It is not surprising that many studies on both theoretical and practical orientation have been devoted to emphasizing the benefits of information sharing. There has also been a considerable body of research that has developed mathematical models quantifying the benefits of information sharing in the supply chain. However, much less research has been done on the empirical side.

This study has empirically tested the relationships among environmental uncertainty, internal integration, external integration, information sharing, and performance. This paper is based on a field study of 105 firms in the automotive manufacturing industry in Canada. The identified constructs have been tested using a structure equation modeling technique. Our results indicated that environmental uncertainty has a direct negative impact on performance and information sharing. Internal and external integration positively impacted performance and information sharing. Interestingly, the findings showed that environmental uncertainty has an indirect positive impact on performance through information sharing. Additionally, information sharing enhanced the positive impact of internal and external integration on performance. The study indicates that information sharing is crucial to supply chain performance because it provides the facts that supply chain managers use to make decisions.