Int. J.

Production Economics 231 (2021) 107878

Contents lists available at ScienceDirect

International Journal of Production Economics

journal homepage: http://www.elsevier.com/locate/ijpe

Achieving a just–in–time supply chain: The role of supply chain intelligence

Jie Yang a, *, Hongming Xie b, Guangsheng Yu c, Mingyu Liu d
a
School of Business Administration, University of Houston-Victoria, 22400 Grand Circle Blvd. Katy, Texas, 77449, USA
b
Department of Innovation and Strategy, School of Management, Guangzhou University, 230 Wai Huan Xi Road, Guangzhou Higher Education Mega Center,
Guangzhou, China
c
Department of Business Administration, School of Management, Fudan University, Shanghai, China
d
Department of Industrial Economics, School of Management, Fudan University, Shanghai, China

A R T I C L E I N F O A B S T R A C T

Keywords: Drawing upon three strategies of demand-driven supply chain intelligence, this study examines the effects of
Supply chain intelligence three factors of demand-driven supply chain intelligence, including customer knowledge management capability,
JIT supply Chain knowledge sharing, and cooperation, on a JIT supply chain, which is operationalized by production planning,
Performance
sourcing, and logistics. It also assesses the effect of a JIT supply chain on operational performance. Employing
path analysis on the data collected from manufacturing firms, this study offers empirical evidence of the pivotal
role of demand-driven supply chain intelligence in achieving a JIT supply chain and its resultant performance
implications. The theoretical and practical contributions are addressed.

1. Introduction
Just-in-time (JIT) supply chains have attracted increasing interests
from operations management scholars (e.g., Tseng, et al., 2019; Chung
et al., 2018; Yao and Hsu, 2018). A JIT supply chain brings a myriad of
advantages to firms including reduced costs, lowered inventory,
improved product quality, shortened lead time, increased responsive­
ness, boosted customer satisfaction, and superior competitive advan­
tages (Monden, 2002; Kreng and Wang, 2005; Heizer et al., 2016). The
philosophy of JIT holds that materials or components arrive at the right
time and right place with the right quantity (Heizer et al., 2016). In a JIT
supply chain, firms depend highly on their suppliers since JIT runs on
on-time delivery of components, largely reducing the inventory of sup­
ply chain parties downstream. However, in order to reduce the risk of
stock outs or inventory write-offs, a firm needs to forecast customer
demand and be able to respond rapidly to the evolving changes in the
marketplace. As noted by Steele (2001), in a JIT supply chain, suppliers
are responsible for knowing their customers and end consumers of their
products. Changes in customer demand trigger JIT operations, pulling
the supply chain activities from the end customer all the way upstream
through distributors and manufacturers to suppliers. Daily supply chain
operations are driven by fulfilling customer demand in a continuous
way, pulling production upstream in the supply chain (Larson, 2005a,
2005b). To make JIT operations effective, a demand-driven supply
chain, focalized with customer integration into the supply chain (Mar­
tinelli and Tunisini, 2019), would be conducive to the success of JIT
operations since JIT operations are required to be linked to short-term
patterns of customer demand (Larson, 2005a, 2005b). Customer
knowledge enables a firm to sustain competitive priorities (Jahani et al.,
2012) and has been acknowledged as the major factor in maximizing a
firm’s value (Croteau and Li, 2003).
As such, this study uses demand-driven supply chain intelligence to
represent the conception of a demand-driven supply chain focusing on
customer integration. Prior studies have mostly focused on the effect of
supply chain intelligence sourced from different supply chain constitu­
ents on innovation of product and adaptability of a supply chain (e.g.,
Schoenherr and Swink, 2015), supply chain performance (e.g., Gebre­
mikael et al., 2019), and risk mitigation in logistics management (e.g.,
Yan et al., 2019). The research examining the effect of supply chain
intelligence on JIT supply chains is scarce, thus warranting further
scrutiny. In particular, this study aims to investigate the linkage between
demand-driven supply chain intelligence and JIT supply chains and the
effect of supply chain intelligence on the operational performance of
supply chains by answering the following two research questions:
1. What are the driving factors of an effective JIT supply chain?
2. Does a JIT supply chain enhance a firm’s operational performance?

* Corresponding author.
E-mail addresses: yangj2@uhv.edu (J. Yang), hmxie@gzhu.edu.cn (H. Xie), yugsheng@126.com (G. Yu), myliu@fudan.edu.cn (M. Liu).

https://doi.org/10.1016/j.ijpe.2020.107878
Received 17 March 2020; Received in revised form 13 July 2020; Accepted 15 July 2020
Available online 21 July 2020
0925-5273/© 2020 Elsevier B.V. All rights reserved.
J. Yang et al.
2. Theoretical background and research hypotheses
2.1. 2.1. demand-driven supply chain intelligence
Supply chain intelligence is defined as knowledge sourced and in­
tegrated from three main supply chain stakeholders-suppliers, cus­
tomers, and competitors (Schoenherr and Swink, 2015). It is the
integration of data collection, analysis, actionable information,
dissemination and response in a supply chain (Handfield, 2006). Supply
chain intelligence enables a firm to get a holistic view of a supply chain
with a perspective of customers (Haydock, 2003). In line with Haydock
(2003), this study focuses on demand-driven supply chain intelligence,
which refers to the acquisition and integration of customer knowledge
and knowledge sharing through effective cooperation between supply
chain partners. Three strategies of a demand-driven supply chain were
highlighted by a thorough literature review: customer closeness strat­
egy, intra-supply chain strategy, and relational strategy (Martinelli
et al., 2017). Informed by the categorization of three strategies towards
a demand-driven JIT supply chain, this study includes three dimensions
in supply chain intelligence as driving factors of a JIT supply chain:
customer knowledge management capabilities, knowledge sharing, and
cooperation between supply chain partners. Arnett and Badrinarayanan
(2005) defined customer knowledge management capabilities as the
collective abilities of a firm to acquire, analyse, integrate, and apply
knowledge collected from customers. Such capabilities enable a firm to
learn and integrate customer needs in the process and meet a myriad of
customer expectations. Thus, improving customer knowledge manage­
ment capabilities is a customer closeness strategy. As a driving factor,
knowledge sharing refers to the activity of making knowledge accessible
to others so that it can be understood, integrated, and applied by others
(Ipe, 2003). It reduces imbalance between customer and supplier in­
telligence and makes them aligned. Since knowledge sharing is part of
the concept of demand-driven supply chains and is a key element in
cross-functional and boundary-spanning activities (Keszey, 2018), we
consider knowledge sharing as an intra-supply chain strategy to concur
with the context of this study. Cooperation between supply chain part­
ners are fundamental for a demand-driven and responsive supply chain
(Henke and Zhang, 2010). Cooperation is a relational strategy, focusing
on relationship improvement through joint collaboration planning,
which strengthens the relationship between a buyer and its key suppliers
in a demand-driven supply chain (Hadaya and Cassivi, 2007). Moreover,
the three driving factors of supply chain intelligence are in line with
triple-Vs (variability, visibility, and velocity) advocated by Santhanam
(2008) for achieving a demand-driven JIT supply chain. There is an
overarching need to enhance variability through customer knowledge
management capabilities (i.e., product mix forecasts), increase visibility
through knowledge sharing (i.e., reduction of bullwhip effect; match of
production capacities and demand variations), and boost velocity
through effective cooperation (i.e., collaborative planning, forecasting,
and replenishment) between supply chain partners. A supply chain can
be optimized through integrating customer knowledge into JIT opera­
tions, through knowledge sharing, and through cooperation (Woollis­
croft et al., 2013), which are consistent with the three driving factors in
this study.
2.2. 2.2. JIT supply chain
JIT embraces the tenets of minimizing waste and inventory. A JIT
supply chain can be articulated as the right items arriving at each supply
chain partner when needed in the right quantity, at the right place, and
with the right quality. JIT synchronizes the operations processes of
supply chain constituents into one process aiming to improve quality
and ensure timeliness of the operations (Claycomb et al., 1999). A JIT
supply chain includes three main elements: JIT production planning, JIT
sourcing, and JIT logistics (Larson, 2005a, 2005b). In particular, Larson,
2005a, 2005b) explicitly delineated that: (1) production planning was
2
International Journal of Production Economics 231 (2021) 107878
depicted as lean production, JIT production planning, demand-based
material pull systems, and process flexibility; (2) JIT sourcing was re­
flected by strategic sourcing to support JIT objectives and analyses of
total cost of material. A thorough analysis of total cost of material calls
for consideration of cost implications in a holistic view; (3) JIT logistics
can be facilitated through transportation network optimization and
unbundled transportation services such as third-party logistics pro­
viders, freight forwarders, and consolidators.
As discussed above, drawing upon three strategies for demand-
driven supply chains, this study hinges on the premise that JIT supply
chain is a consequence of demand-driven supply chain intelligence,
operationalized as customer knowledge management capability with
effective knowledge sharing and cooperation between supply chain
parties. This study examines the effect of the driving factors of demand-
driven supply chain intelligence (customer knowledge management
capabilities, knowledge sharing, and cooperation) on JIT supply chains
in terms of production planning, sourcing, and logistics. It also assesses
the impact of a JIT supply chain on operational performance. The rest of
the paper is structured as follows. Hypotheses development followed by
research methodology will be explained; then, data analyses and results
will be discussed; lastly, a discussion of theoretical contribution and
managerial implications will be addressed.
2.3. 2.3. the effect of demand-driven supply chain intelligence on JIT
supply chain
The driving factor, customer knowledge, enables a firm to gain
substantive competitive advantage through increased organizational
learning and innovation (Paquette, 2011). Customer knowledge enables
a firm to deliver better value to its customers, offer improved products to
customers, and fulfill customers’ needs through integrated knowledge
and deep understanding of its customers. Implementing customer
knowledge management helps a firm create innovative ideas for new
product development and provide new products in time for customers
(Chen and Su, 2006). A learning organization can be created through
effectively managing customer knowledge so that the organization can
continuously improve its customer-related practices, processes, and
technologies (Christensen et al., 2005). Zand et al. (2018) contend that
customer knowledge management capabilities result in fostered
learning and growth as well as improved efficiency and customer
satisfaction. Customer knowledge management enhances product
innovation (Ziyae et al., 2019; Zhan et al., 2019). A firm with a rich
knowledge base has more capabilities of developing radical innovation
through acquiring market knowledge than through sharing internal
knowledge (Zhou and Li, 2012). Such radical innovation enables a firm
to offer a large variety of new products to customers and helps with
effective production planning for the innovative products, sourcing
materials and components from suppliers, and optimizing logistics op­
erations in delivery. In this sense, JIT firms adopt customer closeness
strategy (Martinelli et al., 2017) to acquire valuable customer knowl­
edge for their production planning, sourcing, and delivery.
With the tenet of JIT focusing on eliminating waste and improving
efficiency, firms take advantage of demand-driven supply chain intelli­
gence by implementing customer closeness strategy to increase product
variability through targeting market segments and positioning and dif­
ferentiation. In JIT practices, three driving factors including customer
knowledge management capabilities, knowledge sharing, and coopera­
tion facilitate effective production planning, sourcing, and logistics op­
erations through removing redundant operations, lowering the cost, and
enhancing efficiency. Thus, we posit.
H1. Customer knowledge management capability has a positive effect
on (a) effective production planning, (b) sourcing efficiency, and (c)
logistics operations in a JIT supply chain.
The level of knowledge sharing with suppliers positively influences
performance (Rashed et al., 2010). Through knowledge sharing, firms
J. Yang et al.
can streamline order fulfilment and respond to customers quickly
(Verwaal and Hesselmans, 2004). Knowledge sharing is triggered by the
fact that buyers need resources controlled and owned by their suppliers
(Morgan and Hunt, 1994). Improving visibility among exchange part­
ners has been a key to the success of JIT practices. For example, Toyota
developed knowledge sharing networks with its suppliers for learning
from each other and created a knowledge base for sharing with a pur­
pose of improving production efficiency (Dyer and Nobeoka, 2000).
Processes can be greatly improved through fostering information
sharing between a buyer and its key supplier at such various operations
as production planning, product ordering, and inventory status (Saeed
et al., 2005), thus facilitating the implementation of JIT operations. The
firm that pursues a JIT strategy embraces knowledge resources from
suppliers such as operation cost, quality, level of inventory, and pro­
duction scheduling (Christensen et al., 2005). The driving factor,
knowledge sharing, assumes a pivotal role in the implementation of JIT
practices and enables a firm to fully capitalize upon the relationship
with supply chain partners (Christensen et al., 2005). A high level of
knowledge sharing indicates that exchange parties share valuable
knowledge so that they can leverage the knowledge into beneficial use
for the economic exchanges. Knowledge sharing between exchange
parties, as an intra-supply chain strategy, increases supply chain visi­
bility, facilitating a demand-based material pull system, strategic
sourcing, and transportation network optimization. Such an intra-supply
chain strategy embraces sharing of demand-driven supply chain intel­
ligence and makes a supply chain agile and responsive to evolving
market needs. Therefore, we posit.
H2. Knowledge sharing has a positive effect on (a) effective production
planning, (b) sourcing efficiency, and (c) logistics operations in a JIT
supply chain.
Strategic alliances and partnership formation with key suppliers
enables a buyer implementing JIT to achieve superior competitive
advantage (Narasimhan and Nair, 2005). The success of JIT is dependent
on effective production scheduling with key suppliers and provided
service by suppliers. Such coordination requires well-developed dyadic
relationships between a buyer and its suppliers and effective integration
of production planning with key suppliers (Kannan and Tan, 2005). The
driving factor, cooperation between supply chain partners, embraces a
scope of inter-enterprise, which brings exchange parties together for the
purpose of potential operational optimization and efficiency improve­
ment (Harwick, 1997). Kannan and Tan (2005) stated that cooperation
facilitates material flow in JIT production and creates linked systems. In
JIT practice, products must be provided at the right place on the right
time in right quantity (Handfield, 1994). Production planning, sourcing
efficiency, and logistics operations can be greatly improved through
enhanced supply chain flexibility resulting from enhanced mutual un­
derstanding in the established strategic partnerships with suppliers and
customers (Chang et al., 2005). Effective supply chain management
consists of partnerships between supply chain parties cooperating and
sharing risks and rewards as well as information. A successful supply
chain rests on long-term strategic partnership formation between ex­
change parties (Ellram and Cooper, 1993). Such a relational strategy
speeds up the communication of demand-driven supply chain intelli­
gence through jointly collaborative planning, which results in enhanced
supply chain velocity. While JIT supply chain operations require ve­
locity of materials and products delivery and seamless linkages between
processes, the relational strategy enables a firm to reap the benefits of
supply chain intelligence and improve the efficiencies in JIT supply
chain operations in terms of production planning, sourcing, and
logistics.
H3. Cooperation has a positive effect on (a) effective production
planning, (b) sourcing efficiency, and (c) logistics operations in a JIT
supply chain.
3
International Journal of Production Economics 231 (2021) 107878
2.4. 2.4. the effect of a JIT supply chain on operational performance
A manufacturer’s success in operations depends on synchronization
of supply and mutual operational performance through enhanced
manufacturing agility (Inman et al., 2011). A meta-analysis on the
impact of JIT practices including production planning, sourcing, and
logistics on operational performance suggested that JIT has positive
effect on most dimensions of performance in terms of reduced costs,
lowered inventory, shortened cycle time, quick delivery, and flexible
quantity (Mackelprang and Nair, 2010). In JIT practices, scheduling of
production and delivery is synchronized and accessible for supply chain
parties for operational efficiency improvement through effective coor­
dination of available resources and operations in a supply chain (Lee
et al., 2000). Mas’udin and Kamara (2018) asserted the JIT practices
result in cost reduction, boosted productivity, and waste reduction.
Moreover, JIT operations create an enormous difference in terms of
improved on-time delivery performance, which coincides with Oliveira
and Handfield (2019) observation that supply chain benefits can be
reaped through building real-time supply chain capabilities. Thus, we
posit.
H4. (a) Effective production planning, (b) sourcing efficiency, and (c)
logistics operations in JIT supply chain has a positive effect on opera­
tional performance.
3. Research methodology
3.1. Sample and data collection
Manufacturers in the U.S. served as the key informants in this study,
such approach as widely adopted in the studies on operations manage­
ment (e.g., Zhang, et al., 2018). The profile of respondents is summa­
rized in Table 1. Total design method was employed in the survey to
increase responses (Dillman, 2000). The measurement items in the
survey were adopted from prior studies after an extensive literature
review in the field of demand-driven supply chain intelligence. Face
validity was ensured by sending the questionnaire to scholars and
managers in the area of operations management for a pre-test. As a
result, minor revision was made to ensure the measurement items were
clearly understood by the respondents. We created a revised survey in­
strument online and the survey link was sent to respondents including
directors and vice presidents of purchasing and supply listed on a mar­
keting intelligence platform. They were asked to provide their responses
to the survey questions from a buyer’s (manufacturer’s) view. The ex­
change partners have similar perceptions regarding economic trans­
actions between them (Zaheer et al., 1998), therefore we can say that the
perception of the buyers represents the perspectives of the dyads in an
exchange. The respondents were instructed to consult with an individual
functional department as needed to get non-biased responses with an
over-arching view of an organization. We sent out two rounds of in­
vitations to the sample. In the first round, a total of 1858 samples were
sent by email and 118 emails were returned as undeliverable. As a result,
1740 informants got the email invitation for the survey. We received
133 responses in two weeks. Then, we sent out another round of survey
invitation to those nonrespondents and only 48 responded. Out of 181
responses, 11 were removed due to missing data. After two attempts for
data collection, 170 useable responses were received, reaching a rate of
response at 9.77% (170/1740). The industries in the survey consist of
materials/manufacturing, engineering, construction equipment, energy,
electronic products, healthcare/chemical/pharmaceutical, automoti­
ve/transportation, and others.
To evaluate non-response bias, we compared two waves of responses
collected in the survey. We adopted the method of successive-waves
extrapolation (Armstrong and Overton, 1977), which has been widely
employed in the assessment of non-response bias. The results of ANOVA
indicate that there is no difference between the two waves of data
J. Yang et al.
Table 1
Profile of responding firms.
Firm Age (Years) % Firm Size (Employees) % Industry
�10 18.2 �500 37.3 Materials/Manufacturing
10–20 20 500–1000 8.9 Engineering/Construction
Equipment
�20 61.8 1000–2000 5.9 Energy
�2000 47.9 Electronic products
Healthcare/Chemical/
Pharmaceutical
Automotive/Transportation
Others
collection at significance level p � 0.05 in terms of key demographic
information and firm characteristics such as firm age, size, and annual
sales. Thus, non-response bias is not a concern between the two attempts
of data collection. In the survey, we collected data from single re­
spondents. Since single respondents might inflate estimates of the as­
sociations between variables, potential common method bias could be
an issue (Podsakoff and Organ, 1986). In order to evaluate the potential
common method bias, we performed Harman’s one-factor test following
the suggestion by Podsakoff et al. (2003). Upon extracting the factors
with eigenvalues greater than one, they were found to account for
66.81% of the variance. The first extracted factor accounts for 16.89% of
the variance. Moreover, a single factor confirmatory factor analysis was
conducted to further assess the common method bias (Mossholder et al.,
1998). The results indicate that the one factor model cannot well
represent the sample data, thus there is no concern for common method
bias in this empirical investigation.
3.2. Measures
We adopted five-point Likert scales for the questionnaire items. The
measures were from prior relevant studies. The measure of customer
knowledge management capabilities was adapted from Tanriverdi
(2005) tapping a manufacturer’s capabilities to create marketing
knowledge, transfer customer know-how among supply chain partners,
integrate customer knowledge of supply chain partners to gain insights
of new customer, and change marketing policies. We used four items to
gauge the measure of knowledge sharing which were adapted from Li
et al. (2012) reflecting the means of information sharing regarding
product development, performance measures, joint training programs
within a firm, and customer relationship management. The measure of
cooperation between supply chain partners was adapted from Gligor and
Holcomb (2012) tapping the degree of participation in partners’ stra­
tegic decision and cooperation in the partnership. Three constructs of a
JIT supply chain were developed based on the work of Larson, 2005a,
2005b. Production planning was measured by four items gauging the
extent to which a manufacturer embraces lean production, process
flexibility, JIT production planning, and demand-based material pull
systems. Sourcing was measured by two items: strategic sourcing to
support JIT goals and thorough cost analysis of material procurement.
Two items were used to measure logistics: unbundled transportation
services and transportation network optimization. The measure of
operational performance was adopted from Yang et al. (2020) includes
product quality, operation cost, low inventory, lead time, and delivery.
3.3. Control variables
Two control variables, firm age and size, were included in the model
to control for the impact of a firm’s knowledge management capabilities
and JIT operations. Firm age and size are not the interest of this study,
however both of them are linked to the dependent variables of this
study. For example, large manufacturers are able to control more re­
sources than small ones and they are able to deploy the resources in a
more efficient way for fostering customer knowledge management
4
International Journal of Production Economics 231 (2021) 107878
% Years of Experience % Annual sales (Million US$) %
37.6 �5 34.7 �10 16.5
29.4 5–10 32.4 10–20 8.8
10.6 10–20 22.4 20–50 10
8.8 �20 10.6 50–100 12.9
8.2 �100 51.8
4.8
0.6
efforts and supply chain knowledge sharing. Moreover, operating in a
rapidly changing and volatile environment, large firms tend to exercise
superior JIT operations including production planning, sourcing, and
logistics. A comparison analysis of in-house and vendor elements critical
to JIT implementation between large and small manufacturing firms by
Inman and Mehra (1990) reveals that large firms are more prevalent in
the use of outside consultants to help with JIT implementation, while
small firms gain more reduction in vendor lot sizes and inventory.
Firm age is associated with performance outcomes. In particular,
extensive social connection and institutional ties established over years
in economic transactions between supply chain parties enable firms to
gain substantive knowledge management capabilities. The difference in
performance outcomes might not be caused by practices of customer
knowledge management and sharing of knowledge, but by firm age and
size. Thus, in the analyses, we include firm age and size as two control
variables to distinguish performance implications of the control vari­
ables from the effect of customer knowledge management capabilities.
3.4. Reliability and validity
We performed confirmatory factor analysis to evaluate the discrim­
inant and convergent validity of the measures in the conceptual model.
Table 2 shows the results of the confirmatory factor analysis and lists the
items in the measurement and their Cronbach alpha coefficients. For
sourcing and logistics, since two-item scales were adopted, we reported
Spearman-Brown coefficients as well, 0.57 and 0.71 respectively, as
suggested by Eisinga et al. (2013) that when a scale has two congeneric
items, Spearman-Brown coefficients should be reported as well as
Cronbach alpha coefficients. For the measure of cooperation, we also
presented its Spearman-Brown coefficient, which is 0.81, due to small
number of measurement items.
4. Analyses and results
The data analyses were conducted by using AMOS. The proposed
linkages were tested in structural equation modeling and the structural
equations were reported in Table 3. Fig. 1 presents the completely
standardized parameter estimates and t-values for each path. It indicates
acceptable for the overall fit of the model (χ 2 ¼ 98.03, p ¼ 0.00, d. f. ¼ 6,
CFI ¼ 0.86, IFI ¼ 0.87, NFI ¼ 0.86).
The results shown in Fig. 1 indicate that customer knowledge man­
agement capabilities (β ¼ 0.52, t ¼ 6.41), and cooperation (β ¼ 0.18, t ¼
2.37) are related to production planning. Thus, Hypotheses 1a and 3a
are supported. The results of analyses also show pivotal roles of
customer knowledge management capabilities (β ¼ 0.34, t ¼ 3.93) and
cooperation (β ¼ 0.29, t ¼ 3.68) in sourcing efficiency. Hypotheses 1 b
and 3 b are strongly supported. It also indicates that logistics is signifi­
cantly related to knowledge sharing (β ¼ 0.37, t ¼ 4.46) and cooperation
(β ¼ 0.28, t ¼ 3.30), thus hypotheses 2c and 3c are supported. Hy­
potheses 4a and 4 b are also supported with the results of the analyses
indicating a significant link between production planning (β ¼ 0.46, t ¼
7.17) and operational performance and sourcing (β ¼ 0.20, t ¼ 3.05) and
operational performance. Hypothesis 1c is not supported, which
J. Yang et al.
Table 2
Construct measurement, reliability, and confirmatory factor analysis.
Measures
Customer knowledge management capabilities (α ¼ 0.83)
1. Create marketing skills and knowledge that are applicable
across supply chain partners.
2. Transfer relevant customer knowledge among supply chain
partners.
3. Integrate relevant customer knowledge of multiple supply
chain partners to gain new customer insights.
4. My firm change marketing & product policies based on
relevant customer knowledge discovered in supply chain
partners.
Supply chain knowledge sharing (α ¼ 0.79)
1. Share information about product/process development with
supply chain partners.
2. Share information about customer relationship management
with supply chain partners.
3. Share performance measures with supply chain partners.
4. Our firm and our supply chain partners coordinate to provide
joint training programs to employees.
Cooperation (α ¼ 0.53)
1. There is a cooperative attitude between my firm and supply
chain partners.
2. Our relationship with supply chain partners is cooperative.
3. Our supply chain partners permit each other to participate in
strategic decisions.
Production planning (α ¼ 0.83)
1. Lean/Flow-based production.
2. JIT production planning.
3. Improving process flexibility.
4. Demand-based material pull systems.
Sourcing (α ¼ 0.56)
1. Strategic sourcing to support JIT objectives.
2. Thorough cost analysis of material procurement.
Logistics (α ¼ 0.71)
1. Unbundled transportation services.
2. Transportation network optimization.
Operational performance (α ¼ 0.87)
1. Reduced operation costs.
2. Online delivery.
3. Product quality.
4. Shortened lead time.
5. Lowered inventory.
Table 3
Structural equations.
Structural equation
η4 ¼ 0.06ξ1-0.01ξ2þ0.52η1þ0.11η2þ0.18η3
η5 ¼ 0.09ξ1þ0.06ξ2þ0.34η1þ0.07η2þ0.29η3
η6 ¼ 0.09ξ1-0.03ξ 2þ0.08η1þ0.37η2þ0.28η3
η7 ¼ 0.18ξ1þ0.06ξ2þ0.46η4þ0.20η5þ0.09η6
indicates customer knowledge management capability is not related to
logistics (β ¼ 0.08, t ¼ 0.92). The results indicate that knowledge
sharing is not related to production planning (β ¼ 0.11, t ¼ 1.52) and
sourcing (β ¼ 0.01, t ¼ 0.91). Thus, hypotheses 2a and 2 b are not
supported. The link between logistics and operational performance is
not significant (β ¼ 0.09, t ¼ 1.54). Thus, hypothesis 4c is not supported.
In general, the results show that the eight out of twelve hypothesized
paths are strongly supported.
5. Discussion
Drawing upon three strategies of demand-driven supply chains, this
study assesses the linkage between customer knowledge management
capability, knowledge sharing, and cooperation and JIT supply chain
operations including production planning, sourcing, and logistics. It also
investigates the impact of JIT supply chain operations on operational
performance. In particular, customer knowledge management capability
International Journal of Production Economics 231 (2021) 107878
entails the implementation of customer closeness strategy for enhancing
product variability for customers. Knowledge sharing is considered as an
Standardized inter-organizational strategy, which focuses on the improvement of
loading supply chain visibility through knowledge sharing between supply chain
partners. Cooperation between supply chain partners represent the
0.63 relational strategy for the improvement of supply chain velocity through
joint collaborative planning. Such supply chain velocity facilitates the
0.64 development of a JIT supply chain so that supply chain firms can reap
0.69
the benefits of collaborative production planning, effective sourcing,
and logistics. This study shows that effective production planning is
0.80 related to customer knowledge management capability and cooperation
between supply chain partners. Results of our study suggest that
sourcing efficiency depends highly on the level of customer knowledge
0.54 capability and cooperation with exchange partners in a supply chain. A
significant relationship was found between logistics and knowledge
0.58 sharing and cooperation. Unexpectedly, logistics was not found to be
related to operational performance, while statistically significant results
0.55
0.74
suggest that effective production planning and sourcing efficiency
contribute to enhanced operational performance. This study contributes
to the existing streams of studies on JIT operations and provides prac­
0.70 tical implications to executives of manufacturing firms making efforts in
the implementation of JIT operation successfully through improving
0.66
0.81 triple-Vs, variability, visibility, and velocity, in a supply chain.
5.1. Theoretical contributions
0.63
0.70
0.70
First, the findings of this study provide empirical evidence for the
0.76 pivotal role of demand-driven supply chain intelligence in a JIT supply
chain and its resultant operational performance. Demand-driven supply
0.36 chain intelligence is operationalized by customer knowledge manage­
0.72
ment capability, knowledge sharing, and cooperation. Little research
0.43 has assessed the linkage between demand-driven supply chain intelli­
0.74 gence and JIT supply chain operations. In this study, JIT supply chain
operations are operationalized by production planning, sourcing, and
0.77 logistics. Through building the connections and evaluating the mecha­
0.99
0.74
nism of the effects of customer knowledge management capability,
0.99 knowledge sharing, and cooperation, this study offers empirical evi­
0.84 dence of the linkages and insights into the effect of demand-driven
supply chain intelligence on a JIT supply chain.
Second, this study is informed by three demand-driven supply chain
strategies including customer closeness strategy, intra-supply chain
strategy, and relational strategy to ground the three factors of demand-
driven supply chain intelligence respectively. Customer knowledge
management capability is a customer closeness strategy for enhancing
product variability for customers. Knowledge sharing between supply
chain partners is an intra-supply chain strategy emphasizing supply
chain visibility improvement through knowledge sharing. Cooperation
between supply chain partners is a relational strategy to foster supply
chain velocity though effective joint collaborative planning among ex­
change parties. Three demand-driven supply chain strategies offer a
theoretical grounding for the pivotal role of triple-Vs on a JIT supply
chain. This study offers a nuanced view of achieving a JIT supply chain
by boosting triple-Vs.
Third, there exists a paucity of research dedicating to the under­
pinning connecting demand-driven supply chain intelligence and a JIT
supply chain. This study extends organizational theories to the field of
supply chain management through grounding the investigated linkages
in the three demand-driven supply chain theories. This theoretical
grounding contributes to the literature of JIT operations in a supply
chain and advances the three strategies of developing demand-driven
supply chain intelligence to a higher level in the context of a supply
chain. The study conceptualizes JIT operations in a supply chain in
terms of production planning, sourcing, and logistics. In particular, JIT
purchasing (Handfield, 1993a) and JIT procurement (Handfield, 1993b)
have been discussed in the literature. Information sharing has been
shown to facilitate JIT purchasing in make-to-order firms (Handfield,
5
J. Yang et al.
Fig. 1. Coefficients of the structural model.
1993a). Handfield (1993b) found that JIT materials procurement efforts
can be hindered when non-domestic suppliers are used by make-to-order
and assemble-to-order firms. In this study, we advance it to JIT sourcing
to embrace both purchasing and procurement as well as supplier se­
lection for manufacturing firms for both make-to-order and
make-to-stock.
This study empirically evaluates the significance of three driving
factors in achieving a JIT supply chain through reaping the harvest of
the three strategies. The findings of this study coincide with the asser­
tion of Chi et al. (2019) that intellectual alignment plays an important
role in demand-driven supply chains.
5.2. Managerial implications
First, the pivotal role of demand-driving supply chain intelligence in
achieving a JIT supply chain indicates that the three driving factors are
conducive to JIT supply chains and resultant performance. Executives of
manufacturing firms are suggested to accentuate efforts in enhancing
Triple-Vs by implementing customer closeness strategy, intra-supply
chain strategy, and relational strategy. Supply chain practitioners
implementing JIT supply chain operations are advised to focus their
attention on fostering customer KM capabilities, knowledge sharing, and
cooperation between supply chain partners. The results suggest that
supply chain firms create marketing skills, transfer relevant customer
knowledge, and integrate customer knowledge of multiple supply chain
partners. Providing joint training programs to employees of supply chain
partners would be helpful in knowledge sharing. In order to achieve an
effective JIT supply chain, they also need to share information about
product development and customer relationship management with ex­
change partners. Moreover, having a cooperative attitude and partici­
pating in strategic decisions with exchange partners would facilitate the
implementation of JIT supply chain operations. Taking it together, three
driving factors of demand-driven supply chain intelligence have been
shown to determine the effectiveness of a JIT supply chain in terms of
production planning, sourcing, and logistics. It offers implications for
supply chain practitioners that three driving factors of demand-driven
supply chain intelligence should be focused simultaneously.
Second, managerial implications are also drawn from the results of
the study as it indicates that production planning and sourcing exert
significant effect on operational performance. Operations practitioners
are suggested to have effective production planning through lean pro­
duction, JIT production planning, improving process flexibility, and
demand-based material pull systems. They are also suggested to improve
sourcing efficiency through strategic sourcing to support JIT goals and
thorough cost analysis of material procurement. These efforts should
lead to improved operational performance. Moreover, supply chain
6
International Journal of Production Economics 231 (2021) 107878
practitioners are suggested to adopt professional approaches in supplier
selection such as analytical hierarchy process. The findings of this study
concur with prior studies with regard to the benefits of JIT including
reduced production cost (Swink et al., 2005), improved product quality
(Kumar et al., 2001), shortened cycle time (Dal Pont et al., 2008), and
lowered inventory (Yasin et al., 2003).
5.3. Research limitations and further research
The limitations of this study constrain the interpretation of the
findings of the study and also warrant further research. First, this study
focuses on the impact of demand-driven supply chain intelligence which
is operationalized using customer knowledge management capability,
knowledge sharing, and cooperation between supply chain partners.
Knowledge sharing and cooperation embrace the supply chain opera­
tions between the focal firm and its suppliers. Since it is difficult to
collect data from both sides of the dyadic relationship to evaluate the
knowledge sharing and cooperation in the survey, we asked the re­
spondents to answer survey questions based on the focal firm’s
perception of knowledge sharing activities and cooperation practices in
the economic exchanges with their key suppliers. Although this
approach was adopted by many supply chain scholars in the literature, it
would be of further interest to collect data from both dyads in a rela­
tionship to gauge the unbiased perception of the supply chain practices.
Thus, future research can try to collect information from both the focal
firm and its key supplier to get dyadic information with regard to the
supply chain operations and practices. Second, the study evaluated the
impact of demand-driven supply chain intelligence on a JIT supply
chain. Its effect on other aspects of supply chains is not considered in this
study. As well as a JIT supply chain, demand-driven supply chain in­
telligence could also lead to improved supply chain agility, adaptability,
and alignment. Agility extends the notion of flexibility by incorporating
speed in it when coping with evolving customer needs. Although both
agility and adaptability embrace flexibility, agility refers the ability to
respond to short-term changes in operation, while adaptability responds
to changes in structure (Christopher and Holweg, 2011). The three di­
mensions are used to measure the effectiveness of a supply chain. Future
research could move forward to assess the association between
demand-driven supply chain intelligence and supply chain agility,
adaptability, and alignment. It would be insightful to consider these
linkages in the investigation to better understand the supply chain ef­
ficiency consequences of demand-driven supply chain intelligence in a
manufacturing setting.
J. Yang et al.
Acknowledgements
The authors are grateful to the anonymous reviewers for their helpful
comments on an earlier version of this paper. The second author of this
paper was supported in part by National Natural Science Foundation of
China (71772163 and 71673240). The third author of this paper was
supported in part by National Natural Science Foundation of China
(71572041).
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