Evaluating Theoretical Conceptualisations for Supply Chain and Finance Integration: A Scottish Focus Group

Abstract With supply chain finance gaining more prominence in practice and drawing increasing attention from researchers, the question arises how this emerging discipline can build on existing theoretical conceptualisations. However, few studies have incorporated theoretical frameworks and there remains therefore a gap in literature. To fill this gap, the study reviews five theories on their suitability for supply chain finance: transaction cost economics, agency theory, network theory, collaborative networks and social exchange theory. A Scottish focus group consisting of practitioners involved in supply chain finance provided empirical data for the evaluation. The findings suggest that there is supporting evidence for using agency theory, network theory, transaction cost economics and social exchange theory as theoretical frameworks for studying phenomena of supply chain finance. Furthermore, the results indicate that the conceptualisations based on agency theory should be extended with ‘reverse principal–agent theory’ to fit with the contingencies of supply chain finance. The frameworks of collaborative networks are found less suitable. In addition to these theoretical considerations, the focus group discussion also points out that the financial department’s collaboration with other departments involved in the primary supply chain process in firms needs to be improved. To achieve this training and supplier development, particularly for smaller firms, is seen as key. These outcomes have informed a research agenda for research groups, early career researchers and doctoral students.