Arcs of communication and small- and medium-sized enterprise performance

Abstract

PurposeThe purpose of this paper is to analyse the information shared by SMEs with their main customers and suppliers and its implications on their performance.Design/methodology/approachThe paper puts forward the concept of arcs of communication based on the frequency and direction of the information exchanged by SMEs with their main customers and suppliers. SMEs are classified by the arc of communication they belong to using data from a survey carried out in the Canary Islands (Spain). The Rasch Measurement Theory is applied.FindingsThe largest group of small- and medium-sized enterprises (SMEs) shares information frequently with both customers and suppliers (broad arc of communication). Differences were detected in the performance of SMEs belonging to this broad arc, as well as, in those firms that communicated frequently with their main suppliers (asymmetrical arc of communication towards suppliers). In both cases, these firms were better than their competitors in innovation.Practical implicationsThis study demonstrates the need for better management of the links between SMEs and their suppliers and with their customers in accordance with their strategies, promoting a greater cooperative behaviour throughout the supply chain.Originality/valueSMEs’ customers and suppliers are their main sources of information compared to large firms, which have greater resources to search for and acquire information. This paper investigates the information exchanged by SMEs with their main customers and suppliers from a strategic focus by adding to the literature the concept of arcs of communication. It also has the added value of applying the Rasch Measurement Theory (Rasch, 1960/1980).

The Drivers of Sustainability Practices in SMEs and the Impact on Business Performance

“…Several previous studies found a direct positive impact between collaboration and business performance, such as Yanes-Estévez et al [43], which focused on the importance of effectively managing relationships between SMEs, the suppliers, and consumers. This was in line with the strategies to enhance cooperation in the supply chain, as successful company often consistently outperformed relevant competitors.…”

Communication Catalysts: How Personal Ties Enhance Supply Chain Efficiency

“…For example, inter-organizational communication holds significant importance, particularly in the domains of sales and procurement (Wang et al, 2016;Butt, 2019). Various studies have explored specific aspects, such as the analysis of buyer-supplier personal ties (Christiansen et al, 2003;Saad et al, 2015;Agarwal & Narayana, 2020), as well as communication activities between buyers and suppliers (Li et al, 2023;Yanes-Estévez et al, 2019). While these research endeavors have sought to detail the communication patterns among employees of different companies, they have, however, overlooked the influence of personal ties outside the professional context in this specific context.…”

An Interdisciplinary Survey on Information Flows in Supply Chains

“…In our survey, we further came across a variety of (corresponding) terms, ranging from "growth" [ 8 ] over "capacity" and "breadth" [ 19 ] to "scalability" [ 9 , 12 , 99 ] when referring to volume (e.g., used by [ 9 , 137 ]). Contrarily, velocity was discussed less prominently: Apart from the synonym "frequency" [ 206 ], we only attribute frequency-related aspects of scalability to this property. As an alternative for variety (e.g., used by [ 9 ]), we found the use of "heterogeneity" [ 175 ].…”