Joint Resolution of Supply Chain Risks: The Role of Risk Characteristics and Problem Solving Approach

• Main Author: Bovell, Leah J
• Format: Others
• Published: Digital Archive @ GSU 2012
• Subjects: disruption risk; risk magnitude; risk likelihood; collaborative problem solving; risk identification
• Online Access: http://digitalarchive.gsu.edu/marketing_diss/23; http://digitalarchive.gsu.edu/cgi/viewcontent.cgi?article=1023&context=marketing_diss

The purpose of this study is to examine the disruption risk resolution process in supply chains; specifically, to assess how risk attributes impact the approach firms select to resolve risks and the associated final outcomes. We propose that high magnitude risks are positively associated with mutually beneficial problem resolution; on the other hand, low likelihood risks have the opposite effect, they are negatively associated with mutually beneficial resolution. Our conceptual contribution lies in our articulation of the mechanisms though which risk magnitude and risk likelihood impact mutual problem resolution. We posit that high magnitude risks and low likelihood (uncommon) risks mobilize the social network of actors, triggering vigilant monitoring for risks, communication among actors and across firm boundaries, and resource sharing and coordination which facilitate collaborative problem solving and mutual resolutions. These mobilization mechanisms help supply chain partners to overcome the challenges of complexity and allow for information and resource flows among actors and between firms. Our statistical analysis demonstrates that the impact of risk attributes on mutual problem solutions is fully mediated by timely problem identification and collaborative problem solving.