Supply chain integration, resilience and performance in the South African Rail Industry

Abstract

The rail industry in South Africa performs an important role in the transportation of goods and people. It also contributes in various ways to the socio-economic success of the country’s economy. However, the industry faces various performance-related challenges in areas such as maintenance of rail lines, poor train availability and non-operation of long-distance rail service, decline in fleet availability and accidents, most of which are linked to ineffective supply chain management. To resolve these challenges, this study proposes the implementation of supply chain integration as a method to improve the resilience and performance of the rail supply chain in South Africa. Hence, the aim of the study was to investigate the connection between supply chain integration, resilience, and performance in the rail industry. To achieve the objectives of the study, a quantitative approach based on the positivist paradigm and deductive reasoning was followed. The sample consisted of 300 purposively selected supply chain management professionals including other departments working with supply chain, for example the industrial department and engineering department drawn from the rail industry in Gauteng Province. The collected data was analysed using descriptive statistics, exploratory factor analysis and structural equation modelling. The results of the study indicated significant positive relationships for the three components of supply chain integration, namely internal integration (β=0.132), supplier integration (β=0.369), customer integration (β=0.596) and supply chain resilience. Among these three independent constructs, customer integration emerged as the most significant predictor of supply chain resilience. Significant and strong positive relationships were also observed between supply chain resilience and the tangible (β=0.781) and intangible (β=0.673) dimensions of supply chain performance. Among other things, the study recommends the training of professionals on the importance of supply chain integration, improvement of communications within the rail industry, adoption of relevant technologies and the nurturing of organisational cultures that promote both intra and inter-organisational collaboration. The study is significant in that it contributes new knowledge to the exiting literature in the South African rail industry. It also directs supply chain management research to the rail industry, which is an important economic sector and where there are many emerging issues that require empirical attention. Practically, the study shows that if rail industries improve supply chain integration there will be benefits to the firm in the form of enhanced resilience and performance of the supply chain.