Does social capital affect supply chain performance? Establishing an underlying mechanism and a boundary condition

Abstract

Purpose

This study examines the direct and indirect effects of social capital on supply chain performance via supply chain quality integration (SCQI), which refers to integrating supply chain partners from the perspective of quality management. It also examines the moderating role of environmental uncertainty in the link between social capital and SCQI and determines the conditional indirect effect of social capital on supply chain performance via SCQI.

Design/methodology/approach

Data were collected using a time-lagged research design through a self-administered survey of supply chain professionals in manufacturing firms in Pakistan. Hayes’ PROCESS Macro was used to test the hypotheses.

Findings

The results show a positive relationship between social capital and supply chain performance. SCQI partially mediates the relationship between social capital and supply chain performance. Environmental uncertainty significantly moderates that relationship in such a way that firms that operate under high environmental uncertainty are more likely to use their social capital to develop SCQI than firms that operate under low environmental uncertainty.

Practical implications

The study has practical implications for managers who seek to implement SCQI practices using social capital. Leveraging social capital across the supply chain fosters strong connections and a quality-oriented approach across the supply chain, and improves overall performance. Managers can use the power of social capital to navigate environmental uncertainty.

Originality/value

This study’s originality lies in its drawing on the dynamic capability theory and contingency theory and integrating the dispersed scholarly work on social capital, SCQI, and supply chain performance under the boundary condition of environmental uncertainty.