A behavioral study of supply manager decision-making: Factors influencing make versus buy evaluation

This paper investigates behavioral factors influencing a supply manager's decision to insource or outsource the manufacture of a product component. To do so we posit a theoretical framework that integrates the heretofore distinct operational make–buy literature and the behavioral decision-making literature. Within the framework three factors influencing the make–buy decision are brought into account: the decision-maker's perception of supply risk or “strategic vulnerability”, the degree of core competency represented by the product component under consideration and the formality of the information about supply alternatives. The results of a controlled experimental survey show that: strategic vulnerability and core competency do influence the make–buy decision, strategic vulnerability has greater influence than core competency and information formality moderates the make–buy decision when the strategic vulnerability and core competency conditions are mixed. The practical implications of these results include the notion that management can ensure a more rational make–buy decision if they understand the biases that influence the decision and point these biases out to the decision maker.     

Value of supply disruption information and information accuracy

In this paper, we examine the factors that influence the value of supply disruption information, investigate how information accuracy influences this value, and provide managerial suggestions to practitioners. The study is motivated by the fact that although accurate disruption information creates benefits, fully accurate disruption information may be difficult and costly to obtain. Furthermore, inaccurate disruption information can decrease the financial benefit of prior knowledge and even lead to negative performance. To perform the analysis, we adopt a newsvendor model within a single product setting where the focal firm can source from a supply network and has a given resilience capacity. The results show that information accuracy, specifically information bias and information variance, plays an important role in determining the value of disruption information. This influence varies at different levels of disruption severity and resilience capacity, and our results imply that higher amounts of resilience capacity actually may be detrimental to a firm without accurate information about a disruption's influence. Thus, for companies with a high resilience capacity, obtaining quality information is critical for effectively coping with disruptions.     

A grounded definition of supply risk

All purchasing organizations encounter supply risk, whether it is explicitly understood and assessed, or reactively managed. The purpose of this paper is to provide a grounded definition of supply risk. Case study data from seven purchasing organizations uncovered various definitions of supply risk. These definitions focus on the sources of supply risk, emanating from individual supplier factors and market characteristics, and the outcomes of supply risk events, which involve the inability of purchasing firms to meet customer requirements and threats to customer life and safety. Findings from this research provide practitioners and academicians a starting point for understanding supply risk and insights as to how supply risk can negatively affect business operations.     

Guest Editorial: A purchasing and supply management view of supply resilience for better crisis response

Purchasing and supply management (PSM) has been under great pressure since the COVID-19 pandemic first shook the world. Companies and public organizations faced new kinds of supply disruptions, and at a scale never seen before. New response abilities were required from PSM to address these challenges and disruptions. This Editorial introduces four articles in the Special Issue on “PSM learning from the pandemic: transforming for better crisis management.” These empirical contributions show how companies could build resilience to survive and be competitive during the COVID-19 pandemic. This Editorial discusses how supply resilience should be conceptualized in post-pandemic supply chains adopting a PSM perspective. We suggest that supply resilience practices should be developed and planned according to whether they strengthen existing supply chain relationships (bridging) or establish new ones (buffering) and whether they are short-term (temporary) or long-term (permanent) orientated. Furthermore, three supply resilience capabilities, absorbing, responding and capitalizing, should be prioritized in supply chains for responding to and recovering from global crises and disruptions. Supply resilience is key to crisis response and recovery, and PSM has an essential role in building and sustaining that resilience.     

From market to hierarchy: An empirical assessment of a supply chain governance typology

This study performs an empirical assessment of the highly influential supply chain governance typology put forth in Gereffi et al. (2005). In spite of the influence this Global Value Chain (or GVC) Typology has had, there have been few (if any) attempts to empirically assess its alignment with real-world supply chain structures and to establish a baseline for its predictive utility. The GVC Typology is assessed for face and nomological validity through testing of its key dimensions in relation to purchasing-logistics integration and supplier performance measures, using an information-processing theory framework. The GVC Typology appears to have considerable face validity as actual supply chain governance structures aligned well with those it proposes. It also has reasonable predictive power with regards to governance dimensions and integration, and in some connections between governance types, integration, and supplier performance. This study provides researchers with the tools to move this typology beyond the “conceptual” stage in their work, allowing for holistic and higher-level assessments of supply chain governance structures and changes. It may also help researchers and managers to consider when and to what extent purchasing-logistics integration should be fostered.     

The organizational antecedents of a firm’s supply chain agility for risk mitigation and response

Today’s marketplace is characterized by intense competitive pressures as well as high levels of turbulence and uncertainty. Organizations require agility in their supply chains to provide superior value as well as to manage disruption risks and ensure uninterrupted service to customers. Thus the cultivation of agility is approached as a risk management initiative that enables a firm to respond rapidly to marketplace changes, as well as anticipated and actual disruptions in the supply chain. Agility is of value for both risk mitigation and response.     

Practices and strategies for sustainability-related risk management in multi-tier supply chains

This study investigates how sustainability-related risks are managed in multi-tier supply chains. It focuses on the strategies and practices that companies use to manage sustainability-related risks and how these differ between supply chains and supply chain tiers. We use a multiple-case study with 25 companies forming 5 multi-tier supply chains. As a result of this study, we present a conceptual framework for sustainability-related risk management practices in multi-tier supply chains and apply it empirically by defining sustainability-related risk management profiles for the case supply chains. We show that in multi-tier supply chains, companies need direct and indirect collaboration and direct and indirect monitoring practices for managing sustainability-related risks emanating from not only their first-tier suppliers but also lower-tier suppliers. Our framework helps purchasing and supply chain managers understand the dimensions of sustainability-related risk management in a multi-tier setting and develop strategies and practices for mitigating and managing those risks. We also empirically show the challenge of extending sustainability-related risk management practices beyond first-tier suppliers due to the different practices in different supply chain tiers.     

Enhancing hospital supply chain performance: A relational view and empirical test

Improving hospital supply chain performance has become increasingly important as healthcare organizations strive to improve operational efficiency and to reduce cost. In this study, we propose a research model based on a relational view, delineating the factors that influence hospital supply chain performance: trust, knowledge exchange, IT integration between the hospital and its suppliers, and hospital–supplier integration. Testing results of the research model based on data from a sample of 117 supply chain executives from U.S. hospitals show positive direct effects: (1) from trust and from IT integration to knowledge exchange respectively; (2) from knowledge exchange and from IT integration to hospital–supplier integration respectively; and (3) from hospital–supplier integration to hospital supply chain performance. The results also show the following indirect effects: (1) the influences of knowledge exchange and IT integration on hospital supply chain performance are partially and fully mediated by hospital–supplier integration, respectively and (2) the influences of trust and IT integration on hospital–supplier integration are fully and partially mediated by knowledge exchange, respectively. In addition, the results show the following moderating effects: (1) hospital system membership moderates the relationships between IT integration and knowledge exchange and between trust and knowledge exchange; (2) hospital environmental uncertainty moderates the relationship between trust and knowledge exchange; and (3) trust moderates the relationship between knowledge exchange and hospital–supplier integration. Implications of the study findings and directions for future research are discussed.     

Uncertainty,supply risk management and their impact on performance

The purpose of this research is to identify the antecedents of supply risk management performance. Speed consortium benchmarking is used to explore the concepts of supply risk monitoring and mitigation. In addition, a survey yielding 207 responses is used to test our hypothesized antecedents of supply risk management performance. Findings indicate that the transaction cost constructs environmental- and behavioral uncertainty have a negative effect on supply risk management performance. In addition, supply risk mitigation and supply risk management process maturity positively influence supply risk management performance, the latter having the strongest influence. Furthermore, supply risk monitoring, supply risk mitigation and supply risk management process maturity all moderate the effect of environmental uncertainty, whereas only risk monitoring has an influence on the relationship between behavioral uncertainty and supply risk management performance. This research identified not only the antecedents of supply risk management performance, but also the moderating effect of different supply risk management principles on the relation between uncertainty and supply risk management performance. Most importantly, our study shows the relevance of developing general supply risk management structures and capabilities (i.e. supply risk management process maturity) in order to manage supply risks successfully. Our findings indicate that even more important than the proper selection of individual risk monitoring and mitigation strategies is the implementation of a risk management process.     

基于复杂自适应供应网络脆弱性的突发风险研究

本文将全球化背景下的供应链系统视为复杂自适应供应网络,以复杂自适应供应网络脆弱性分析为视角,对当前供应链突发风险管理这个热点问题展开了研究,采用微观与宏观相结合、定性分析与定量分析相结合的方法对突发风险进行了分析,建立了突发事件条件下复杂自适应供应网络的脆弱性评价模型,并结合具体实例进行了验证。结果表明,供应链突发风险管理策略应该尽可能使得供应链各子系统脆弱性以及子系统各脆弱性因素之间的相互影响保持均衡,不存在相对脆弱的短板。这为企业从全局考虑改善供应链系统性能提供了的最佳途径。     

A longitudinal study of supply organizational change

This research examines the high level of change in supply organizations of large North American companies using data collected from 51 large North American supply organizations in 1987, 1995 and 2003. Analysis is supplemented by an additional 55 companies for which data were collected in 1995 and 2003. The availability of longitudinal data from individual companies over a 16-year period provided a unique opportunity to trace changes made to each company's supply organizational structure and their roles and responsibilities. Findings suggest that the respondents made major changes in supply organizational structure, supply chain responsibilities, use of purchasing teams, supply involvement in major corporate activities (MCA) and CPO reporting line, title and background.     

Firm's resilience to supply chain disruptions: Scale development and empirical examination

This paper expands our understanding of factors that contribute to development of firm resilience to supply chain disruptions. In doing so, we operationalize firm resilience to understand how supply chain disruption orientated firms can develop resilience to supply chain disruptions. We find that supply chain disruption orientation alone is not enough for a firm to develop resilience. Supply chain disruption oriented firms require the ability to reconfigure resources or have a risk management resource infrastructure to develop resilience. The way in which supply chain disruption oriented firms develop resilience through resource reconfiguration or risk management infrastructure depends on the context of the disruption as high impact or low impact. In a high impact disruption context, resource reconfiguration fully mediates the relationship between supply chain disruption orientation and firm resilience. In a low impact disruption context, supply chain disruption orientation and risk management infrastructure have a synergistic effect on developing firm resilience.     

Strategic supply management: The relationship between supply management practices, strategic orientation and their impact on organisational performance

A theoretical model is presented for conceptualising the relationship between the management of supply, strategic orientation at the business-unit level and their proposed link with firm performance. The shortcomings of existing approaches in accounting for the wide variety of purchasing practices in a comprehensive supply management framework are discussed as well their alignment with strategic orientation. The paper concludes by presenting a model and propositions concerning firm-level supply management, strategic orientation and firm performance.     

An analysis of research into the future of purchasing and supply management

Business organisations are going through rapid external environmental and internal organisational changes due to increasing globalisation, E-business, and outsourcing. As a result, the future of purchasing and supply management—as a function within organisations, as a process that spans organisation boundaries and as a profession—raises important concerns for both organisations and the purchasing professional. This paper considers a broad and rather fragmented body of empirical evidence and analyses 42 relevant empirical studies on the future of purchasing and supply management. The major findings are reported in terms of changes in business contexts, purchasing strategy, structure, role and responsibility, system development and skills. Cross-sectional comparative analyses were also conducted to examine variation by sector, firm type, people's roles in purchasing, and country. A number of major implications for the purchasing function, process and professional bodies are presented together with suggestions for future research to address significant gaps in the current body of knowledge.     

Supply Chain Finance: A supply chain-oriented perspective to mitigate commodity risk and pricing volatility

This study addresses the Supply Chain Finance challenge of Commodity Price Volatility (CPV) by adopting a supply chain-oriented perspective. In particular, the effectiveness of two Supply Chain Risk Management (SCRM) strategies in mitigating CPV, namely, Switching suppliers and Substituting Commodities, and the main factors that may affect their value, are investigated with a simulation analysis. A Real Option Valuation (ROV) model was developed and tested on real cases of CPV mitigation, as experienced by a large multinational company (Fortune 100) leader in the Fast Moving Consumer Goods (FMCG) industry. The results show the effectiveness of Switching suppliers and Substituting Commodities in mitigating CPV, highlighting that the convenience of adopting such strategies is strongly influenced by some specific conditions, like the relative values of the long-term prices of the commodities, the purchasing volume, and the sunk cost needed to build flexibility.     

集群式供应链系统的风险及其识别研究

本文通过对基于产业集群的供应链系统的研究,定义了产业集群及产业集群供应链系统的概念;结合供应链系统风险的概念,确立了集群式供应链风险的定义,并对其进行了分类,完善了集群式供应链系统风险管理的相关内容。     

Cyber supply chain risk management: Revolutionizing the strategic control of critical IT systems

Cyber supply chain risk management (CSCRM) is a new discipline designed to help IT executives address the challenges of the rapid globalization and outsourced diffusion of hardware and software systems. CSCRM is an integrative discipline combining elements of cybersecurity, supply chain management, and enterprise risk management into a new and powerful concept to exert strategic control over the end-to-end processes of the focal organization and its extended enterprise partners. This article provides a survey of the field, as well as a detailed analysis of the results of a four-year research project on CSCRM, conducted by the Robert H. Smith School of Business Supply Chain Management Center for the National Institute of Standards and Technology, that focused on the development of organizational assessment tools and a capability/maturity model for this emerging discipline.     

Fairness in supply chain contracts: A laboratory study

Various contracts can be designed to coordinate a simple supplier–retailer channel, yet the contracts proposed in prior research and tested in a laboratory setting do not perform as standard theory predicts. The supplier, endowed with all bargaining power, can neither fully coordinate the channel nor extract all of the channel profit. We report on a sequence of laboratory experiments designed to separate possible causes of channel inefficiency. The three causes we consider are inequality aversion, bounded rationality, and incomplete information. It turns out that all three affect human behavior. Inequality aversion has by far the most explanatory power regarding retailers’ behavior. Incomplete information about the retailer's degree of inequality aversion has the most explanatory power in regards to the suppliers’ behavior. Bounded rationality affects both players, but is of secondary importance.     

A proactive approach to supply chain risk management: Shifting orders among suppliers to mitigate the supply side risks

Globalization, e-trade, advanced technologies and emerging production techniques have increased supply chains’ efficiency and added value. However, despite numerous advantages, these factors make supply chains more fragile and vulnerable to risks. For this reason, companies that perform supply chain risk management gain competitive advantage. In the past, supply chain managers mainly focused on reducing costs; but recently, they have begun to give importance to supply chain continuity and resiliency which have significant impacts on costs as well. Hence, conventional reactive planning has given way to proactive planning in supply chain risk management. In this study, the supply chain risk management process is investigated and a procedure is proposed in the risk mitigation phase. In the first stage of the proposed procedure, an initial procurement plan is obtained via a linear programming model, considering the cost criterion as the first priority. In the second stage, this plan is revised by including the risk criterion into the planning as the second priority. The aim of this procedure that enables proactive planning is to reduce the supply side risks. The model is tested with a hypothetical data set and the cost analysis is performed to evaluate the performance of the procedure. Finally, the whole supply chain risk management process including the proposed procedure is applied to an international automotive company.