Bringing corporate strategy to life through firm-wide and strategic supply chain performance alignment, to perform as required within strategic supply chains

Bringing corporate strategy to life through firm-wide and strategic supply chain performance alignment, to perform as required within strategic supply chains

Background: The corporate strategy gap between formulation and execution is an ongoing struggle, with few execution efforts aligned with strategy, contributed by a continually changing business environment, poor performance management, slow strategy execution and inadequate technology capabilities. These matters are increasing complexity for top management in corporate strategy formulation and cascading, which are key to building a world-class firm. To address this problem in practice, this research study focused on executives at B2B firms operating in strategic supply chains and identified gaps in the literature. In the supply chain performance management domain, there is limited research on top management’s supply chain-related role and supply chain’s role in corporate strategy formulation. In the strategic performance management domain, linkages with supply chain are unclear, and there is limited research on corporate strategy cascading. This study aims to resolve the research problem: How do executives at top performing B2B firms in Australia form and cascade corporate strategy firm-wide to ensure that the firm performs as required within its strategic supply chains?

Methodology: This research study develops and examines a theoretical framework through a qualitative interpretive methodology and explores the intersection of two major domains Strategic Performance Management and Supply Chain Performance Management by applying Dynamic Capabilities Theory. The research problem was dissected into two research issues to explore the sensing, seizing, and transforming dynamic capabilities and microfoundations of dynamic capabilities associated with corporate strategy formulation and cascading to help resolve the research problem.

Findings: This research study found that top management are dedicated to supply chain performance management from a strategic planning perspective during corporate strategy formulation, because they know that strategic supply chain elements in corporate strategy drives value and firm growth. Using dynamic capabilities, top management incorporate strategic supply chain considerations into corporate strategy to seize strategic supply chain opportunities and performance objectives, by sensing the requirements of strategic supply chains, to transform the firm and strategic supply chain operations to be capable of seizing the opportunities, to gain and sustain significant supply chain competitive advantages and superior supply chain performance. Top management recognise strategic supply chains as critical to business success, and value supply chain knowledge and expertise in the top management team as well as participation from key personnel from cross-functional areas, especially key supply chain-focused personnel. Successful corporate strategy cascading and firm-wide strategic alignment to strategy entails the development and alignment of business plans and budgets, strategic performance alignment, supply chain strategy alignment, cross-functional alignment, people performance strategic alignment (individual, rewards and teams), performance behaviour alignment and strategic supply chain alignment. Further, the findings of this study enrich the discourse on strategic supply chain performance management by supporting the view that dynamic capabilities enable executives and B2B firms to gain and sustain significant competitive advantages and superior supply chain performance within strategic supply chains.

Contribution: The findings enabled the development of a revised theoretical framework that addresses the gaps identified in the literature. This research study advances the body of knowledge of the two major domains and the Dynamic Capabilities Theory, and identifies the sensing, seizing, and transforming dynamic capabilities and microfoundations of dynamic capabilities associated with corporate strategy formulation and cascading with a strategic supply chain performance focus. The key components of corporate strategy cascading are identified, and a definition is proposed. A key output of this research study included a Strategic Supply Chain Performance Management Framework outline as a guide for executives at B2B firms operating in strategic supply chains, which identifies the key components to formulate and cascade a corporate strategy with a strategic supply chain performance focus to achieve and sustain superior competitive advantage. A new term and definition for strategic supply chain performance management is also proposed.