Effect of interorganizational systems on supply chain flexibility

It is obvious that developing technology and telecommunication facilities eases the customers to reach a variety of products and providers, makes them more selective, and increases the number of competitors for businesses. Consequently transformation of markets to a more bustling and rapid changing form derives from these developments. Main challenge for businesses in these rapid changing markets is to respond markets and customers requirement in the same rapid manner, while maintaining the high quality and low price for products. This challenge increasingly drives businesses to form supply chains. Supply chains make the businesses to establish closer and longer term relationships with their suppliers and customers.Close and long term relationships between business units, suppliers and customers expose two interrelated concepts in supply chain management. These concepts are information sharing and integration. Information sharing in a supply chain is executed through interorganizational systems. On the other hand, supply chain integration is a measure of collaboration and coordination between participants of a supply chain. There are many studies in supply chain literature considering the relationship between these two concepts.Capability of a supply chain to adapt its activities to rapid changing markets and customer requirements is defined as supply chain flexibility. It is an inevitable challenge for a supply chain to improve its flexibility in order to improve and maintain competitiveness. Flexibility concept is frequently evaluated from the functional or business unit flexibility point of view in literature, and overall supply chain flexibility does not take much consideration. Hence, this study tried to develop a measurement model to measure overall integrated supply chain flexibility. Measurement model integrates and measures flexibility in three levels of a supply chain (business unit, first tier supplier and first tier customer) with five dimensions.Another issue frequently considered in flexibility literature is the importance of information sharing through chain members as a facilitator of adaptability to rapid changing markets. Although there are many studies claiming that relationship, there is a deficiency about studies considering the way this relationship occurs. Main purpose of this study is developing a model to identify the way this relationship occurs.Towards this purpose, a research model is identified and analyzed using structural equation modeling method. Final model suggests that information sharing between businesses has an indirect effect over supply chain flexibility. Supply chain integration is a mediator for this relationship.