Intangible supply chain complexity, organizational structure and firm performance

Abstract

PurposeThe purpose of this paper is to conduct a large-sample empirical examination of how intangible supply chain complexity impacts firm performance in light of a firm's organizational structure.Design/methodology/approachThe study uses panel data from 2,580 Indian manufacturing firms and constructs empirical proxy for intangible supply chain complexity, i.e. CHQ distance from major cities. The proposed conceptual model is grounded in the dynamic capability view (DCV) and social network theory (SNT). Multivariate regression analyses are performed to investigate the effect of intangible complexity on firm performance.FindingsResults show that intangible supply chain complexity, as proxied by “CHQ distance from major cities”, negatively affects firm performance and a firm's organizational structure plays an important role in conceiving CHQ locational strategies. Firms with interconnected supply chain and social network (e.g. business group firms) have a higher propensity to locate their CHQs farther away from major cities, and business group firms that have more distantly located CHQs experience better financial performance compared to independent firms (with less network resources).Originality/valueIn light of the supply chain literature and relevant theories, the study conceptualizes intangible supply chain complexity as “CHQ distance from major cities” and deepens our understanding of the relationship between intangible complexity and firm performance in light of organizational structure. Further, it develops an objective understanding of intangible supply chain complexity by relying on secondary panel data.

Supply chain relational capital and firm performance: an empirical enquiry from India

“…Buyer firms engage in value-adding activities through purchasing of parts, materials and services from a group of suppliers (Pant et al, 2020(Pant et al, , 2021Yu et al, 2021;Qiao and Wang, 2021;Yang et al, 2019;Corvino et al, 2019;Alvarado-Vargas and Kelley, 2019;Lu and Shang, 2017). In a dynamic business environment, effective supply chain management is considered to be an important means to achieve a sustainable competitive advantage (Yu et al, 2021;Nam et al, 2011;Tan et al, 1998).…”

“…The authors would like to sincerely thank the four anonymous reviewers and editors for their pertinent comments and suggestions for this paper, which not only improved the quality, but also the presentation of this paper. complexity, poor value chain performance and lower financial outcomes (Pant et al, 2021;Zhao et al, 2019;Bode and Wagner, 2015;Bozarth et al, 2009;Choi and Krause, 2006). A number of studies have highlighted the importance of an over-reliance on relational capital in supply chain management as a means to mitigate the embedded uncertainty in buyersupplier relationships (Yeoman and Santos, 2019;Mahapatra et al, 2019;Fan and Stevenson, 2019;Forkmann et al, 2016).…”

Customer integration and customer value: contingency roles of innovation capabilities and supply chain network complexity

“…From the CRBV perspective, therefore, this study further advances the existing supply chain integration literature by empirically examining the extent to which customer integration contributes to customer value through process/ product innovation capabilities under varying conditions of SCNC. Thus, while empirical evidence regarding the extent to which SCNC impacts on business operations remains equivocal (Pant et al, 2021;Turner et al, 2018), the results from this study, as presented in Figures 2 and 3, show that leveraging customer integration through process innovation drives customer value more when such resource orchestration activity occurs in an environment characterized by greater SCNC. The findings corroborate the contention that the relationship between innovation and performance is contextdependent (Rousseau et al, 2016;Story et al, 2015), and align with the literature that suggests that greater SCNC, while it may be a major source of threat to business survival, facilitates the development and deployment of value-enhancing resources and capabilities (Turner et al, 2018) such as innovation (Wang et al, 2015;Choi and Krause, 2006).…”

“…Although the notion of complexity has been increasingly linked to supply chains (Pant et al , 2021; Turner et al , 2018), SCM researchers have conceptualized and measured the complexity construct differently (Manuj and Sahin, 2011; Bozarth et al , 2009). As Bode and Wagner (2014) argue, two basic qualities define complexity: structure and behavior .…”

“…Meanwhile, past studies reveal that the performance effects of innovation capabilities are context-dependent (Rousseau et al , 2016; Rosenbusch et al , 2011). Scholarly and practitioner understanding is that, although supply chain network complexity (SCNC) may generate deleterious consequences for firms (Pant et al , 2021; Chand et al , 2020), it might also facilitate value-creating outcomes of firm-specific resources (Turner et al , 2018) such as innovation capabilities (Wang et al , 2015; Choi and Krause, 2006). Hence, the degree of SCNC may provide an important external environment context to explain when customer integration and innovation capabilities are associated with customer value (Chowdhury et al , 2019; Brandon‐Jones et al , 2014).…”