Preprint Article Version 1 This version is not peer-reviewed

The Relationships between Supply Chain Capability and Shareholder Value Using Financial Performance Indicators

Version 1 : Received: 3 March 2020 / Approved: 5 March 2020 / Online: 5 March 2020 (02:35:22 CET)

A peer-reviewed article of this Preprint also exists.

Hong, S.-J.; Najmi, H. The Relationships between Supply Chain Capability and Shareholder Value Using Financial Performance Indicators. Sustainability 2020, 12, 3130. Hong, S.-J.; Najmi, H. The Relationships between Supply Chain Capability and Shareholder Value Using Financial Performance Indicators. Sustainability 2020, 12, 3130.

Journal reference: Sustainability 2020, 12, 3130
DOI: 10.3390/su12083130

Abstract

The purpose of this paper is to explore which financial performance indicators (FPIs) evaluate the level of supply chain capability (SCC) that explicitly touches all of the business functions and processes within and beyond the company. The authors investigated nine FPIs that were selected from the financial statements of 155 companies within nine industries. The authors find that suitable FPIs to measure SCC for shareholders’ value are return-on-assets (ROA), days-sales-outstanding (DSO), and current ratio (CR). This means that higher ROA, shortened DSO, and an appropriate level of CR could reach a sustainable supply chain. These results will help the industry to avert a major disruption in supply chain processes and activities using suitable financial performance indicators.

Subject Areas

shareholder value; return-on-asset; days-sales-outstanding; current ratio; supply chain capability

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