Supply Network Structure Research Articles

Analysing developing countries approaches of supply chain resilience to COVID-19

PurposeThe Covid-19 pandemic has made it essential to explore the resilience factors specific to developing regions, not only because they pose threats of extreme poverty and offer a novel context but also because they play an important role in globalisation.Design/methodology/approachA mixed-method approach was undertaken to address this novel pandemic situation. First, an open-ended structured questionnaire was developed, and data were collected from three neighbouring emerging economies: Pakistan, India and Iran. Experts' perspectives on vulnerabilities, response measures, resilience and restoration of supply chain activities, and the role of social capital were collected. Second, building upon the findings from phase one of the studies, a quantitative structured questionnaire using the supply chain operational reference (SCOR) model was used to collect data in a structured manner. This quantitative data were further analysed using frequency and contingency analysis.FindingsThe findings from the first phase of the study inductively derive 36 resilience categories. Later, the contingency findings show that supply chain (SC) disruption is a major vulnerability for emerging economies, whereas solutions offered to combat it lay in the reconfiguration of resources, such as financial, technological, human, information and material. Additionally, supply network structure and social capital play an integral part in making SCs resilient against disruption.Research limitations/implicationsThe respondents comprise the academics/SC researchers, which make the findings interesting though they lack the industrial experts' perspectives, directly. Nevertheless, the propositions can be tested in industrial settings to see whether the results are limited to a specific industrial setting or are rather generalised.Practical implicationsSimilarly, practitioners and policy makers can incorporate the SCOR metrics/factors outlined in this study into their performance measurement systems and ensure continuous monitoring for firm's resilience.Originality/valueThe study offers a holistic understanding of the developing regions' approaches to Covid-19. The paper also takes a social capital perspective to explain firms' resilience in these emerging economies.

5G in digital supply chain and operations management: fostering flexibility, end-to-end connectivity and real-time visibility through internet-of-everything

5G technology enables end-to-end connectivity in real time at a highly granular level along with the associated end-to-end visibility through the Internet-of-Everything. While some potential benefits of 5G for digital supply chain and operations management have been declared, literature is still silent about theoretical underpinning and structured conceptualisation of application areas, underlying implementation challenges, and the role of 5G in future transformations of value creation. This paper aims to offer some directions of how to close this research gap. We organise the discussion around five major capabilities of the digital supply chain and smart operations which can be enhanced by 5G, i.e. intelligence, visibility, transparency, dynamic networking, and connectivity. We delineate possible future research topics related to 5G in different areas of Industry 4.0-driven, digital supply chain and operations management which can be useful for researchers and practitioners alike when seeking to understand the impact of 5G on both short-term and long-term time scales. Our analysis encompasses both operational processes (e.g. transformations of manufacturing and warehouse operations by end-to-end connectivity of devices) and strategic perspectives (e.g. transformations of business models and supply network structures through end-to-end real-time visibility and connectivity of industry, public infrastructure, and consumers). Finally, cost-benefits trade-offs are discussed.

Comparative Analysis of Illicit Supply Network Structure and Operations: Cocaine, Wildlife, and Sand

Illicit supply networks (ISNs) are composed of coordinated human actors that source, transit, and distribute illicitly traded goods to consumers, while also creating widespread social and environmental harms. Despite growing documentation of ISNs and their impacts, efforts to understand and disrupt ISNs remain insufficient due to the persistent lack of knowledge connecting a given ISN’s modus operandi and its patterns of activity in space and time. The core challenge is that the data and knowledge needed to integrate it remain fragmented and/or compartmentalized across disciplines, research groups, and agencies tasked with understanding or monitoring one or a few specific ISNs. One path forward is to conduct comparative analyses of multiple diverse ISNs. We present and apply a conceptual framework for linking ISN modus operandi to spatial-temporal dynamics and patterns of activity. We demonstrate this through a comparative analysis of three ISNs – cocaine, illegally traded wildlife, and illegally mined sand – which range from well-established to emergent, global to domestic in geographic scope, and fully illicit to de facto legal. The proposed framework revealed consistent traits related to geographic price structure, value capture at different supply chain stages, and key differences among ISN structure and operation related to commodity characteristics and their relative illicitness. Despite the diversity of commodities and ISN attributes compared, social and environmental harms inflicted by the illicit activity consistently become more widespread with increasing law enforcement disruption. Drawing on these lessons from diverse ISNs, which varied in their histories and current sophistication, possible changes in the structure and function of nascent and/or low salience ISNs may be anticipated if future conditions or law enforcement pressure change.

The Influence of Supply Network Structure on Firm Sustainability Performance

This study investigates the structural properties of supply network and examines the relationship between a firm’s degree centrality and local density and its sustainability performance. Furthermore, we examine the potential moderating effects of sustainability capability and a firm’s closeness centrality on sustainability performance. The hypotheses were tested using a secondary supply network dataset consisting of 18943 companies and 103,632 contractual links between them from the automotive industry. We use social network analysis approach for calculating each structural property. Upon that, we also retrieved the sustainability performance data using Eikon database and 304 companies were returned for the further regression analysis. Our results unravel that local density of a firm’s supply network has a significant relationship with its sustainability performance. The results also indicate that sustainability capability weakens the relationship between a firm’s upstream supplier degree centrality on sustainability performance. Moreover, the association between a firm’s local density and sustainability performance may be strengthened by the firm’s closeness centrality. In this light, this study contributes to supply chain research and sustainability management by accounting for the embedded nature of visible and often-invisible connectivity patterns in supply networks and showing how these structural properties influence the embedded firms to achieve their sustainability performance.

THE SEISMIC RESPONSE OF WATER SUPPLY NETWORKS IN RANDOM SEISMIC FIELDS BASED ON PHYSICAL MECHANISMS

Water supply networks are important components of lifeline engineering. Because of the influence of random earthquake motion fields, their seismic response and function also have obvious randomness. The influence of the complicated topological structure of water supply networks cannot be considered by the traditional seismic response analysis of buried pipelines. The traditional method is also difficult to be applied to analyze the random vibration of the nonlinear system. The physical response of pipelines has not been implemented into the functional analysis of water supply networks. To solve these three problems, this paper modifies the random physical model of seismic ground motion fields on the local engineering site, introduces a finite element method of buried pipe networks, combines the probability density evolution method, and realizes the random seismic response analysis of water supply networks. Furthermore, the transient flow theory is utilized, and the random seismic function analysis of water supply networks is completed. It lays foundation for the seismic reliability evaluation of water supply networks.

Catastrophic supply chain disruptions and supply network changes: a study of the 2011 Japanese earthquake

PurposeCatastrophic supply chain disruptions can significantly damage the operational and financial performance of firms. While a growing body of literature on supply network structures has studied what influences supply networks' vulnerability to supply chain disruptions and capability to recover from them, it remains unclear how supply network structures change after major supply chain disruptions. We aim to provide an understanding of how these changes occur.Design/methodology/approachUsing a natural experiment approach and supply network data from Factset, this study investigates how firms' supply network structures change after experiencing the catastrophic supply chain disruptions caused by the 2011 Tohoku earthquake and tsunami in Japan. We capture post-earthquake supply network changes using the measures of degree centrality and ego network density.FindingsThe results of the analysis suggest that compared to unaffected firms, the affected firms experience changes in their supply network structures tending toward lower complexity measured by in-degree centrality, out-degree centrality and ego network density.Originality/valueThis study contributes to social network theory and the complex adaptive supply network literature by providing empirical evidence of structural changes in supply networks after catastrophic supply chain disruptions. A managerial contribution is made by providing a reflection on why these changes might be occurring and alert firms to the challenges of managing complexity in their supply networks.

Enhanced Variable Neighborhood Search-Based Recovery Supplier Selection for Post-Disruption Supply Networks

With the increasing reliance on global sourcing and the growth in the likelihood of disruptive incidents, today’s supply networks are more prone to unexpected natural and man-made disruptive events. In order to alleviate the losses caused by these disruptive events, when a large-scale event disrupts multiple suppliers simultaneously, a single or several critical suppliers should be selected from the disrupted ones to assist them to recover their production as soon as possible. The selection of these recovery suppliers is of great importance in the recovery process of the entire supply network. Thus, this paper proposes a recovery supplier selection method from the view of the supply network structure. Firstly, a tripartite graph-based supply model is proposed to depict a two-stage supply network, which consists of multiple manufacturers and suppliers as well as the diverse product supply-demand interdependence connecting them. To measure the impacts caused by supplier disruptions and to evaluate the effectiveness of recovery supplier decisions, two supply network performance metrics reflecting product supply availability are also given. Then, the recovery supplier selection problem is described as a combinatorial optimization problem. To solve this problem, a heuristic algorithm, with enhanced variable neighborhood search (EVNS) is designed based on the general framework of a variable neighborhood search. Finally, experiments based on a real-world supply network are conducted. The experimental results indicate that the proposed method is applicable and effective.

Assessing supply network complexity in maritime industry in Malaysia: inter-firms’ relations drives pattern of supply network structure

Assessing supply network complexity in maritime industry in Malaysia: inter-firms’ relations drives pattern of supply network structure

Methodological and ideological options exploring supply chain models for Sydney rock oysters

The processing/wholesale supply chain model has been historically adopted by farmers of Australia's Sydney rock oyster (SRO) (Saccostrea glomerata) industry to transfer their product to consumers. The model has been criticized for restricting farmer's price bargaining power and for offering limited added value to the product. Recent anecdotal reports suggest that there has been a change in how oysters are supplied by farmers to the market. This case study aimed to map the supply chain of SROs at an industry level, to identify and to describe the existing supply and value chain models within the broader supply network structure, and to investigate factors that determine how farmers choose supply chain models. A literature review, a web-content search, and semi-structured interviews with supply chain stakeholders were undertaken to achieve these aims. Results suggest that the processing/wholesale model still plays a dominant role within the broader supply network. However, other models of supply chain coordination that generate higher returns have emerged in response to farmer's dissatisfaction with the processor/wholesaler model. Findings suggest that oyster farmers choose specific distribution models based on the net financial value they generate and other considerations such as farmers' skills, interest in maximizing profits, knowledge about consumer demand, time/effort to develop network links and existing trust-based relationships.

Discontinuous transition to loop formation in optimal supply networks

The structure and design of optimal supply networks is an important topic in complex networks research. A fundamental trait of natural and man-made networks is the emergence of loops and the trade-off governing their formation: adding redundant edges to supply networks is costly, yet beneficial for resilience. Loops typically form when costs for new edges are small or inputs uncertain. Here, we shed further light on the transition to loop formation. We demonstrate that loops emerge discontinuously when decreasing the costs for new edges for both an edge-damage model and a fluctuating sink model. Mathematically, new loops are shown to form through a saddle-node bifurcation. Our analysis allows to heuristically predict the location and cost where the first loop emerges. Finally, we unveil an intimate relationship among betweenness measures and optimal tree networks. Our results can be used to understand the evolution of loop formation in real-world biological networks.

Administrative environmental innovations, supply network structure, and environmental disclosure

AbstractThis study contributes to a theoretical and empirical understanding of whether and how administrative environmental innovations (AEIs)—implemented to help track and manage a firm's environmental impacts—are related to environmental disclosure. Drawing on the Belief–Action–Outcome framework, we posit that the motivation of individuals (employees, managers, and the leadership) within the firm to access, use, and act on the environmental information available to them would be enhanced by the firm's implementation of AEIs, resulting in more extensive environmental disclosure by the firm. Additionally, building on the literature on supply chain networks, we posit that the structural position of the firm vis‐à‐vis its supply network—reflecting information flows, network learning, and status—moderates the AEI implementation–environmental disclosure relationship. To test our hypotheses, we build a multi‐industry dataset of 3,106 firm‐year observations based on 67,809 dyadic cost‐of‐goods‐sold‐based relationships obtained from Bloomberg's supply chain relationships database to construct the supply networks of focal firms. We also draw on Bloomberg's environmental, social, and governance (ESG) data for our AEI implementation and environmental disclosure measures. We find significant evidence to support our hypothesis that AEI implementation is positively associated with the extent of environmental disclosure. However, the implementation of both internal and external forms of AEIs has a more pronounced positive relationship with the extent of environmental disclosure, compared to the implementation of either form alone. With regard to supply network structure, we identify three principal variables—accessibility, control, and interconnectedness—that influence network learning and status of the focal firm and find that they moderate the AEI implementation–environmental disclosure relationship. We provide insights for theory and practice based on our findings.

When Ignorance Is Not Bliss: An Empirical Analysis of Subtier Supply Network Structure on Firm Risk

Using a multitier mapping of supply-chain relationships constructed from granular global, firm-to-firm supplier–customer linkages data, we quantify the degree of financial risk propagation from the supply network beyond firms’ direct supply-chain connections and isolate structural network properties serving as significant moderators of risk propagation. We first document a baseline fact: a significant proportion of tier-2 suppliers are shared by tier-1 suppliers. We then construct two simple metrics to capture the degree of tier-2 sharing and disentangle its effect from tier-2 suppliers’ own risks. We show that the focal firms’ risk levels are significantly related to the proportion of shared tier-2 suppliers in their supply network, and the effect becomes monotonically stronger as their tier-2 suppliers become more highly shared. Finally, we uncover causal relationships behind these associations using a new source of exogenous, idiosyncratic risk events in an event study setting. We show that, as tier-2 suppliers are impacted by these events, focal firms experience negative abnormal returns, the magnitude of which is significantly larger when the impacted tier-2 suppliers are more heavily shared. Overall, our study uncovers the subtier network structure as an important risk source for the focal firm, with the degree of tier-2 sharing as the main moderator. Our results also provide the microfoundation for a common structure in idiosyncratic risks and suggest the importance of incorporating the effect of subtier supply network structure in the portfolio-optimization process. This paper was accepted by Vishal Gaur, operations management.

Management of Critical Lower-Tier Suppliers in Global Networks: Practical Relevance, Literature Review, and Management Perspectives

Global supply networks have grown as a result of decades of intensive, strategic outsourcing to firms located in eastern countries. The initially linear supply chains have transformed over time into complex, extensive supply network structures with numerous lower-tier suppliers located all over the world. The recent COVID-19 pandemic has caused bottlenecks in these global supply chains, presenting company supply managers who are responsible for sourcing with enormous challenges. Firms face high risks due to the low levels of transparency and asymmetric divisions of power in their global supply chains, risks that are only heightened by the recent COVID-19 crisis. In this article, we address this issue by describing the characteristics of critical lower-tier suppliers (CLTS) in practice and scientific literature. The results of this review may serve as an initial framework, guiding researchers in the future as they develop a research model that can be used to explain the success factors of CLTS management in global network structures. Finally, based on these literature review results, this article provides an overview of perspectives and trends in the management of CLTS in the post-COVID-19 business world.

Sustainable supply network structure: Understanding impact of inter-firms’ relations as drivers of supply network complexity

This study examined the Inter-Firm Relation (IFR) as one of the elements to enhance Sustainable Supply Network Structure (SSNS) management in Malaysian maritime industry supply network. IFR has been an interesting research area for academics and businesses practices due to its relevance in determining the best practices and impacts to encourage SSNS. The Social Network Analysis (SNA) method was adopted to develop valid attribute for the measurement process and the embeddedness theory was used to evaluate IFR among the proposed attributes. These methods enable the researcher to transform relational data in the form of network matrix and produce reliable results for theoretical and industrial applications which have not been discovered in previous studies. A total of 37 managers in a maritime industry supply network were approached to participate in this study. Result revealed that IFR has different effects on the formation of SSNS. The finding provides useful insight in formulating the importance of IFR towards improving and understanding SSNS, particularly, in the Malaysian maritime industry. The contribution of this research extends to the literature and put forward solutions for the industry since previous studies are neglecting IFR, which is highlighted as a source of supply network complexity. Keywords: complexity, inter-firm relation, social network analysis, supply network, sustainable supply network

Does being central in formal network improve trust projection? A social network analysis of supply network structure

Does being central in formal network improve trust projection? A social network analysis of supply network structure

The relationship between quality and governance mechanisms

PurposeRecent literature has highlighted the importance of quality and governance in supply networks. Usually, the relationships between the actors are complex, comprising both formal and informal interactions. Despite recent advances in quality and governance in supply networks, extant literature highlights the lack of quality in healthcare supply-chain networks in relation to governance mechanisms. This paper aims to investigate the role of governance mechanisms and their influence on the quality of healthcare supply networks, and assumes that governance instruments can support quality performance.Design/methodology/approachA multiple-case research approach was employed. Six organisations in the Brazilian healthcare sector were analysed (four operate only with renal replacement therapy, one is a material supplier, and one operates with renal replacement therapy and collective procurement).FindingsFindings showed that there is no formalised supply network structure in these organisations. A possible consequence of this is that the supply-network governance is dominated by informal relationships. In the quality dimension, managers' awareness is limited, but there are mechanisms in place to control the quality of the materials.Practical implicationsHealthcare managers can actively invest in the social aspects of the relationship between buyer and supplier, such as trust and commitment, thus increasing responsiveness in patient care. However, this informal procedure can lead to problems with tracking and reliability, ultimately leading to quality problems. Therefore, it is recommended that formal and informal governance instruments be used jointly to improve service quality.Originality/valueThis study suggests that the integration of formal and informal mechanisms of governance can improve the quality of supply networks. Additionally, if the administrative process is purely formal, network relationships and their efficiency will be impaired.

The Power of Sectoral Geographical Centrality in Global Production

Power is a key component in understanding and analyzing global production and the governance structures of Global Value Chains. In this paper, we propose a novel analytical link between the power dynamics in GVCs and the network configuration of their respective production topology. Our proposed link is based on the notion of positional power according to which power is associated with the centrality of a sector with regards to the production process, the sector belongs to. Using global input-output data, we show that the network structure of global production is associated with the global distribution of profits among national economic sectors and, consequently, influences the power relations and thus the governance structures of supply networks. More specifically, we find a high correlation between the distribution of profits and a sector’s position in global production, captured by its total strength centrality. Based on this, we provide a quantitative measure of positional power within global production and its governance structures.

Construction of a stochastic model for a water supply network with hidden leaks and a method for detecting and calculating the leaks

We have constructed a stochastic model of a water supply network with leaks, which, compared to the previously proposed models (excluding leaks), more adequately describes the processes of transportation and water distribution in water supply systems. Mathematical modeling of water supply networks is associated with difficulties related to the huge dimensionality of actual water supply networks, limited information resources and operational data, which does not make it possible to assess parameters of the technological equipment and structure of a water supply network adequately enough. Therefore, an equivalent scheme is built for an actual water supply network based on its dictation points, which is then used for subsequent calculations. The task on building a scheme for an equivalent water supply network consists of three problems: identification of the structure, parameters, and state of a water supply network. The proposed method for leaks detection is based on the comparison of change in the magnitude of head at pumping stations and at the dictation points of a water supply network. Based on the stochastic model of a water supply network with leaks, we have constructed a method for calculating the magnitude of leaks, which implies the following: by knowing the head of water at the nodes of an equivalent water supply network and the approximate diameters of leaks at nodes, new values of heads at nodes of the equivalent water supply network are calculated. Then we again compute the magnitude of a leak by knowing the new head at the node and the diameter of the leaks. Upon completion of several such iterations, a conclusion is drawn on that starting at a certain step the magnitude of leaks and the heads at the nodes of the equivalent water supply network stop changing. By knowing the magnitude of leaks and head at each node within the equivalent water supply network, we determine the actual diameter of fistulas at each node. The proposed method for calculating the magnitude of leaks does not require financial costs or the use of additional equipment; it could be used by water utilities to detect and calculate the magnitude of leaks

Is it too complex? The curious case of supply network complexity and focal firm innovation

AbstractFirms have increasingly relied on their supply network for improving their innovation performance. Although the relationship between the supply network structure and innovation has been investigated, the link between supply network complexity and a firm's innovation remains unexplored. By employing transaction cost economics and the concept of a recombinatory search, we propose that the complexity dimensions (horizontal, vertical, and spatial complexity) of a supply network impact the innovation performance of a firm and that such relationships are moderated by a strategic emphasis on value creation and the influence of the firm over the supply network. With a large‐scale network data of 201 firms across six industries and 20 countries, we take a robust empirical approach that accounts for endogeneity, unobserved heterogeneity and intrafirm error correlation to test our theory. We find strong support for a nonlinear relationship (with diminishing growth) between both horizontal and vertical complexity with respect to innovation performance. We find that spatial complexity is negatively related to innovation performance. Additionally, we find that a firm's strategic emphasis and its influence indeed moderates the link between the complexity dimensions and innovation performance. Based on our findings, we offer specific managerial guidance for the effective implementation of sourcing practices.

Supplier innovation value from a buyer–supplier structural equivalence view: Evidence from the PACE awards in the automotive industry

AbstractWith the growing demand for smarter, cleaner, and safer cars, automotive original equipment manufacturers (OEMs) are increasingly seeking novel inventions from innovative new or foreign suppliers. However, not all innovative suppliers are equally valuable for an OEM. When transforming novel inventions into products, OEMs could find it challenging to work with the suppliers with whom they lack trust or have limited shared understanding. In this study, we adopt a social capital perspective to understand how three types of social capital (i.e., structural, relational, and cognitive) influence a supplier's innovation value to the OEM. Hypotheses are tested using a unique data set combining the supply network structure and automotive supplier innovation award. Our results suggest that it is more difficult to obtain innovation value from a new or culturally distant foreign supplier. However, we also found that suppliers whose networks overlap more with the OEM's network are more likely to provide valuable innovations to the OEM, an effect that is stronger for culturally distant suppliers. This study contributes to the supply network and innovation literature by highlighting the importance of understanding the dyadic social capital between the buyer and supplier when evaluating innovation value of a supplier to a buying firm.