Multiple multi-tier sustainable supply chain management: a social system theory perspective

Abstract

A multi-tier supply chain is a complex system as it covers a focal company and multiple tiers of suppliers in a complex supply chain network. This study explores the complexity in multi-tier sustainable supply chain management (SSCM) through a social systems theory perspective. We carried out a case study on IKEA China’s sustainable cotton initiative and examined its five cotton-textile supply chains. The primary data were collected through 22 semi-structured interviews with managers of IKEA China and their multi-tier suppliers. The findings suggest that in order to cope with environmental complexity in implementing multi-tier sustainable initiatives, focal companies tend to create both internal complexity and collaborative complexity in a variety of governance mechanisms. In addition, environmental overlap and available collaborative complexity increase in this process and can feed back into systems to facilitate further creation of requisite variety. We contribute to the multi-tier SSCM literature through providing an in-depth understanding of nuanced mechanisms of managing different tiers of suppliers to cope with complexities by adopting a social systems theory perspective. We also contribute to multi-tier supply chain governance mechanisms from an evolution perspective.