The Impact of Supply Chain Resilience on Company Performance: A Dynamic Capability Perspective

Abstract

Due to the less secure and more unpredictable environment, supply chains are becoming more fragile and suffering from disruption risks. Researchers have proposed that supply chain resilience is an effective way to mitigate risks. However, unified definition of supply chain resilience and related empirical findings are still lacking. We define supply chain resilience and classify it into three dimensions: supplier, internal and customer resilience. From the perspective of dynamic capabilities, this study empirically examines how supply chain resilience contributes to company performance. We also examine the inter-relationships among three dimensions of supply chain resilience. The relationships are tested by structural equation modeling using a sample of 171 firms from mainland China. Results show that internal resilience positively influences supplier and customer resilience. Internal and customer resilience improve financial performance indirectly through operational performance. Although supplier resilience has no direct effect on operational performance, it improves financial performance directly. This study contributes to supply chain resilience and risk management literature by providing the definition and measurement of supply chain resilience, and empirically testing how its three dimensions improve company performance. It also provides practical implications on how to develop supply chain resilience in order to achieve competitive advantage.