Operational efficiency as a contingent, not universal mechanism: evidence from Pakistani SME supply chains

Purpose This study aims to critically investigate the presumed universal mediating role of operational efficiency between core supply chain capabilities integration, agility, adaptability and overall performance. It questions the established paradigm that positions operational efficiency as an indispensable conduit to competitive advantage, particularly within the volatile context of small and medium-sized enterprises (SMEs) in an emerging economy Pakistan. Design/methodology/approach To empirically test this theoretical contention, a quantitative, positivist approach using a cross-sectional survey of 400 Pakistani SMEs was employed. This design was chosen to objectively measure the complex relationships between latent constructs within a population facing significant volatility and resource constraints, a context that provides a critical test for universal mechanism. Established scales were rigorously adapted and pretested for contextual relevance. Data were analyzed using partial least squares structural equation modeling in R. This method was specifically selected for its ability to model complex mediation pathways without strict distributional assumptions, making it ideal for an exploratory test of the hypothesized contingencies in this emerging economy setting. Findings The results reveal a critical contingency; operational efficiency does not universally mediate the capability performance relationship. While it transmits the effects of supplier and internal integration to performance, it fails to be a significant mediator for supply chain adaptability and agility. Furthermore, customer integration, while improving operational efficiency, does not directly enhance overall performance. This demonstrates that the efficacy of operational efficiency is not automatic but is instead bounded by the type of capability deployed and the firm’s specific contextual constraints. Originality/value This research provides a significant practical recalibration by challenging the universal application of operational efficiency as a core mediator in supply chain models. To the best of the authors’ knowledge, it is the first study to empirically demonstrate that this mechanism can fail in specific, high importance contexts. The findings offer a crucial contingency perspective, emphasizing that the path to supply chain performance in emerging economies is more nuanced than prevailing theories suggest, requiring a move beyond one size fits all, efficiency centric strategies.