Alignment between business environment characteristics, competitive priorities, supply chain structures, and firm business performance

Purpose – This paper aims to analyze the relationships between four constructs – business environment characteristics, competitive priorities, supply chain structures, and firm business performance. Design/methodology/approach – By establishing a conceptual model and conducting structural equation modeling analysis using collected industrial survey data, the study provides a systemic understanding of the relationships between the individual business environment characteristics, the individual competitive priorities and supply chain structures, and the impact of alignment between these elements on firm business performance. Findings – Results of the study reveal that the differences in both strategic and supply chain responses to business environment between high‐ and low‐performing firms in the US textile manufacturing industry are striking. The findings provide evidence to corroborate the impact of the alignment between business environment characteristics, competitive priorities, and supply chain structures on firm business performance. Originality/value – A conceptual model linking business environment characteristics, competitive priorities, supply chain structures, and firm business performance is first proposed and empirically investigated. The appropriate strategic responses and supply chain structures designed to the specific business environment characteristics are quantitatively identified. The nature of these relationships and the effect of alignment are revealed.