The Impact of Demand Information Transparency on Endogenous Supply Process Reliability in Blockchain Era

Abstract

With supply disruption occurring frequently nowadays, suppliers increasingly undertake costly effort to improve its own supply reliability. Meanwhile, some retailers are issued with blockchain technology, which reduces information asymmetry for suppliers, thereby mitigating supply disruptions. This study investigates how the demand information transparency via the retailer's adoption of blockchain affect the supplier's process reliability level. Although conventional wisdom suggests that the supplier will enjoy an information superiority if keeping the demand information private, we reveal that the retailer may opt to adopt the blockchain technology to achieve demand information transparency with the supplier, and such information transparency of blockchain-adoption system can incentivize the supplier to set an efficient supply reliability improvement level.