Dealing with Supply Chain Risks: Linking Risk Management Practices and Strategies to Performance

Andreas Wieland, Carl Marcus Wallenburg

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

Purpose: – The effects of supply chain risk management (SCRM) on the performance of a supply chain remain unexplored. It is assumed that SCRM helps supply chains to cope with vulnerabilities both proactively by supporting robustness and reactively by supporting agility. Both dimensions are assumed to have an influence on the supply chain's customer value and on business performance. The aim of this research is to provide clarity by empirically testing these hypotheses and scrutinizing the findings by the means of case studies.
Design/methodology/approach: – The research is empirical. Survey data were collected from 270 manufacturing companies for hypotheses testing via structural equation modeling. Additionally, qualitative data were collected to explore the nature of non‐hypothesized findings.
Findings: – It is found that SCRM is important for agility and robustness of a company. Both agility and robustness show to be important in improving performance. While agility has a strong positive effect only on the supply chain's customer value, but not directly on business performance, robustness has a strong positive effect on both performance dimensions. This important finding directs the strategic attention from agility‐centered supply chains to ones that are both robust and agile. The case studies provide insights to the fact that robustness can be considered a basic prerequisite to deal with supplier‐side risks, while agility is necessary to deal with customer‐side risks. The amount of agility and robustness needs to fit to the competitive strategy.
Practical implications: – Since volatility has increasingly become a prevalent state of supply chains, companies need to consider robustness to be of primary importance to withstand everyday risks and exceptions.
Originality/value: – This is the first study to view the relationship between SCRM, agility/robustness, and performance.
Purpose: – The effects of supply chain risk management (SCRM) on the performance of a supply chain remain unexplored. It is assumed that SCRM helps supply chains to cope with vulnerabilities both proactively by supporting robustness and reactively by supporting agility. Both dimensions are assumed to have an influence on the supply chain's customer value and on business performance. The aim of this research is to provide clarity by empirically testing these hypotheses and scrutinizing the findings by the means of case studies.
Design/methodology/approach: – The research is empirical. Survey data were collected from 270 manufacturing companies for hypotheses testing via structural equation modeling. Additionally, qualitative data were collected to explore the nature of non‐hypothesized findings.
Findings: – It is found that SCRM is important for agility and robustness of a company. Both agility and robustness show to be important in improving performance. While agility has a strong positive effect only on the supply chain's customer value, but not directly on business performance, robustness has a strong positive effect on both performance dimensions. This important finding directs the strategic attention from agility‐centered supply chains to ones that are both robust and agile. The case studies provide insights to the fact that robustness can be considered a basic prerequisite to deal with supplier‐side risks, while agility is necessary to deal with customer‐side risks. The amount of agility and robustness needs to fit to the competitive strategy.
Practical implications: – Since volatility has increasingly become a prevalent state of supply chains, companies need to consider robustness to be of primary importance to withstand everyday risks and exceptions.
Originality/value: – This is the first study to view the relationship between SCRM, agility/robustness, and performance.
LanguageEnglish
JournalInternational Journal of Physical Distribution & Logistics Management
Volume42
Issue number10
Pages887-905
ISSN0960-0035
DOIs
StatePublished - 2012
Externally publishedYes

Keywords

    Cite this

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    title = "Dealing with Supply Chain Risks: Linking Risk Management Practices and Strategies to Performance",
    abstract = "Purpose: – The effects of supply chain risk management (SCRM) on the performance of a supply chain remain unexplored. It is assumed that SCRM helps supply chains to cope with vulnerabilities both proactively by supporting robustness and reactively by supporting agility. Both dimensions are assumed to have an influence on the supply chain's customer value and on business performance. The aim of this research is to provide clarity by empirically testing these hypotheses and scrutinizing the findings by the means of case studies.Design/methodology/approach: – The research is empirical. Survey data were collected from 270 manufacturing companies for hypotheses testing via structural equation modeling. Additionally, qualitative data were collected to explore the nature of non‐hypothesized findings.Findings: – It is found that SCRM is important for agility and robustness of a company. Both agility and robustness show to be important in improving performance. While agility has a strong positive effect only on the supply chain's customer value, but not directly on business performance, robustness has a strong positive effect on both performance dimensions. This important finding directs the strategic attention from agility‐centered supply chains to ones that are both robust and agile. The case studies provide insights to the fact that robustness can be considered a basic prerequisite to deal with supplier‐side risks, while agility is necessary to deal with customer‐side risks. The amount of agility and robustness needs to fit to the competitive strategy.Practical implications: – Since volatility has increasingly become a prevalent state of supply chains, companies need to consider robustness to be of primary importance to withstand everyday risks and exceptions.Originality/value: – This is the first study to view the relationship between SCRM, agility/robustness, and performance.",
    keywords = "Strategy, Supply chain, Risk management, Supply chain management, Agility, Robustness, Performance management",
    author = "Andreas Wieland and Wallenburg, {Carl Marcus}",
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    language = "English",
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    pages = "887--905",
    journal = "International Journal of Physical Distribution & Logistics Management",
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    Dealing with Supply Chain Risks : Linking Risk Management Practices and Strategies to Performance. / Wieland, Andreas; Wallenburg, Carl Marcus.

    In: International Journal of Physical Distribution & Logistics Management, Vol. 42, No. 10, 2012, p. 887-905.

    Research output: Contribution to journalJournal articleResearchpeer-review

    TY - JOUR

    T1 - Dealing with Supply Chain Risks

    T2 - International Journal of Physical Distribution & Logistics Management

    AU - Wieland,Andreas

    AU - Wallenburg,Carl Marcus

    PY - 2012

    Y1 - 2012

    N2 - Purpose: – The effects of supply chain risk management (SCRM) on the performance of a supply chain remain unexplored. It is assumed that SCRM helps supply chains to cope with vulnerabilities both proactively by supporting robustness and reactively by supporting agility. Both dimensions are assumed to have an influence on the supply chain's customer value and on business performance. The aim of this research is to provide clarity by empirically testing these hypotheses and scrutinizing the findings by the means of case studies.Design/methodology/approach: – The research is empirical. Survey data were collected from 270 manufacturing companies for hypotheses testing via structural equation modeling. Additionally, qualitative data were collected to explore the nature of non‐hypothesized findings.Findings: – It is found that SCRM is important for agility and robustness of a company. Both agility and robustness show to be important in improving performance. While agility has a strong positive effect only on the supply chain's customer value, but not directly on business performance, robustness has a strong positive effect on both performance dimensions. This important finding directs the strategic attention from agility‐centered supply chains to ones that are both robust and agile. The case studies provide insights to the fact that robustness can be considered a basic prerequisite to deal with supplier‐side risks, while agility is necessary to deal with customer‐side risks. The amount of agility and robustness needs to fit to the competitive strategy.Practical implications: – Since volatility has increasingly become a prevalent state of supply chains, companies need to consider robustness to be of primary importance to withstand everyday risks and exceptions.Originality/value: – This is the first study to view the relationship between SCRM, agility/robustness, and performance.

    AB - Purpose: – The effects of supply chain risk management (SCRM) on the performance of a supply chain remain unexplored. It is assumed that SCRM helps supply chains to cope with vulnerabilities both proactively by supporting robustness and reactively by supporting agility. Both dimensions are assumed to have an influence on the supply chain's customer value and on business performance. The aim of this research is to provide clarity by empirically testing these hypotheses and scrutinizing the findings by the means of case studies.Design/methodology/approach: – The research is empirical. Survey data were collected from 270 manufacturing companies for hypotheses testing via structural equation modeling. Additionally, qualitative data were collected to explore the nature of non‐hypothesized findings.Findings: – It is found that SCRM is important for agility and robustness of a company. Both agility and robustness show to be important in improving performance. While agility has a strong positive effect only on the supply chain's customer value, but not directly on business performance, robustness has a strong positive effect on both performance dimensions. This important finding directs the strategic attention from agility‐centered supply chains to ones that are both robust and agile. The case studies provide insights to the fact that robustness can be considered a basic prerequisite to deal with supplier‐side risks, while agility is necessary to deal with customer‐side risks. The amount of agility and robustness needs to fit to the competitive strategy.Practical implications: – Since volatility has increasingly become a prevalent state of supply chains, companies need to consider robustness to be of primary importance to withstand everyday risks and exceptions.Originality/value: – This is the first study to view the relationship between SCRM, agility/robustness, and performance.

    KW - Strategy

    KW - Supply chain

    KW - Risk management

    KW - Supply chain management

    KW - Agility

    KW - Robustness

    KW - Performance management

    U2 - 10.1108/09600031211281411

    DO - 10.1108/09600031211281411

    M3 - Journal article

    VL - 42

    SP - 887

    EP - 905

    JO - International Journal of Physical Distribution & Logistics Management

    JF - International Journal of Physical Distribution & Logistics Management

    SN - 0960-0035

    IS - 10

    ER -