scholarly journals The interaction between supply networks and internal networks: performance implications

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Fabienne Chedid ◽  
Canan Kocabasoglu-Hillmer ◽  
Jörg M. Ries
Keyword(s):  
Financial Performance ◽  
Network Data ◽  
Supply Network ◽  
Firm Level ◽  
Content Type ◽  
Geographic Dispersion ◽  
Focal Firm ◽  
Internal Network ◽  
Internal Networks ◽  
The Impact

PurposeThe importance of the supply network to firm performance is well documented. Until now, the firm and its suppliers have been conceptualized as single entities. Yet, multinational corporations (MNCs) are composed of a complex, geographically dispersed internal network of subsidiaries. The supply and internal networks are inherently linked. The purpose of this study is to investigate the impact of the interaction of these networks on firm-level financial performance.Design/methodology/approachBuilding on supply network, internal network and dual embeddedness research, the authors investigate the interaction of these networks using supply network data from FactSet and internal network data from Orbis. We assess the impact at the MNC level, using measures of firm-level financial performance, physical proximity between the two networks and geographic dispersion of the internal network.FindingsThe results show that the performance effect of physical proximity of the firm with its supply network is negatively moderated by the geographic dispersion of the firm's internal network. This effect can be traced back to the diminishing marginal profitability of a firm's assets. Moreover, the benefits of dual embeddedness to the individual subsidiary come at a cost at the firm-level due to the operational challenges of managing a complex subsidiary network.Research limitations/implicationsThis study is the first to investigate the supply and internal networks of MNCs simultaneously.Originality/valueThe paper extends supply network literature by considering the internal network of the focal firm and its suppliers. This paper is one of the first studies that offer an understanding of the interaction between supply and internal networks of a focal firm and the effect on financial performance.

Revisiting the impact of organized labor on corporate bottom lines

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Dmytro Osiichuk ◽  
Paweł Mielcarz ◽  
Julia Kavalenka
Keyword(s):  
Financial Performance ◽  
Organized Labor ◽  
Corporate Financial Performance ◽  
Firm Level ◽  
Data Set ◽  
Content Type ◽  
International Panel ◽  
Transmission Mechanisms ◽  
Credible Threat ◽  
The Impact

Purpose Relying on an international panel data set, the purpose of this paper is to quantify the economic impact of labor unionization on corporate financial performance. Design/methodology/approach Static panel regression analysis is performed for a firm-level multinational data set to elucidate the postulated empirical relationships between employee unionization and corporate performance. The transmission mechanisms intermediating the studied effects are discussed and operationalized. Findings The empirical evidence demonstrates that firms with a higher level of employee unionization spend more on wages and labor-related expenses. The concomitant downside of higher resource extraction by unions is a lower rate of net employment creation and a higher possibility of redundancy layoffs. Originality/value Overall, the authors demonstrate that by creating a credible threat of employee disobedience manifested through strikes and internal wage disputes, labor unions remain an effective mechanism of increasing employees’ bargaining power. Despite the discovered weak negative associative link between the degree of unionization and corporate financial performance, the authors perceive the overall evidence to be inconclusive on this matter.

Linking ISO 9000 certification to firm performance and financial crisis: a matched sample longitudinal analysis

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Efrosini Siougle ◽  
Sophia Dimelis
Keyword(s):  
Firm Performance ◽  
Financial Crisis ◽  
Financial Performance ◽  
Iso 9000 ◽  
Matched Sample ◽  
Firm Level ◽  
Content Type ◽  
Crisis Period ◽  
Technological Differences ◽  
The Impact

PurposeThis is a longitudinal study exploring the effect of ISO 9000 certification on firm's financial performance in the pre-crisis period and the 2008 financial crisis period.Design/methodology/approachThe empirical analysis is based on a 22-year dataset with balance sheet data from 136 Greek listed firms covering the period 1992–2013. A matching technique is applied to properly estimate potential differences in the impact of ISO 9000 on firm's financial performance between the groups of certified and matched non-certified (control) firms in the entire period but, most importantly, in pre-crisis vs crisis periods, using the difference-in-differences econometric approach.FindingsThe findings indicate that certified firms exhibit significantly higher financial performance relative to the matched non-certified group in both the pre-crisis and crisis periods, which tends to persist for several years post-certification. The financial crisis has a negative and statistically significant effect on firm performance in both the certified and matched non-certified groups, which nevertheless did not differ significantly between them. Controlling for sectoral and technological differences did not harm the higher performance of certified firms relative to the matched control peers. The results remain in the same direction when the authors test the ISO 9000 effect in the sub-group of certified firms that obtained the certification at the firm-level.Originality/valueThe study is original in its sample design and hypothesis testing. The matched sample created from a sufficiently long and continuous time dataset enabled the authors to properly estimate firm performance differences of ISO 9000 between pre-crisis and crisis periods. Of additional value is the testing of sectoral/technological differences and the distinction between firm-level and plant-level certification.

Environmental management rivalry and firm performance

2017 ◽  
Vol 10 (2) ◽  
pp. 227-247 ◽  
Author(s):  
Anupam Kumar ◽  
David E. Cantor ◽  
Curtis M. Grimm ◽  
Christian Hofer
Keyword(s):  
Environmental Management ◽  
Financial Performance ◽  
Performance Data ◽  
Test Theory ◽  
Data Set ◽  
Content Type ◽  
Firm Financial Performance ◽  
Focal Firm ◽  
Environmental Image ◽  
The Impact

Purpose The purpose of this paper is to build and test theory regarding how rivalry in environmental management (EM) affects a focal firm’s environmental image and financial performance. Design/methodology/approach The theory is tested with an original panel data set of 2,776 focal-rival dyad pairs. Measures of environmental signals are developed from content analysis of corporate sustainability reports. Environmental performance data are drawn from the Newsweek US 500 Green Rankings database. Financial performance data are drawn from COMPUSTAT. Findings The main findings are that focal firm signals have a positive and significant impact on both focal firm environmental image and financial performance. Rival firm signals have a negative effect on focal firm environmental image. Surprisingly, rival firm signals have a positive impact on focal firm financial performance. Practical implications This paper can serve as a testament to the value of monitoring rival firm strategies and signaling to counter the impact of rival signals in the environmental domain. Environmental practices can be a source of competitive advantage for firms, and failure to compete in this space can place the firm at a competitive disadvantage. Originality/value This study makes several contributions to the EM literature. Leveraging competitive dynamics and the institutional viewpoints, this study builds theory with regard to how signals of competitive EM activity among a focal firm and its rivals affect environmental image and financial performance.

An empirical examination of firm financial performance along dimensions of supply chain resilience

2017 ◽  
Vol 40 (3) ◽  
pp. 254-269 ◽  
Author(s):  
Xun Li ◽  
Qun Wu ◽  
Clyde W. Holsapple ◽  
Thomas Goldsby
Keyword(s):  
Supply Chain ◽  
Financial Performance ◽  
Three Dimensions ◽  
Empirical Examination ◽  
Content Type ◽  
Supply Chain Resilience ◽  
Critical Dimensions ◽  
Firm Financial Performance ◽  
Supply Chain Agility ◽  
The Impact

Purpose This paper aims to investigate the impact of three critical dimensions of supply chain resilience, supply chain preparedness, supply chain alertness and supply chain agility, all aimed at increasing a firm’s financial outcomes. In a turbulent environment, firms require resilience in their supply chains to prepare for potential changes, detect changes and respond to actual changes, thus providing superior value. Design/methodology/approach Using survey data from 77 firms, this study develops scales for preparedness, alertness and agility. It then tests their hypothesized relationships with a firm’s financial performance. Findings The results reveal that the three dimensions of supply chain resilience (i.e. preparedness, alertness and agility) significantly impact a firm’s financial performance. It is also found that supply chain preparedness, as a proactive resilience capability, has a greater influence on a firm’s financial performance than the reactive capabilities including alertness and agility, suggesting that firms should pay more attention to proactive approaches for building supply chain resilience. Originality/value First, this study develops a comparatively comprehensive definition for supply chain resilience and explores its dimensionality. Second, this study provides empirically validated instruments for the dimensions of supply chain resilience. Third, this study is one of the first to provide empirical evidence for direct impact of supply chain resilience dimensions on a firm’s financial performance.

Do disclosure and transparency affect bank’s financial performance?

2019 ◽  
Vol 19 (6) ◽  
pp. 1344-1361
Author(s):  
Isaiah Oino
Keyword(s):  
Risk Management ◽  
Corporate Governance ◽  
Financial Performance ◽  
Financial Institutions ◽  
Content Type ◽  
Loan Portfolios ◽  
Cent Level ◽  
Transparency And Disclosure ◽  
The Impact

Purpose The purpose of this paper is to examine the impact of transparency and disclosure on the financial performance of financial institutions. The emphasis is on assessing transparency and disclosure; auditing and compliance; risk management as indicators of corporate governance; and understanding how these parameters affect bank profitability, liquidity and the quality of loan portfolios. Design/methodology/approach A sample of 20 financial institutions was selected, with ten respondents from each, yielding a total sample size of 200. Principal component analysis (PCA), with inbuilt ability to check for composite reliability, was used to obtain composite indices for the corporate governance indicators as well as the indicators of financial performance, based on a set of questions framed for each institution. Findings The analysis demonstrates that greater disclosure and transparency, improved auditing and compliance and better risk management positively affect the financial performance of financial institutions. In terms of significance, the results show that as the level of disclosure and transparency in managerial affairs increases, the performance of financial institutions – as measured in terms of the quality of loan portfolios, liquidity and profitability – increases by 0.3046, with the effect being statistically significant at the 1 per cent level. Furthermore, as the level of auditing and the degree of compliance with banking regulations increases, the financial performance of banks improves by 0.3309. Research limitations/implications This paper did not consider time series because corporate governance does not change periodically. Practical implications This paper demonstrates the importance of disclosure and transparency in managerial affairs because the performance of financial institutions, as measured in terms of loan portfolios, liquidity and profitability, increases by 0.4 when transparency and disclosure improve, with this effect being statistically significant at the 1 per cent level. Originality/value The use of primary data in assessing the impact of corporate governance on financial performance, instead of secondary data, is the primary novelty of this study. Moreover, PCA is used to assess the weight of the various parameters.

Comparative analysis of QISMUT+3’s Islamic corporate social responsibility

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Agung Nur Probohudono ◽  
Astri Nugraheni ◽  
An Nurrahmawati
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Statistical Testing ◽  
Content Type ◽  
Islamic Bank ◽  
Csr Disclosure ◽  
Corporate Social ◽  
The Impact ◽  
Positive Effect

Purpose The purpose of this study is to analyze the impact of corporate social responsibility (CSR) disclosure on the financial performance of Islamic banks across nine countries as major markets that contribute to international Islamic bank assets (Indonesia, Malaysia, Saudi Arabia, UAE, Kuwait, Qatar, Turkey, Bahrain and Pakistan or further will be called QISMUT + 3 countries). Design/methodology/approach Islamic Social Reporting Disclosure Index (ISRDI) is being used as a benchmark for Islamic bank CSR performance that contains a compilation of CSR standard items specified by the Accounting and Auditing Organization for Islamic Financial Institutions. The secondary data is collected from the respective bank’s annual reports and it used the regression analysis techniques for statistical testing. Findings This study found that CSR disclosure measured by ISRDI has a positive effect on financial performance. Almost all ISRDI sub-major categories have a positive effect on financial performance except the “environment” subcategory. The highest major subcategory for ISRDI is the “corporate governance” category (82%) and the “environment” category (13%) is the lowest. For the UAE, Kuwait and Turkey, the ISRDI is positively affected by financial performance and the other countries on this research are not. Originality/value This study highlighted the economic benefits of social responsibility practices as a part of business ethics in nine countries that uphold the value of religiosity. Thus, the development of the results of this research for subsequent research is very wide open.

Could CSR improve the financial performance of developing countries’ firms? Analyses of mediating effect of intangible resources

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohamed Hamdoun ◽  
Mohamed Akli Achabou ◽  
Sihem Dekhili
Keyword(s):  
Developing Countries ◽  
Human Capital ◽  
Financial Performance ◽  
Competitive Advantage ◽  
Mediating Effect ◽  
Social Dimension ◽  
Content Type ◽  
Intangible Resources ◽  
The Impact

Purpose This paper aims to examine the link between corporate social responsibility (CSR) and financial performance in the context of developing countries. More specifically, the mediating role of a firm’s competitive advantage and intangible resources, namely, human capital and reputation are studied. Design/methodology/approach The study considered a sample of 100 Tunisian firms. The analysis makes use of the structural equation modelling method to explore the relationship between CSR and financial performance, by including mediator variables. Findings The results confirm that CSR has no significant direct effect on financial performance. In particular, they indicate that the social dimension of CSR has a negative impact on performance. However, CSR does have a positive impact on competitive advantage via the two intangible resources considered, human capital and company reputation. Research limitations/implications The research fills a gap that occurred in the previous literature. In effect, previous studies focussed only on the direct link between CSR and financial performance. In addition, it enriches the limited literature on CSR strategies in the context of developing countries. However, further studies should explore the opposite relationship, i.e. the impact of financial performance on CSR strategy. In addition, the authors believe that amongst other potential research avenues, it would be interesting to study the moderating role of the activity sector. Practical implications From a practical point of view, this study suggests new applications with respect to the link between CSR and financial performance. To enhance their company’s financial performance, managers need to ensure that intangible resources are managed efficiently. Originality/value The paper contributes to the literature by examining how a firm’s intangible resources mediate between CSR and competitive advantage and how competitive advantage mediates between intangible resources and financial performance. Second originality is related to the study of the link between CSR and the financial performance of business organisations in the context of a developing country.

Corporate social responsibility and financial performance: bidirectional relationship and mediating effect of customer loyalty: investigation in Sweden

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Abir Hichri ◽  
Moez Ltifi
Keyword(s):  
Corporate Social Responsibility ◽  
Financial Performance ◽  
Customer Loyalty ◽  
Mediating Effect ◽  
Content Type ◽  
Global Context ◽  
Bidirectional Relationship ◽  
Corporate Social ◽  
The Impact

Purpose The study is based on a hybrid model composed of accounting and business data and is amongst the first to test the impact of corporate social responsibility (CSR) performance on the financial performance of the company, as well as the impact of financial performance on CSR performance. The bidirectional logic chosen by the study is rarely adopted in the global context and has never been tested in the Swedish context. Moreover, the purpose of this paper is to test the mediating effect of customer loyalty on the company’s CSR performance-financial performance relationship to assess this effect over the long term. This design has been neglected in previous studies. Design/methodology/approach Data was collected from a sample of 110 Swedish companies during the period 2009–2019. This study collects the data from the Thomson Reuters Eikon database. A multiple regression analysis was performed to test the hypotheses. Findings The results confirmed the bidirectional relationship between CSR performance and company financial performance. This means that CSR performance positively influences the company’s financial performance. Similarly, financial performance positively influences the company’s CSR performance. Moreover, customer loyalty has a positive and significant mediating effect on the company’s CSR performance-financial performance relationship. Originality/value This study adds several inputs. The first contribution of the research is to test a hybrid model composed of accounting and commercial data. This model is amongst the first to test the impact of CSR performance on the financial performance of the company and the impact of financial performance on CSR performance. The second contribution is the bidirectional logic chosen by the study which is rarely adopted in the global context and has never been tested in the Swedish context. The third contribution is to test the mediating effect of customer loyalty on the company’s CSR performance-financial performance relationship to assess this effect over the long term. This design has been neglected in previous studies. The fourth contribution is the choice of the field of investigation for the reliability of the data used and the generalisation of the results obtained.

The interplay between digital transformation and governance mechanisms in supply chains: evidence from the Italian automotive industry

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Emilio Paolucci ◽  
Elena Pessot ◽  
Riccardo Ricci
Keyword(s):  
Digital Technologies ◽  
Digital Transformation ◽  
Development Effort ◽  
Governance Mechanisms ◽  
Relational Governance ◽  
Firm Level ◽  
Digital Interface ◽  
Content Type ◽  
Automotive Suppliers ◽  
The Impact

PurposeThis paper aims to investigate the effect of specific subsets of digital technologies and governance mechanisms (i.e. relational and contractual) on the efficiency of the automotive supply chain (SC).Design/methodology/approachBuilding on the Transaction Costs Economic (TCE) theory, and on the literatures on the governance and Digital Transformation of SCs, the research employs a multi-respondent survey on a sample of 101 Italian automotive suppliers. It analyses the interplay between investments in network and physical–digital interface technologies and buyer–supplier relationship governance models in a joint product development effort. The related effects on costs, from the automotive suppliers' perspective, are considered.FindingsThe results confirm the TCE assumptions on governance mechanisms being appropriate to enhance cost performance, but in particular show that digital technologies shape the governance of buyer–supplier relationships with different patterns. The features of synchronisation and accessibility, as ensured by network technologies, are found to strengthen the impact of contractual governance, while the adoption of physical–digital interface technologies, and their enhanced features of virtualisation and traceability, further enhance the impact of relational governance on the efficiency improvements of suppliers.Practical implicationsSC actors need to recognise the importance of long-term collaboration and superior coordination through investments in specific subsets of digital technologies, to ensure a higher product and production data codifiability, transparency and thus integration at both an intra- and an inter-firm level.Originality/valueThis study is one of the first to have considered Digital Transformation in SCs from the suppliers' perspective and its implications on the efficiency of relationship governance with buyers.

The impact of within-industry diversification on firm performance

2018 ◽  
Vol 13 (6) ◽  
pp. 1475-1501 ◽  
Author(s):  
Varaporn Pangboonyanon ◽  
Kiattichai Kalasin
Keyword(s):  
Financial Performance ◽  
Positive Impact ◽  
Labor Costs ◽  
Institutional Perspective ◽  
Product Lines ◽  
Content Type ◽  
Linear Pattern ◽  
Coordination Costs ◽  
Industry Diversification ◽  
The Impact

Purpose The purpose of this paper is to investigate how within-industry diversification affects the financial performance of small- and medium-sized enterprises (SMEs) in emerging markets (EMs). The authors draw on both the resource-based view and the institutional perspective and argue that within-industry diversification can enhance the financial performance of SMEs in EMs. Due to institutional voids in emerging economies, SMEs can gain additional benefits from scope economies, as well as from market returns, by filling product market voids and gaps in business ecosystems, while also enjoying low input and labor costs that reduce the coordination costs of diversification. This, in turn, enhances benefits of within-industry diversification, thereby resulting in higher financial profitability. Design/methodology/approach This study employs panel data econometrics to estimate the model. The authors test hypotheses on 195 firms, originating from five countries in Southeast Asia, during the period of 2009–2014. Findings The empirical results support the arguments. Within-industry diversification has a positive impact on the performance of SMEs in EMs. These effects become weaker when the institutional contexts are more developed. Nevertheless, such effects become stronger when SMEs in EMs are more efficient. Research limitations/implications The relationship between within-industry diversification and performance is a positive linear pattern, which differs from the pattern in advanced economies. In addition to unrelated diversification, the related diversification is preferable for firms in EMs. Practical implications The paper provides implications for SMEs that aim to enhance their performance by engaging in single product lines and within-industry diversification. Originality/value This paper examines the different ways within-industry diversification can enhance SMEs performance in EM contexts.

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