Abstract
This study investigates the influence of blockchain and smart contracts on partners’ trust, increasing visibility, competitiveness, and environmental performance when implemented in manufacturing supply chains. Partial least squares (PLS) was the main method used to test and verify the research model and hypotheses. According to the test results, blockchain and smart contracts positively influence partners’ trust. Increasing trust produces a positive effect on increasing visibility, further promoting competitiveness and environmental performance. However, the vulnerability of smart contracts still causes information security concerns. If smart contracts are adopted for an extended time, partners will worry about problems of information vulnerability stemming from the smart contract, further reducing trust and affecting visibility. Regarding academic implications, this study not only proves the relationship between blockchain, smart contracts, partners’ trust, increasing visibility, competitiveness, and environmental performance. In addition, we also proved the vulnerability of smart contracts; our test results fill these gaps. Regarding practical implications, with extended contract periods, partners may expand their doubt in the smart contract and reduce information sharing, further affecting visibility. Manufacturers are reminded that smart contracts may carry hidden trouble that disrupts the relationship between partners’ trust and visibility.
Highlights
In the supply chain of heavy manufacturing industries, visibility is a critical factor in raising production and manufacturing efficiency in the industry
Its application can produce a greater stimulus to promote the influence of blockchain and further increase partners’ trust, thereby promoting competitiveness and environmental performance
The influence of blockchain and the application of smart contracts have a positive effect on increasing visibility
Summary
In the supply chain of heavy manufacturing industries, visibility is a critical factor in raising production and manufacturing efficiency in the industry. Chain visibility is defined as the extent to which actors within a supply chain have access to or share information that. Kurniawan et al (2017) indicated that a greater level of visibility offers a complete view of the production process, from outbound suppliers to the ultimate customers. Visibility improves confidence and helps maintain practices of related production activities under the supply chain, assisting firms in controlling production costs. Greater visibility helps control and improves the production environment. Air emissions, recycling wastewater, solid waste discharge, and the consumption of hazardous, harmful, and toxic materials can be controlled and improved (Dubey et al, 2020), achieving greater environmental performance
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