influence of supplier management on supply chain
TRANSCRIPT
Faculty of Economics and Business
Master Thesis: Supply Chain Management
Influence of Supplier Management on
Supply Chain Resilience – a Multiple
Case Study Date of Submission: February 14th, 2014
Author:
Torben Bethke BSc.
(s1943782) – [email protected] – 0049 (0) 1635498076
Supervisor:
Dr. Kirstin Scholten
Assistant Professor of the Department of Operations
Second Supervisor:
Dr. Jan de Vries
Professor of the Department of Operations
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Bethke, T. (2014)
Preface
About six months ago, I started working on my master thesis project which turned out a striving
battle against the multilayered dimension of the thesis topic. Countless hours have passed that will
be mostly untraceable to the readers eye, but the struggle and battle with one’s self to strive for the
best, carried a great burden. This article is a small capture of the endless discussions with my fellow
colleague, dissolute explanations to friends, and the endeavor of the project.
Acknowledgements
I would like to thank my thesis supervisor Dr. K. Scholten for her encouragement and support
throughout the research process. She provided guidance and intellectual support throughout the
research project and her feedback was highly appreciated. I also would like to acknowledge Thom
Dijkstra with whom I shared endless discussion about our theses, and shared the experience of
qualitative research. Finally, I would like to thank my parents for the endless support they provided
to me that made it possible to become a to-be graduate master student of the University of
Groningen.
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Bethke, T. (2014)
Abstract
Purpose. This paper investigates how the role of suppliers affects supply chain resilience. The role
of suppliers is determined by using the classical supplier management portfolio approach by Kraljic
(1983) to distinguish between four cases in the processing industry. Supply chain resilience is
understood as the combination of two capabilities robust and agility. The purpose is to identify how
the supplier management affects the capabilities in supply chains.
Design / Methodology / Approach. A multiple case study in the process industry is conducted by
interviewing several purchase/ supply chain managers. Interviews and secondary data are used to
distinguish cases into three different types of supplier. All cases are analyzed following a multi-step
coding procedure to identify resilience capabilities and compare them to other supply chains.
Findings. The empirical data shows differences of resilience capabilities in supply chains to be
either more robust or agile which shows that capabilities are not equally important for all cases.
Therefore, supplier management can be said to influence the resilience of supply chains. The
findings are used to develop a two-by-two matrix with the dimensions supply risk (horizontal) and
resilience (vertical) as axes.
Practical Implications. The developed matrix provides linkage between purchasing managers’
supplier management and supply chain resilience capabilities. It also provides insights into
upstream supply chain vulnerabilities and potential risks factors for a company. Finally, this papers
implication is the development of simple two-by-two matrix that provides purchasers with a simple
tool to understand how supplier management affects resilience in supply chains.
Originality / Value. This paper contributes to an advanced understanding how internal supplier
management affects the resilience in supply chains. Furthermore, it is the first paper that provides
insights into supply chain vulnerabilities and resilience from a buyer perspective.
Key Words: Supply Chains, Purchasing, Portfolio, Resilience, Supplier Management
Article Classification: Case Study
Word Count: 8.211
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Bethke, T. (2014)
Table of Content
1. Introduction ............................................................................................................................................................................ 5
2. Theoretical background .................................................................................................................................................... 6
2.1 Concept of Resilience .................................................................................................................................................. 6
2.2 Purchasing ....................................................................................................................................................................... 8
3. Methodology ........................................................................................................................................................................ 11
3.1 Case Selection and Setting ...................................................................................................................................... 12
3.2 Data Collection ............................................................................................................................................................ 13
3.3 Data Analysis ............................................................................................................................................................... 15
4. Findings ................................................................................................................................................................................. 17
4.1 High Supply Risk ........................................................................................................................................................ 17
4.2 Low Supply Risk ......................................................................................................................................................... 18
5. Discussion ............................................................................................................................................................................. 19
6. Conclusion, Limitations & Recommendations ...................................................................................................... 21
7. Bibliography ........................................................................................................................................................................ 24
8. Appendix ............................................................................................................................................................................... 29
8.1 Data Triangulation .................................................................................................................................................... 29
8.2 Interview Protocol ..................................................................................................................................................... 29
8.3 Results ............................................................................................................................................................................ 31
Table of Figures Figure 1 - Capabilities to Form Resilience (Wieland & Wallenburg, 2013) ............................................ 7
Figure 2 – Conceptual framework ............................................................................................................ 11
Figure 3 – Identification of Cases in the Kraljic Matrix (1983) .............................................................. 13
Figure 4 - Methodology ............................................................................................................................. 17
Figure 5 - Matrix ........................................................................................................................................ 19
Figure 6 - Cube model (based on Kraljic, 1983) ...................................................................................... 21
Tables Table 1 – Overview of Interviews ............................................................................................................. 15
Table 2 - Secondary Data ........................................................................................................................... 15
Table 3 - Role of Supplier and Type of Disruption .................................................................................. 16
Table 4 - Representative Data Coding Supplier Role .............................................................................. 31
Table 5 - Coding Procedure Capabilities .................................................................................................. 32
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1. Introduction More than 70% of companies experience at least one supply chain disruption per year (Business
Continuity Institute, 2010; 2011; 2012). The effect of such interruptions on the normal flow of
goods, material and/ or services (Craighead, Blackhurst, Rungtusanatham, & Handfield. 2007) is
known to decrease stock prices by 33% - 40% and increase equity risk value compared to
competitors over a three year period (Hendricks and Singhal, 2005). Hence, it becomes increasingly
important to manage supply chains and to decrease the frequency and negative impact of
disruptions in order to remain competitive. It is necesseary for companies to develop capabilities
that help companies to overcome unforeseen disruptions in supply chains. Resilience concept
focuses on supply chains’s adataptive capabilites to prepare, respond, and recover from a disruption
(Ponormarov & Holcomb, 2009). Resilient supply chains are constructed by determining sources of
vulnerabilities (Peck, 2005), and capabilities to survive disruptions (Wieland & Wallenburg, 2012;
Jüttner & Maklan, 2011). Hence, matching capabilities and vulnerabilities constructs resilience in
supply chains (Petitt, Fiksel, & Croxton, 2010). A function influencing upstream supply chain
vulnerability is purchasing (Monczka, Handfield, Giunipero, & Patterson, 2008). While, purchasing
and supply managers are responsible for the selection of partners, sourcing strategies and
allocation of resources (Monczka et al., 2008), little research has been conducted on how such
strategies can contribute to matching capabilities and vulnerabilities and ultimately supply chain
resilience.
One approach to distinguish suppliers is a portfolio approach of which can be traced back to the
Kraljic matrix (1983) which embodies the classical and most accepted theory (Gelderman & van
Weele, 2005). The theory proposes to distinguishing suppliers on two dimensions, supply risks and
impact on profitability (Kraljic, 1983). Its main premise is that by identifying and distinguishing
between the roles of suppliers, purchasing performance will increase by adapting management
practices to each type of supplier (Pagell, Wu, & Wasserman, 2010). However, differentiation of
suppliers implies a variation in the management of relations and thus the allocation of resources
(Kraljic, 1983). Hence, it affects building and maintaining the capabilities in supply chains. Based on
the classical Kraljic (1983) approach, this paper explores how the role of suppliers, affects the
resilience of supply chains. A multiple case study methodology is employed to investigate the effect
of supplier categorization on resilience.
In answering the research questions this thesis contributes to the field of supply chain resilience in
three important ways. First of all, to develop a purchasing resilience portfolio clearly establishes the
link between supplier selection and supply chain resilience. Secondly, by considering the impact of
upstream vulnerabilities, this thesis gives insights into how to build resilience in the upstream
supply chain of a company. Thirdly, managerial implications are to provide knowledge about how
supplier management affects capabilities in supply chains, helps to effectively allocate resources
and to prepare supply chains better to handle disruptions.
The remaining paper is structured into five parts. The next chapter presents the theoretical
background by introducing the two capabilities, robustness and agility, that are identified to
construct resilience (Wieland & Wallenburg, 2012, 2013) and discussing supplier portfolio
management. Section three focuses on the employed case study methodology including research
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design, case selection, data collection, and the multi-step coding procedure on resilience capabilities
in the supply chains. Part four presents the findings in a two-by-two matrix and the implications to
resilience are discussed in the subsequent part. Finally, part six concludes on the main research
objective and its theoretical as well as managerial implications, the papers limitations, and
nominates direction for future research.
2. Theoretical background
2.1 Concept of Resilience Disruptions in supply chains are defined as “unforeseen events that interfere with the normal flow
of materials and/or goods within the supply chain” (Craighead, et al., 2007, p. 132) and therefore
significantly threatens normal business operations (Wagner & Bode, 2008, p. 309). Disruptions
originate from several sources exogenous or endogenous to the supply chain (Trkman &
McCormack, 2009), and can originate from the demand side, supply side, or be catastrophic
(Wagner & Bode, 2006). Thus, disruptions are beyond the reach of a single company and no supply
chain is invulnerable to disruptions no matter how well it is managed (Peck, 2005). Risks of
disruption arise from vulnerabilities in supply chains (Wagner & Bode, 2006). Vulnerabilities are
understood as supply chain characteristics that are directly linked to a given supply chain
disruption (Wagner & Bode, 2006) and supply chain susceptibility to the harm of an event is of
significant relevance (Wagner & Bode, 2009, p. 278). These vulnerabilities in supply chains can be
seen as atomistic (part of the supply chain) or holistic (across the entire supply chain) (Svensson,
2000). Consequently, it can be derived that decreasing characteristics that make a supply chain
susceptible for disruptions, decreases the severity of a disruptions impact (Wieland & Wallenburg,
2012). However, it is not possible to foresee and prepare for all possible cases (Peck, 2005). Instead,
capabilities that make a supply chains resilient are necessary to overcome disruptions (Wieland &
Wallenburg, 2012).
Resilience as a concept developed in theory as a consequence of major disruption in supply chains
in the past (Wieland & Wallenburg, 2012), e.g. the 2011 earthquake in Japan, hurricane Katrina. It
can be distinhuished from supply chain risk management (SCRM) which focuses on the
identification and management of risks, reducing vulnerabilities (Jüttner, Peck, & Christopher,
2003), for foreseable events (Petitt et al., 2010). Supply chain resilience on the other hand is based
on the premise that not all risks can be anticipated (Peck, 2005; Jüttner & Maklan, 2011). Therefore,
it aims to develope capabilities that enable a supply chain to prepare for unexpected events,
respond to disruption, and recover from them (Ponomarov & Holcomb, 2009). Hence, capabilities in
supply chains that are manifested in the supply chain processes are considered as important
characteristics of resilient supply chains (Ponomarov & Holcomb, 2009). Definitions of supply chain
resilience capabilities differ. While Jüttner & Maklan (2011) adapted a facetted distinction of the
capabilities into flexibility, velocity, visibility, and collaboration. Christopher and Peck (2004)
concept of resilience includes collaboration, agility, and risk culture, and Pettit et al. (2010)
identified fourteen different capabilites that can increase supply chain resilience. In this article,
resilience of supply chains is conceptualized by two capabilites, (1) robustness (anticipation and
preparedness), and (2) agility (visibility and speed) following research by Wieland and Wallenburg
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Bethke, T. (2014)
(2012; 2013), Figure 1. Their definition into proactive (robustness) and reactive (agility) measures
makes it possible to distinguish chronological how supplier management affects the resilience
capabilities in supply chains.
Figure 1 - Capabilities to Form Resilience (Wieland & Wallenburg, 2013)
2.1.1 Robustness
Literature on robustness is extending quickly and there exists a large consensus on factors that
determine the robustness of supply chains. Robustness literature key terminology is the focus on
the ability of a supply chain to perform during disturbance (Klibi, Martel, & Guitouni, 2010; Vlajic et
al., 2012; Wieland & Wallenburg, 2012). A robust supply chain remains effective for all potential
situations (Klibi et al, 2010), therefore does not need to alter its state and can continue to operate
within a desired performance range (Vlajic et al., 2012, Wieland & Wallenburg, 2012). It is further
specified that supply chain robustness is determined by the degree a supply chain shows an
acceptable performance on key performance indicators before and after unexpected events that
cause disturbances (Vlajic et al., 2012, p. 177). In addition, it can determine the recovery of a system
as it resistance decreases the gap from a performance decrease to the desired recovery level. The
definitions of robustness generally state that the supply chains remains in its initial state (Nair &
Vidal, 2011; Wieland & Wallenburg, 2012) but uncertainty and unforeseen disruptions can require
that a supply chain is able to react quickly (Christopher & Peck, 2004). Thus, a supply chain needs
not only to be robust but also needs to incorporate agility to be resilient (Wieland & Wallenburg,
2013).
2.1.2 Agility
Agility is understood as a driving capability in a supply chain to respond to disruptions (Wieland &
Wallenburg, 2012, Jüttner & Maklan, 2011; Tang & Tomlin, 2008). It determines a supply chain’s
capability to respond or react rapidly to a disruption (Swafford, Gosh, & Murthy, 2006). Literature
on agility identifies factors that determine the agility of a supply chain and distinguish agility into
several underlying concepts including visibility, velocity (Christopher & Peck 2004), and flexibility
Robustness Agility
Resilience of Supply Chains
Anticipation
Forecast of
possible
future
changes
Preparedness
Resistance to
forecasted
changes
Visibility
Perception of
current
changes
Speed
Fast reaction to
perceived
changes
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Bethke, T. (2014)
(Tang & Tomlin, 2008; Swafford et al., 2006). Agility in supply chains is necessary when the supply
chain needs to react rapidly to unforeseen changes (Christopher & Peck, 2004) and supply chain
robustness is no longer sufficient to survive a disruption. A slow reacting supply chain can result to
substantial financial losses and loss of competitiveness (Norrman & Jansson, 2004). The focus in
adjusting the supply chain to changes and is not focused how effectively it is achieved but that it
modifies to the new circumstances (Swafford et al., 2006). Therefore, the capability that makes
supply chains react quickly to unforeseen changes is necessary to build resilient supply chains
(Wieland & Wallenburg, 2013).
2.2 Purchasing Purchasing managers are responsible for the procurement of supplies and services. They are
responsible for tasks that include availability, coordination, and an efficient flow of supplies (Kern,
Moser, Sundaresan, & Hartmann, 2011). Purchasers are responsible for choosing strategies,
selecting suppliers, and allocation of resources (Monczka, et al., 2008). Therefore, they generally
have a high degree of supplier contact on the upstream side of the supply chain (Zsidisin, Ellram, &
Ogden, 2003) and thus influence the vulnerability (Monczka et al., 2008). Moreover, suppliers
become more and more important for the value creation of companies (Dubois & Pedersen, 2002)
and supply chains are lengthening that stretch around the world vulnerable to unpredictable and a
changing world (Peck & Jüttner, 2002). Purchasing can be responsible for up to 80% of a company’s
total costs (Ramsay & Croom, 2008) and thus purchasers seek strategies to optimze their resources
allocation. One way to increase the purchasing performance is to adapt a supplier management
approach such as supplier portfolios. Based on the supplier management approach, purchasers
distinguish between suppliers and decide on the allocation of resources which determine the
capabilites in suppply chains.
2.2.1 Supplier Portfolios
Supplier portfolios suggest differentiating suppliers and optimizing the way suppliers are
management (Dubois & Pedersen, 2002). To adapt a different management strategies to suppliers
allows to optimal allocate limited resources and it will increase purchasing performance (Pagell,
Wu, & Wasserman, 2010). The Kraljic matrix (1983) is the classical and most used portfolio
approach in purchasing (Gelderman & van Weele, 2005). Other authors developed based on the
Kraljic matrix (1983) adapted versions (e.g. Oldsen & Ellram 1997; Bensaou, 1999, Gelderman &
van Weele, 2003) and use it to explore its applicability to more recent purchasing themes such as
sustainability (e.g. Pagell, Wu, & Wasserman, 2010). Moreover, the Kraljic matrix (1983) is also used
to compare supplier portfolios to other theories (Dubois & Pedersen, 2002), such as the network
approach (Snehota & Hakansson, 1995). Thus, the classical Kraljic matrix (1983) is still relevant in
the field of purchasing.
Kraljic (1983) identifies four types of suppliers (noncritical, leverage, bottleneck, and strategic)
distinguished in four quadrants build on two dimensions, supply risks and impact on profitability,
Figure 2. Following the reasoning by Kraljic (1983), each quadrant bears different risks on
companies’ financial performances and consequently requires a variable approach of procurement
to optimize usage of purchasing’s limited resources. The supplier risks dimensions assumes that for
certain products only a very limited number of alternative suppliers are available or none, while
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there are many alternative suppliers for others (Kraljic, 1983). Thus, a supply chain which involves
a supplier with limited or no alternatives should have several measures in place to avoid
disruptions. Other scholars continued to develop the Kraljic (1983) theory and proposed several
strategies on how to determine the measures of the dimensions. Gelderman & van Weele (2003)
suggest using cross-functional teams to develop appropriate measures, while Kraljic (1983) names
several alternatives to determine the profit impact of a supplier. A low supply risks is implied when
supplies are standardized and are available from other suppliers in the market so that no
dependency arises between buyer and supplier. Next, each quadrant of the Kraljic (1983) matrix is
introduced and related to the capabilities of resilience to provide an understanding of the
discrepancies between risk avoiding strategies and resilience.
Noncritical items have a low financial impact and low supply risk. Suppliers offer standardized
products, which vastly available from numerous sources and should be sourced from several
suppliers (Kraljic, 1983). Purchases are evaluated on prices and reliability of suppliers to perform to
the agreed terms (Kraljic, 1983). This implies a decentralized rather than centralized purchasing
approach (Gelderman & Semeijn, 2006) and thus product can be obtained from several sources.
Multiple sourcing is a strategy to strengthen supply chains robustness (Norrman & Jansson, 2004)
as the diversification and easy substitution of the product can decrease risk of supply default
(Costantino & Pellegrino, 2010; Tang, 2006). The high degree of standardization of products and
availability in the market allows for an easy substitution of suppliers at minimal costs (Kraljic,
1983). However, an easy substitution strategy would decrease any integration to a minimum and
minimize employment of ICT for quick identification of disruptions in the supply chain (Pereira,
2009). Contrary, IT employment could significantly decrease costs and improve procurement
performance (Gunasekaran & Ngai, 2004). In addition, IT can be beneficial to make a disruption
visible (Blackman, 2013) and increase the speed of communication among supply chain members
about a disruption (Pereira, 2009). Purchasing is responsible for an efficient ordering (Kraljic,
1983) using transaction costs economics (Allen, 1991). Yet, multiple suppliers increase the
complexity in managing relations and determining the optimal number of suppliers (Sarkar &
Mohapatra, 2009), which dissipates additional purchasing resources. Moreover, purchasing
managers scatter resources over several relations and thus fragments capabilities to identify and
deal with disruptions.
Leverage items have a high financial impact but are low in supply risk. These commodities are
offered by several suppliers and the price is the main determinant of the purchase (Kraljic, 1983).
Companies are held to use its stronger position to optimize prices among the different sources of
supplies and investing into relationships is seen as unnecessary (Kraljic, 1983). This quadrant
includes suppliers that have alternatives in the market and multiple sourcing is proposed which
decreases supplier default (Costantino & Pellegrino, 2010). Additionally, Kraljic (1983) presumes
that the focal company is in the position to exploit the relations (Caniels & Gelderman, 2007). This
sort of asymmetry in relations may be preferable for the focal company in terms of costs, but the
arising dependency for the supplier jeopardizes susceptibility to demand disruptions (Gulati &
Sytch, 2007). Therefore, risks arise from the dependency of a supplier on the focal company if
demand fluctuation affects the frequency of orders and suppliers struggle to adjust to changes (Chen
& Xiao, 2009). Moreover, the containment to invest in the relations limits implementation of
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contingency plans and employment of ICT to detect disruptions (Pereira, 2009). The focus on
ordering efficient and effective would minimize inventories which can protect a supply chain
functioning from disruptions (Chopra, & Sodhi, 2012). Another way to decrease the costs would be
for the supplier to adapt the ICT of the stronger party and increase the visibility of disruptions
(Pereira, 2009). Thus, it is constraint to provide agility in the supply chain to form resilience.
Bottleneck items have a low financial impact but have a high supply risk. They are sourced from
(often) just one available supplier and companies need to mitigate risks by contracting and
optimizing inventories (Kraljic, 1983). This can mean to have additional inventory and other backup
plans in case for a shortage in supply (Kraljic, 1983). The likelihood of a monopoly as single supplier
increases dependency for the focal company with no alternative available (Costantino & Pellegrino,
2010; Wang, Gilland, & Tomlin, 2010), and therefore the risks of supply default and disruptions is
more severe with no alternative available (Norrman & Jansson, 2004). Kraljic (1983) proposes
inventory buffers and backup plans to deal with these risks. However, inventory buffers can
increase vulnerabilities due to wrong forecasts and holding inventory (Chopra & Sohdi, 2012), while
improving the robustness of supply chains to withstand disruptions (Tang, 2006). The limited
availability of suppliers in the market makes multiple sourcing strategies difficult which otherwise
could offset a disruption from one supplier difficult. Hence limits strategies to build robustness in
supply chains (Wieland & Wallenburg, 2012).
Strategic items have a high financial impact and high supply risk. These supplies are significant to a
company’s profitability and are sourced from a small number of suppliers (Kraljic, 1983).
Companies should seek close relationships that focus on long-term securing of the supplies and
engage in contingency planning, and gaining control over supplier (Kraljic, 1983). Question to make
or buy the item may be a concern for long-term strategic plans. Purchasing management should
allocate most resources to these relations as they have both, high supply risk and high impact on
profitability (Kraljic, 1983). Nevertheless, this quadrant should receive most attention by
purchasers to identify risks and contingency plans should be in place (Kraljic, 1983). Limitations in
the number of suppliers ascend vulnerabilities and intensive relations are costly to develop and
maintain (Bensaou, 1999), therefore raising more sources for vulnerabilities in supply chains. A
disruption in this supply chain would strongly influence on finances according to Kraljic (1983) and
limitation in alternatives sources decreases robustness which would be offset by larger inventories
(Tang, 2006). Yet, Kraljic (1983) suggest developing a long-term relation to secure supplies. This
could lead to supplier and buyer investments (Bensaou, 1999) or ICT integration that could increase
the visibility of disruptions (Pereira, 2009).
The different quadrants of the Kraljic matrix (1983) uses supply risk as dimension to determine the
criticality of suppliers and balances it to the financial impact. It becomes more costly to have
classical measures against disruptions such as safety stocks or multiple sourcing, when there are
few alternative suppliers or inventory costs are high. A high supply risk implies that only few
suppliers are available and Kraljic (1983) suggest either to develop the relationship or to have
inventory against potential bottlenecks in supplies.
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This paper’s conceptual framework is a two by two matrix with supply risks (low, high) on the
horizontal axis and resilience (robust, agile) on the vertical axis, Figure 2. The understanding of the
framework is that depending on the supply risks, supply chains develop more robust or agile
capabilities and therefore help a company to overcome disruptions. A low number of suppliers
would mean that a company is developing strategies to secure supplies from suppliers either by
preventive measures that strengthen the supply chain or is able to react quickly to a disruption. A
high number of suppliers would mean that the company uses strategies to decrease dependency on
single suppliers and spread the risk of supply shortage. The difference between low and high supply
risks will eventually impact the resilience capabilities to more robust or agile supply chains
depending on the company’s supplier management. Supply risk is the dimension on which supply
chains are distinguished to understand the balance of resilience capabilities.
3. Methodology Resilience in a supply chain context still lacks advanced understanding of the interplay of
capabilities and requires further empirical research (Blackhurst et al., 2011). This research is
explorative as it intends to identify resilience in multiple supply chains based on suppliers’
management using a case study methodology.
A case study methodology is most suitable to apply for three reasons: (1) the objective focuses on
“how” and “why” questions, (2) researchers have no control over events, and (3) the focus is on a
contemporary phenomenon within a real-life context (Yin, 2009, p. 13). All three reasons are
present within the research. The research question is to identify how the role of the supplier affects
the resilience in the supply chain. Second, the research focuses on disruptions in the past and last, it
is subject to an existing management problem of company Alpha.
Figure 2 – Conceptual framework
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Employing multiple-case studies provides researchers with knowledge of resilience in several,
chance to test, and locally ground theory than a single case study (Miles & Huberman, 1994). Thus, it
yields results that are more generalizable than a single case (Eisenhardt & Graebner, 2007). As this
paper aims at identifying the relation between the role of suppliers and its effect on the resilience of
supply chains, it can be understood as X causes Y research objective (Miles & Huberman, 1994, p.
24). Hence, the relationship between the role of suppliers and the resilience in the supply chain is
empirically investigated by an inductive explorative multiple case study. The unit of analysis in this
research is the supply chain, which is investigated in four cases with company Alpha as buyer and
represents multiple embedded cases (Yin, 2009, p. 46). The case study research design is founded
on the guidelines proposed by Yin (2009), and Karlsson (2011), which require constant adjustments
in the research as it is a “linear but iterative process” (Yin, 2009, p. 1). Company Alpha was selected
as main partner because it employs a proactive management to its suppliers, is identified by experts
as suitable to conduct research, and is strongly interested in academic research on its maturity as
business. Furthermore, processing companies, like company Alpha, rely on the physical availability
of supplies and therefore a shortage can result in visible downtime and delay, which often has
severe impact on the company’s production and profitability. Thus, it provides a good base to
identify and understand action and reaction. Gaining access to confidential data of companies is a
main hurdle any researcher faces and often results in anonymity of the cases (Yin, 2009). Even so,
not recommended but not avoidable (Yin, 2009) this report anonymizes involved companies and
data to provide an understanding of the situation to the reader, while protecting confidentiality of
businesses. The focal company, that is the main supporter of the project, is labelled company Alpha.
3.1 Case Selection and Setting Company Alpha is a joint venture of two global businesses in the processing industry that has been
operating for more than 60 years employing several thousand employees. The company processes
raw materials into a variety of products which are offered national and international to business
and end customers. The business complexity in operations, supply chains and physical
requirements of products can cause unexpected disruptions. Supplier management is very
important for company Alpha as it relies heavily on its suppliers to ensure quality and safety in
processes and procedures.
To gain the status as supplier for company Alpha, all suppliers have to follow a selective procedure
that test the manufacturer processes. After the certification the supplier can be used by the joint
venture and other companies of the owner companies. The aim of this procedure is to capture the
smallest total costs of ownership for company Alpha and assure product quality at the
manufacturer. Actors in the case supply chains vary in the size of employees from approximately
100 to several 100,000, and are operating national, international, and global.
Cases are selected to present a variety in the cases and to identify difference between suppliers. In
addition, the selection is based on the interviewees’ involvement in the events to receive first hand
data. The four case supply chains are assigned to three different quadrants of the Kraljic matrix
(1983), Figure 3. The company is involved in a restructuring program and uses academic support to
evaluate its business maturity which supported access to confidential information.
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Bethke, T. (2014)
1. The first supply chain case involves company Alpha, the first tier supplier Tools&Co, and a
second tier supplier (manufacturer).
2. The second supply chain case involves a first tier supplier (Equip. Ltd.) to company Alpha
including a huge, highly customized product which was assembled at the premises of
company Alpha.
3. The third supply chain case involves an automated and electronically supervised supply
chain of company White. The supplier of electronic equipment is Elect. Ltd.
4. The fourth supply chain case involves a regular maintenance contract of products which
requires the shipment of substitute products and service provider.
Figure 3 – Identification of Cases in the Kraljic Matrix (1983)
* see part 3.4 for analysis
3.2 Data Collection To accomplish data triangulation (Voss, Tsikriktsis, & Frohlich, 2002)(appendix 8.1), data collection
used the following techniques: (1) five in-depth interviews with managers, (2) observations during
informal meetings, (3) consultation with an external expert, and (4) a review of press releases,
internal report, and company websites. The development of an interview protocol, case study
protocol, recording of interviews, and multiple researchers collecting data, strengthened the
reliability of the research (Yin, 2009).
Before the actual data collection phase a meeting was held to reach consensus on both sides on what
will be the research topic, cases of interest, persons of interest, and to overall manage expectations.
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Bethke, T. (2014)
The project is supported by top management of company Alpha which is of value to gain
interviewees’ collaboration, resources, and open doors (Voss et al., 2002). Interviewees were
chosen after counseling with managers in a snowball sampling. It resulted in the selection of four
interviewees with similar management responsibilities but diversity in supply chains, Table 1.
Three interviews were held face to face at the premises of the interviewees and two interviews
were conducted via phone due to availability and distance issues. An interview protocol (appendix
8.2) was developed in collaboration with a second researcher and was reviewed by an academic
expert. It is based on the literature review and served to structure the interviews. Interviews were
individual and semi-structured (varying between 30 – 90 minutes), and conducted during the last
quarter of 2013 and beginning of 2014. Researcher triangulation was achieved by having two
researchers conducted the interviews with changing roles for each interview. One researcher was
responsible for addressing questions and the other researcher was responsible for taking notes on
the content and context (Eisenhardt, 1989). Feedback and discussions between the researchers
after each interview was iterative to improve the research structure and probing procedure. All
interviews were recorded, transcribed verbatim within 24 hours and emailed to the interviewee for
verification (Voss et al. 2002). If there were any unclear answers, interviewees were contact via
email to clarify content. Moreover, interviewees were informed beforehand and addressed again at
the beginning of each interview of confidentiality treatment of the information, which is
documented in a signed form of consent.
During the interviews, the respondents were asked to recall an example of an unexpected
disruption in a supply chain and to describe their organization’s behavior, the interviewees’ role,
and other involved parties such as suppliers. Probing was used to receive detailed responds on
specific aspects directly linked the supply chains members actions and questions about general
issues were directed to the interviewee to receive information about the interviewee and the
organization. Respondents were asked to state the actual events rather than the interviewees’
opinion about events.
A secondary data research after the interviews identified external sources that provided additional
insights to markets, suppliers and information on supply chains, Table 2. This resulted in
supplementary reports providing context and additional articles that show the impact of
disruptions as recognized by media and government. Furthermore, a simple research on supplier
websites provided more information about sizes, markets, and products. It resulted in small
discrepancy between the interviewees’ knowledge about market and suppliers identified via an
online search which in one case could be confirmed by an external expert.
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Bethke, T. (2014)
Table 1 – Overview of Interviews
Case Company Role in Supply Chain
Function of the Interviewees
Supply Chain Involvement
Structure & Type
Length
1 Alpha
Tools&Co
Buyer
1st - tier supplier
Contract Holder
Contract Manager
> 4
> 7
Semi-structured
Semi-
structured (via phone)
90 minutes 30 minutes
2 Alpha Buyer Contract Manager
> 1 Semi-structured (via phone)
45 minutes
3 Alpha
Buyer Contract Holder > 3
Semi-structured
90 minutes
4 Alpha
Buyer Contract Manager
> 1
Semi-
structured
60 minutes
Table 2 - Secondary Data
Document Name Type of Document Year 1 2 3 4 5
Disruption Report for Government Event Publication Government Publication Project Publication Supplier Selection Procedure
Report Documentation Report Presentation Slides
2012 2013 2013 2009 2013
3.3 Data Analysis The data analysis started with a within-case analysis and was followed by a cross case analysis to
compare the findings, generalize and gain a deeper understanding of the within-case findings
(Huberman & Miles, 1994). Data was analyzed based on the steps outlined by Miles and Huberman
(1994) and supported during the coding and re-coding of data by the software Atlas.ti (Atlas.ti
GmbH).
The initial step of the data analysis was a data reduction approach to code sentences, phrases, and
paragraphs to facilitate a simpler analysis and resulted in first order codes. Data was filtered to only
sentences that were applicable for this study and carefully selected to include facts and not
opinions. Second order coding focused on assigning categories to the first order codes. First, the
Kraljic (1983) dimension of supply risks and financial impact were used to assign the cases in the
matrix. When a code stated “that it is part of a tender” it was assigned to supply risk, Table 4
(appendix 8.3). Cases are distinguished on the profit impact by using the procurement costs and the
resulting downtime costs as it was not possible to gain financial details of the company. The supply
risk is considered high when three or less suppliers are available.
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Bethke, T. (2014)
An internet search for the product contributed as secondary source as the knowledge of managers
does not necessarily yield exact knowledge about the actual market. In one case an expert was
consulted to provide more insights to the market, Table 3.
Table 3 - Role of Supplier and Type of Disruption
Case Stated number of supplier
Secondary data
Impact on profitability
Type of supplier according to Kraljic (1983)
1 4 - 5 => 5* High Leverage 2 =< 3 2 - 3 High Strategic 3 2 - 3 3 High Strategic 4 1 - 2 X Low Bottleneck
X= no additional data identified *Case 1 includes the knowledge of an external expert
To answer the research question “how does the role of supplier affect the resilience in supply
chains?” Second order coding within cases preceded with focus on the resilience capabilities.
Wieland and Wallenburg (2013) conceptualization of resilience was used to distinguish robustness
and agility of which the lower level categories of the framework were used to assign codes.
Definitions were used from supply chain literature to define anticipation (Wieland & Wallenburg,
2013), preparedness (Hamel & Välikangas, 2003), visibility (Francis, 2008), and speed (velocity)
(Christopher & Peck, 2004). To give an example, when a code mentioned “we had it in our backyard”
it was assigned to preparedness, while a phrase such as “we filed a non-conformance report” was
assigned to visibility. The codes that described similar meanings were assigned descriptive
categories to generalize the meaning, Table 5. To assign general categories within the resilience
dimensions allowed making inferences on the reason why supply chains are more robust or agile.
Next, the cross-case analysis was conducted to test generalizability of the findings from single cases
(Yin, 2009). The results of the cases were then juxtaposed to identify similarities and differences
between cases. Categories that are identified in one case but not in the other case, led to a review of
the data to find reasons for differences such as product characteristics. The comparison between the
cases was then extended to incorporate the supply risk of each dimension to provide a distinction
between cases and fill the matrix with four labels. An overview of the overall methodology process
is illustrated in Figure 4.
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Bethke, T. (2014)
Figure 4 - Methodology
4. Findings The findings of the analysis are presented below to describe the four quadrants of the conceptual
framework. Supply chains need to be robust and agile but as the conceptual framework proposed,
the capabilities are not equally important for all cases. As a result the findings of the four cases are
presented in the associated quadrant of the new matrix. The quadrants are named (1) dependent,
(2) tailored, (3) autonomous, and (4) variable.
4.1 High Supply Risk
4.1.1 Dependent
This quadrant is high in supply risks and high in robustness. The supplier offers a very rare supply
or service which limits the alternatives of provides due to highly specific knowledge. The purchasing
company protects its need for products by contractual agreements that the supplier holds stock or
has a safety stock of critical products. It is therefore dependent on the supplier to prepare sufficient
items in stock and deliver the products to the buyer side warehouse for further distribution, as one
interviewee stated: “the vendor is responsible for making sure that the spare parts are in stock.” A
disruption after the central warehouse of company Alpha is severe as the know-how of the supplier
is necessary to resume the supply chain operations and the limited availability of qualified personal
creates dependency on the supplier to help handling the disruption. Disruptions become visible by
the supplier whose expert requires the supplies and inform the buyer about the disruption. The
buyer depends on the supplier to offer a solution to react to the disruption.
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Bethke, T. (2014)
4.2.2 Tailored
The supply chain faces a high supply risks and tends to be more agile. A high supply risks due to the
product specifications, operational importance, and financial magnitude developed a relationship
between members in the supply chain. The company is willing to invest in the relationship and
involvement between the parties forms routines in contact personal and cross functional supply
chain teams. The frequent exchange of information and insights to the buyers/ supplier work
increases the visibility of events in the supply chain. Visibility and direct links between companies
improves the speed of the supplier to react and is important to restore the supply chain. The cross
supply chain teams and communication is necessary due to the specifications required by the buyer
side and is customized to meet the needs of the buyer and restore the supply chain.
4.2 Low Supply Risk
4.2.1 Autonomous
This quadrant is low in supply risks and tends to be more robust. A lower supply risks implies that
the product can be sourced from several suppliers and that the product is procured to achieve lower
costs. It is a product that is more frequently used by the buyer and products are used for several
purposes which is possible due to standardization in product specifications. Company Alpha kept
products in its inventory from a previous order. When the disruption in the supply chain occurred,
the company made the problem visible to its suppliers by standardized procedure. They engaged
cross-functional teams to resolve the disruption so that all parties can be satisfied. However, the
long restoration of the supply chain between manufacturer and buyer is shortened by the use of
preexisting stock of the company. Therefore, the company is working on restoring the supply chain,
while it can mitigate the impact of the disruption for the company. As one interviewee states: “we
just found replacement for the product in our own stock.” It is independent from the supply chain to
be restored, but the company is interested to restore the original supply chain and add the products
to its stock for the future.
4.2.2 Variable
The fourth quadrant is low in supply risks and a dominant agility capability. Unfortunately, no
supply chain case was available and therefore the findings can be only derived from the other cases
but remains mostly guess work. The other low supply risks quadrant is more robust than agile as it
uses inventory to overcome the shortage due to the disruption. This quadrant would not have such
robustness but the agility is more present. It does not exclude the robustness factors but because of
circumstances this is not enough and the supply chain needs to adapt to changes. But the high
degree of standardization and alternative in the market would presume that the company is able to
react by resembling the supply chain to other suppliers quickly and overcome the impact of the
disruption.
Combining the supply risks (horizontal) and resilience capability (vertical) result in a two-by-two
matrix, Figure 5. The four quadrants resemble how the resilience of supply chains differs from
supply chain to supply chain. The specifications of products and their supply chains implies
companies to develop capabilities in their supply chains implicitly, as result a supply chain is more
likely to develop robustness or agility capabilities. Findings of the cases showed that the supply
19
Bethke, T. (2014)
risks are of importance on how a company prepares, responds, and recovers from unforeseen
disruptions.
Figure 5 - Matrix
5. Discussion Though resilient supply chains require both a proactive and reactive part, it appears that each
supply chains benefits differently from capabilities based on the supply chain characteristics. The
findings in the previous section illustrate that supply chains resilience has no blueprint and requires
thoughtful and skillful managers that understand the characteristics of each supply chain.
From the findings the question can be answered whether resilience capabilities are equally
important in all cases (Wieland & Wallenburg, 2013). The empirical findings allow saying that it is
not the case and resilience capabilities are unequally important. Instead, it depends on the supply
chains characteristics as they determine supply chains vulnerabilities and the susceptibility to
disruptions (Wagner & Bode, 2009). Supply chains of standardized items and low supply risks are
reoccurring orders for the company and thus traditional measures of stock against supply shortage
(Blackhurst et al., 2011) is a predominant strategy to continue operations until the supply chain is
restored. Inventory from previous projects was kept due to the standardization and future use. It is
surprising that the case company did not employ multiple sourcing for the low supply risks
dimensions. But it can be explained by the company’s certification test of suppliers to increase
quality and safety which prevents multiple sourcing strategies. The tendering process for the
selection process of suppliers can be immense when multiple suppliers are involved and avoiding
this process helps to cut costs and time losses (Tunca & Wu, 2009). It is this procedure that slows to
identify other suppliers, to be accepted as supplier, and prevents the company to react to
disruptions. Moreover, the supplier selection criteria decreases chances to react quickly as for
20
Bethke, T. (2014)
several items only one supplier has the required certification. The company develops its own
bottleneck for purchasing managers with barrier to source from alternative suppliers in the market.
Inventory is an effective and often used strategy to prepare for disruptions (Vlajic et al. 2012;
Chopra & Sodhi, 2012). But with increasing financial impact and customization it becomes too
expensive to rely on a single robustness strategy and thus require another way how a supply chain
can overcome a disruption. In this paper the adaptability of products that could be used as
substitute during the disruption in the supply chain is related to postponing (Boone, Craighead, &
Hanna, 2007). However, it requires a certain degree of standardization of the products and costs
should not erode the benefits of supply chain capabilities (Pettit et al. 2010). Moreover, to hold
inventory a company needs to anticipate a certain demand and can develop measures such as safety
stocks to prepare against disruptions in the supply chain (Blackhurst et al., 2011). But, the cases in
this paper varied in their frequently and sometimes demand occurred only on new projects with
specific defaults. Therefore, it is very difficult to forecast demand and the high costs hinder to
purchase bulks (Tang, 2006). Yet, it is observed that the general standardization of product size and
range is contributing to find alternative supplies in case of shortcomings. In the other cases this
strategy is not applicable due to the type of disruption, e.g. the disruption occurs after the
warehouse, or simply because the supply chain is of such physical as well as financial size that it is
not possible. These cases incorporate a higher degree of collaboration and communication with the
supplier and thus develop cross supply chain teams and cross functional teams that allow
visualizing quickly the disruption among supply chain members. Visibility of disruptions to supply
chain members is very important to get the suppliers involved to develop solutions. Increasing the
visibility of disruptions to suppliers increases the speed the supply chain reacts to changes (Wieland
& Wallenburg, 2013). It raises the knowledge about each other and implicitly prepares the supply
chain to respond quicker with increasing visibility of the disruption (Blackman, 2013).
Resilience is the supply chain capability to prepare, respond, and recover (Ponormarov & Holcomb,
2009). The supply chain cases of this paper different in the last of the three resilience phases. It was
very striking that that the cases with a high supply risks showed that they did not simply return to
the normal state of the supply chain but aimed at improving the items and communication. As a
result of the disruptions, the supply chain members develop and improve the supply chain or the
items. A long-term focus of the business relations (Kraljic, 1983) could be the cause for this. It did
end in improvements of the supply chain or its products, while the low risks supply chain only
aimed at restoring the supply chain until the products are sufficient. The short-term interaction and
variance of ordering supplies next time with a different supplier prevent that supply chain members
learn from the disruption as supply chain.
The matrix of this paper can be added to the classical Kraljic matrix (1983) and provides purchasers
insights on how the portfolio approach can affect supply chains resilience capabilities. Awareness of
the supplier managements’ implications prepares to focus on strengthening the capability which is
more important while creating awareness for the weaker capability. Purchasers can then allocate
resources to build up the capabilities and tailor them to the supply chains characteristics. Thus, they
can better prepare their supply chains against unforeseen disruptions. The resulting cube provides
an understanding on how to link classical supplier management to the implications for resilience
21
Bethke, T. (2014)
capabilities in the supply chains, Figure 6. It takes a different approach than other approaches of
developed resilience portfolios. Pettit et al. (2010; 2013) propose a matrix that with an increase of
capabilities and decrease of vulnerabilities, while Blackhurst et al. (2011) suggest another resilience
matrix based on their resource based view. Both researches point to one direction or quadrant in
which resilience is possible, which is with high capabilities (Pettit et al. 2010) or high enhancers
(Blackhurst et al., 2011). From their perspective, the matrix of this paper would distinguish further
the resilient quadrant.
Figure 6 - Cube model (based on Kraljic, 1983)
6. Conclusion, Limitations & Recommendations Today’s wide spawning supply chains and ongoing focus on more efficient and effective supply
chains increase the relevance to understand and build resilience capabilities in supply chains as it
can give a strategic advantage and therefore should be strategic objective (Sheffi & Rice, 2005).
Scholars investigating the resilience in supply chains are continuing to focus on how to build
resilience supply chains and identify the link to supply chain vulnerabilities (Pettit et al., 2010;
2012; Blackhurst et al., 2011). But literature on how company’s supplier management affects the
resilience in the upstream of supply chains is non-existent. This research attempts to add to the
existing literature gap in resilience and provide both theoretical and managerial implications.
The main research contribution of this thesis is an empirical derived matrix based on the classical
supplier management approach of Kraljic (1983). It provides a connection between supplier
management and resilience capabilities in supply chains and thus also identifies potential causes of
vulnerabilities. Based on the supply risk dimension of Kraljic (1983) this papers empirical finding
observed that the resilience capabilities are not always equally relevant.
22
Bethke, T. (2014)
To answer the research question, supplier management does affect the resilience in supply chains.
The allocation of resources and the management of suppliers can result in stronger manifestation of
robustness or agility capabilities in supply chains that help to survive disruptions.
This research theoretical contribution is to provide insights how the supplier selection affects the
resilience in supply chains. It also adds to the literature stream on vulnerabilities (e.g. Peck, 2005;
Wagner & Bode, 2006) by giving comprehensions to the impact of upstream vulnerabilities for a
buyer company. Moreover, resilience literature addresses the proactive management of suppliers in
supply chains (Wieland & Wallenburg, 2013), which this research contributes to by researching
how proactive management of suppliers affects resilience in supply chains.
The managerial implication is that by providing a simple matrix it offers managers insights on how a
classical portfolio approaches for supplier management impacts capabilities in companies supply
chains. Thus, it provides insights to understand for variety of supply chains which capabilities are
more significant. To understand the implications of a company’s supplier management on supply
chain capabilities increases the awareness for vulnerabilities and can help to survive a supply chain
disruption. To survive a supply chain disruption can have a strong impact for the competitiveness of
a company (Norrman & Jansson, 2004) and thus should be a strategic objective (Sheffi & Rice,
2005).
Another contribution of this research is that it shows how the purchasing managers directly
influence upstream supply chains vulnerability and thus the risks of disruptions. Moreover, the
cases show how an active management of suppliers can reduce the impact of disruptions and
improve business practices. Therefore it provides insights on purchasing functions role of supplier
management and its impact on supply chain resilience which has a wider view on the magnitude
and implications of disruptions. The cases provided insights on how important it is to have specific
strategies to procure different supplies and therefore increase the resilience. Furthermore, the
research helps to reduce the gap in literature to identify the right strategies for different supply
chains (Blackhurst et al. 2011).
The discussion section of this paper proposes a cube model (Figure 6) that adds a third dimension
to the Kraljic matrix (1983) providing an increased understanding how resilience can be influenced
by different suppliers. Of course, further research is necessary to confirm the findings and replicate
the paper findings to other companies and industries.
Undoubtedly, there is much more research necessary to test and investigate this papers’ matrix
(Figure 5). This thesis contribution should be used to further investigate the impact of supplier
management on the resilience of supply chain, including the implications for vulnerabilities in
upstream supply chains. Future research should discuss without limiting it to the different directs.
Another aspect of this paper limitation is its large dependency on the buyers’ side (four out of five
interviews) and limits availability of information in three cases to one perspective. In addition, two
interviews were conducted via phone rather than face-to-face. Though access to the two
interviewees was limited due to spatial differences, it prevented to observations of nonverbal
communication (Berger, 2003), and limited informal channels of communication to a minimum.
23
Bethke, T. (2014)
This paper has several limitations and provides ground for further research. First of all, the cases
are applied only to three quadrants so that research should focus developing a holistic multiple case
study that covers all quadrants and distinguishes the implications. This should be repeated in the
process industry to test this paper’s findings and generalized to a cross industry research to support
the universal applicability of supply chain resilience (Blackhurst et al., 2011). It would be interesting
to investigate how resilience applies in service supply chains (Ellram, Tate, & Billington, 2004).
Second, the literature of resilience still requires more empirical data as well as statistical analyses to
strengthen the understanding of resilience capabilities. Finally, this research provides empirical
data about how supply chain resilience is different from supply chain to supply chain. Therefore, it
provides a first step to a more sophisticated approach that could evaluate the performance of supply
chain resilience.
Additionally, it needs to be mentioned is the general critics at portfolio models and their reduction
of complex issues into simplistic theory which ignores relations other than linear supply chain
(Dubois & Pedersen, 2002). But, by explaining the resilience of supply chains on a classical
approach, this paper provides the initial step to deepen knowledge about supplier management’s
implication for supply chain resilience. Furthermore, to use well researched and tested theory
includes that there is a good understanding of the shortcomings and benefits of the theory. But for
the future it would be of interest to substitute the portfolio approach with another supplier
management approach such as the industrial network approach (Hakansson & Snehota, 1995).
To conclude, this thesis contributes to an advanced understanding of supply chain resilience,
upstream vulnerabilities, supplier management, and purchasing. Nevertheless, research on
resilience in supply chains needs to continue to fill the gaps of unexplored areas (Blackhurst et al.,
2011), and hopefully this article can provide other scholars to continue research in this field.
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Bethke, T. (2014)
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8. Appendix
8.1 Data Triangulation
Overview of Validity and Reliability during the research project (based on Yin, 2009)
Type Method Research Phase Construct validity Multiple interviews
Review by expert Introduction into company and purchasing context Expert support for identification of cases Expert review of interviewees
Data collection Research Design/Data collection Sample selection Data collection, Data analysis
Internal validity Two researchers Interview guidance by experienced research
Data collection Data collection
External validity Single case studies used for replication logic,
Research Design/ Analysis
Reliability Case study protocols, Interview protocol & transcripts
Data collection Data collection
8.2 Interview Protocol Supply Chain Resilience Project
The management of highly interconnected supply chains presents an ever-increasing challenge in
today’s competitive business environment and a disruption in the supply chain has been recognized
by many as inevitable. To be able to reduce risk the design of a supply chain must incorporate event
readiness, the provision of an efficient and effective response and the capabilities of returning to the
original (or better) functional state after a disruption- this is the essence of supply chain resilience.
While supply chain risk management aims at the identification and assessment of possible risks to
develop mitigation strategies, supply chain resilience complements and enhances such methods by
enabling a supply chain to deal with and recover from unforeseeable risks. On an individual basis,
organisations have been conscious of the need for risk management and contingency planning for
some time. However, the critical exposure along the supply chain is often overlooked. The research
project on supply chain resilience started in April 2013 and is aimed at exploring how large
companies (can) build resilience by investigating critical exposures to risks along supply chains.
Over the next year we hope to complete 5 case studies on the subject to derive overall conclusions.
Subtopics include the set-up of critical success factors for supply chain resilience, the impact of
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supply chain integration on supply chain resilience and how purchasing, in particular relationships,
can contribute to supply chain resilience. To enable the Research Team to gain insights we are
asking you to engage in a short interview (about 60 minutes –questions we are interested in are
listed below). We guarantee anonymity of statements in the report and that data will only be used
by the researchers and not forwarded to any other persons or organization.In return for your
support we would be delighted to provide your company with both customized initial feedback and
a detailed report on our overall findings on completion of the project. In addition, we would be
pleased to invite you to a presentation and workshop on our findings at RUG or your company. We
are very grateful for your consideration and hope that you find our project interesting and
worthwhile. If you have any questions in relation to this document or the project, please do not
hesitate to contact us.
Interview Questions
1. Could you please describe your background and your position/role at the company?
2. Please describe the supply chain which encountered an unexpected disruption?
Structure
Information flow
Relationships with suppliers
3. Please describe in detail a disruption in the previous mentioned supply chain?
When/How did you find out?
Impact of the disruption
Supplier interaction
Programs and contingency plans in place
4. How did you respond to the disruption?
Specific actions
Involvement of different departments
Supplier involvement in managing disruption
5. How did your company recover (return to same state of operations/better operations) from the
disruption?
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Length from discovery of disruption till recovery
Changes in (infra-)structure, relationships
6. How is your supply chain prepared for future disruptions?
Involvement of supply chain members
Contingency plans (outreach in the supply chain)
What changed in comparison to pre-disruption preparation
8.3 Results Table 4 - Representative Data Coding Supplier Role
Dimension Category Codes Representative Data
Su
pp
ly R
isk
Alternative suppliers (Anything that is stated about the
availability of alternative suppliers during the procurement
process) Standardization of products
(Anything that describes the products characteristics and
degree of customization)
“The next time we would go to one of the other one.” (Interviewee 3) “But on this level probably 4 or 5.” (Interviewee 4) “so we need to go to 3 manufacturers to get a quote” (Interviewee 1) “They are part of a tender.” (Interviewee 2) “Was not fully under specification but they got a concession to the specification so they could actually use it” (Interviewee 1) “The materials were not compliant to the specification” (Interviewee 2) “The standard company Alpha uses in the globe contract don’t have that specific type of class/ ratings” (Interviewee 1)
Pro
fita
bil
ity
Im
pa
ct
Costs of supplies (Anything that determines the costs of the products) Disruption consequences (Anything that can be related to
the consequences of the disruption, including financial or
media aspects)
You have to think of billions (Interviewee 3) “And this piece of equipment was about XXX euros.” (Interviewee 4) “After XX days production loss.” (Interviewee 3) “The delay was in the end 5-6 weeks.”(Interviewee 2)
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Table 5 - Coding Procedure Capabilities
Dimension Categories First Order Codes - Representative Data
Ro
bu
stn
ess
Anticipation:
Ability to discern potential future events or
situations
(Pettit et al., 2010)
Supplier Notifications Internal Decision Making
“We had notifications and discussions about it” (Interviewee 4) “We decided every year again” (Interviewee 4)
Preparedness:
The freeing of resources and collecting of
contingency plans to overcome these events
(Hamel & Välikangas,
2003)
Inventory Monitoring System Scheduling Predefined Contact Persons
“We found replacement for the product in our own stock” (Interviewee 1) “All our production facilities, all our plants are linked to a control room.” (Interviewee 4) “They provide regular preventive maintenance.” (Interviewee 5) “I am the focal point for everything related to this.” (Interviewee 3)
Ag
ilit
y
Visibility:
Visibility refers to the identification of the
status of entities, location captured in
messages about events
(Francis, 2008).
Process Insights Cross Functional Supply Chain Teams Formal Reports
“They were aware of the problem we have here” (Interviewee 3) “That’s why the CMT got involved, got the TA-the technical authority- got the buyer from the procurement department involved, from Tools& Co, and the manufacturer had people involved and their project management and we had a meeting at the manufacturer” (Interviewee 1) “the vehicle is a nonconformance report that basically triggers the remedial actions” (Interviewee 1)
Speed/ Velocity:
The speed with which a supply chain can react to
changes
(Christopher & Peck, 2004)
Respond Team Supplier Accessibility Priority Setting of Personal Cross Functional Teams
“You start putting together an investigation team.” (Interviewee 4) “Instead of doing this test over here, we had our guys flying over there.” (Interviewee 4) “It was the same day I was starting on it.” (Interviewee 3) “So suddenly, we had all kind of people in the organization working on this topic and trying to find out more information.” (Interviewee 3)
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THE END