Abstract
Supply chain and operations management requires frequent decision making, and decisions are importantly influenced by the personality traits and knowledge of the decision maker. Thus, we analyse the effect of those factors on the confidence and quality of decisions taken in the context of supply chain management. The data were gathered via an online supply chain simulation game where subjects needed to make several decisions. Personality traits of the participants were tested using the Big Five model. The structural model was estimated using the partial least squares structural equation modelling approach. We found that decision-makers with lower levels of extraversion and agreeableness and higher levels of conscientiousness and openness make better decisions. On the other hand, neuroticism and agreeableness negatively affect confidence in decisions. Tested knowledge positively influences both decision-makers’ confidence in and the quality of their decisions while self-reported knowledge has no significant effect. Therefore, the companies should carefully consider how an individual’s personality matches the type of job at hand and rely on tested instead of self-reported knowledge.
Highlights
Decision-making plays a significant role in operations and supply chain management (SCM) and uses large amounts of organisational resources (Roehrich, Grosvold, &Hoejmose, 2014)
Introverts do better with problem-solving tasks requiring insight and reflection (Moutafi et al, 2003). This leads to our first hypothesis: H1a: The personality trait extraversion is negatively associated with the quality of a decision
Decision making is a vital aspect in supply chain and operations management
Summary
Decision-making plays a significant role in operations and supply chain management (SCM) and uses large amounts of organisational resources Researchers have sought to understand how firms make decisions on strategic and operational levels (Steckel, Gupta, & Banerji, 2004) This paradigm has led to underemphasising individuals’ dispositional characteristics as an important factor in the quality of individuals’ decisions. The way an individual makes SCM-related decisions depends on dispositional characteristics such as personality traits and level of domain knowledge (Tokar, 2010). We use a computer simulation game to explore the effects of decision-makers’ personality traits and domain knowledge on their confidence in and quality of decisions made in SCM tasks. The research approach followed in this study, the sources of data, and data analysis procedure are explained This is followed by the findings on how different personality traits, along with self-reported and test-evaluated supply chain domain knowledge, influence the quality of and confidence in decisions.
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