Transformations  in
Business & Economics

DEMAND CHAIN ALIGNMENT COMPETENCE, MANAGERIAL COGNITION, AND FIRM PERFORMANCE: THE MODERATING ROLE OF SUPPLY CHAIN FLEXIBILITY
Junxia Yuan, Junjun Gao, Dandan Wu

ABSTRACT. Effective demand management is an essential part of operations management, especially in the fashion industry. It helps enterprises avoid sales losses, increase inventory turnover, and raise firm performance. The major sources of effective and efficient demand management practices derive from the improvement in demand chain alignment competence (DCAC). By integrating dynamic capability theory and upper echelon theory, the present research discusses the role of DCAC and explores its main antecedents and consequences. Exploratory factor analysis, confirmatory factor analysis, and hierarchical linear regression are conducted to analyze the data collected from 156 fashion enterprises. The results from qualitative interviews and quantitative analysis indicate that managerial cognition (MC) is a critical antecedent of DCAC. In addition, supply chain flexibility has a significantly positive moderating effect on the relationship between MC and DCAC. Further, DCAC primarily predicts firm performance. Finally, novel theoretical and empirical insights are discussed.

KEYWORDS: demand chain alignment competence, supply chain flexibility, managerial cognition, dynamic capability, upper echelon theory.

JEL classification: C12, C51, C87, D12.