The impact of supply chain integration and internal control on financial performance in the Jordanian Banking Sector

Abstract

The aim of this paper is to use a recently developed framework of supply chain integration (SCI) to examine the influence of a set of relationships between SCI and internal control on financial performance in the Jordanian banking sector. SCI consists of external integration and internal integration. External integration includes customer integration and supplier integration. This study utilizes survey data from 249 employees in the Jordanian banking sector and tests the research framework and hypotheses using exploratory factor analysis. The impact of supply chain internal and external integration and internal control significantly affected financial performance. The impact of the examined factors on financial performance is as follows, in decreasing order: internal integration, supplier integration, customer integration, and internal control. This study's contribution to supply chain management is in its integration of SCI and internal control variables to propose a practical framework for the banks to use, and its development of a measurement tool for managers to determine the effects of internal and external integration and internal control on financial performance.