The Influence of Digital Transformation On the Re-configurability and Performance of Supply Chain: A Study of Home Appliances Manufacturing Industries in Pakistan
Abstract
The proposed research aims at examining the effects of digital transformation on the performance of the supply chains using the mediating variables of supply chain integration, visibility and reconfigurability in the electronics, machinery and home appliances manufacturing sectors in Pakistan. Even though the digital transformation is now widely recognized as a competitive driver, there is a paucity of empirical evidence as to how digital features can be converted into quantifiable performance results in the developing economies. This study fills this gap with a proposed and tested integrated capability-based framework based on the dynamic capability theory. A quantitative, cross-sectional study design was utilized based on survey data gathered on 250 managerial respondents within the Pakistani manufacturing companies. Measurement of constructs was done on validated multi-item Likert scales. The data were analyzed with the help of a Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS to determine measurement validity, the structural relationships, mediation effects, and model fit. Findings show that digital management technologies and digital network connectivity have a positive impact on supply chain integration (β= 0.322; 0.336) and visibility (β= 0.284; 0.330). Integration of the supply chain can greatly lead to improvement in performance (β = 0.215, p =0.05) and visibility alone does not depict a significant direct effect. The model describes 62% of variance on performance of the supply chain (R2 = 0.620). The present study has its contribution by empirically demonstrating the re-configurability of supply chains as a central mediating dynamic capability between digital transformation and performance in an emerging economy setting, which can have both theoretical and practical managerial implications.
Keywords: Digital transformation; Supply chain integration; Supply chain visibility; Supply chain re-configurability; Supply chain performance; Manufacturing industry; PLS-SEM; Pakistan; Dynamic capability theory
