Innovation diffusion with the supply chain : the Chinese apparel firms in Shenzen

Abstract

Supply chain management directly affects corporate performance. Today’s supply chain management is very different from what it was a decade ago; nowadays, developing and implementing a networked, flexible supply chain that integrates all partners, (manufacturers, retailers, suppliers, carriers, and vendors), into a seamless unit is the crucial step in meeting ongoing customer demand and maintaining a competitive edge. However, effective supply chain integration can not be achieved unless the different components involved in the processes are coordinated. As the traditional ways of growing business erode, companies will increasingly depend on innovations to build up competitive advantages and carry out a holistic, fully integrated approach to their supply chain designs. By doing so, the management sectors of supply chain integration can replace conventional, functional, silo-limited thinking with the pursuit of flexibility and effectiveness. This research addresses a gap in the literature between innovation diffusion and supply chain integration. This study examines how organisations expand their efforts on supply chain integration and how they can improve their innovation efforts during the integration process. Companies that manufacture for designer labels and other apparel lines in Shenzhen, China were surveyed to examine the inter-relationship between their supply chain integration performance, their perception of the two governance mechanisms, and their innovation diffusion processes. The results showed that supply chain integration has a positive relationship with innovation diffusion and supply chain integration governance mechanisms do impact innovation diffusion processes.