Organizational alignment and supply chain governance structure : Introduction and construct validation

Purpose – The purpose of this paper is to introduce and validate two new constructs with the potential to sharpen our understanding of how and why firms integrate their internal supply chains and assess the governance structure of their supply chains. The first construct, organizational alignment (OA), is a reflective scale measuring the extent to which upper management attempts to foster integration between internal supply chain functions. The second, supply chain governance structure (SCGS), is a formative index, and is a first attempt at developing a measurement instrument to assess SCGS along multiple dimensions. Design/methodology/approach – Following a literature review, measures of OA and SCGS are conceptualized. These instruments are used to collect data, after which they are refined and validated through parallel scale development (OA) and index construction (SCGS) processes. Findings – OA shows acceptable content and construct validity, and SCGS shows acceptable results for content and item specification, as well as multicollinearity. Practical implications – OA and SCGS may provide some insight into how to promote better internal supply chain integration within the firm, and may allow for an assessment of the governance structure of the firm's supply chain. In different industries and at different times, this knowledge may prove useful in supply chain design and supply base optimization decisions. Originality/value – These scales have considerable applicability in logistics and supply chain management research. Together, they represent initial attempts to assess upper management influence on internal supply chain alignment (OA), and to assess the governance structure of a firm's supply chain.