The Influence of Supply Chain Integration, Agility, and Innovation on Company Performance

Abstract

This research aims to determine and investigate the role of supply chain integration, agility, and innovation in the performance of Micro, Small, and Medium Enterprises (MSMEs) operating in the food and beverage sector. By optimizing these factors, companies can enhance the value and profitability generated across the supply chain, encompassing value addition from suppliers to manufacturers, manufacturers to distributors, and ultimately to consumers. This value is created from the service value and price of a finished product, with the total costs borne by the entire supply chain system. The study focuses on MSMEs in the Yogyakarta region, employing random sampling techniques to gather data from various stakeholders, including owners, managers, and operational staff. Questionnaire-based data collection is followed by Structural Equation Model (SEM) analysis using AMOS software. The results of this research indicate that integration, agility, and innovation have a positive effect on company performance, both in terms of financial performance and operational performance. This study contributes to the supply chain literature, specifically in the food and beverage industry, by expanding the understanding of supply chain dynamics. To enhance supply chain integration, managers can implement broader strategies and utilize information technology for better collaboration. To improve supply chain agility, the focus should be on developing flexibility and partnering with agile businesses. Supply chain innovation can be promoted through investments in technology and prioritizing innovation in products, processes, and business models.