Examining the synergistic effect of supply chain agility, adaptability and alignment: a complementarity perspective

Drawing on complementarity theory, this paper aims to examine the type and effect of interdependencies/interaction (i.e. complementarity or substitutability) between the supply chain capabilities of agility, adaptability and alignment.

A survey research design is adopted to collect primary and secondary data from 182 international firms. The complementarity (or substitutability) of three As (agile, adaptable and aligned) were analyzed in three-way and pairwise interactions; both, correlation and performance differences methods of testing the type of interactions among the system’s elements were used. Supply chain-centric and firm-centric performance metrics were used to examine the interaction types.

The study did not find empirical evidence of three-way complementarity between the three As. However, this paper did find evidence of complementarity in bivariate interactions for alignment and adaptability. Moreover, in the performance difference method, the study found a substitute relationship between all pairs of As.

The findings related to the substitutability between the three As offer managers guidance on how to allocate their limited resources to avoid unnecessary over-or under-investing in either one of the three As.

This study helps refine prior findings related to the three As by offering evidence that firms can still achieve their performance-related goals with reduced investment commitments by taking advantage of the substitutability relationship existent between these capabilities. That is, instead of concomitantly developing all three As as past studies have suggested, managers can use the findings to determine how to prioritize their resource allocation better. Furthermore, understanding the actual interaction among the supply chain variables generally provide insights for designing the supply chain, change management in the supply chain, developing supply chain strategy and adopting best practices in the supply chain.