The Effect Of Supplier Performance Evaluation On Supply Chain Operational Performance: The Case Of Ethio Telecom
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Date
2020-06
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Addis Ababa University
Abstract
Supply chain management is an increasingly important organizational concern, and proper
management of supplier relationships constitutes one essential element of supply chain success.
Facing increasingly competitive contests, many organizations view supplier performance as an
important contributor to their competitive advantage. The purpose of the research is to examine
the effect of supplier performance evaluation on supply chain operational performance of ethio
telecom. The dimensions of supplier performance evaluation are supplier quality performance,
delivery performance, cost performance, innovation performance and sustainability performance
whereas the dimensions of supply chain operational performance are supply chain reliability,
responsiveness, flexibility, cost and asset management. The study employed inferential
quantitative approach to examine the magnitude, direction and significance of the relationship
between supplier performance dimensions and supply chain operational performance dimensions
using Partial Least Square Structural Equation Modelling (PLS-SEM) to test the proposed
hypotheses. The primary data was collected using a survey instrument adapted from literature and
modified to align with the research objectives which is found to be reliable and valid. 94
questionnaires were distributed and 85 valid responses were analyzed using smartpls 3 and SPSS
version 26. The result of the study depicts supplier quality, and innovation performance evaluation
has a significant effect on the effectiveness dimension of supply chain operational performance
(i.e. supply chain reliability, responsiveness and flexibility) whereas delivery has a significant
positive effect on supply chain responsiveness and flexibility but sustainability has an only
significant positive effect on supply chain reliability. The study found no significant relationship
with the cost dimension of supplier performance evaluation and supply chain operational
performance dimensions. The study contributes to fill the gap outlined in literature and its
managerial implication will help ethio telecom to improve its supply chain operational
performance. Based on the findings of the study recommendation is given to work on the significant
factors to improve the supply chain operational performance of ethio telecom.
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Keywords
supplier performance evaluation, supply chain operational performance, supply chain efficiency supply