The role of supply chain analytics capability and adaptation in unlocking value from supply chain relationships

Abstract

The performance and survival of many supplier firms depend on key buyer–supplier relationships (BSRs). A difficult task in managing such relationships is creating value when there is a lack of justice. This study examines whether supply chain analytics capability (SCAC) and adaptation can prove useful for suppliers in extracting greater value from supply chain relationships. The role of SCAC in driving value has not been evaluated in contexts where independent decision making is constrained, such as the case for a power disadvantaged supplier. We use resource orchestration theory and social exchange theory to develop a model that explains how SCAC and adaptation can work in BSRs and test it using data from North American suppliers. The results show that in relationships marked by low levels of procedural justice, SCAC becomes critical in extracting value from the relationship, while in relationships marked by high levels of procedural justice, adaptation is more important. The findings lead to actionable insights on how suppliers can leverage SCAC and adaptation to maximize value from supply chain relationships. A key insight is that benefits from firm-level capabilities, like SCAC, depend on relational attributes in the supply chain context.