Anand Nair

Complexity and Adaptivity in Supply Networks: Building Supply Network Theory Using a Complex Adaptive Systems Perspective*

Supply networks are composed of large numbers of firms from multiple interrelated industries. Such networks are subject to shifting strategies and objectives within a dynamic environment. In recent years, when faced with a dynamic environment, several disciplines have adopted the Complex Adaptive System (CAS) perspective to gain insights into important issues within their domains of study. Research investigations in the field of supply networks have also begun examining the merits of complexity theory and the CAS perspective. In this article, we bring the applicability of complexity theory and CAS into sharper focus, highlighting its potential for integrating existing supply chain management (SCM) research into a structured body of knowledge while also providing a framework for generating, validating, and refining new theories relevant to real-world supply networks. We suggest several potential research questions to emphasize how a CAS perspective can help in enriching the SCM discipline. We propose that the SCM research community adopt such a dynamic and systems-level orientation that brings to the fore the adaptivity of firms and the complexity of their interrelations that are often inherent in supply networks.

Internalisation of ISO 9000 standards: The antecedent role of functionalist and institutionalist drivers and performance implications

This study presents an investigation of the relationship between motivation for ISO 9000 certification and internalisation of practices underlying ISO 9000 standards. We use the theoretical lenses of resource-based view and institutional theory to develop our research hypotheses linking motivation with internalisation of ISO 9000 standards. These theories also provide a cogent means to understand the findings from the study. Further, the study presents the performance implications of internationalisation of ISO 9000 standards. A path model is developed that link motivation, internalisation of ISO 9000 standards and performance. Survey data from 281 ISO 9001 certified manufacturing and service organisations in Australia is used to test the research hypotheses of the study. The results suggest that internalisation of practices underlying ISO 9000 standards is affected by functionalist and institutionalist drivers. We find that internalisation of ISO 9000 standards is positively associated with operational performance, and operational performance, in turn, is positively associated with business performance. A closer examination by splitting the sample between high and low performing firms reveals that internalisation of ISO 9000 standards is associated with both functionalist and institutionalist motives in low performing firms, whereas only functionalist driver influence the internalisation of ISO 9000 standards in high performing firms. We offer theoretical and managerial implications of our findings. †Both authors contributed equally to the paper.

Supply network topology and robustness against disruptions - An investigation using multi-agent model

In this study we examine the relationship between supply networks topology and its robustness in the presence of random failures and targeted attacks. The agent-based model developed in this paper uses the basic framework and parameters in the experimental game presented in Sterman [1989, Modeling managerial behavior: Misperceptions of feedback in a dynamic decision making context. Management Science, 35 (3), 321–339] for modelling adaptive managerial decision making in an inventory management context. The study extends the linear supply chain context to a complex supply network and undertakes a rigorous examination of robustness of these supply networks that are characterised by distinct network characteristics. We theorise that network characteristics such as average path length, clustering coefficient, size of the largest connected component in the network and the maximum distance between nodes in the largest connected component are related to the robustness of supply networks, and test the research hypotheses using data from several simulation runs. Simulations were carried out using 20 distinct network topologies where 10 of these topologies were generated using preferential attachment approach (based on the theory of scale-free networks) and the remaining 10 topologies were generated using random attachment approach (using random graph theory as a foundation). These 20 supply networks were subjected to random demand and their performances were evaluated by considering varying probabilities of random failures of nodes and targeted attacks on nodes. We also consider the severity of these disruptions by considering the downtime of the affected nodes. Using the data collected from a series of simulation experiments, we test the research hypotheses by means of binomial logistic regression analysis. The results point towards a significant association between network characteristics and supply network robustness assessed using multiple performance measures. We discuss the implications of the study and present directions for future research.

The Role of Information Connectivity in Making Flexible Logistics Programs Successful

Purpose – Aims to conceptualize flexible logistics programs and information connectivity as two important aspects of logistics flexibility and to examine the role of information connectivity in making flexible logistics programs successful.Design/methodology/approach – A hierarchical regression model is used to test the research hypotheses.Findings – The results suggest that flexible logistics programs are strongly related to all performance dimensions, and that information connectivity fully mediates the relationship between flexible logistics programs and asset productivity and partially mediates the relationship between flexible logistics programs and delivery competence.Research limitations/implications – Future theoretical research can develop a detailed conceptualization of logistics flexibility. In this paper, the constructs are developed utilizing an exploratory factor analysis approach. Future research utilizing confirmatory factor analysis approach will allow a better validation of the performan...

Linking manufacturing postponement, centralized distribution and value chain flexibility with performance

In this paper we provide some preliminary insights regarding the relationship between the operational policies of manufacturing postponement, centralized distribution and value chain flexibility. Their impact on performance is examined. We considered asset productivity, delivery competence and responsiveness as three aspects of performance. A conceptual model is developed and empirically tested using the structural equations modeling technique. Our results provide strong evidence of a positive relationship between the operational policies and performance. We observe that value chain flexibility mediates the effect of manufacturing postponement and centralized distribution on the performance measures. The implications of our findings are discussed and directions for future research are provided.In this paper we provide some preliminary insights regarding the relationship between the operational policies of manufacturing postponement, centralized distribution and value chain flexibility. Their impact on performance is examined. We considered asset productivity, delivery competence and responsiveness as three aspects of performance. A conceptual model is developed and empirically tested using the structural equations modeling technique. Our results provide strong evidence of a positive relationship between the operational policies and performance. We observe that value chain flexibility mediates the effect of manufacturing postponement and centralized distribution on the performance measures. The implications of our findings are discussed and directions for future research are provided.

Supply Networks as a Complex Adaptive System: Toward Simulation‐Based Theory Building on Evolutionary Decision Making

In this article, we examine how the firms embedded in supply networks engage in decision making over time. The supply networks as a complex adaptive system are simulated using cellular automata (CA) through a dynamic evolution of cooperation (i.e., “voice” decision) and defection (i.e., “exit” decision) among supply network agents (i.e., firms). Simple local rules of interaction among firms generate complex patterns of cooperation and defection decisions in the supply network. The incentive schemes underlying decision making are derived through different configurations of the payoff-matrix based on the game theory argument. The prisoners dilemma game allows capturing the localized decision-making process by rational agents, and the CA model allows the self-organizing outcome to emerge. By observing the evolution of decision making by cooperating and defecting agents, we offer testable propositions regarding relationship development and distributed nature of governance mechanisms for managing supply networks.

Innovation‐oriented operations strategy typology and stage‐based model

Purpose – This paper aims to examine how firms, operating in mature and growing industries, can improve the alignment of their operations strategy to fit situations characterized by varying rates of industry growth and technological changes.Design/methodology/approach – The authors enhance the operations strategy typology presented by Lei and Slocum by incorporating an enhanced set of competitive priorities and supporting structure/infrastructure requirements into their four cell matrix. They then introduce a stage‐based model of environmental dynamism and complexity that can foster major transitions in operations strategy.Findings – Industry growth and technological change interact to create alternative environments with varying levels of dynamism and complexity requiring realignment of operations strategy. With increasing rates of technological change, the authors emphasize an urgent need to include innovation as a competitive priority (along with cost, quality, delivery and flexibility) to proactively ...

Dynamics of competing with quality- and advertising-based goodwill

Goodwill formation is a complex process and many factors influence the formation of goodwill of a firm. The implications of advertising enabled goodwill formation are reported in several articles in the research literature. In this paper, we extend this stream of research by including quality in the goodwill formation process. We adopt a dynamic model of competition utilizing a differential game approach and derive expressions for open-loop Markovian Nash equilibrium investments in advertising and quality. The insights gained from the analysis of our model and from the equilibrium solutions are presented in the form of research propositions.

Coopetitive Buyer–Supplier Relationship: An Investigation of Bargaining Power, Relational Context, and Investment Strategies

This study proposes an analytical approach combined with a behavioral experiment for a joint examination of the competitive and cooperative (i.e., coopetitive) relationship between a buyer and a supplier. Specifically, the article considers the scenario in which the buyer and the supplier invest in strategic capabilities to increase their relative bargaining power. The article examines how dynamic investments in strategic assets are influenced by the locus of bargaining power and by the underlying context (synergistic vs. adversarial) of the interfirm relationship. The dynamic evolution of bargaining power is also examined. A dynamic game model is considered to examine the evolution of investment strategies in critical resources and to investigate the issues of bargaining power in a buyer–supplier dyad. Equilibrium expressions for the investment strategies of the buyer and the supplier are presented and their implications for buyer–supplier relationships are examined. The behavioral experiment complements the analytical model and examines the correspondence between optimal behavior suggested by the analytical model and the boundedly rational behavior of decision makers in an experimental context. The results from the model and behavioral experiments suggest that the strategies are a function of the risk-adjusted returns obtained from investments. The experiment shows that, in a synergistic relational context when the buyer maintains bargaining power, the investment shifts of the buyer and the supplier accord well with theoretical predictions. In an adversarial relational context, the results of the experimental study do not correspond well with that predicted by the theoretical model. The implications of the results are discussed and directions for future research are presented.

Strategic purchasing participation, supplier selection, supplier evaluation and purchasing performance

In this article, we examine how purchasing’s strategic participation influences supply management activities via the choice of appropriate operational and strategic criteria. Specifically, the study focuses on supplier selection and monitoring ongoing supplier performance evaluation based on operational and strategic criteria. A combination of choosing appropriate supplier selection criteria and monitoring supplier performance ensures that the benefits of purchasing’s participation in strategic planning translate into better purchasing performance of cost, quality, delivery, flexibility and innovation. We test the hypotheses using survey data collected from manufacturing companies in the US by means of a path model. Our results provide support for the tenet that purchasing’s participation in strategic planning influences purchasing performance directly as well as through the mediating effects of supplier selection criteria and supplier performance evaluation. We discuss the theoretical and managerial implications of the findings and propose directions for further research.