The Proposed Conceptual Model for Investigating Moderating Effects of Contextual Factors on Supply Chain Management Practice-Performance Link in Malaysian Small and Medium Enterprises

Abstract

Small and medium enterprises (SMEs) are playing an increasingly important role in sustaining economic growth
and generating employment in Malaysia. SMEs also play a very crucial role in supply chain management (SCM)
as they may serve the roles of suppliers, producers, distributors and customers. However, adoption of SCM in
Malaysian SMEs has not been broadly explored. Therefore, the authors propose a conceptual model by
examining the moderating effects of contextual factors (firm size, firm age and supply chain length) on the
relationship between SCM practices, namely, information sharing, strategic supplier partnership, customer
relationship, material flow management, corporate culture and SCM performance in a single study. The study
has important managerial implications as the findings will enable management of SMEs to understand
progressive and highly varied SCM practices and contextual factors that contribute to the SCM performance and
its effective implementation.