Risk Identification and Its Resonant Effect in Service-Oriented Supply Chain

Abstract

This article investigates service-oriented supply chain risk management, differentiating it from manufacturing through two steps. In the first step, we review prior research to identify the service-oriented supply chain’s distinctive features and typical risks. In the second step, the resonant effect of these risks on service-oriented supply chain performance is examined by an empirical study in the construction sector that was hit hard during COVID-19. In doing so, a model comparing the single impacts of risks on supply chain performance to the theoretical model was developed to confirm the resonant effect mechanism. Obtained from 196 service-oriented firms in Vietnam's construction, our study found that the resonant effect model explained 63% of service-oriented supply chain performance variance versus 46.3% in the comparative model. The influence of a single risk on supply chain performance is also more significant, proving the resonant mechanism influence. Another interesting result is the low-impact demand risk on supply chain performance, reinforcing the service-oriented supply chain advantage. The notion for resonant effect reduction is minimising the coefficient of “α” to limit/eliminate risks’ relationship. Hence, the proposed resonant effect model can serve as a guide. Our recommendation to embrace supply chain management strategies, such as avoidance, speculation, and postponement, should be balanced with acceptable cost/benefit trade-offs.