Is Organisational Ambidexterity a Good Booster to Supply Chain Flexibility in the Textile and Apparel Industry in Sri Lanka?

Abstract

The environment does not remain stable forever because change is inevitable. The frequency and speed of change however varies from industry-to-industry, business-to business. Thereby, the manner by which a firms’ supply chain adapts to these environment dynamics demand greater attention. Building on the relationship between manufacturing strategy and the environment, the purpose of this paper is to analyse the direct impact of environmental dynamism on supply chain flexibility, and the indirect impact of achieving supply chain flexibility required by the environment through organisational ambidexterity in the Sri Lankan textile and apparel industry which is an industry under increased pressure to be more flexible and the highest export revenue contributor to the economy. A positivism paradigm provided the foundation for this explanatory research. A cross-sectional survey method was used to collect the primary data from operations or supply chain managers across firms in the Sri Lankan textile and apparel industry. Eighty-seven responses were received and analysed using the SmartPLS software. As a preliminary result, this study finds that there is a significant positive impact of environmental dynamism on supply chain flexibility and this relationship is partially mediated by organisational ambidexterity. Moreover, the results reveal a significant positive impact among the variables; environmental dynamism, organisational ambidexterity and supply chain flexibility. In the practical context, managers need to be aware of environmental changes to identify areas which require investment in flexibility as it incurs both costs and risks for a firm. Further, the insights which managers gain on supply chain flexibility, from being responsive to dynamic environments is enhanced when organisational ambidexterity is practiced. Practicing organisational ambidexterity helps managers to refine existing processes to maintain competitive advantage, and achieve the optimal degree of flexibility required by the firm and its environment in being open to innovation. Owing to limitations identified, future research possibilities are extending the research to other industries, carrying out longitudinal studies, and testing other possible mediator variables.

Keywords: Supply Chain Flexibility, Environmental Dynamism, Organisational Ambidexterity