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UNCERTAINTY AS AN ANTECEDENT OF THE SUPPLY CHAIN RISK: DOES SUPPLY CHAIN FLEXIBILITY MATTER IN RISK MITIGATION?
Corresponding Author(s) : Jutamat Sutduean
Humanities & Social Sciences Reviews,
Vol. 7 No. 2 (2019): March
Abstract
Purpose: This study aims to address the existing research gap, as well as to explore the various types of flexibility which could contribute in mitigating supply chain risks.
Methodology: In this regard, we consider three aspects under SCR namely; manufacturing process risk, delivery risk, and supply risk. The study explores the relationships among supply chain risk and environmental uncertainty, and the moderating role of supply chain flexibility by employing data of 91 manufacturing companies and develop a structural equation modelling.
Results: Developing economies are contributing well in the global trade and are responsible for 50% of the generated global output. They present future prospects for economic growth and pose challenges mainly because of immature supply chain operations. Considering the critical role of emerging economies in global supply chain, such as India and China, it is also important to observe the moderating and driving supply chain risk factors in these regions. It is assumed that this study will not only fill the existing gap in the literature of SCRM but will assist researchers and practicing managers, by enabling them to fully understand certain types of supply chain flexibility, thus reducing the SCR under business environments.
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- Blackhurst, J., M.J. Rungtusanatham, K. Scheibe and S. Ambulkar, 2018. Supply chain vulnerability assessment: A network based visualization and clustering analysis approach. Journal of Purchasing and Supply Management, 24(1): 21-30. DOI: https://doi.org/10.1016/j.pursup.2017.10.004
- Ciccullo, F., M. Pero, M. Caridi, J. Gosling and L. Purvis, 2018. Integrating the environmental and social sustainability pillars into the lean and agile supply chain management paradigms: A literature review and future research directions. Journal of Cleaner Production, 172: 2336-2350. DOI: https://doi.org/10.1016/j.jclepro.2017.11.176
- Colicchia, C. and F. Strozzi, 2012. Supply chain risk management: A new methodology for a systematic literature review. Supply Chain Management: An International Journal, 17(4): 403-418. DOI: https://doi.org/10.1108/13598541211246558
- Dierker, L., J.R. Evia, K. Singer-Freeman, K. Woods, J. Zupkus, A. Arnholt, E.G. Moliski, N.D. Deckard, K. Gallagher and J. Rose, 2018. Project-based learning in introductory statistics: Comparing course experiences and predicting positive outcomes for students from diverse educational settings. International Journal of Educational Technology and Learning, 3(2): 52-64. DOI: https://doi.org/10.20448/2003.32.52.64
- Dincer, N. and Z. Kilinç, 2018. The analysis of stress levels of the female wrestlers studying in higher education (a case of batman province). Asian Journal of Education and Training, 4(3): 156-160. DOI: https://doi.org/10.20448/journal.522.2018.43.156.160
- Dogan, M.F. and Z. Dogan, 2018. Identifying common errors in vertical lowercase manuscript writing of the first graders in primary school. Journal of Education and e-Learning Research, 5(3): 144-156. DOI: https://doi.org/10.20448/journal.509.2018.53.144.156
- Durie, A.D. and E.S. Beshir, 2018. The effect of proactive market orientation on company performance: The case of medium and large manufacturing companies in ethiopia. International Journal of Management and Sustainability, 7(2): 93-100. DOI: https://doi.org/10.18488/journal.11.2018.72.93.100
- Edwin, O., B. Alemaw, K. Laletsang and N. Tafesse, 2017. Estimating hydraulic properties of alluvial sand aquifer in motloutse river course, eastern botswana. Asian Review of Environmental and Earth Sciences, 4(1): 28-35. DOI: https://doi.org/10.20448/journal.506.2017.41.28.35
- Eketu, C.A., 2018. Perspectives on human nature and implications for research in the behavioural sciences. International Journal of Emerging Trends in Social Sciences, 4(1): 42-46. DOI: https://doi.org/10.20448/2001.41.42.46
- Epstein, M.J., 2018. Making sustainability work: Best practices in managing and measuring corporate social, environmental and economic impacts. Routledge. DOI: https://doi.org/10.4324/9781351280129
- Ghadge, A., S. Dani and R. Kalawsky, 2012. Supply chain risk management: Present and future scope. The international journal of logistics management, 23(3): 313-339. DOI: https://doi.org/10.1108/09574091211289200
- Gligor, D., 2018. Performance implications of the fit between suppliers' flexibility and their customers' expected flexibility: A dyadic examination. Journal of Operations Management, 58: 73-85. DOI: https://doi.org/10.1016/j.jom.2018.05.002
- Ho, W., T. Zheng, H. Yildiz and S. Talluri, 2015. Supply chain risk management: A literature review. International Journal of Production Research, 53(16): 5031-5069. DOI: https://doi.org/10.1080/00207543.2015.1030467
- Hofmann, E., 2017. Big data and supply chain decisions: The impact of volume, variety and velocity properties on the bullwhip effect. International Journal of Production Research, 55(17): 5108-5126. DOI: https://doi.org/10.1080/00207543.2015.1061222
- Huang, M.-C., G.-F. Yen and T.-C. Liu, 2014. Reexamining supply chain integration and the supplier's performance relationships under uncertainty. Supply Chain Management: An International Journal, 19(1): 64-78. DOI: https://doi.org/10.1108/SCM-04-2013-0114
- Kamalahmadi, M. and M.M. Parast, 2016. A review of the literature on the principles of enterprise and supply chain resilience: Major findings and directions for future research. International Journal of Production Economics, 171: 116-133. DOI: https://doi.org/10.1016/j.ijpe.2015.10.023
- Kumar, V., O. Bak, R. Guo, S.L. Shaw, C. Colicchia, J.A. Garza-Reyes and A. Kumari, 2018. An empirical analysis of supply and manufacturing risk and business performance: A chinese manufacturing supply chain perspective. Supply Chain Management: An International Journal, 23(6): 461-479. DOI: https://doi.org/10.1108/SCM-10-2017-0319
- Kwak, D.-W., Y.-J. Seo and R. Mason, 2018. Investigating the relationship between supply chain innovation, risk management capabilities and competitive advantage in global supply chains. International Journal of Operations & Production Management, 38(1): 2-21. DOI: https://doi.org/10.1108/IJOPM-06-2015-0390
- Lavastre, O., A. Gunasekaran and A. Spalanzani, 2014. Effect of firm characteristics, supplier relationships and techniques used on supply chain risk management (scrm): An empirical investigation on french industrial firms. International Journal of Production Research, 52(11): 3381-3403. DOI: https://doi.org/10.1080/00207543.2013.878057
- Lo, S.M. and D. Power, 2010. An empirical investigation of the relationship between product nature and supply chain strategy. Supply Chain Management: An International Journal, 15(2): 139-153. DOI: https://doi.org/10.1108/13598541011028741
- Mangla, S.K., P. Kumar and M.K. Barua, 2015. Risk analysis in green supply chain using fuzzy ahp approach: A case study. Resources, Conservation and Recycling, 104: 375-390. DOI: https://doi.org/10.1016/j.resconrec.2015.01.001
- Roehrich, J.K., S.U. Hoejmose and V. Overland, 2017. Driving green supply chain management performance through supplier selection and value internalisation: A self-determination theory perspective. International Journal of Operations & Production Management, 37(4): 489-509. DOI: https://doi.org/10.1108/IJOPM-09-2015-0566
- Scholten, K., C. de Blok and R.-J. Haar, 2018. How flexibility accommodates demand variability in a service chain: Insights from exploratory interviews in the refugee supply chain. In: Thepalgrave handbook of humanitarian logistics and supply chain management. Springer: pp: 359-393. DOI: https://doi.org/10.1057/978-1-137-59099-2_12
- Sodhi, M.S., B.G. Son and C.S. Tang, 2012. Researchers' perspectives on supply chain risk management. Production and operations management, 21(1): 1-13. DOI: https://doi.org/10.1111/j.1937-5956.2011.01251.x
- Srinivasan, M., D. Mukherjee and A.S. Gaur, 2011. Buyer–supplier partnership quality and supply chain performance: Moderating role of risks, and environmental uncertainty. European Management Journal, 29(4): 260-271. DOI: https://doi.org/10.1016/j.emj.2011.02.004
- Strom, M., 2013. Pwc and the mit forum for supply chain innovation: Making the right risk decisions to strengthen operations performance. Pwc. MIT Forum for Supply Chain Innovation. http://www. pwc. com/en_GX/gx ….
- Thun, J.-H., M. Drüke and D. Hoenig, 2011. Managing uncertainty–an empirical analysis of supply chain risk management in small and medium-sized enterprises. International Journal of Production Research, 49(18): 5511-5525. DOI: https://doi.org/10.1080/00207543.2011.563901
- Venkatesh, V., S. Rathi and S. Patwa, 2015. Analysis on supply chain risks in indian apparel retail chains and proposal of risk prioritization model using interpretive structural modeling. Journal of Retailing and Consumer Services, 26: 153-167. DOI: https://doi.org/10.1016/j.jretconser.2015.06.001
- Wieland, A. and C. Marcus Wallenburg, 2012. Dealing with supply chain risks: Linking risk management practices and strategies to performance. International Journal of Physical Distribution & Logistics Management, 42(10): 887-905. DOI: https://doi.org/10.1108/09600031211281411
- Wiengarten, F., V. Bhakoo and C. Gimenez, 2015. The impact of host country regulatory quality on the value creation process in e-business supply chains. International Journal of Production Research, 53(16): 4963-4978. DOI: https://doi.org/10.1080/00207543.2015.1008108
- Wiengarten, F., P. Humphreys, C. Gimenez and R. McIvor, 2016. Risk, risk management practices, and the success of supply chain integration. International Journal of Production Economics, 171: 361-370. DOI: https://doi.org/10.1016/j.ijpe.2015.03.020
- Wu, K.-J., C.-J. Liao, M.-L. Tseng, M.K. Lim, J. Hu and K. Tan, 2017. Toward sustainability: Using big data to explore the decisive attributes of supply chain risks and uncertainties. Journal of Cleaner Production, 142: 663-676. DOI: https://doi.org/10.1016/j.jclepro.2016.04.040
- Wu, T., Y.-C.J. Wu, Y.J. Chen and M. Goh, 2014. Aligning supply chain strategy with corporate environmental strategy: A contingency approach. International Journal of Production Economics, 147: 220-229. DOI: https://doi.org/10.1016/j.ijpe.2013.02.027
- Yi, C.Y., E. Ngai and K. Moon, 2011. Supply chain flexibility in an uncertain environment: Exploratory findings from five case studies. Supply Chain Management: An International Journal, 16(4): 271-283. DOI: https://doi.org/10.1108/13598541111139080
- Zeng, Y., L. Wang, X. Deng, X. Cao and N. Khundker, 2012. Secure collaboration in global design and supply chain environment: Problem analysis and literature review. Computers in Industry, 63(6): 545-556. DOI: https://doi.org/10.1016/j.compind.2012.05.001
- Zhou, J., F.T. Mavondo and S.G. Saunders, 2018. The relationship between marketing agility and financial performance under different levels of market turbulence. Industrial Marketing Management. DOI: https://doi.org/10.1037/t79278-000
References
Blackhurst, J., M.J. Rungtusanatham, K. Scheibe and S. Ambulkar, 2018. Supply chain vulnerability assessment: A network based visualization and clustering analysis approach. Journal of Purchasing and Supply Management, 24(1): 21-30. DOI: https://doi.org/10.1016/j.pursup.2017.10.004
Ciccullo, F., M. Pero, M. Caridi, J. Gosling and L. Purvis, 2018. Integrating the environmental and social sustainability pillars into the lean and agile supply chain management paradigms: A literature review and future research directions. Journal of Cleaner Production, 172: 2336-2350. DOI: https://doi.org/10.1016/j.jclepro.2017.11.176
Colicchia, C. and F. Strozzi, 2012. Supply chain risk management: A new methodology for a systematic literature review. Supply Chain Management: An International Journal, 17(4): 403-418. DOI: https://doi.org/10.1108/13598541211246558
Dierker, L., J.R. Evia, K. Singer-Freeman, K. Woods, J. Zupkus, A. Arnholt, E.G. Moliski, N.D. Deckard, K. Gallagher and J. Rose, 2018. Project-based learning in introductory statistics: Comparing course experiences and predicting positive outcomes for students from diverse educational settings. International Journal of Educational Technology and Learning, 3(2): 52-64. DOI: https://doi.org/10.20448/2003.32.52.64
Dincer, N. and Z. Kilinç, 2018. The analysis of stress levels of the female wrestlers studying in higher education (a case of batman province). Asian Journal of Education and Training, 4(3): 156-160. DOI: https://doi.org/10.20448/journal.522.2018.43.156.160
Dogan, M.F. and Z. Dogan, 2018. Identifying common errors in vertical lowercase manuscript writing of the first graders in primary school. Journal of Education and e-Learning Research, 5(3): 144-156. DOI: https://doi.org/10.20448/journal.509.2018.53.144.156
Durie, A.D. and E.S. Beshir, 2018. The effect of proactive market orientation on company performance: The case of medium and large manufacturing companies in ethiopia. International Journal of Management and Sustainability, 7(2): 93-100. DOI: https://doi.org/10.18488/journal.11.2018.72.93.100
Edwin, O., B. Alemaw, K. Laletsang and N. Tafesse, 2017. Estimating hydraulic properties of alluvial sand aquifer in motloutse river course, eastern botswana. Asian Review of Environmental and Earth Sciences, 4(1): 28-35. DOI: https://doi.org/10.20448/journal.506.2017.41.28.35
Eketu, C.A., 2018. Perspectives on human nature and implications for research in the behavioural sciences. International Journal of Emerging Trends in Social Sciences, 4(1): 42-46. DOI: https://doi.org/10.20448/2001.41.42.46
Epstein, M.J., 2018. Making sustainability work: Best practices in managing and measuring corporate social, environmental and economic impacts. Routledge. DOI: https://doi.org/10.4324/9781351280129
Ghadge, A., S. Dani and R. Kalawsky, 2012. Supply chain risk management: Present and future scope. The international journal of logistics management, 23(3): 313-339. DOI: https://doi.org/10.1108/09574091211289200
Gligor, D., 2018. Performance implications of the fit between suppliers' flexibility and their customers' expected flexibility: A dyadic examination. Journal of Operations Management, 58: 73-85. DOI: https://doi.org/10.1016/j.jom.2018.05.002
Ho, W., T. Zheng, H. Yildiz and S. Talluri, 2015. Supply chain risk management: A literature review. International Journal of Production Research, 53(16): 5031-5069. DOI: https://doi.org/10.1080/00207543.2015.1030467
Hofmann, E., 2017. Big data and supply chain decisions: The impact of volume, variety and velocity properties on the bullwhip effect. International Journal of Production Research, 55(17): 5108-5126. DOI: https://doi.org/10.1080/00207543.2015.1061222
Huang, M.-C., G.-F. Yen and T.-C. Liu, 2014. Reexamining supply chain integration and the supplier's performance relationships under uncertainty. Supply Chain Management: An International Journal, 19(1): 64-78. DOI: https://doi.org/10.1108/SCM-04-2013-0114
Kamalahmadi, M. and M.M. Parast, 2016. A review of the literature on the principles of enterprise and supply chain resilience: Major findings and directions for future research. International Journal of Production Economics, 171: 116-133. DOI: https://doi.org/10.1016/j.ijpe.2015.10.023
Kumar, V., O. Bak, R. Guo, S.L. Shaw, C. Colicchia, J.A. Garza-Reyes and A. Kumari, 2018. An empirical analysis of supply and manufacturing risk and business performance: A chinese manufacturing supply chain perspective. Supply Chain Management: An International Journal, 23(6): 461-479. DOI: https://doi.org/10.1108/SCM-10-2017-0319
Kwak, D.-W., Y.-J. Seo and R. Mason, 2018. Investigating the relationship between supply chain innovation, risk management capabilities and competitive advantage in global supply chains. International Journal of Operations & Production Management, 38(1): 2-21. DOI: https://doi.org/10.1108/IJOPM-06-2015-0390
Lavastre, O., A. Gunasekaran and A. Spalanzani, 2014. Effect of firm characteristics, supplier relationships and techniques used on supply chain risk management (scrm): An empirical investigation on french industrial firms. International Journal of Production Research, 52(11): 3381-3403. DOI: https://doi.org/10.1080/00207543.2013.878057
Lo, S.M. and D. Power, 2010. An empirical investigation of the relationship between product nature and supply chain strategy. Supply Chain Management: An International Journal, 15(2): 139-153. DOI: https://doi.org/10.1108/13598541011028741
Mangla, S.K., P. Kumar and M.K. Barua, 2015. Risk analysis in green supply chain using fuzzy ahp approach: A case study. Resources, Conservation and Recycling, 104: 375-390. DOI: https://doi.org/10.1016/j.resconrec.2015.01.001
Roehrich, J.K., S.U. Hoejmose and V. Overland, 2017. Driving green supply chain management performance through supplier selection and value internalisation: A self-determination theory perspective. International Journal of Operations & Production Management, 37(4): 489-509. DOI: https://doi.org/10.1108/IJOPM-09-2015-0566
Scholten, K., C. de Blok and R.-J. Haar, 2018. How flexibility accommodates demand variability in a service chain: Insights from exploratory interviews in the refugee supply chain. In: Thepalgrave handbook of humanitarian logistics and supply chain management. Springer: pp: 359-393. DOI: https://doi.org/10.1057/978-1-137-59099-2_12
Sodhi, M.S., B.G. Son and C.S. Tang, 2012. Researchers' perspectives on supply chain risk management. Production and operations management, 21(1): 1-13. DOI: https://doi.org/10.1111/j.1937-5956.2011.01251.x
Srinivasan, M., D. Mukherjee and A.S. Gaur, 2011. Buyer–supplier partnership quality and supply chain performance: Moderating role of risks, and environmental uncertainty. European Management Journal, 29(4): 260-271. DOI: https://doi.org/10.1016/j.emj.2011.02.004
Strom, M., 2013. Pwc and the mit forum for supply chain innovation: Making the right risk decisions to strengthen operations performance. Pwc. MIT Forum for Supply Chain Innovation. http://www. pwc. com/en_GX/gx ….
Thun, J.-H., M. Drüke and D. Hoenig, 2011. Managing uncertainty–an empirical analysis of supply chain risk management in small and medium-sized enterprises. International Journal of Production Research, 49(18): 5511-5525. DOI: https://doi.org/10.1080/00207543.2011.563901
Venkatesh, V., S. Rathi and S. Patwa, 2015. Analysis on supply chain risks in indian apparel retail chains and proposal of risk prioritization model using interpretive structural modeling. Journal of Retailing and Consumer Services, 26: 153-167. DOI: https://doi.org/10.1016/j.jretconser.2015.06.001
Wieland, A. and C. Marcus Wallenburg, 2012. Dealing with supply chain risks: Linking risk management practices and strategies to performance. International Journal of Physical Distribution & Logistics Management, 42(10): 887-905. DOI: https://doi.org/10.1108/09600031211281411
Wiengarten, F., V. Bhakoo and C. Gimenez, 2015. The impact of host country regulatory quality on the value creation process in e-business supply chains. International Journal of Production Research, 53(16): 4963-4978. DOI: https://doi.org/10.1080/00207543.2015.1008108
Wiengarten, F., P. Humphreys, C. Gimenez and R. McIvor, 2016. Risk, risk management practices, and the success of supply chain integration. International Journal of Production Economics, 171: 361-370. DOI: https://doi.org/10.1016/j.ijpe.2015.03.020
Wu, K.-J., C.-J. Liao, M.-L. Tseng, M.K. Lim, J. Hu and K. Tan, 2017. Toward sustainability: Using big data to explore the decisive attributes of supply chain risks and uncertainties. Journal of Cleaner Production, 142: 663-676. DOI: https://doi.org/10.1016/j.jclepro.2016.04.040
Wu, T., Y.-C.J. Wu, Y.J. Chen and M. Goh, 2014. Aligning supply chain strategy with corporate environmental strategy: A contingency approach. International Journal of Production Economics, 147: 220-229. DOI: https://doi.org/10.1016/j.ijpe.2013.02.027
Yi, C.Y., E. Ngai and K. Moon, 2011. Supply chain flexibility in an uncertain environment: Exploratory findings from five case studies. Supply Chain Management: An International Journal, 16(4): 271-283. DOI: https://doi.org/10.1108/13598541111139080
Zeng, Y., L. Wang, X. Deng, X. Cao and N. Khundker, 2012. Secure collaboration in global design and supply chain environment: Problem analysis and literature review. Computers in Industry, 63(6): 545-556. DOI: https://doi.org/10.1016/j.compind.2012.05.001
Zhou, J., F.T. Mavondo and S.G. Saunders, 2018. The relationship between marketing agility and financial performance under different levels of market turbulence. Industrial Marketing Management. DOI: https://doi.org/10.1037/t79278-000