Assessing the Influence of Industry 5.0 on Supply Chain Integration and Performance: An Empirical Analysis within the Manufacturing Sector

Industry 5.0 (I5.0) is increasingly emerging as a prominent paradigm across the global business landscape, with three distinctive core values: human-centricity, sustainability, and resilience. This shift introduces notable changes in multiple aspects and requires academics and practitioners to reexamine the concept of supply chain management. Whilst previous research has identified the potential of I5.0 in enhancing supply chain performance (SCP), there has been insufficient attention paid to the understanding of the nature and implications of human-AI interactions. More specifically, there is a lack of thorough discussion on the mechanism how I5.0 can improve SCP. This exploratory study therefore aims to develop theoretical insights through empirical examination of the relationships between I5.0 and SCP in the manufacturing industry, with supply chain integration (SCI) as a mediator. Adopting a dynamic capabilities perspective, we argue that overcoming the challenges associated with implementing I5.0 may motivate companies to integrate their supply chains and enhance their SCP. Partial least squares structural equation modelling (PLS-SEM) is applied to test the hypotheses using survey data from 230 industry professionals, followed by a fuzzy analytic hierarchy process (FAHP) to quantify and prioritise the impacts of I5.0 challenges on SCP indicators. The results indicate that I5.0 has a direct positive impact on both SCI and SCP. Furthermore, SCI plays a significant role in mediating the relationship between I5.0 and SCP. This research contributes to the body of knowledge by empirically validating the relationships between I5.0, SCI, and SCP in a solitary and holistic model, thereby bridging the gaps in the literature between these distinct research streams.