Vol. 48, No. 3
Global Supply Chains: Other Voices
As an academic discipline, supply chain management borrows liberally from other areas to inform empirical studies. But supply chain scholars may not realize that other disciplines are interested in supply chain issues and the realities of supply chain management. We are fortunate to present essays by eminent scholars in three other academic disciplines — economics, geography and sociology/global development — that use supply chain concepts to advance their theories and practices, especially in the global arena. In turn, we believe that these "outside" views of supply chains will serve our community by bringing fresh approaches to very difficult problems and raising new research possibilities and perspectives.
In this introduction, we outline the highlights of each essay and present some avenues for further research for supply chain and other academic disciplines.
Arnold Maltz, Ph.D., is an associate professor of supply chain management at Arizona State Univeristy in Tempe, Arizona.
Supply Chain Logistics, Trade Facilitation and International Trade: A Macroeconomic Policy View
Trade facilitation (TF) is the rubric that covers the research on and policy analysis of impediments to global sourcing and multinational supply chains that are not the traditional border barriers such as tariffs or quotas. TF research offers a macroeconomic perspective on how policymakers should change the environment facing business to promote international trade and economic growth, whereas the microeconomic perspective of supply chain logistics considers how a business should organize its operations given the policy environment. Four approaches to TF research that are oriented toward measuring the policy environment facing business are covered in this review: Country bench-marking, country or product case study, deep econometric analysis of one type of TF, and econometric analysis of multiple TF issues faced by business across multiple countries. All told, the research shows that the links between improved TF policies and business global sourcing through international trade are positive; however, which policy reforms support more global sourcing is unique to each country, depending on the products and supply chains of which the country is a part, and also on initial conditions. Even so, a key finding that spans the research is that unilateral policy reforms within a country can expand international trade more than multilateral trade negotiations; and that TF reforms tend to improve a country's supplier position more than its buyer activities. Moreover, adherence to International Organization for Standardization (ISO) guidelines and use of information technology are particularly important, confirming that ISO certification has become the price of admission for many supply chains.
Catherine L. Mann, Ph.D., is the Rosenberg Professor of Global Finance in the International Business School at Brandeis University in Concord, Massachusetts.
The Geography of Global Supply Chains: Evidence from Third-Party Logistics
Global supply chains have a distinct geography that involves the dimensions of production, distribution and consumption. This geography, at the heart of many sourcing strategies, is often neglected by supply chain managers, or at least by scholars investigating supply chain management. However, this essay underlines that this geography reveals patterns that depict well the organization and structure of outsourcing, with distribution systems supporting the dichotomy between the geography of production and consumption. Significant segments of supply chain management exist solely to support this spatial divergence. Global processes also are reflected in regional structures and the case of third-party logistics providers (3PLs) is investigated. Depending on the gateway and the type of supply chain being serviced, North American 3PLs display a clustering that is particularly prevalent around airport terminals and cross-border ports of entry. Such firms are highly flexible, and changes in locational behavior are likely to reflect changes in outsourcing and supply chain management.
Jean-Paul Rodrigue, Ph.D., is a professor in the Department of Global Studies & Geography at Hofstra University in Hempstead, New York.
Why the World Suddenly Cares About Global Supply Chains
The global value chain (GVC) concept has gained popularity as a way to analyze the international expansion and geographical fragmentation of contemporary supply chains, and the value creation/capture therein. It has been used broadly in academic publications that examine a wide range of global industries, and by many of the international organizations concerned with economic development. This note highlights some of the main features of GVC analysis and discussed the relationship between the core concepts of governance and upgrading. The key dynamics of contemporary global supply chains and their implications for global production and trade are illustrated by (1) the consolidation of global value chains and the new geography of value creation and capture, with an emphasis on China; (2) the key roles of global supermarkets and private standards in agri-food supply chains; and (3) how the recent economic crisis contributes to shifting end markets and the regionalization of value chains. It concludes with a discussion of the future direction of GVC analysis and a potential collaboration with supply chain researchers.
Gary Gereffi, Ph.D., is a professor in the Department of Sociology at Duke University in Durham, North Carolina;
Joonkoo Lee, Ph.D., is a postdoctoral research scholar at the Social Science Research Institute at Duke University in Durham, North Carolina.
Engagement in Environmental Behavior Among Supply Chain Management Employees: An Organizational Support Theoretical Perspective
While environmental management is an important topic in supply chain management, there is little theoretical understanding of how firm practices (supervisory support, rewards and training) relate to employee engagement in environmental behaviors. Drawing upon behavioral research literature, the purpose of our article is to use organizational support theory to develop a model of how employee perceptions of management practices influence employee engagement in environmental behaviors, such as participating in environmental management activities, promoting environmental initiatives, and proposing innovative environmental practices. The theoretical model was evaluated using a sample of supply chain management employees employed by a major retailer, and support was found for all of the hypothesized relationships — except those entailing rewards. Study findings demonstrate the importance of employee perceptions in advancing employee-level involvement in environmental behaviors, and also shows how organizations can modify their internal infrastructures to champion environmental behaviors through their effects on employee perceptions of support for the environment and commitment to the environment. Additionally, the research illustrates how an extant behavioral theory, organizational support theory, can profitably be modified and adopted to explain behavior in the field of supply chain management.
David E. Cantor, Ph.D., is an assistant professor of supply chain management in the College of Business at Iowa State University in Ames, Iowa,
Paula C. Morrow, Ph.D., is a University Professor and the Max S. Wortman, Jr. Professor of Management in the College of Business at Iowa State University in Ames, Iowa;
Frank Montabon, Ph.D., is an associate professor in the College of Business at Iowa State University in Ames, Iowa.
The Intersection of Power, Trust and Supplier Network Size: Implications for Supplier Performance
This paper examines the intersecting effects of power, trust and supplier network size on five dimensions of supplier performance (delivery, quality, cost, innovation and flexibility). When assessing main effects, coercive power shows a negative relationship with supplier quality and innovation; reference power shows a positive relationship with all dimensions of supplier performance; and legitimate power shows a positive relationship with supplier delivery, cost and flexibility. The supplier's trust in the buyer also shows a positive relationship to all five supplier performance dimensions. While exhibiting no main effects, supplier network size moderates these power-performance relationships: Increasing supplier network size appears to attenuate the impacts of coercive and referent power upon suppliers performance, while strengthening this connection in the case of legitimate power. Contrary to our hypotheses, expert power use exhibits a negative relationship with supplier delivery performance — an effect which is exacerbated with increasing supplier network size. Overall, this study suggests that, while not as independently important as perhaps thought, selecting the right number of suppliers may have considerable contextual influence on the interplay between power, trust and performance in buyer-supplier relationships.
Regis Terpend, Ph.D., is an assistant professor of supply chain management in the College of Business and Economics at Boise State University in Boise, Idaho;
Bryan Ashenbaum, Ph.D., is an assistant professor of supply chain management in the Farmer School of Business at Miami University in Oxford, Ohio.
Drivers of Relationship Quality in Logistics Outsourcing in China
Given than an increasing number of companies outsource their logistics activities to third-party logistics providers (3PLs), managing logistics outsourcing relationships has become a critical capability. Although the fundamental importance of relationship quality in supply chain relationship management has begun to be understood, it has not been investigated in the context of logistics outsourcing, especially in China. This study addresses the gap in the literature by examining the drivers of relationship quality and investigating its effect on performance in logistics outsourcing in China. We use transaction cost economics and resource dependence theory as the bases of this study. Dependence on 3PL (i.e. 3PL importance and unavailability of alternatives), logistics performance and relationship characteristics (i.e. the level of information sharing, relationship length and legal contract) are hypothesized as the relationship drivers, based on transaction cost economics and resource dependence theory. Findings reveal that 3PL importance, logistics performance and information sharing are positively related to relationship quality; and that relationship length and the presence of a legal contract are marginally and positively related to relationship quality. The positive influence of relationship quality on financial performance also is observed. The managerial implications of the findings are considered, and the limitations along with future research directions are discussed.
Zhaofang Chu, Ph.D., is an associate professor of logistics and supply chain management in the School of Management at the University of Science and Technology in Hefei, China;
Qiang Wang, Ph.D., is a professor in the School of International Trade and Economics at the University of International Business and Economics in Beijing, China.
Linking Supply Chain Management Superiority to Multifaceted Firm Financial Performance
Research has shown that superior supply chain effectiveness can yield enhanced firm financial performance. However, existing research does not use a consistent definition or a comprehensive list of supply chain leader firms. Using matched sample comparison, this study investigates the robustness of the relationship between supply chain effectiveness and the overall financial health of firms viewed as supply chain leaders by using AMR's supply chain top 25 list. We hypothesize that firms that have been identified by AMR as supply chain leaders will be more financially healthy than non-supply chain leaders: That is, they will have better cost, activity and liquidity ratios. The findings indicate that firms identified as supply chain leaders outperform their non-supply chain leader peers in accounting-based activity, cost and liquidity measures.
Bertie M. Greer, Ph.D., is an associate professor of management in the College of Business at Northern Kentucky University in Highland Heights, Kentucky;
Peter Theuri, DBA, is a professor of accounting at the Halie/US Bank College of Business at Northern Kentucky University in Highland Heights, Kentucky.