The Effect of Supply Chain Agility on Business Performance in the Power Tool Industry: A Case of Robert Bosch Africa

Abstract

The study aimed to investigate the effect of supply chain agility on business performance in Robert Bosch Africa. The study sought to address the following objectives: first, to investigate the effect of market sensitivity on business performance of Robert Bosch Africa. Second, to investigate the effect of process integration on business performance of Robert Bosch Africa. Third, to investigate the effect of virtual integration on business performance of Robert Bosch Africa. Lastly, to investigate the effect of network-based agility on business performance of Robert Bosch Africa. Correlation research design was used. The population targeted composed of 152 associates of Robert Bosch Africa spread across seven countries: Morocco, South Africa, Egypt, Tunisia, Nigeria, Ghana, and Kenya. Stratified sampling technique was used to select a representative sample of 110 Robert Bosch Africa associates. A structured questionnaire was used to collect data. Data was analyzed generating the percentage distribution, mean and standard deviation scores along with Pearson’s rank correlation and linear regression analysis performed using SPSS version 25. The findings were presented in figures and tables. Results showed that market sensitivity composite score on a 5-point scale was moderate and the second least rated among the four supply chain agility dimensions. However, market sensitivity explained 29.5% of the variance in business performance, R2=.295, F (1) = 24.271, p<.01. Process integration composite score was moderate and the least rated of the four supply chain agility dimensions. However, it had a statistically significant predictive power on business performance, explaining 29.4% of the variance in business performance, R2=.294, F(1) = 24.106, p<.01. Virtual integration was the most highly rated supply chain agility dimension on a 5-point scale. However, it accounted for only 13.9% of the variance in business performance, R2=.139, F (1) = 9.342, p<.01. A high networkbased agility composite score was obtained, emerging second after virtual integration. It explained 27.9% of the variance on business performance, R2=.279, F (1) = 22.474, p<.01. The study concluded that the effect of market sensitivity on business performance of Robert Bosch Africa was positive. Process integration also positively contributed to business performance of the company. Virtual integration was the most manifest dimension of supply chain agility and yet contributed the least to business performance. Network-based agility had a positive effect on business performance comparable to process integration and virtual integration dimensions of supply chain agility. The study recommended that managers should carefully identify supply chain decision priorities and (re)deploy resources exclusively to identified priorities. Robert Bosch Africa should consolidate its process integration gains by channeling most of the company’s process integration efforts to eradicating non-value adding activities. The company should make strategic use of virtual integration to support and optimize other supply chain agility facets such as process integration and market sensitivity that contribute more to business performance yet revealed practice gaps. It should strengthen its network-based agility by promoting a culture of intra and inter-organizational knowledge sharing and crosspollination. In terms of future studies, a mixed methods study based on a larger and more diverse sample that captures the voices of all supply chain stakeholders including suppliers and customers is proposed. Extension of this research into other business sectors is also recommended.