Supply chain management (SCM) plays a major role in creating (or destroying) shareholder value by influencing the three major drivers of firm financial performance: revenue, operating costs, and working capital. Yet, the relationship between SCM competency and firm financial performance is not well-established. Drawing on the resource-based view of the firm, this study assesses this relationship using Delphi-style opinion data from AMR Research’s Supply Chain Top 25 rankings to assess SCM competency and Altman’s (1968)Z-score statistic as the measure of financial success. The study findings show that firms recognized by industry experts for SCM competency have significantly higher Z-scores than their close competitors and industry averages.
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Ellinger et al. (2011) studied this question.
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