Scandinavian Working Papers in Economics

INDEK Working Paper Series,
Royal Institute of Technology, Department of Industrial Economics and Management

No 2014/7: Effects of product and supplier criticality on resilience capabilities: An empirical analysis of a global supply chain

Sudipa Sarker (), Mats Engwall (), Paolo Trucco and Andreas Feldmann ()
Additional contact information
Sudipa Sarker: KTH Royal Institute of Technology, & Politecnico di Milano, Postal: Department of Industrial Economics and Management, Royal Institute of Technology, SE-100 44 Stockholm, Sweden
Mats Engwall: Department of Industrial Economics and Management, Royal Institute of Technology, Stockholm, Postal: Department of Industrial Economics and Management, Royal Institute of Technology, SE-100 44 Stockholm, Sweden
Paolo Trucco: Politecnico di Milano, Postal: Department of Management, Economics and Industrial Engineering, 20133 Milan, , Italy
Andreas Feldmann: Department of Industrial Economics and Management, Royal Institute of Technology, Stockholm, Postal: Department of Industrial Economics and Management, Royal Institute of Technology, SE-100 44 Stockholm, Sweden

Abstract: From resilience perspective, it is important for supply chains to have multiple suppliers in order to maintain a high level of operational performance. On the contrary, keeping multiple suppliers are expensive from purchasing perspective, because, large amount of internal resources are required to maintain numerous suppliers. Moreover, some products may only have a sole source of supply. Against the backdrop, it is important for supply chains to understand, how, different products and supplier compositions affect different resilience capabilities. Hence, drawing from the literature of supply chain resilience, first, conceptual linkages among product criticality, supplier criticality and resilience capabilities are derived. Second, data from four plants of a global manufacturing organization with different supplier and product compositions are collected. Finally, hypothesized relationships are tested by using parametric statistical tests. The empirical data indicate that product and supplier criticality affect different capabilities of supply chain resilience. Theoretical contribution of this research is the conceptual model that is derived from synthesizing the existing literature of supply chain resilience. Practical contribution is the enhanced understanding of the effects of product and supply criticality on different resilience capabilities.

Keywords: Supply Chain Resilience; Supply Disruption; Business Impact; Time to Recovery; Empirical Study

JEL-codes: L14; L23

14 pages, August 6, 2014

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