Supply Chain Information Integration and Firm Performance: Evidence from India

Supply chain information integration (SCII), an IT-enabled capability, enhances firms’ collaboration with suppliers and clients resulting in better operations and performance. Bottom-of-pyramid segments in emerging markets pose distinct challenges due to their institutional context. The benefits that domestic and foreign firms can harness from SCII differ due to the distinct set of difficulties faced by these two types of firms. We suggest that SCII has a positive influence on firm performance through client collaboration for foreign and domestic firms, but SCII’s influence is stronger for domestic firms; whereas supplier collaboration is positive for foreign firms but negative for domestic firms. We test our theory by comparing the outcomes of leveraging SCII for collaboration, across domestic and foreign firms in the automotive ancillary and part manufacturing sectors in India. We use a unique dataset of 133 firms and use both partial least squares and econometric analysis to test our theorized relationships.