Drivers for the Willingness of Small and Medium Enterprise in Implementing Halal Supply Chain Management

  • Abstract
  • Keywords
  • References
  • PDF
  • Abstract

    This study investigates the role of consumer concern, supplier readiness, and government initiative in determining the willingness of halal SME to deploy halal SCM.  The hypotheses were assessed by using mail survey conducted in Malaysia in 2017. The empirical data use 172 data obtained from small and medium enterprise. Reliability and validity of the item is assessed through Cronbach alpha and factor analysis. To test the hypotheses, structural equation modelling by partial least square was adopted. The study finds that consumer concern plays a crucial role in determining the willingness to implement halal SCM. The supplier readiness can play important role in influencing halal SME to implement halal SCM. Finally, this study revealed that the important of government initiatives is significantly influenced halal SME to implement halal SCM in the operational activity.  




  • Keywords

    Halal; halal management; halal supply chain management; Malaysia; small and medium enterprise.

  • References

      [1] Zailani S, Kanapathy K, Iranmesh M & Tieman M (2015), Drivers of halal orientation strategy among halal food firms. Br. Food J. 117(8), 148–163.

      [2] Rahman RA, Rezai G, Mohamed Z, Shamsudin MN & Sharifuddin J (2013), Malaysia as Global Halal Hub : OIC Food Manufacturers’ Perspective. J. Int. Food Agribus. Mark. 25, 154–166.

      [3] Tieman M (2013), Consumer perception on halal meat logistics. Br. Food J. 115(8), 1112–1129.

      [4] Tieman M & Ghazali M (2013), Principles in halal purchasing. J. Islam. Mark. 4(3), 281–293.

      [5] Ahmed A, (2008), Marketing of halal meat in the United Kingdom: Supermarkets versus local shops. Br. Food J. 110(7), 655–670.

      [6] Bonne K & Verbeke W (2008), Muslim consumer trust in halal meat status and control in Belgium. Meat Sci. 79(1), 113–123.

      [7] Muhamed AA, Rahman MNA, Hamzah FM, & Zain CRC (2017), An investigation towards consumer intention to purchase halal financing product and services using theory of planned behaviour. Adv. Sci. Lett. 23(9).

      [8] Vachon S & Klassen RD (2008), Environmental management and manufacturing performance: The role of collaboration in the supply chain. Int. J. Prod. Econ.111(2), 299–315.

      [9] Talib MSA & Hamid ABA (2014), Halal logistics in Malaysia: a SWOT analysis. J. Islam. Mark. 5(3), 322–343.

      [10] O’Regan N & Ghobadian A (2005), Innovation in SMEs: the impact of strategic orientation and environmental perceptions. Int. J. Product. Perform. Manag. 54(2), 81–97.

      [11] Schulze-Ehlers B, Steffen N, Busch G, & Spiller A (2014), Supply chain orientation in SMEs as an attitudinal construct. Supply Chain Manag. An Int. J. 19(4), 395–412.

      [12] Zakaria Z (2008), Tapping Into the World Halal Market : Some Discussions on Malaysian Laws. Shariah J. 16, 603–616.

      [13] Miocevic D & Crnjak-Karanovic B (2012), The mediating role of key supplier relationship management practices on supply chain orientation-The organizational buying effectiveness link. Ind. Mark. Manag. 41(1), 115–124.

      [14] Bali O, Kose E, & Gumus S (2013), Green supplier selection based on IFS and GRA. Grey Syst. Theory Appl. 3, 158–176.

      [15] Carr AS & Pearson JN (1999), Strategically managed buyer-supplier relationships and performance outcomes. J. Oper. Manag. 17(5), 497–519.

      [16] Manzouri M, Ab-Rahman M, Zain C, & Jamsari E (2014) Increasing Production and Eliminating Waste through Lean Tools and Techniques for Halal Food Companies. Sustainability 6(12), 9179–9204.

      [17] Poniman D, Purchase S, & Sneddon J (2015), Tracebility system in the Western Australia halal food supply chain. Asia Pacific J. Mark. Logist. 27(2), 324–348.

      [18] Karia N & Wong CY (2012), The impact of logistics resources on the performance of Malaysian logistics service providers. Prod. Plan. Control July 2014, 1–18.

      [19] Signori P, Flint DJ, & Golicic S (2015), Toward sustainable supply chain orientation (SSCO): mapping managerial perspectives. Int. J. Phys. Distrib. Logist. Manag. 45(6), 536–564.

      [20] Nasir M, Norman A, Fauzi S, & Azmi M (2011), An RFID-based validation system for Halal Food. Int. Arab J. Inf. Technol., 8(2), 204–211.

      [21] Sarac A, Absi N, & Peres SD (2015), Impacts of RFID technologies on supply chains : a simulation study of a three-level supply chain subject to shrinkage and delivery errors. Eur. J. Ind. Eng. 9(1), 27–52.

      [22] Hernandez MIS & Miranda FJ (2011), Linking internal market orientation and new service performance. Eur. J. Innov. Manag. 14(2), 207–226.

      [23] Moorthy MK, Yacob P, Chelliah MK, & Arokiasamy L (2012), Drivers for Malaysian SMEs to Go Green. Int. J. Acad. Res. Bus. Soc. Sci. 2(9), 74–86.

      [24] Polit DF & Beck CT (2012), Nursing Research: generating and assesing evidence for nursing practice, 34.

      [25] Lee S (2008), Drivers for the participation of small and medium-sized suppliers in green supply chain initiatives. Supply Chain Manag. An Int. J. 13(3),185–198.

      [26] Bansal P (2005), Evolving sustainably: A longitudinal study of corporate sustainable development. Strateg. Manag. J. 26(3), 197–218.

      [27] Prahinski C & Benton WC (2002), Supplier Performance Evaluations in the Supply Chain. in Proceedings - Annual Meeting of the Decision Sciences Institute.

      [28] Kumar D & Rahman Z (2015), Sustainability adoption through buyer supplier relationship across supply chain: A literature review and conceptual framework, 3(1–2) Holy Spirit University of Kaslik.

      [29] Sarstedt M, Hair JF, Ringle CM, Thiele KO, & Gudergan SP (2016), Estimation issues with PLS and CBSEM: Where the bias lies!. J. Bus. Res. 69(10), 3998–4010.

      [30] Hair JF, Black W, Babin B, & Andersson R. Multivariate Data Analysis 7th Edition. Upper Saddle River, New Jersey: Prentice Hall; (2009).

      [31] Hair JF, Sarstedt M, Ringle CM, & Mena J (2011), An assessment of the use of partial least squares structural equation modeling in marketing research. J. Acad. Mark. Sci. 40(3), 414–433.

      [32] Hinkin TR, Tracey JB, & Enz CA (1997), Scale construction: Developing reliable and valid measurement instruments. J. Hosp. Tour. Res. 21(1), 100–120.

      [33] Osburn HG (2000), Coefficient alpha and related internal consistency reliability coefficients. Psychol. Methods 5(3), 343–355.

      [34] Likert R (1932), A Technique for the Measurement of Attitudes Archives of Psychology. Arch. Psychol. 140(140), 1–55.

      [35] Chen J, Ching RKH, & Tsou HT (2009), Multi-channel store image and the effects on purchase intention. Serv. Ind. J. 29(9), 1215–1230.

      [36] Grimm P, Pretesting a questionnaire, Wiley Int. Encycl. Mark., (2010).

      [37] Pura M (2005), Linking perceived value of and loyalty to mobile services. Manag. Serv. Qual. An Int. J. 15(6),509–538.

      [38] Polit DF & Beck CT (2006), The Content Validity Index : Are You Sure You Know What ’ s Being Reported ? Critique and Recommendations. Res. Nurs. Health 29, 489–497.

      [39] Astrachan CB, Patel VK, & Wanzenried G (2014), A comparative study of CB-SEM and PLS-SEM for theory development in family firm research. J. Fam. Bus. Strateg. 5(1), 116–128.

      [40] Xiaosong D & Lai F (2012), Using partial least squares in operations management research : A practical guideline and summary of past research. J. Oper. Manag. 30(6), 467–480.

      [41] Hulland J (1999), Use of partial least squares (PLS) in strategic management research: a review of four recent studies. Strateg. Manag. J. 20(2), 195–204.

      [42] Hair JF, Sarstedt M, Pieper TM, & Ringle CM (2012), The Use of Partial Least Squares Structural Equation Modeling in Strategic Management Research: A Review of Past Practices and Recommendations for Future Applications. Long Range Plann. 45(5–6), 320–340.

      [43] Yong AG & Pearce S (2013), A Beginner’s Guide to Factor Analysis: Focusing on Exploratory Factor Analysis. Tutor. Quant. Methods Psychol. 9(2),79–94.

      [44] Williams LJ, Vandenberg RJ, & Edwards JR (2009), 12 Structural Equation Modeling in Management Research: A Guide for Improved Analysis. Acad. Manag. Ann. 3(1), 543–604.

      [45] Hair JF, Hult GT, Ringle C, & Sarstedt M (2014), A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM), 46, (1–2).

      [46] Garver MS & Mentzer JT (1999), Logistics research methods: employing structural equation modeling to test for construct validity. J. Bus. Logist. 20(1), 33–57.

      [47] Peterson RA (2000), A Meta-Analysis of Variance Accounted for and Factor Loadings in Exploratory Factor Analysis. Mark. Lett. 11(3), 261–275.

      [48] Bagozzi RP & Phillips LW (1982), Representing and Testing Organizational Theories: A Holistic Construal. Adm. Sci. Q. 27(3), 459.

      [49] Nunnally JC & Bernstein IH, Psychometric Theory. McGraw-Hill, Inc, (1994).

      [50] Fornell C & Larcker DF (1981), Evaluating Structural Equation Models with Unobservable Variables and Measurement Error. J. Mark. Res. 18(1), 39–50.

      [51] Henseler J, Ringle CM, & Sarstedt M (2014), A new criterion for assessing discriminant validity in variance-based structural equation modeling. J. Acad. Mark. Sci. 43(1), 115–135.

      [52] Christmann A & Van Aelst S (2006), Robust estimation of Cronbach’s alpha. J. Multivar. Anal. 97(7), 1660–1674.

      [53] Henseler J, Hubona G, & Ray PA (2016), Using PLS path modeling in new technology research: updated guidelines. Ind. Manag. Data Syst. 116(1), 2–20.

      [54] Henson RK (2001), Understanding internal consistency reliability estimates: A conceptual primer on coefficient alpha. Meas. Eval. Couns. Dev. 34(3), 177–189.

      [55] Harun TWR, Rashid RA, & Hamed AB (2015), Factors Influencing Products’ Knowledge of Islamic Banking Employees. J. Islam. Stud. Cult. 3(1), 23–33.

      [56] Yoo W, Mayberry R, Bae S, Singh K, He Q, & Lillard Jr JW (2014), A Study Effect of MultiCollinearity in the Multivariable Analysis. Int. J. Appl. Sci. Technol. 4(5), 9–19.

      [57] Haitovsky Y (1969), Multicollinearity in Regression Analysis: Comment. Rev. Econ. Stat. 51(4), 486.

      [58] O’Brien RM (2007), A caution regarding rules of thumb for variance inflation factors. Qual. Quant. 41(5), 673–690.

      [59] Awang Z, Afthanorhan A, & Asri MAM (2015), Parametric and Non Parametric Approach in Structural Equation Modeling ( SEM ): The Application of Bootstrapping. Mod. Appl. Sci. 9(9), 58–67.

      [60] Krause DR (1999), The antecedents of buying firms’ efforts to improve suppliers. J. Oper. Manag. 17(2), 205–224.

      [61] Talib HHA, Ali KAM, & Idris F (2014), Critical success factors of quality management practices among SMEs in the food processing industry in Malaysia. J. Small Bus. Enterp. Dev. 21(1), 152–176.

      [62] Ngah AH, Zainuddin Y, & Thurasamy R (2014), Barriers and enablers in adopting Halal transportation services : A study of Malaysian Halal Manufacturers. Int. J. Bus. Manag. II(2).

      [63] Barney J (1991), Firm Resources and Sustained Competitive Advantage. Journal of Management 17(1), 99–120.

      [64] Tieman M (2011), The application of Halal in supply chain management: in-depth interviews. J. Islam. Mark. 2(2), 186–195.

      [65] Tieman M (2013), Establishing The Principles In Halal Logistics. J. Emerg. Econ. Islam. Res. 1, 1–13.

      [66] Govindan K, Rajendran S, Sarkis J, & Murugesan P (2013), Multi criteria decision making approaches for green supplier evaluation and selection: a literature review. J. Clean. Prod. 98, 66–83.

      [67] Lee AHI, Kang HY, Hsu CF, & Hung HC (2009), A green supplier selection model for high-tech industry. Expert Syst. Appl., 36(4), 7917–7927.

      [68] Wei Z, Zhao J, & Zhang C (2014), Organizational ambidexterity, market orientation, and firm performance. J. Eng. Technol. Manag. - JET-M 33, 134–153.

      [69] Chang W, Ellinger AE, Kim K, & Franke GR (2015), Supply chain integration and firm financial performance: A meta-analysis of positional advantage mediation and moderating factors. Eur. Manag. J..

      [70] Bartsch F, Diamantopoulos A, Paparoidamis NG, & Chumpitaz R (2016), Global brand ownership: The mediating roles of consumer attitudes and brand identification. J. Bus. Res. 69(9), 3629–3635.

      [71] Mohd Suki N (2016), Consumer environmental concern and green product purchase in Malaysia: structural effects of consumption values. J. Clean. Prod. 132, 204–214.

      [72] Omar EN& Jaafar HS (2011), Halal supply chain in the food industry - A conceptual model. ISBEIA 2011 - 2011 IEEE Symp. Business, Eng. Ind. Appl., September 2011, 384–389.

      [73] Sari DK, Mizerski D, & Liu F (2017), Boycotting foreign products: a study of Indonesian Muslim consumers. J. Islam. Mark. 8(1), 16–34.




Article ID: 24892
DOI: 10.14419/ijet.v8i1.2.24892

Copyright © 2012-2015 Science Publishing Corporation Inc. All rights reserved.