The effect of IoT capability on supply chain integration and firm performance: an empirical study in the UK retail industry

Abstract

Purpose

The purpose of this study is to use empirical data to examine the hierarchical impact of the Internet of things capability on supply chain integration (SCI), supply chain capability (SCC) and firm performance (FP) in the UK retail industry.

Design/methodology/approach

A deductive approach was employed to carry out this research. Structural equation modelling (SEM) was performed using the partial least square method (SmartPLS 3.3.3) to test theoretical predictions which underlie the relationships among Internet of things capability (IoTC), SCI, SCC and FP. Data are collected using an online survey completed by senior executives of 66 large, medium and small firms within the UK retail industry.

Findings

The empirical results of this research reveal that IoTC has a significant positive effect on the UK retail industry FP through the mediating role of SCI and SCC.

Practical implications

The research results from this study provide useful management insights for firms within the retail industry into the development of effective strategies for integrating their supply chain alongside the adoption of IoTC into SCI, consequently leading to improvements in FP.

Originality/value

Although previous studies have explored the impact of IoT on FP through the sequential mediating role of SCI and SCC, few have explored the impact of the IoT capability (IoTC) on FP through sequential mediators, i.e. SCI and SCC. This study examines the relationship between IoTC, SCI, SCC and FP in the UK retail industry supply chain to address this knowledge gap. Moreover, this study examines the effects of IoTC on FP by applying partial least square (PLS)-SEM techniques. Testing the sequential mediating role of SCI and SCI is undertaken, and the relationships among IoT-enabled SCI and SCC is analysed to improve FP. The robustness check's result through PLSpredict analysis also confirms the power of the model proposed in this study.

Citation

Argyropoulou, M., Garcia, E., Nemati, S. and Spanaki, K. (2024), "The effect of IoT capability on supply chain integration and firm performance: an empirical study in the UK retail industry", Journal of Enterprise Information Management, Vol. 37 No. 3, pp. 875-902. https://doi.org/10.1108/JEIM-06-2022-0219