An empirical analysis of supply and manufacturing risk and business performance: a Chinese manufacturing supply chain perspective

Abstract

Purpose-This study explores the importance and impact of supply and manufacturing risk management upon business performance within the context of Chinese manufacturing supply chains. Design/Methodology/Approach-A two phased multi-method approach was adopted, which included a survey questionnaire to practitioners in Chinese manufacturing supply chains followed by semi-structured interviews. The findings included 103 valid survey responses complemented by six semi-structured interviews. Findings-The results indicate that in Chinese manufacturing context supply risk and manufacturing risk management are both vital for business performance. A high correlation between business and manufacturing risk management performance exists, however no significant impact of supplier dependency, systematic purchasing, maturity of production and supply chain, and human resources was found despite previously these elements being regarded as key influencers for supply and manufacturing risk management performance. The Chinese manufacturing supply chain indicated that elements such as the supplier and customer orientation, flexibility, manufacturing and supply risk highly connotes with business performance. Theoretical/Practical implications-In the current unpredictable and volatile business environment the competitiveness of manufacturing supply chains to a large extent depend on their ability to identify, assess and manage the manufacturing and supply risks. The findings of this study will assist supply chain managers in taking decision on manufacturing and supply risk management and reducing the uncertainty upon their business performance. Originality/value-The supply chain risk has been widely explored within the context of individual case studies, or standalone models focusing on either supply or manufacturing risk in supply chains, however to what extent this has been applicable to a wider context and its impact upon business process has not been explored. Hence, this study simultaneously has analysed manufacturing risk and supply risk and its impact upon Chinese manufacturing supply chains business performance. Moreover, this study uses a combination of quantitative and qualitative methods, which is often limited in this area. Finally, the institutional theory lens offers novel insights in better understanding the factors that can affect the impact of supply and manufacturing risk management upon business performance in those contexts, such as China, where the institutional aspect presents specific features.

Sustainable Supply Management Practices and Sustainability Performance: The Dynamic Capability Perspective

“…The quantity of SSM practices is large when all measurements are considered. In this way, firms must perceive which practice is highly significant and persuasive in SSM as the firm size is also considered as a primary factor affecting a business supply risk management (Kumar et al, 2018) and network resources (Huggins & Johnston, 2010) since large firms are found to have better data conveyance and perform better in utilizing information (Ellegaard, 2008), as compared with small enterprises (Raza et al, 2019;Raza & Majid, 2016). Therefore, this study argument grounded in the conception that SSM practices can amplify SCRM and NC linked with firm size, which, in turn, strengthens the path between SSM practices and SP.…”

“…In search of the answer to this question, recent literature mainly paid attention to firm's social and green practices and technological adaptation strategies (Bai et al, 2012;Beske-Janssen et al, 2015;Chardine-Baumann & Botta-Genoulaz, 2014;Mårtensson & Westerberg, 2016;Paulraj, 2011;Rathore et al, 2020). Furthermore, supply management literature reveals that considerable attention has been paid to environmental, social, and economic performances (Hong et al, 2018;Kumar et al, 2018). Limited studies have been carried out on supply chain sustainability practices and performance outcomes (Hong et al, 2018;Kamble et al, 2020).…”

“…Considering that in practice, firms' sustainability is simultaneously affected by multiple factors (D'Souza et al, 2020;Lourenço & Branco, 2013), moderations and mediation pathways may exist in the relationship between SSM practices and SP. The governance mechanisms for a firm performance recently proposed that the differentiated effects of sustainable supply chain management (SSCM) practices could be significantly revealed through probing supply chain dynamic capabilities (Hong et al, 2018;Vijayan & Kamarulzaman, 2020), the performance of supplier risk management and performance of manufacturing risk management (Kumar et al, 2018), social networks and network governance as critical intermediaries between SSCM institutional forces and SSCM commitment (H. E. Lu et al, 2018). This article focuses on SCRM and NC as important mechanisms because businesses frequently adjust their risk management practices and networking capabilities when they notice that they have successively sustained their supply chain management practices.…”

Determining the antecedents of dynamic supply chain capabilities

“…Discriminant validity was established by comparing the AVE with maximum shared variance (MSV) for each construct. MSVs of the constructs were less than AVEs, providing evidence of discriminant validity (Kumar et al, 2018;Liu et al, 2018). Furthermore, bi-variate correlations were compared with the square root of AVE (Fornell & Larcker, 1981).…”

The Environment Factors of Supply Chain Risk Management : A Conceptual Framework

“…This phenomenon has led to increased interest in supply chain risk management (SCRM) to cope with complex supply chain. SCRM has received increased attention from researchers and practitioners because of the uncertainty and complexity facing supply chains (Kumar et al,2018). SCRM provides effective tools and practices which, aligned with the corporate strategy, mitigates the challenges created by uncertainty and complexity.…”