Organisational culture as the antecedent of supply chain collaboration and its relationship with competitive advantage Open Access

Although supply chain collaboration has received considerable research attention in recent years with its impact on firm performance being a popularly aspect (Zhang and Huo, 2013; Ralston et al., 2015; Cai et al., 2016; Panahifar et al., 2018), it remains not thoroughly understood.

First, while some studies (Zhang and Huo, 2013; Ralston et al., 2015) found a positive relationship between supply chain collaboration and firm performance, others (Flynn et al., 2010; Wiengarten et al., 2019) concluded mixed findings or documenting a non-linear relationship (Zhao et al., 2015). Additionally, limited research has delved into the relationship between supply chain collaboration and firm’s competitive advantage (Liao et al., 2017), particularly regarding cost and differentiation.

Secondly, the existing literature has investigated the individual impacts of organisational culture on supply chain collaboration or firm performance. However, a notable inconsistency persists in previous studies regarding the relationship between organisational culture and supply chain collaboration. For instance, research utilising the Competing Value Framework (CVF) proposed by Quinn and Rohrbaugh (1983) yielded conflicting findings –some studies suggesting a positive correlation between development and group culture with all three dimensions of supply chain collaboration (Cao et al., 2015; Porter, 2019), while others have indicated that group culture has no impact on supply chain collaboration practices (Braunscheidel et al., 2010; Taha et al., 2022). This discrepancy underscores the need for further investigation into how different types of organisational culture influence supply chain collaboration and ultimately contribute to competitive advantage. Given that Vietnamese culture is rooted in Confucian values emphasising hierarchy with power distances (Nguyen et al., 2010, 2024; Nguyen, 2016), it would provide more insight to examine whether group and development culture types, which are not normally rooted in the Vietnamese culture, would still influence supply chain collaboration, as this research was conducted in the context of the garment industry in Vietnam.

Thirdly, although several studies were conducted to address the issues of supply chain collaboration in the garment industry in different locations (i.e. Vanathi and Swamynathan (2014) and Bari and Park-Poaps (2020) who studied the impact of supply chain collaboration on competitive advantage in India and Bangladesh; Phan et al. (2020) who examined the impact of supply chain integration on supply chain performance in Vietnam; and Ramanathan and Gunasekaran (2014) who investigated the effect of supply chain collaboration on the success of collaboration and future collaboration of a leading textile manufacturer in India, these studies did not delve into the aspect of internal collaboration as a dimension of supply chain collaboration or explore organisational culture as an antecedent of supply chain collaboration.

The above mentioned three gaps reflect the lack of relevant studies in the literature on the linkage between organisational culture and supply chain collaboration, and how this relation will affect a firm competitive advantage. As a result, there have been calls for future research in this respect by Liao et al. (2017), Maestrini et al. (2018), Wiengarten et al. (2019), and Benton et al. (2020). Therefore, a study on this topic will enhance existing knowledge in the field both in terms of theoretical and practical contributions.

In relation to supply chain competitiveness, cost leadership and differentiation were discussed comprehensively in the existing literature since the early days, showing the relation between supply chain collaboration and performance (Lawrence and Lorsch, 1967; Porter, 1985; Hill, 1988). In the garment industry in developing countries, cost and differentiation are recognised as the key factor of supply chain collaboration outcome, differentiating manufactures from their competitors (Um and Kim, 2019; Swazan and Das, 2022). Therefore, cost and differentiation are the leading-based competitive advantages in the context of developing countries. They were selected for this study to examine the relationship between organisational culture, supply chain collaboration, and competitive advantages. The study answers the following research questions:

To answer these questions, the study employed Organisational Culture Theory and Relational View Theory to shed light on the role of organisational culture in supply chain collaboration and competitive advantage. This study differentiates itself from others in the domain of organisational culture and supply chain collaboration by examining how group and development cultures, which are rarely examined in the literature, can enhance supply chain collaboration. The investigation of both internal and external dimensions of supply chain collaboration is also examined in this study, providing a nuanced understanding of its dynamics. Another contribution of this study lies in the examination of how supply chain collaboration may affect a firm’s competitive advantage, adding to the existing knowledge on the effects of supply chain collaboration on firm performance, which is popularly revisited in the literature.

The remainder of the paper is structured as follows. First, Section 2 provides the review of existing literature, conceptual framework, and development of hypotheses. The research context is introduced in Section 3, followed by the research methodology in Section 4. Then, Section 5 covers the analysis and findings while Section 6 provides the discussion. Academic and practical implications are discussed in Section 7. The paper concludes with limitations and future research in Section 8.

Organisational culture refers to a shared norms, values and assumptions within an organisation (Schein, 1992) or “the way we do things around here” (Deal and Kennedy, 1982, p. 60). This research utilized the CVF (Competing Values Framework) to analyse organisational culture, as the framework has been widely used and substantially validated in numerous studies (Cao et al., 2015; Porter, 2019; Hong et al., 2020; Rizzi et al., 2022; Taha et al., 2022). Accordingly, the framework encompasses four cultural types: development, group, hierarchy, and rational. Development culture focuses on innovation, growth, and dynamism. It encourages members to embrace new ideas and provides opportunities for self-development. Group culture prioritises stability. It emphasises tradition, teamwork, loyalty, common goals, commitment, and participation among its members. Hierarchy culture emphasizes structure, order, and established procedures. This focus on stability and predictability which aims to enhance productivity, efficiency, and product reliability. Finally, rational culture focuses on external transactions and emphasises achieving goals and maximising efficiency.

Most previous studies focused on hierarchy and rational cultures, in which it was found that the former is negatively related to both internal and customer collaboration (Cao et al., 2015) or financial performance (Fekete and Bocskei, 2011), while the latter has an insignificant impact on external collaboration (Cao et al., 2015). Therefore, this study seeks to enrich the extant literature by concentrating on the remaining two types: development and group cultures.

Sharing cultural similarities with other Asian countries, the Vietnamese value systems are, to some extent, influenced by Confucian philosophy (Nguyen et al., 2010, 2024). The power distance dimension indicates that society endorses the existence of authority, power differences, status-based privilege, and social inequality. Power is not expected to be equally divided but is viewed as a means of maintaining social other and stability (GLOBE, 2020).Supply chain collaboration.

In the field of supply chain management, the terms “partnership”, “coordination”, “cooperation”, “collaboration”, and “integration” are frequently used interchangeably (Chang et al., 2016). Nevertheless, it is noted that “collaboration goes beyond integration by including long-term commitments to technology sharing and closely integrated planning and control systems” (Harrison et al., 2014, p. 326).

A narrative review of the existing literature shows that supply chain collaboration practices are typically classified based on either activities or dimensions (Tran et al., 2023). Prior studies commonly analysed four main mechanisms for collaboration based on the activities involved in the relationship: information sharing, goal congruence, decision synchronisation, and incentive alignment (Zhang and Cao, 2018; Um and Kim, 2019; Huang et al., 2020). In terms of dimensions, supply chain collaboration encompasses internal and external (i.e. supplier and customer) collaborations (Porter, 2019; Shukor et al., 2021; Taha et al., 2022; Zhou et al., 2023).

Many studies on supply chain collaboration in the literature explore the external collaboration activities between participating firms, such as supplier and customer collaborations. However, there is a limited amount of research on internal collaboration among the functional departments within a firm. Given the importance of internal relationships within a firm, this research investigates supply chain collaboration from the perspective of internal, supplier and customer collaborations.

Internal collaboration refers to the relationship between functional departments within the organisation. This practice includes facilitating various functional units working together in teams, making conflict-solving decisions, and sharing resources and information to obtain a better outcome. Internal collaboration is often indicated by sharing operational information among departments (Yunus and Tadisina, 2016; Shukor et al., 2021), joint planning (Ganbold and Matsui, 2017), understanding mutual responsibilities and regular meetings among internal functions (Yunus and Tadisina, 2016; Hendijani and Norouzi, 2023). Internal integration has been analysed in various contexts, including container shipping lines in Singapore (Thai and Jie, 2018), the hotel sector in Egyptian cities (Taha et al., 2022), and pharmaceutical companies in Jordan (Alzoubi et al., 2020). Most recently, Hendijani and Norouzi (2023) investigated internal integration in Iran’s food industry during the COVID-19 pandemic.

Supplier collaboration refers to the collaboration and sharing of operational, financial, and strategic knowledge between a buying firm and its suppliers. For example, sharing operational information with suppliers could involve demand forecasts, production plans, delivery status, and inventory levels (Shou et al., 2018; Chaudhuri et al., 2018). In addition, joint planning with suppliers could be established in terms of decision-making in quality improvement, process design, and cost control (Shou et al., 2018; Chaudhuri et al., 2018), and collaborative approaches can be developed in areas such as risk/revenue -sharing and long-term agreements with key suppliers (Shou et al., 2018; Chaudhuri et al., 2018). Many researchers have investigated supplier collaboration. For instance, Shou et al. (2018) delved into supplier integration, gathering data at the plant level across more than 20 countries. Porter (2019) investigated supplier collaboration, collecting data from supply chain professionals and procurement specialists in various companies throughout the United States.

Customer collaboration refers to the collaboration and sharing of operational, financial, and strategic knowledge between a buying firm and its customers. Sharing of operational information is one of the most common indicators of customer collaboration (Chaudhuri et al., 2018; Shou et al., 2018; Thai and Jie, 2018). Specifically, manufacturing firms share operational information with major customers about market information (Ganbold and Matsui, 2017; Nguyen, 2022), inventory levels (Ganbold and Matsui, 2017), production plans (Shukor et al., 2021), and logistics status (Nguyen, 2022). Customer collaboration is additionally achieved by joint planning in product design, production process, and quality improvement (Chaudhuri et al., 2018; Shou et al., 2018). Customer collaboration has attracted the attention of many studies recently. For example, Birasnav and Bienstock (2019) provided insights into customer integration in small manufacturing companies based in the Indian State of Tamil Nadu. Shukor et al. (2021) investigated customer integration in Malaysia’s service and manufacturing industries. Recently, Zhou et al. (2023) examined the customer collaboration efforts of third-party logistics firms in China.

Competitive advantage refers to the organisation’s ability to establish a defensible position in comparison to its competitors (Porter, 1985). Since the publication of Porter’s Competitive Strategy in 1980, the generic strategies of Cost Leadership, Differentiation and Focus have been widely adopted (Stonehouse and Snowdon, 2007). A firm pursuing a cost leadership strategy must become the lowest-cost producer, allowing it to earn above-average profits even when charging a price that is not higher than the industry average. A differentiation strategy aims to establish a customer perception that the firm’s product or services are superior to those of competitors, enabling the company to command a premium price from customers. This is achieved by brand, quality, and performance. The focus strategy, also known as targeting a niche market, is closely related to both cost and differentiation, in that “firms can create value for customers in specific and unique market segments by using the focused cost leadership strategy or the focused differentiation strategy” (Hitt et al., 2019, p. 126). Hence, “focus” refers to a niche market segment rather than a separate competition strategy. Previous research has identified six dimensions of competitive advantage: price/cost, quality, delivery speed, product innovation, time to market, and process flexibility (Liao et al., 2017; Teng et al., 2022). These dimensions represent either the cost leadership or differentiation aspects of competitive advantage (Porter, 1985; Demeter et al., 2016). Additionally, empirical evidence regarding the relationship between cost competitive advantage and differentiation competitive advantage is still lacking. Therefore, this research examined cost and differentiation as two aspects of competitive advantage.

Organisational culture is identified as a unique pattern of norms, values, beliefs and ways of behaving that characterise how groups and individuals come together to get things done (Fareed et al., 2016). Once staff become familiar with an organisation’s culture, the work environment becomes more enjoyable, leading to improved morale, teamwork, information sharing and openness to new ideas (Goffee and Jones, 1996). Detert et al. (2000) investigated the link between organisational culture and the implementation of new behaviours and practices, vividly noting this relationship as “organisations practice X because their culture is to practice X” (Detert et al., 2000, p. 853). Therefore, the potential impact of organisational culture on how a firm’s collaboration practices, both internally and externally, are conducted can be underpinned by this theory.

Meanwhile, this study also delves into the correlation between supply chain collaboration and firm’s competitive advantage. Given that supply chain collaboration encompasses the connections between various functional units within a firm, as well as between a firm and its suppliers and customers, the Relational View (RV) is appropriate in explaining the conceptual link between these relationships as intangible resources and a firm’s performance including its competitive advantages. RV is an extension of the Resource-Based View which suggests that the deployment of organisational resources, including intangibles such as relationships, may lead to superior firm performance (Dyer and Singh, 1998). It posits that assets specific to relationships, routines for sharing partner-specific knowledge, complementarity of partner resources, and effective governance structures positively contribute to a firm’s performance. This theory was also used in previous studies to explain the link between internal and external relationships and performance (Wiengarten et al., 2019; Um and Kim, 2019; Zhang et al., 2021). Therefore, in this research, the RV theory lends theoretical support to the role of both internal and external collaborations as a means to leverage complementary capabilities to achieve competitive advantages.

A conceptual framework was developed based on the theories and literature review to assess how organisational culture impacts supply chain collaboration and its resulting effects on competitive advantage, as shown in Figure 1. Further explanation about hypotheses can be found in the hypotheses development section.

Organisational culture refers to the shared values and beliefs of a company (Cao et al., 2015; Oh and Han, 2020). Based on this definition, organisational culture plays a crucial role in shaping the members’ behaviour, which impacts supply chain collaboration. Companies with a group culture emphasise the importance of values, traditions, teamwork, loyalty, shared objectives, dedication, and member involvement of members within the organisation (Cameron and Quinn, 2011). Meanwhile, a development culture focuses on creativity, growth, dynamism, and innovation.

The positive relationship between these types of organisational culture and supply chain collaboration has been investigated. For example, Schilke and Cook (2015) indicated that firms with a dominant group culture are more likely to gain trustworthiness of the alliance partners in Germany. Besides, Lee et al. (2016) found that group culture positively related to software process improvement knowledge sharing in Taiwanese organisations. Furthermore, Panuwatwanich and Nguyen (2017) discovered that firms dominated by group culture exhibit favourable conditions for the successful implementation of total quality management in Vietnamese construction firms. Regarding development culture, it is found that development culture positively related to external collaboration (Braunscheidel et al., 2010; Cao et al., 2015) and internal collaboration (Cao et al., 2015; Taha et al., 2022). For instance, Cao et al. (2015) revealed a positive relationship between group culture and all three dimensions of supply chain integration using data collected from manufacturers in ten countries. Taha et al. (2022) demonstrated that development culture positively had impact on internal and customer collaboration in the hotel industry of Egypt. Moreover, the prospective impact of various organisational factors, including organisational culture, on how a firm’s internal and external collaborations are conducted can be underpinned by the OCT. Thus, it is expected that organisational culture related to group and development types has a positive effect on supply chain collaboration, given that firms operate in Confucian national culture which is characterised by power distance. Therefore, the following hypothesis is put forward:

Internal collaboration involves understanding mutual responsibility and joint planning to solve operational problems among functional departments to achieve common goals (Zhao et al., 2013). Internal collaboration helps functional departments to eliminate non-value-added activities in their processes by understanding mutual responsibilities. For instance, by sharing operational information, departments can gain a comprehensive view of material and product availability, effectively preventing stock-outs and ensuring replenishment. As departments work cohesively, they can streamline their workflows, leading to quicker responses to changes in delivery requirements than those of competitors. In the existing literature, internal integration is shown to be positively associated with growth in profit, growth in market share, and growth in the sales of container shipping lines in Singapore (Thai and Jie, 2018), and various companies throughout the United States (Porter, 2019). Danese et al. (2013) found that internal collaboration positively influences on responsiveness, as indicated by on-time delivery, fast delivery, flexibility to change product mix, and flexibility to change volume in manufacturing plants located in different countries. In addition, Alzoubi et al. (2020) showed that internal collaboration has a positive direct effect on competitive priorities at pharmaceutical companies in Jordan. Most recently, using a sample of 94 companies in the food industry in Iran, Hendijani and Norouzi (2023) found that internal integration led to better financial performance and operational performance than those of competitors during the COVID-19 pandemic.

Meanwhile, external collaboration is often indicated by sharing operational information, joint planning, and collaborative problem-solving with suppliers and customers (Zhao et al., 2013). Consequently, supply chain collaboration can contribute to competitive advantage by providing accurate and updated demand and supply information, production plans, and future directions (Schoenherr and Swink, 2012). Vanathi and Swamynathan (2014) indicated the positive relationship between supply chain collaboration and competitive advantage in the context of the textile industry in India. Liao et al. (2017) showed that the greater the collaboration between supply chain partners, the greater the firm’s competitive advantage that can be obtained in Taiwan’s networking communication industry. Moreover, the role of internal collaboration and external collaboration, as the means to exploit complementary capabilities to achieve a competitive advantage, is supported by the RV. Therefore, the following hypotheses are posited:

Cost leadership and differentiation have been discussed comprehensively in the existing literature since the early days (Lawrence and Lorsch, 1967; Porter, 1985; Hill, 1988). Several studies have examined the link between supply chain collaboration and operational performance, indicated by cost and differentiation. For instance, Demeter et al. (2016) revealed that external integration fully mediates the positive impact of internal integration on operational performance. Um and Kim (2019) discovered that the performance of Korean manufacturing firms, assessed in terms of cost, quality, speed, and flexibility, is an outcome of supply chain collaboration. However, there remains a gap in empirical evidence regarding the relationship between cost competitive advantage and differentiation competitive advantage.

Cost is recognised as the most important factor for garment firms in Bangladesh, as indicated by Swazan and Das (2022). Employing a low-cost strategy has proven to be a key commercial success, particularly in sectors characterised by low profit margins, such as commodities (Howard et al., 2019; Swazan and Das, 2022). By implementing this cost-effective strategy, manufacturing firms can attract more clients, differentiating them from their competitors. Thus, the following hypothesis is proposed:

Table 1 presents the constructs and their dimensions investigated in this study.

Vietnam is the fourth largest exporter of clothing globally (WTO, 2022). The garment industry accounts for approximately 15% of Vietnam’s GDP, with an annual growth rate of 17% (Phan et al., 2020). In addition, with a workforce exceeding three million, the textile and garment industry plays a vital role in employment (VITAS, 2022). However, most Vietnamese companies are primarily involved in the manufacturing stage, which has low value-added and high unit costs in the apparel commodity chain (Lopez-Acevedo and Robertson, 2016). Most Vietnamese garment companies (65%) engage in “Cut-Make-Trim” (CMT) contracts, followed by Free on Board (FOB) at 25%, leaving Original Design Manufacturing and Original Brand Manufacturing with minimal shares (Le, 2019). CMT offers the lowest added value as manufacturers only handle production stages, relying on clients for all inputs. In contrast, FOB manufacturers procure their own materials and manage the entire production and packaging process (Frederick and Daly, 2019).

Supply chain collaboration in the garment industry is essential due to its complex and intricate supply chain structure (Lopez-Acevedo and Robertson, 2016), in which numerous intermediaries exist between fibre producers and consumers, requiring extensive collaboration for smooth operations. In Vietnam context, over 70% of input materials for Vietnam’s garment industry are sourced from China, Taiwan, and Korea (VITAS, 2022). Vietnamese garment companies primarily export to USA (49%), EU (10%), and Japan (9%) (VITAS, 2022). The public media frequently highlights the issues of inadequate or insufficient connections among supply chain partners (Trang, 2020). Therefore, collaboration with suppliers and customers is suggested as a solution for the success of Vietnam’s garment industry (Pham et al., 2020; VITAS, 2022; Tran et al., 2023).

Additionally, the garment industry in Vietnam relies heavily on manual, labour-intensive production processes. As a key production factor, reducing the costs associated with labour could help enhance firm’s competitive advantage (Trang, 2020). Also, the Vietnamese culture, like some other East and South Asian societies, is influenced by Confucian values that emphasise hierarchical structures (Nguyen et al., 2010, 2024; Nguyen, 2016), which should be considered when investigating supply chain collaboration, in view of organisational culture in terms of development and group types, in relation with competitive advantage.

Given the aforesaid background, this study therefore examines organisational culture regarding group and development types as an antecedent of supply chain collaboration in the Vietnam’ garment industry, and its resulting effects on firm’s competitive advantage.

In this study, survey research was used to explain the relationships among variables in the conceptual model. Survey research, described as the process of collecting information from a sample of individuals based on their responses to questions (Check and Schutt, 2011), is widely recognised across many disciplines. This method allows for the collection of standardised data from a relatively large and geographically scattered population in a highly economical manner (Quinlan et al., 2015). It is a useful approach that offers clear advantages in describing and predicting phenomena and their relationships (Zikmund et al., 2013). Given that this research aimed to examine the antecedents and outcomes of supply chain collaboration, survey research was deemed an appropriate method.

The research population was garment manufacturers, as they are the main players in the garment supply chain in Vietnam. The unit of analysis of this study was the organisation. The sampling frame was compiled using information from the Vietnamese Textile and Garment Directory 2020, and various official websites, such as those of the Vietnamese Ministry of Industry and Trade, and the Vietnamese Ministry of Planning and Investment. The survey questionnaire was sent to the list of company emails with the link to the Qualtrics platform.

The measurements of constructs were developed based on the existing literature. These items were commonly mentioned in relation to the corresponding constructs across multiple studies. The construct of organisational culture includes development culture and group culture, with the measurement items derived from the studies of Braunscheidel et al. (2010), Pinho et al. (2014), Cao et al. (2015), Gambi et al. (2015), Schilke and Cook (2015), Lee et al. (2016), Porter (2019), Rizzi et al. (2022), and Taha et al. (2022). Supply chain collaboration involves internal and external collaboration, with measurement items adapted from Alfalla-Luque et al. (2015), Ralston et al. (2015), Shou et al. (2018), Thai and Jie (2018), Birasnav and Bienstock (2019), Porter (2019), Um and Kim (2019), Alzoubi et al. (2020), Shukor et al. (2021), Taha et al. (2022), Hendijani and Norouzi (2023), and Zhou et al. (2023). Meanwhile, competitive advantage is characterised by cost and differentiation dimensions, and the measurement items were adapted from Porter (1985), Danese et al. (2013), Jitpaiboon et al. (2013), Zhang and Huo (2013), Wong et al. (2015), Kumar (2018), Al-Doori (2019), Porter (2019), Um and Kim (2019), Alzoubi et al. (2020), Hendijani and Norouzi (2023), and Buranasiri et al. (2024). More information about the measurement items can be found in the Appendix.

Based on the conceptual framework, a survey questionnaire detailing each construct was designed. The questionnaire included four sections: demographic questions, organisational culture, supply chain collaboration, and competitive advantage. Demographic questions referred to participants’ organisation, job title, department, and years of experience in the company. The main sections comprised measurement items related to organisational culture, supply chain collaboration, and competitive advantage. The survey utilised a five-point Likert scale, where “1” indicated “Strongly disagree” and “5” represented “Strongly agree”. In addition, the survey instrument followed the forward-backward translation process (Brislin, 1970). This involved translating from English to Vietnamese, then back-translating into English and comparing with the original English version to ensure equivalence (Chen et al., 2010).

The questionnaire was then assessed by pre-test and pilot-test (Hair et al., 2018). The questionnaire was sent to four Vietnamese academics at the authors’ university and eight industry professionals in Vietnam for pre-testing. The invitation email for the pre-testing was delivered with the project synopsis, the Vietnamese version of the survey questionnaire, and the pre-test criteria. Following this, nine responses were received. The survey questionnaire was revised by incorporating several changes in the format and the wording of the questions.

A pilot test was then administered with participants whose profiles are similar to those of the target population so that items could be screened for appropriateness (Hair et al., 2018). The questionnaire was delivered to participants via the Qualtrics application. The pilot test was conducted with 35 participants purposely selected from the researcher’s professional network, all of whom are also included in the mailing list. The survey instrument was tested for internal consistency and reliability, indicating the extent to which a set of indicator variables produces steady and consistent results with alternative measures (Hair et al., 2019). Eventually, the final version of the questionnaire in Vietnamese was distributed to the potential participants using the Qualtrics platform.

Factor analysis was carried out to establish the internal consistency of the attribute combination by using SPSS 28.0. Confirmatory Factor Analysis (CFA) was subsequently employed to examine the convergent and discriminant validity of the constructs. The links between organisational culture, supply chain collaboration, and competitive advantage were analysed through structural equation modelling (SEM) in AMOS 28.0.

Of the 1,919 emails containing the Qualtrics application link that were sent to potential participants, 451 could not be delivered. Hence, the initial sample size was reduced to 1,468. Out of this group, 709 responses were received. Following investigation into issues such as missing data, outliers, straight-line error, non-normality, multicollinearity, and common method bias identified in the responses (Maier et al., 2023), a total of 192 usable ones remains for further analysis. The sample demographic consisted primarily of middle and senior managers at 57%, with staff marking up 36% of the participants, while the remaining did not specify their positions. Approximately half of the participants had over five years of experience in their respective companies. Most participants worked for departments associated with supply chain management, such as production (24%), sales and marketing (15%) and research and development (12%). The remains are human resource, purchase, finance, others, and not stated. Hence, it can be concluded that they are eligible to participate in this research.

The results of the measurement model are demonstrated in Table 2, which shows the factor loading value of items on their respective constructs. Several items were removed after carefully considering the factor loading values, ensuring the thematic meaning of the constructs was not affected, and the items’ relevance within the specific context. For instance, items SC3 and SC4 were removed, as most garment manufacturing firms in Vietnam engage in FOB and CMT processing contracts in which raw materials are provided by major customers and they do not work directly with major suppliers (Tran and Tran, 2018). The remained items have factor loading values above the threshold of 0.5 except three items being slightly below the cut-off value. Nevertheless, they were deemed essential to remain in the measurement model because of their theoretical importance (Birasnav and Bienstock, 2019). Besides, Cronbach’s alpha values for all constructs surpassed the threshold of 0.7 (Hair et al., 2018).

The KMO measure yielded a value of 0.801, falling within the expected range of 0.5–1 (Hair et al., 2010). Bartlett’s Test of Sphericity was significant with the Chi-square = 1609.011, df = 190 and Sig <0.001. Those results suggest that the sample size was sufficient for factor analysis.

CFA was conducted to assess the overall model fit, construct validity and reliability. In this study, supply chain collaboration and organisational culture were operationalised as a second-order factor. This approach is supported by both theoretical and methodological justifications. The theoretical argument for forming a second-order construct to measure supply chain collaboration is supported by the concept of collaboration that firms should collaborate both internally and externally (Porter, 2019; Shukor et al., 2021; Taha et al., 2022), and thus should be treated as a whole. This research intends to also examine the impact of supply chain collaboration as a whole, focusing on its impact on competitive advantage rather than disaggregating it into individual dimensions. Similarly, the construct of organisational culture was analysed at the second-order level involving group culture and development culture (Um and Kim, 2019; Munir et al., 2020). From a methodological perspective, the second-order model would be more parsimonious than the first-order model (Vanpoucke et al., 2014). Besides, the congeneric measurement models of organisational culture and supply chain collaboration were analysed at the first and second-order levels. After trying different models, the congeneric measurement model of organisational culture and supply chain collaboration at the second-order level obtained improved convergent and discriminant validity values.

The model fit was acceptable with Chi-square/df = 1.573; CFI = 0.939; RMSEA = 0.055, and PCLOSE = 0.265, according to the suggested threshold values (Hu and Bentler, 1999). The average variance extracted (AVE) score of each construct is higher than 0.50, and the construct reliability (CR) score exceeds 0.7. These findings suggest sufficient evidence that the convergent validity of the full measurement model was established (Hair et al., 2018). Furthermore, all items were strongly loaded (>0.7) on their respective factors, and the square root of the AVE value for each reflective construct was greater than its correlation with all other constructs (Table 3). These results confirmed the discriminant validity of the constructs.

SEM was employed to test the hypotheses. The model fit indices were acceptable with Chi-square/df = 1.692; CFI = 0.925; RMSEA = 0.060, and PCLOSE = 0.089, according to the suggested threshold values (Hu and Bentler, 1999). The SEM results with standardised coefficients for the significant paths are presented in Figure 2. Meanwhile, Table 4 presents the results of the hypothesis testing with statistical significance, indicating that organisational culture positively influences supply chain collaboration which, in turn, positively enhances both cost and differentiation competitive advantages. Meanwhile, differentiation competitive advantage is also positively influenced by that of cost nature.

This study found that organisational culture positively affects supply chain collaboration, with a statistical significance of β = 0.665, p < 0.001 (i.e. Hypothesis H1 is supported). The construct of organisational culture in factor analysis was examined in the second order, including development culture and group culture. First of all, this result implies that the dominant attributes of development culture, namely, entrepreneurship, creativity, and adaptability, would enhance supply chain collaboration. Indeed, firms that nurture these cultural aspects, which drive innovation, within their organisations tend to implement more internal and external collaboration practices than other organisations because the higher level of supply chain collaboration can enhance their innovation capability (Liao et al., 2021). This result supports previous studies’ finding that development culture is positively related to both internal integration (Cao et al., 2015; Taha et al., 2022) and external integration (Braunscheidel et al., 2010; Cao et al., 2015). For example, Cao et al. (2015) found a positive relationship between development culture and all three dimensions of supply chain integration, using data collected from manufacturers in ten countries. In addition, Taha et al. (2022) illustrated that development culture is positively related to internal and customer integration in the hotel sector in Egyptian cities. However, this challenges the finding that development culture is not significantly associated with supplier integration (Taha et al., 2022). One potential reason for this discrepancy is the type of industry being examined. It should be noted that the research of Taha et al. (2022) was conducted in the service sector, and hotel managers may not have developed a close relationship with the suppliers of outsourced activities. Therefore, the development culture and the degree of collaboration with suppliers in the service sector may differ from those in the manufacturing sector.

The second dimension of organisational culture is group culture (GC). The results of this study also revealed that group culture positively relates to supply chain collaboration. When employees feel comfortable sharing their thoughts, it becomes easier for them to discuss operational issues and make decisions collaboratively. Moreover, in an environment where employees feel their ideas are valued, they are likely to speak up about concerns and participate in joint planning. The finding is consistent with that of several previous studies. For example, Cao et al. (2015) showed the positive relationship between group culture and supply chain collaboration, using data collected from manufacturers across ten countries. Schilke and Cook (2015) found that group culture-dominant firms are more likely than others to gain the trust of alliance partners in Germany. Lee et al. (2016) and Panuwatwanich and Nguyen (2017) also revealed that organisations dominated by group culture have the greatest ability to successfully implement total quality management among Vietnamese construction firms. However, this finding challenges the notion that group culture does not impact (Braunscheidel et al., 2010; Taha et al., 2022). This inconsistency is likely due to the differences in national cultures (Chang et al., 2016).

There is a statistically significant positive relationship between supply chain collaboration and cost competitive advantage (β = 0.309, p < 0.1) (i.e. Hypothesis H2a is supported). This means that supply chain collaboration as a whole can enhance cost competitive advantage. This result is consistent with that of previous studies showing that supply chain collaboration positively impacts cost performance (Al-Doori, 2019; Porter, 2019; Um and Kim, 2019; Hendijani and Norouzi, 2023). A detailed discussion regarding the impact of each dimension of supply chain collaboration, that is, internal, supplier, and customer collaboration, on cost competitive advantage is presented below.

The first dimension of supply chain collaboration in the relationship with cost competitive advantage is internal collaboration. One plausible explanation for this result is that internal collaboration helps different functional departments within the firm eliminate non-value-added activities in their processes by understanding mutual responsibilities. It is likely that sharing information among departments fosters cost leadership. For instance, by sharing inventory information, departments may gain a comprehensive awareness of materials, product status, and availability, effectively preventing stock-outs and enabling timely replenishment. Moreover, sharing logistics data enables visibility into transportation schedules, routes, and capacity utilisation across departments, and by sharing information about supply and demand status, departments can make informed decisions on production planning, resource allocation, and inventory management. Therefore, these attributes can help with cost reduction. This finding is consistent with that of previous studies. For example, it was found that internal integration (as a dimension of supply chain integration) is positively associated with growth in profit, growth in market share, and growth in sales of container shipping lines in Singapore (Thai and Jie, 2018) and in various companies throughout the United States (Porter, 2019). In addition, Alzoubi et al. (2020) indicated that internal collaboration has a positive direct effect on cost competitive priority among pharmaceutical companies in Jordan. Most recently, Hendijani and Norouzi (2023) demonstrated that internal integration could improve financial performance compared to competitors during the COVID-19 pandemic, using a sample of 94 companies in Iran’s food industry.

The second dimension of supply chain collaboration in the relationship with cost competitive advantage is supplier collaboration. This positively significant impact can be explained in several ways. Input issues such as costs, quality, and quantity of raw materials are critical success factors for manufacturers. Manufacturing firms are likely to get adequate inputs by sharing their inventory level information. In addition, suppliers may inform manufacturers about the quality and quantity of materials in advance, allowing production managers to allocate suitable labour to minimise unit manufacturing costs. In addition, since the number of workers is then stable, the production costs are reduced, improving the product’s price. This finding broadly supports the finding obtained by previous studies that supplier collaboration positively impacts cost performance. For example, Kim and Chai (2016) showed that supplier collaboration is associated with the financial performance of manufacturing firms in the United States. Al-Doori (2019) found that information sharing and joint decision-making with suppliers, similar to the indicators of supplier collaboration in this study, positively affect the cost performance of automotive firms in Pakistan. Moreover, Alzoubi et al. (2020) indicated that supply chain integration, including supplier integration, has a positive direct effect on the cost competitive priority of pharmaceutical companies in Jordan.

Customer collaboration is the third dimension of supply chain collaboration that relates to cost competitive advantage. Customers will likely give long-term orders to manufacturers they trust, which means those manufacturers can reduce their set-up costs. Furthermore, the number of workers is then stable; therefore, the production costs can be reduced, resulting in a better product price. This finding is consistent with that of previous studies. For example, Zhang and Huo (2013) illustrated that customer integration can help companies achieve higher sales, profits and market share, based on a survey of 617 manufacturers in multiple industries in China. Additionally, Kumar (2018) pointed out that information sharing with customers on issues such as inventory status, order tracking, product development, and sales forecasting significantly impacts sales and profit and reduces the inventory costs and manufacturing costs of firms in India. Customer collaboration has been found to have a positive effect on the cost performance of Korean manufacturing firms across different industry sectors (Um and Kim, 2019), automotive firms in Pakistan (Al-Doori, 2019) and the cost competitive priorities of pharmaceutical firms in Jordan (Alzoubi et al., 2020).

The findings also support the hypothesis that supply chain collaboration positively affects differentiation competitive advantage (β = 0.635, p < 0.001) (i.e. Hypothesis H2b is supported). This means that supply chain collaboration as a whole can foster differentiation competitive advantage. This result broadly supports the findings obtained in previous studies (Al-Doori, 2019; Um and Kim, 2019; Swazan and Das, 2022; Hendijani and Norouzi, 2023; Buranasiri et al., 2024). The next paragraphs provide a comprehensive discussion of the effect of each dimension of supply chain collaboration, that is, internal, supplier, and customer collaboration, on differentiation competitive advantage.

First, the finding suggests that internal collaboration has a positive effect on gaining a competitive advantage by differentiation. There are various possible explanations for this outcome. By exchanging inventory information, departments can have a comprehensive understanding of material and product availability, effectively avoiding stock shortages and enabling prompt restocking, ultimately resulting in on-time deliveries. Moreover, understanding mutual responsibilities helps eliminate redundancies and inefficiencies in processes. As departments work cohesively, they can streamline their workflows, leading to quicker responses to changes in delivery requirements than those of their competitors. This result is consistent with that of previous studies. For example, Danese et al. (2013) found that internal collaboration positively influences responsiveness, indicated by on-time delivery, fast delivery, flexibility to change product mix, and flexibility to change volume, based on data from manufacturing plants in different countries. Most recently, using a sample of 94 companies in the food industry in Iran, Hendijani and Norouzi (2023) demonstrated that internal integration leads to better operational performance, including faster delivery speed and enhanced flexibility in volume, product mix, and new product offerings, compared to competitors, especially in pandemic conditions.

Supplier collaboration is the second dimension of supply chain collaboration that may impact differentiation competitive advantage. This result can be explained in several ways. First, supplier collaboration may foster differentiation competitive advantage in terms of on-time delivery. In the import-oriented supplier network in the garment industry, manufacturers face increasing uncertainties from upstream organisations. These uncertainties arise from transportation variations, duty fluctuations, weather conditions, and changes in the regulatory environment (Danese et al., 2013). In addition, complex procedures associated with international logistics can cause delays in getting input materials. Having suppliers involved in the planning of production schedules and inventory enables suppliers to adjust their operations accordingly. This can allow reduced lead time in the supply chain. Therefore, by updating the operational information and collaborative planning with suppliers, the manufacturers can get the materials on time, which, in turn, leads to the timelier delivery of customer orders compared with competitors. In addition, this finding agrees with the finding of previous studies that supplier collaboration can enhance differentiation competitive advantage regarding delivery. For example, supplier integration was found to have a positive effect on the production lead time manufacturing of firms the United States (Kim and Chai, 2016). Specifically, Kumar (2018) showed that information sharing with suppliers on issues such as inventory status, order tracking, product development, and sales forecasting can improve on-time delivery. In the same vein, Al-Doori (2019) observed a positive correlation between information sharing and joint planning with trading partners, including suppliers, and delivery speed as an aspect of the operational performance of automotive organisations in Pakistan. Second, supplier collaboration may result in differentiation competitive advantage in terms of flexibility. One possible explanation for this result is that sharing information with suppliers about customer demand foster a greater ability to customise products than competitors. Suppliers typically have specialised knowledge in their fields. They can leverage their expertise to create customised solutions when the manufacturing firm shares details about its customised needs, such as technical specifications and design preferences. This empowers the manufacturing firm to enhance its ability to customise products. Another plausible explanation for this finding can be found in the joint decision-making with suppliers. When suppliers are involved in the planning of production schedules and inventories, they can align their operations and make necessary adjustments, ensuring the manufacturing firms have the necessary input materials to change production volumes. This finding support for idea that supplier collaboration can increase flexibility. For instance, Danese et al. (2013) showed that supplier integration results in responsiveness in terms of flexibility to change product mix and volume. Kim and Chai (2016) illustrated that integration with suppliers positively affects the ability to respond to and accommodate periods of poor supplier performance for manufacturing firms in the United States. Similarly, it was found that supplier collaboration leads to improve firm performance, including flexibility, based on surveys of the automotive sector in Pakistan (Al-Doori, 2019) and manufacturing firms across different industry sectors in Korea (Um and Kim, 2019).

Meanwhile, customer collaboration may also be positively related to differentiation competitive advantage. This can be explained in two ways. First, customer collaboration may result in differentiation competitive advantage in terms of on-time delivery. Specifically, information sharing with customers can lead to on-time delivery. This may be because the primary focus of Vietnamese garment firms lies in overseas markets, specifically the United States, the European Union, and Japan (VITAS, 2022). Consequently, the intricate processes related to international trade may decrease the speed of deliveries. When customers are informed about the progress of their orders’ production and shipping, they can provide feedback and preferences, which can improve delivery performance. Furthermore, joint decision-making with customers fosters on-time delivery. Information about inventory level, labour, and processes is likely to be shared with customers or their representatives, allowing them to be involved in the decision-making process. By doing so, customers can address any potential issues and act proactively. For example, they might be willing to change delivery schedules or explore alternative options to maintain on-time delivery. This study confirmed the finding of previous studies that information sharing with customers can enhance differentiation competitive advantage in terms of delivery (Wiengarten et al., 2014; Kumar, 2018; Al-Doori, 2019). For example, Wiengarten et al. (2014) illustrated that sharing operational information with customers is positively associated with delivery performance, based on data from multiple countries. Kumar (2018) showed that information sharing with customers on issues such as inventory status, order tracking, product development, and sales forecasting significantly impacts delivery. In addition, Al-Doori (2019) concluded that there is a positive correlation between information sharing with customers and the delivery speed of automotive organisations in Pakistan.

Second, customer collaboration can lead to differentiation competitive advantage in terms of flexibility. Specifically, information sharing with customers can enhance flexibility. When customers share their preferences, requirements and feedback regarding product development, manufacturing firms can use this information to customise certain features or aspects of the product. This can help differentiate them from competitors who offer one-size-fits-all products. With customer demand forecasting, manufacturing firms can allocate resources, namely, labour and facilities, more efficiently, enabling them to adjust production volumes quickly. This finding aligns with that of previous research. For instance, Wiengarten et al. (2014) illustrated that sharing operational information with customers is positively associated with flexibility performance, indicated by volume flexibility, mix flexibility, and product customisation ability, using multi-country data. Additionally, Kumar (2018) showed that information sharing with customers on issues such as inventory status, order tracking, product development, and sales forecasting significantly impacts the responsiveness of Indian manufacturing organisations. Moreover, it was found that information sharing with customers positively affects the flexibility of automotive organisations in Pakistan (Al-Doori, 2019). Swazan and Das (2022) found that sharing technical knowledge between buyers and firm managers helps Bangladeshi garment firms improve their ability to manufacture large quantities.

Furthermore, joint decision making with customers can lead to better flexibility compared with competitors. When customers are actively involved in the product development process, they can provide valuable input and insights into product features. This ensures that the final product aligns closely with specific customer requirements. Moreover, customer involvement in new product development can result in innovative ideas that the manufacturer may not have considered. This innovation can lead to the introduction of new and diverse products. In addition, this result is consistent with multiple previous studies’ findings that customer collaboration has a positive impact on flexibility. For example, Danese et al. (2013) showed that customer integration positively relates to flexibility to change product mix and volume in an international context. In addition, Kim and Chai (2016) found that customer integration can improve the ability of manufacturing firms in the United States to respond to and accommodate periods of poor supplier performance. It was concluded that joint decision-making with trading partners, including customers, leads to flexibility as an aspect of the operational performance of automotive organisations in Pakistan (Al-Doori, 2019). Moreover, Um and Kim (2019) found that customer collaboration can enhance the flexibility of Korean manufacturing firms across different industry sectors.

The findings support Hypothesis H3 that cost competitive advantage positively affects differentiation competitive advantage (β = 0.179, p < 0.001). The statistical result means that cost competitive advantage may help to improve differentiation competitive advantage. Price advantage has been identified as the greatest competitive advantage of Bangladesh’s garment business (Swazan and Das, 2022). A low-price strategy leads to commercial success, especially in the commodities sector, which is associated with low profit margins (Howard et al., 2019; Swazan and Das, 2022). With a low-price strategy, manufacturing firms can attract more clients, differentiating them from their competitors. Cost leadership and differentiation were mentioned in the existing literature (Lawrence and Lorsch, 1967; Porter, 1985; Hill, 1988). However, there is still a lack of empirical evidence for the relationship between cost competitive advantage and differentiation competitive advantage. Many studies have investigated the impact of supply chain collaboration and operational performance associated with cost and differentiation (Demeter et al., 2016; Kim and Chai, 2016; Al-Doori, 2019; Um and Kim, 2019). For example, Demeter et al. (2016) found that external integration fully mediates the positive impact of internal integration on operational performance, as indicated by cost and differentiation in an international survey. Um and Kim (2019) found firm performance, which is measured by cost, quality, speed, and flexibility, to be an outcome of supply chain collaboration among Korean manufacturing firms. Moreover, Lee et al. (2015) found that cost and differentiation positively influence financial performance, based on a survey of 156 food-service franchise firms in Korea. However, the existing literature does not mention the relationship between cost and differentiation. Therefore, further research is needed to gain a comprehensive understanding of this correlation.

This study addressed several prevailing concerns within supply chain collaboration literature. Given previous studies’ mixed results and in response to the compelling call for future research on supply chain collaboration (Liao et al., 2017; Maestrini et al., 2018; Wiengarten et al., 2019; Benton et al., 2020), this study takes a distinctive approach by investigating the impact of organisational culture on supply chain collaboration. Thus, it strives to provide a comprehensive contribution to the existing body of knowledge regarding the antecedents of supply chain collaboration. First, similar to other Asian cultures, Vietnamese values are, to some extent, influenced by Confucian Asia culture (GLOBE, 2020), which is characterised by hierarchical relationships (Nguyen et al., 2010, 2024; Nguyen, 2016). The empirical evidence from this research indicates that group and development types of organisational culture are associated with supply chain collaboration. This is an interesting finding, indicating that firms operating in a Confucian-influenced culture, characterised by hierarchies, may also benefit from a “paradigm shift” towards implementing policies that support group and development culture types.

Second, the investigation of supply chain collaboration practices from both internal and external perspectives represents a noteworthy contribution of this research. While the existing literature has primarily focused on external collaboration activities with stakeholders, such as suppliers and customers, this research broadens its scope to include internal collaboration within an organisation’s functional departments. By considering both internal and external aspects of supply chain collaboration as a whole, this study provides a holistic understanding of supply chain collaboration practices.

Third, this research found that a high level of supply chain collaboration practices enhances firm’s competitive advantage regarding both cost and differentiation. While previous studies have predominantly examined the link between supply chain collaboration and operational performance, this research stands out as one of the few to directly delve into the impact of supply chain collaboration as an intangible resource on competitive advantage. This finding contributes to expanding the RV theory by highlighting that relationships through supply chain collaboration, enhanced by organisational culture, can also be valuable, rare and inimitable resources that positively contribute to creating competitive advantage apart from other forms of firm performance that have been already known in the literature.

Fourth, this study makes a significant contribution to the ongoing discourse on competitive advantage. Specifically, it empirically demonstrates that cost competitive advantage can enhance differentiation competitive advantage, thus expanding the current theoretical linkage between these two constructs. The key insight is that manufacturing firms prioritize cost reduction and then pass on those cost savings to their business partners, which in turn cultivates a competitive advantage in differentiation. This result challenges the conventional notion that cost reduction and differentiation strategies are inherently at odds (Porter, 1985). Importantly, these insights emerge within the specific context of the garment industry in Vietnam, characterised by low-profit margins, therefore adding another theoretical contribution relating to the context in which the aforesaid linkage may exist. Nevertheless, further research is required to determine whether similar findings hold in contexts with high-profit margins.

For garment firm’s managers and their business partners, this study reveals practical implications regarding supply chain collaboration. In the pursuit of successful supply chain collaboration, organisational culture emerges as a significant antecedent. This result underscores the paramount importance of sharping and nurturing organisational culture in collaboration endeavours. Therefore, this study recommends that firm managers focus on cultivating organisational culture, with particular emphasis on development and group culture. To implement this recommendation effectively, senior managers should engage in comprehensive leadership development efforts since effective management plays a foundational role in building organisational culture (Schein, 2010). It has been observed that three highly influential mechanisms for uniting and transforming culture involve actions taken by leaders: providing role models, teaching, and training; leader involvement in measurement and control; and how leaders respond to organisational incidents and crises. Managers should encourage, commit to and provide resources for team-building activities, such as annual outreach events or workshops. This can improve joint problem-solving abilities and mutual understanding between different departments and external partners.

The results underscore the importance for garment firm’s managers to recognize the crucial role of supply chain collaboration in gaining competitive advantage. This insight suggests that a multifaceted approach to supply chain collaboration is essential, encompassing both internal collaboration among functional departments within a firm, and external collaboration with suppliers and customers. In today’s business environment, competition is no longer between individual organisations, but between the entire supply chains (Wu et al., 2014; Teng et al., 2022). Therefore, it is essential for every member to collaborate within their respective supply chain to create mutual benefits. Firms should establish key performance indicators that measure collaboration, such as sharing operational information and understanding the mutual responsibility. Recognising and rewarding collaborative efforts can reinforce supply chain collaboration.

This study has demonstrated that the pursuit of cost competitive advantage can enhance differentiation competitive advantage within garment firms. The implications suggest a strategic focus on not only reducing costs and offering lower prices compared to competitors, but also channelling the resultant savings from cost-efficiency into developing flexibility features. For example, firms can use cost savings to invest in flexible production lines that accommodate customisation and enable rapid responses to customer demands. This approach enables manufacturing firms to cultivate distinctive attributes that set them apart from their industry counterparts.

This research aims to examine how the organisational culture influences supply chain collaboration and competitive advantage in Vietnam’s garment industry. The results indicate a significant correlation between organisational culture related to group and development types and supply chain collaboration. The results of this research reveal that supply chain collaboration has a positive effect on competitive advantage in terms of both cost and differentiation. Notably, it was also found that cost competitive advantage has a significant positive effect on differentiation competitive advantage.

Some limitations of this study should be addressed by future research. First, this study discovered that cost competitive advantage could enhance differentiation competitive advantage. Nevertheless, it is essential to acknowledge that this finding is specific to the garment industry in Vietnam, which is known for its low-profit margins. Future research could unravel whether the observed relationship between cost competitive advantage and differentiation competitive advantage remains consistent in industries and countries with different economic conditions. Exploring these aspects would offer researchers a thorough understanding of how competitive advantages operate across various business landscapes, contributing to an enhanced comprehension of these pivotal concepts. Furthermore, this research primarily focused on data collected from the focal firms only. Therefore, gathering extensive data from dyadic relationships - including their suppliers and customers - could provide a deeper understanding of how organisational culture influences collaboration and competitive advantage.

This paper forms part of a special section “International Symposium on Logistics (ISL) 2023 “Managing Supply Chains during Geopolitical Turbulence””, guest edited by Christos Braziotis, Ajeseun Jimo, Engin Topan.