How do different supply chain configuration settings impact on performance trade-offs?

Abstract

The notion of 'fit' in the supply chain management (SCM) literature has evolved following the adoption of the contingency approach in an endeavour to achieve greater organisational effectiveness. In this paper, we investigate the possible approaches to achieving a state of fit between supply chain configuration settings and performance indicators, while taking into account the contextual factors related to different industry sectors and geographical dispersion levels. This study addresses the pressing issue of the performance trade-offs faced by companies to achieve a higher service level and customer satisfaction (effectiveness) on the one hand, while being costefficient on the other hand (efficiency). The paper contributes to the SCM literature and practice through synthesising a conceptual framework that scrutinises the relationships between six individual configuration settings and nine effectiveness/efficiency indicators. The study's findings explain the motivations behind different configuration decisions, which help in obtaining the most appropriate fit between supply chain configuration and performance.