Examining the Link between the Governance Mechanisms and Supply Chain Performance — an Empirical Study within the Triadic Context

Abstract

The goal of the research is twofold. First, it aims to reveal the basic modes of governance run by the manufacturer across the examined triadic supply chains. Secondly, the paper compares the groups of triadic supply chains, applying certain modes of governance, including network governance, in terms of the relational benefits and supply chain performance. To investigate the relationship between network governance and the supply chain performance, the Principal Component Analysis (PCA) with Varimax Rotation was used, followed by the cluster analysis and non-parametric tests. The study showed that the triadic supply chains significantly differentiate in terms of the modes of governance. Further findings also indicated that the triadic supply chains that follow the network governance mode consider their performance to be significantly higher in comparison to the supply chains that do not run this type of governance mechanism. Firstly, the research showed that it is difficult to unequivocally reveal the pure mechanisms of governance, undistorted by the influence of another distinct mode in the triadic supply chains. On the contrary, they are more or less influenced by other modes of governance distinguished in the literature. Likewise, it is also important to highlight that the mechanism of governance is inseparably bound with a certain dyadic relationship established between two actors in the wider structure of supply chains. The study also showed that incorporating a clan as a social mechanism of governance together with a market and hierarchy results in increasing the relational benefits and overall performance for both dyads in the triadic supply chains.

Model of Trust-Based Cooperative Relationships in a Supply Chain

“…It is worthwhile to note Covey's (2008) observation stating that the "lack of trust is associated with the biggest risk, " which means that a weak tendency to trust and excessive caution are associated with the risk of slowing down operations, increasing costs, and losing the opportunity to cooperate and achieve synergy effects; hence, not the best solution. It is also important to highlight that the mechanism of governance is inseparable from a specific dyadic relationship established between two actors in a wider structure of supply chains (Swierczek, 2019).…”