Competitors: friend or foe in building Supply Chain Resilience?
Student : Gerwin Matthijs Loer (S2886502)
Supervisor : Dr. K. Scholten
Second supervisor : Dr. J. de Vries
Word count: 11.546
MSc Supply Chain Management
Faculty of Economics and Business
University of Groningen
ABSTRACT
Purpose – This study aims to explore how competitive actions influence the creation of Supply Chain
Resilience for engaging companies as well as competitors. This is from importance since current resilience practices are overlooking the majority of effects of competitive actions. Therefore, an overview of competitive actions in each interaction direction and correlated effects on SCRes was a necessity.
Design / Methodology / Approach – An in-depth exploratory multiple case study was carried out
across the food, medical devices and packaging industry during the COVID-19 virus. Furthermore, multi-source data collection including 12 semi-structured interviews were executed. In addition, secondary data such as written documents extended this data. At last, a deductive coding approach was executed.
Findings – Competitive actions influence the creation of Supply Chain Resilience in three ways. First,
upstream competitive actions contribute to the preparedness of an organization to unforeseen events. Whilst, competitors are less responsive to disruptions because of availability issues. Second, vertical competitive actions contribute to mutual gain in agility, flexibility and collaboration for the considered companies. Third, downstream competitive actions contribute to demand side visibility. In this way, flexibility and agility was either gained or lost. Besides, the underlying mechanisms of the competitive actions and delayed responsiveness of competitors were considered.
Originality / Value – This paper creates a categorical overview of the impact competitive actions have
on Supply Chain Resilience of organizations. More specifically, this research took the perspective of engaging companies and horizontal members. By doing this, specific novel patterns were observed for upstream, downstream and vertical competitive actions.
Acknowledgements
Table of content
1 Introduction 5
2 Theoretical Background 8
2.1 Supply Chain Resilience and its strategies 8
2.2 Competitive Actions 11
2.2.1 Upstream competitive actions 13
2.2.2 Vertical competitive actions 14
2.2.3 Downstream competitive actions 16
2.3 Conceptual Framework 17 3 Methodology 19 3.1 Case context 19 3.2 Case Selection 20 3.3 Data Collection 22 3.4 Data analysis 25 4 Findings 28
4.1 Upstream competitive actions 28
4.1.1 Collaboration 30
4.1.2 Agility and Flexibility 32
4.1.3 Redundancy 32
4.2 Vertical competitive actions 33
4.2.1 Collaboration, agility and flexibility 34
4.2.2 Redundancy 34
4.3 Downstream competitive actions 35
4.3.1 Collaboration 35
4.3.2 Agility and Flexibility 36
4.3.3 Redundancy 37
5 Discussion 38
5.1 Discussing upstream competitive actions 39
5.2 Discussing vertical competitive actions 40
5.3 Discussing downstream competitive actions 41
5.4 Discussing the delayed effect on competitors 42
6 Conclusion 43
6.1 Managerial Implications 43
6.2 Limitations and Future Research 44
1 Introduction
Late March 2014, the crop of hazelnuts was significantly damaged because of hail and frost. Consequently, all producers of products making use of hazelnut were dealing with supply issues. Ferrero, the Piedmont-based company that makes Ferrero Rocher and Nutella acquired one of the biggest producers of Hazelnut. Ferrero secured the incoming flow of raw materials whilst simultaneously hampering competitors in their likelihood of acquiring critical raw materials in times of supply disruptions (adapted from Rankin, 2014). This illustration shows that competitors directly influence each other’s adaptive capability of the supply chain to prepare for unexpected events, respond to disruptions, and recover from them by maintaining continuity of operations at the desired level of connectedness and control over structure and function (Ponomarov and Holcomb, 2009 p.131), also referred to as Supply Chain Resilience (SCRes).
SCRes can be developed by adopting four main strategies: flexibility, redundancy, agility and collaboration (Tukamuhabwa et al. 2015). Competitive actions are deployed to influence at least one of these resilience strategies. Consequently, companies seek to increase own SCRes, whilst preferably hampering the SCRes of competitors. Competitive actions are defined as externally directed, specific and observable moves which are used to defend or improve relative competitive position (Chen, 1988; Smith et al., 1992; Young et al., 1996). Literature suggests that competitive actions may be directed at three different points in the SC being upstream, downstream and vertical (Heil and Helsen, 2001; Scholten and Schilder, 2015; Pulles et al., 2016).
The lack of consensus on how competitive actions create SCRes is because in general competitive actions have paradoxically effects. On the one hand, scholars encourage competitors to engage in vertical interaction to create resilience (Scholten and Schilder, 2015). These authors found for instance that competitors shared physical resources which increased all of the four strategies and consequently improved SCRes for both parties. On the other hand, scholars suggest that by engaging in downstream and upstream competition one is able to achieve relative advantage over competitors. For instance, Tukamuhabwa et al. (2017) found that competitors placed large orders at suppliers to delay the supply for competitors. This action decreased the flexibility, redundancy and agility for competitors. In addition, even if competitors have previously created SCRes with one another, the danger of competitive actions may always be present. This is supported by Gnayawali et al. (2006), they found that there is no consensus in literature whether the aggressiveness of firms which previously competed becomes lower when firms collaborated in the past.
The major disadvantage of either of these claims is that they are built upon limited empirical foundation. Based on the lacking knowledge on the role of competitors in the creation of SCRes, this paper will address the influence of competitive actions in each of the three resilience phases. Consequently, this paper will extend the knowledge base with the following research question:
How do competitive actions at different points in the SC influence the creation of Supply Chain Resilience within engaging organizations and competitors?
Competitive actions can be categorized by downstream, upstream and vertical activity. By categorization, clear patterns were identified within each interaction direction for focal organizations and competitors. First, all vertical competitive actions were revolved around mutual gain and reciprocity. In addition, these two principles increased flexibility, agility and collaboration. Second, upstream and downstream competitive actions improved the preparation and response to disruptions for engaging firms. Furthermore, data analysis revealed a delayed effect on competitors caused by upstream and downstream competitive actions. Consequently, because of decreasing effects on either demand side visibility or availability of supply responsiveness to disruptions was lowered for competitors.
2 Theoretical Background
2.1 Supply Chain Resilience and its strategies
This paper regards SCRes as: “the adaptive capability of the supply chain to prepare for unexpected events, respond to disruptions, and recover from them by maintaining continuity of operations at the desired level of connectedness and control over structure and function” (Ponomarov and Holcomb 2009 , p. 131). This paper regards this definition as most suiting since it describes how resilience impacts the three phases of a disruption: preparedness, response and recovery (Ali et al., 2017; Pettit et al., 2010). This is highly important since the effectiveness of competitive actions is directly linked to these three phases as well.
SCRes can be achieved with resilience strategies and practices. Wieland and Wallenburg (2012) included robustness and agility as factors for SCRes. Furthermore, Jüttner and Maklan (2011) found that flexibility, collaboration, visibility and velocity are of importance. An extensive literature review of Tukamuhabwa et al. (2015) found the four main strategies to build SCRes: redundancy, flexibility, collaboration and agility. Therefore, the creation of SCRes will be conceptualized based on these four strategies. As observable, there exist overlap between the factors considered by these scholars. However, the initial exclusion of robustness, velocity and visibility does not imply that these factors are not of importance in this paper. In the findings, in some instances these factors are used to describe more accurately the effects of competitive actions. Subsequently, these excluded factors will be transformed into the found resilience strategies of Tukamuhabwa et al. (2015).
Redundancy is defined as the strategic and selective use of spare capacity and inventory that
invoking redundancy contributes to less dependency on suppliers and allows for more flexible decision making a direct link with flexibility is found by scholars (Johnson et al., 2013).
Flexibility is the ability to adapt to changing requirements of the intra and inter-organizational
environment with minimum time and effort (adapted from Tukamuhabwa et al., 2015; Erol et al., 2010). The following flexibility practices enhance SCRes: postponement, a flexible supply base, flexible transportation, flexible labor arrangements, order fulfilment flexibility (Tang, 2006, Christopher and Holweg, 2011; Pettit et al., 2013). “For example, it is argued that flexibility through postponement enhances resilience during a crisis by deferring demand to a future period (Tang, 2006). Thus, flexibility creates SCRes by enhancing prompt adaptability during turbulence (e.g. Christopher and Holweg, 2011)” (Tukamuhabwa et al.,2015, p.5604). Furthermore, other scholars suggest that flexibility facilitates coordination processes and enables organizations to deal with high levels of uncertainty (Manuj and Mentzer, 2008; Scholten et al., 2014). In order to achieve this, supply chain visibility is crucial since it ensures confidence in the supply chain, preventing overreaction, unnecessary interventions and ineffective decisions in a risk event situation(Scholten et al.,2014;Christopher and Lee, 2004;Pettit et al., 2013; Jüttner and Maklan, 2011) Although creating flexibility seems ideal, some scholars state that there exist a limit to increasing flexibility, since companies need to balance their practices to ensure efficiency (Pettit et al, 2010 ; Pettit et al, 2013;Chopra and Sodhi, 2014). Although flexibility enables companies to respond to disruptions in a better fashion, the costs of potential disruptions must outweigh investing in flexibility. This also explains why it was found in surveys that managers appreciate the impact of disruptions but do little to none to prevent them (Chopra and Sodhi, 2014).
Agility is defined as the ability to respond quickly to unpredictable changes in demand or
visibility that speed also influences agility. The effect of visibility on SCRes is already explained. However, the contribution of velocity is still unexplained. Velocity enables flexible adaptations to for instance demand fluctuations which consequently enhances recovery speed from a risk event (Jüttner and Maklan, 2011; Christopher and Peck, 2004; Stevenson and Spring, 2007).
Collaboration is defined as the ability to work effectively with other entities for mutual benefit
2.2 Competitive Actions
Outcome Definition Construct Example References Upstream
competitive action
Upstream competitive actions are defined as observable moves
directed towards suppliers within the supply chain which affect the SCRes of a focal firm and of competitors (adapted from (Chen, 1988; Smith et al., 1992; Young et al., 1996).
Preferred resource allocation
Acquiring supply first in times of supply shortages because of higher levels of relational governance with suppliers
Pulles et al. (2016), Hüttinger et al. (2012)
Capturing supply pre-disruption Procuring critical resources to hamper production of competitors (contracting, supplier take-over, competitive procurement) Salop (2005), Tukamuhabwa et al. (2017) Responsive procurement
Buying all supply to keep producing (and preventing production of
competitors) after fire in one of the largest production sites
Xue et al. (2018), Latour (2001), Sheffi and Rice (2005)
Vertical competitive actions
Vertical competitive actions are defined as observable moves directed towards focal firms within the supply chain which affect the SCRes of a focal firm whilst also impacting the resilience of a competitor (adapted from (Chen, 1988; Smith et al., 1992; Young et al., 1996).
Acting as Learning sources
Mutual learning on how to effectively build routines to prepare for disruptions
Scholten et al. (2019)
Innovative collaboration
Joint process innovation to increase production capacity and thus
responsiveness in times of disruption
Helferich and Cook (2002), Ponomarov and Golgeci (2013)
Information Sharing The sharing of appropriate and timely information between supply chain actors helps to identify issues within the supply chain
2.2.1 Upstream competitive actions
In essence, upstream competitive actions can be viewed as external actions to obtain resources in order to better prepare, respond and recover from disruptions whilst (un) knowingly impacting rivals. In literature three different competitive actions were found: capturing supplier capacity pre-disruption, capturing supplier capacity post-disruption and preferential resource allocation.
Before disruptions emerge, focal firms have possibilities to prepare themselves for unforeseen events. Both capturing supplier capacity pre-disruptively and preferred resource allocation impact the preparedness for disruptions. Capturing supplier capacity pre-disruptively is conceptualized as critical procurement strategies which guarantee organizations with supply whilst hampering supply for competitors (Bell et al. 2015). Capturing supplier capacity pre-disruptively can be performed by for example contracting supply or supplier take-over. For instance, Tukamuhabwa et al. (2017) found that a beer company bought all the bottles of suppliers to stop the production of their competitor. The
Exchanging physical resources Sharing of physical resources in order to quicker respond to disruptions
Scholten and Schilder (2015), Tukamuhabwa et al. (2017).
Downstream competitive actions
Downstream competitive actions are defined as observable moves directed towards consumers within the supply chain which affect the SCRes of a focal firm whilst impacting the resilience of a
competitor(adapted from (Chen, 1988; Smith et al., 1992; Young et al., 1996).
Creative Destruction Sudden fluctuations in demand caused by the introduction of a novel product or product features of a competitor
Schumpeter (2010), Aoki and Yoshikawa (2002), Giuloni (2009).
Pricing strategies pre-disruption
Pricing wars which lead to significant demand fluctuations and disruptions within the market
Heil and Helsen(2001), Pettit et al.(2013).
Table 2.1: Competitive actions influencing SCRes found in literature
firm demonstrated their power inside the market by making it hard for competitors to attain critical resources whilst securing them for own production.
In times of disruptions, the relationship with a supplier plays a significant role in the responsiveness of an organization. Moreover, collaboration with suppliers has a positive impact on SCRes (Scholten and Schilder, 2015). This is caused by mutual understanding between buyer and supplier about the timely sharing right type of information, which leads to more velocity, reduces time to anticipate, respond and recover from disruptions (Melnyk et al., 2014; Scholten and Schilder, 2015). Furthermore, the relationship between firm and supplier may extend to levels of preferred customer-ship. This has significant consequences for competitors. Since, suppliers are willing to allocate higher quality resources such as personnel or innovations to preferred partners (Pulles et al., 2016; Hüttinger et al., 2012). Furthermore, in times of supply disruptions, preferred partners obtain preference in the supply of resources (Hüttinger et al., 2012). This significantly contributes to the preparedness for upcoming disruptions.
After a disruption occurs, several companies have to fight over the remaining supply within an industry. Organizations can win this battle by becoming preferred customer as illustrated by the previous paragraph. However, responsive procurement could also be a good alternative. Literature suggested several strategies for entering in responsive procurement: multi-sourcing (Lee, 2017), flexible contracting with suppliers (Xue et al., 2018) and capturing supply post disruption (Latour, 2001; Sheffi and Rice, 2005). Responsive procurement can be characterized as agile and quick strategies to respond to disruptions.
2.2.2 Vertical competitive actions
The foundation of vertical competitive actions lays in the mutual benefit of risk sharing and exchange of information to increase SCRes (Barratt, 2004). This paper considers the following actions: innovative collaboration, sharing of physical resources, sharing of information and competitors acting as learning source.
technology. Product innovation is defined as changes at the end of providing products or services, while process innovation refers to changes in the method of producing products or services (De Propris,2002). Innovative collaboration contributes to increasing production capacity, improved production efficiency and lower plant downtime (Pisano,1996; Sjödin, 2018; Lager,2012). Therefore, collaborative innovation might contribute to agility and flexibility.
Responding to disruptions can also be influenced by competitors. For instance, information sharing between competitors (the extent to which a firm shares a variety of relevant, accurate, complete and confidential ideas, plans, and procedures with competitors (adapted from Cao et al., 2010) might improve the visibility within the supply chain (Christopher & Lee, 2004; Brandon-Jones et al.,2014). The advantage of improved visibility are mutual benefits regarding the identification of problems within the supply chain (Melnyk et al., 2014). However, empirical research which proofs that sharing information with competitors creates visibility has yet to be done. Therefore, this paper tries to explore how this vertical competitive is performed or otherwise explain why it is not performed.
However, joint relationships raise questions since firms need to manage the paradox of simultaneous competition and collaboration, walking a fine line between cooperating with partners in good faith and maintaining a posture of vigorous competition with rivals, often including those very same partners (Bengtsson & Kock, 2000; Hamel, 1991; Khanna et al., 1998; Gnayawali et al. 2006). Therefore, it is not illogical that in some cases collaboration is not feasible because of protection mechanisms or external factors (Tukamuhabwa et al.,2017; Estrada et al., 2016). Therefore, drawing on previous literature, the reasons why vertical interaction in might be inapplicable should be discussed in this paper.
Exchanging physical resources is defined as the process of leveraging capabilities and assets as well as investing in capabilities and assets with supply chain partners (Cao et al.,2010). Resource sharing enables companies to respond with a higher velocity to upcoming disruptions (Scholten and Schilder,2015). Examples being sharing transportation facilities and production at competitors (Scholten and Schilder, 2015). One of the fundamental building blocks of sharing processes with competitors is reciprocity (Scholten and Schilder, 2015). This entails that competitors interact with one another based on the expectation of obtaining relational benefits in a later stage (Blau, 1964; Lambe et al.,2001; Pulles et al. 2016).
2.2.3 Downstream competitive actions
Downstream competitive actions have been largely unacknowledged in SCRes literature, since research on demand side resilience has been relatively unexplored.Only a few studies have started to open the black box of demand disruption risk (Chopra and Sodhi 2014; Ellis et al. 2011; Pettit et al.2013). Demand disruptions find their origins by underlying reasons such as unpredictable changes in customer preferences (Nagurney et al., 2005). Furthermore, disturbances in the flow of materials or services are caused by unexpected behavior of customers. Based on marketing literature, the following competitive actions have been identified: creative destruction (Schumpeter, 2010) and pricing strategies (Heil and Helsen, 2001).
Creative destruction is defined as innovations which significantly harm the market position of competitors (Schumpeter, 2010). The introduction of new products or new features affects customer preferences and may cause demand side disruptions (Aoki and Yoshikawa, 2002; Giulioni, 2009). Further, empirical evidence of Golgeci and Ponomarov (2013) found that creative destruction is a response to sudden demand disruptions in the market. However, to the best of my knowledge no SCRes literature has explicitly shown how firms build SCRes with the use of creative destruction and how competitors are affected.
cause heavy demand shocks in the market. Similar demand side disruptions were found by promotional acts in Pettit et al. (2013). In both papers, the influence of competitors was present and thus the proposition can be made that pricing strategies have significant overlap with demand side resilience. However, this paper will empirically derive how demand side fluctuations caused by competitors affect the creation of SCRes.
2.3 Conceptual Framework
After reviewing the available literature, the following conclusions were drawn. First,
competitive actions exist in the following interaction directions: downstream, vertical and upstream. Furthermore, companies engage in upstream and downstream competitive actions to achieve relative advantage over competitors. In some instances, companies engage in vertical interaction in order to mutually reap benefits. At last, competitive actions may be deployed to influence one or more of the resilience strategies. Second, according to literature the four main strategies companies involve themselves in are increasing flexibility, creating redundancy, forming collaborative supply chain relationships and improving supply chain agility (Tukamuhabwa et al., 2015).
3 Methodology
To empirically research the effect of competitive actions on SCRes, a multiple-case study was executed, since this method is most appropriate to explore phenomenon in depth (Yin, 2009). The call for in depth information is originated from the lack of insights on the underlying mechanisms concerning competitive actions, especially regarding the creation of SCRes. Further, the insufficient knowledge on the role of competitive actions in the creation of SCRes (phenomenon) calls for empirical insights of a multitude of cases. This is based upon the reasoning of Eisenhardt and Graebner (2007), they emphasize that the justification for the use of case study revolves around the lack of plausible theory and importance of the phenomenon. Both of these requirements are satisfied, since the role of competitive actions is unexplored in current SCRes literature, immediately indicating a lack of plausible theory. Furthermore, based on the hypothesized severe effects of several competitive actions on SCRes one is able to argue that current resilience strategies should be enriched by this external source of uncertainty. Therefore, the importance of the phenomenon can be established. Finally, Benbasat et al. (1987) found two other strengths of case study. First of all, case study allows the questions of why, what and how to be answered with a relatively full understanding of the nature and complexity of the complete phenomenon. Second of all, case study lends itself to early, exploratory research where the variables are still unknown and the phenomenon is not fully understood yet. The second strength is useful since this paper combines several literature stream (Marketing, Strategic Supply Chain Management and Supply Chain Resilience) for the first time. Furthermore, the first strength is useful to identify the underlying mechanisms related to the how-research question.
3.1 Case context
materials. These industries are characterized by capacity disruptions (Ivanov and Rozhkov, 2017) , supply fluctuations (Ellegaard and Schibsbey, 2019), demand fluctuations (Ellegaard and Schibsbey, 2019) and perishability of goods (van Donk, 2001).
3.2 Case Selection
In paragraph 3.1, the sector and specific industries which show high likelihood of competitive actions were identified. The next step is finding appropriate organizations which are located in these industries. Besides, the right industry, the presence of competitive actions had to be guaranteed. Therefore, initial correspondence with organizations revolved around the effect COVID-19 had on their supply chain and how each approached company was dealing with their competitors in these difficult times (table 3.1).
Type of Industry Effect of COVID-19 Why are competitive actions expected?
Food Initial significant demand increase because of customer panic and reluctance to go outside. After a lot of customers stockpiled their houses with food, a significant demand drop was observed.
Capability to handle demand fluctuations. Need for proper demand forecast and demand visibility increases likelihood of using competitive actions to stabilizing the SC.
Medical Devices Significant drop in non-corona related medical operations. Therefore, medical production companies observed a drop of demand of around 70 percent. Furthermore, patients are not cured, therefore a big spike in demand will be expected in the near future.
Battle for the best preparation of one’s supply chain when demand increase would occur in order to survive the current lack of demand.
Packaging supplier Supply issues because of foreign lockdowns. Competitors not able to produce sufficient to fulfill their demand.
Since, competitors had to survive in order to secure demand and allow production to continue making upstream and downstream competitive actions very likely.
Table 3.1: Case context per considered industry
The unit of analysis of this research were competitive actions (see table 3.2) within each considered organization. This enabled the use of competitive actions engaged and dealt with by selected organizations. This paper had strict selection procedures for obtaining the right organizations to be able to regard competitive actions as unit of analysis. The following requirements had to be satisfied:
Organizations needed to engage in at least two of the constructs (table 2.1) identified in the theoretical background in order to discuss the findings with current literature. Organizations needed to possess the knowledge and awareness of the effects their
competitive actions had on their horizontal members.
Organizations needed to at least be engaged or be affected in two out three interaction directions being upstream, downstream and vertical competitive actions.
By carefully selecting the cases, this paper aims to satisfy the replication theory of Yin (1994). Replication theory has to be satisfied to allow repeatability of a paper (Yin, 1994). This paper hypothesizes that there exists variance when looking at specific competitive actions and again when focusing on specific interaction directions. Therefore, theoretical replication theory will be taken into consideration (Yin, 1994).
Type of competitive action
Case Organization 1 Organization 2 Organization 3 Organization 4
3.3 Data Collection
The main source of information were the formal interviews within each organization. An interview protocol was used in order to extract this information (Appendix). The interviews were semi structured to ensure that all the extracted data were comparable, which improves the reliability of the paper (Yin, 2009). Furthermore, semi-structured interviewing enables a certain amount of freedom for the interviewees. Each interview was recorded and transcribed into either English, Dutch or German quotes depending on the interviewees preference within 24 hours after the interview took place, this is in line with Eisenhardt (1989). The interviews were conducted in the language of choice of the interviewees. The interviewees used words, sentences and phrases from the Dutch, German and English language. This ensured a comfortable interviewing sphere in which the interviewees were able to accurately describe their experiences at all time. Each interviewee, had the possibility to review the quotes in
Vertical competitive actions Buying physical resources from competitors (Buy)
Information Sharing with competitors (Inf)
Downstream competitive actions Creative Destruction (Cre)
Power Display (Pow)
Pricing strategies (Pri)
their language and again after the translation in English. The place and duration of each of the interviews can be observed in table 3.3.
In each specific organization, three interviews were conducted with relevant workers with various job descriptions as can be observed in table 3.3. These workers were chosen based on the following criteria:
Knowledge about previous (competitive) actions during disruptions caused by the coronavirus
Insight and awareness of competitive actions during disruptions
Actively involved in competitive actions to influence competitors during the coronavirus
Each interviewee had to satisfy at (least) two of the above mentioned criteria. After the selection of organizations and interviewees one more hurdle had to be overcome. Each of the selected interviewees had to consent to the code of conduct (Appendix 4). Furthermore, three consented interviewees were selected per organization to reduce the respondent bias and increase triangulation of sources (Voss, 2009). Not only respondent bias was reduced, more perspectives within a case ensured more complete and enriched data (Voss, 2009). To create a more complete overview of the cases, additional secondary data was used. In addition, triangulation of sources will be completed with the use of informal conversations after the interviews, clients PowerPoint presentations, pictures and other observations such as body language during the interviews. Voss (2009) found that triangulation of sources improves the validity of a paper. The secondary data enhanced triangulation since it enhanced the reliability of the statements made by the interviewees.
Industry Job Description Length of
interview
Secondary data
Food ( Interviewee 1C) Procurement manager 80 min Dutch post interview conversation Medical devices (Interviewee 2A) CEO 40 min Medical devices (Interviewee 2B) Executive VP 45 min Medical devices (Interviewee 2C)
VP/ Head of engineering 65 min
Food (Interviewee 3A) Technical buyer 85 min Recorded Pictures Dutch post interview conversation Food (Interviewee 3B) Line Planner 60 min
Food (Interviewee 3C) Procurement manager 60 min Packaging supplier (Interviewee 4A-1) Packaging supplier (Interviewee 4A-2) Administration HR manager Purchaser 60 min Packaging supplier (Interviewee 4B)
Account manager 65 min PowerPoint presentation Packaging supplier
(Interviewee 4C)
Sourcing representative 55 min
Table 3.3: Interview details
3.4 Data analysis
The semi-structured interviews and important Dutch quotes from the post interview conversations were analyzed, following the three steps suggested by Miles and Huberman (1994): data reduction, data display and conclusion. In addition, other secondary data such as presentation slides and pictures were used to confirm statements and emphasize the importance of quotes.
First, quotes were extracted from the raw data. These quotes, usually a few sentences to a paragraph long contain relevant information which show significant correlation with the research theme. In the first phase, initial labelling and information extraction was done based on the constructs outlined in Table 2.1 and the four resilience strategies. However, where some constructs were not found or barely found, other important constructs were consistently mentioned. Therefore, the following initial construct was newly introduced:
“power display”. In addition, “capturing supply pre-disruption” was initially composed out of
contracting supply and supplier take-over however this became “contracting supply”, since the data showed only one instance of supplier take-over without any detail . Similarly, the
“exchange of physical resources” was changed into “buying physical resources from competitors”. Furthermore, the following constructs (table 2.1) were removed because of
limited quotes and too little information on the effect on competitors: “responsive
procurement” and “innovative collaboration”.
Second, these quotes were converted into first-order descriptions. These first-order descriptions try to capture the essence of the quote and link it to one of the constructs displayed in table 2.1 in less words whilst remaining its context. Moreover, a quote such as
“And they [external suppliers] really have supply and then I called with Competitor 1: I have been called by this kind of company, we don't need the stuff maybe you need it. (..) (Inf 1C)
became “Knowledge sharing” (table 2.1 information sharing).This process enables the possibility to relate constructs from the theoretical background to the data. Consequently, initial thoughts and propositions were thought of and tested in follow-up interviews within the case but also in later interviews.
incentive alignment (Buy-3A) are connected to “reciprocity enhancing actions”. These overarching second-order codes show the underlying mechanism(s) of each competitive action. In addition, all of the quotes have been linked to suitable resilience strategies. In this specific example “reciprocity enhancing actions" mainly revolved around the resilience strategy “collaboration”(for more information see table 3.4 or Appendix 2 and 3).
Vertical Competitive action
Quote
First order code Second order code Resilience strategy Information sharing with competitors
“And they [external suppliers] really have supply and then I called with Competitor 1: I have been called by this kind of company, we don't need the stuff maybe you need it. I was talking with them and called them up and in the end we did not need it, because we had enough. I try to help them [external suppliers] and try to sell it to competitor 1 or competitor 2.” (Inf-1C)
Knowledge sharing Collaboration Buying physical resources from competitors
I am also responsible for trade. And that is more or less buying and using products from competitors. This to for example enrich our product portfolio. There are like constructions of times that we buy this from you and we then make some other products. But this is not necessarily related with disruptions but this is naturally grown. We are investing in a specific area and a competitor is then investing in another area. And then we buy from each other for a reasonable and fair price because we both know from each other how expensive it is to make starch related products. (Buy-3A) Buying products from competitors Reciprocity enhancing actions General competitor collaboration
“ I think that most of the competitor interactions are drawn to incentive alignments so you do something and we get this and this back. Without it being really out in the open or on paper. “ (Interviewee 3A)
Incentive alignment
“So, we did not look at our competitors basically, we looked at ourselves and what was necessary to get us through this corona virus in a very sane and positive way. So, the short answer is that we did not look at our competitors. “ (Interviewee 1B)
Focus on internal processes Internal optimization Flexibility
4 Findings
In analyzing the data, I was able to unravel specific details on how competitive actions of each interaction direction contributed to the creation of SCRes. Moreover, we found that the effect of competitive actions differs per resilience phase, i.e. preparing, responding and recovering. In addition, the type of interaction direction also directly correlates to the disruption phases for both horizontal members as engaging firms. The findings will be split into three main paragraphs, each for every interaction direction. In these paragraphs, the main similarities and differences within interaction direction will be discussed. In addition, a similar approach will be executed for each singular competitive action.
4.1 Upstream competitive actions
Upstream competitive actions can be summarized as obtaining preferential resource allocation and contracting supply. The main difference between these competitive actions was trust in the supply base. As stated by Con-3C: “ our procurement strategy is that we
always need to have the critical products” and “I cannot tell my site director that he has to shut down the factory because [materials] are not available.” Therefore, organizations 3 and
4 who engaged in contracting supply needed the reassurance of supply of critical components. Whereas, preferred resource allocation because of its nature and focus on
“good connections” (Pre-1A) had less issues regarding this aspect. The similarity between all
cases is that by engaging in these upstream competitive actions companies are able to prepare their supply chain for disruptions by securing supply. A perfect illustration for secure supply was provided by Con-3C: “And we made a contract with them that we will always get
the stuff. (…). If all factories are shut down, then it stops of course. But we will be the last party that suffers from a stop of [Chemical Supplier]”.Therefore, secure supply is defined as the
“right” (Con-3C) to receive supply before any other competitor. Organizations 1,2 and 3 were
Type of competitive action
Competitive action
Flexibility Collaboration Agility Redundancy
4.1.1 Collaboration
Building and maintaining connections with suppliers play a significant role in attaining the social privilege of first supply. From the data, we observed that companies obtaining this social privilege of first supply were involved in chains of positive social interactions. This could be in preparation of disruptions as stated by Pre-2C: “we want to show that we really care
about them [critical suppliers]” and “I personally attend meetings with [these] suppliers”. But
also during disruptions “we arranged (…) food, drinks, soup, warmth (..), toilets, showers (..)
[since truck drivers were not allowed to enter the facility]. They [Suppliers] really appreciated [the effort] we take with [the secondary services] (Pre-1C). These relationships contribute to
attaining supply in critical moments, since “that was partly the reason why they supply to us
[instead of to our competitors] (Pre-1A) and “truck drivers say it is nice there “ (Pre-1A). All in
all, these statements show that mutual reciprocity helps in attaining preferred resource
Downstream competitive actions Creative Destruction (Cre) Increased demand side visibility (P/2/3/4) Decreases demand side visibility (R/2/3/4) Strategic downstream collaboration (P/2) Decreases demand side visibility (R/2) Increased demand side visibility (P/1/2/3) Responsiven ess to demand switches (R/2/3/4) Decreased demand side visibility (R/2/4)
Power display (Pow) Increased demand side visibility (P/2/4) Decreased demand side visibility (R/2/4) Production issues (R/4) Creation of hostility (A/2) Priority listing (R/4) Creation of hostility (A/2) Production issues (R/4) Increased demand side visibility (P/2/4) Decreased demand side visibility (R/2/4) Spare production capacity No alternative supply Pricing strategies (Pri) Increased demand visibility (P/3/4) Decreased demand visibility (R/3/4) Creation of hostility (A/4) Creation of hostility (A/4) Increased demand side visibility (P/3/4) Decreased demand side visibility (R/3/4)
Table 4.1: Table depicting the impact of competitive actions on the SCRes strategies
allocation. Furthermore, since mutual reciprocity is an chain of social exchanges organizations prepare themselves also for the long term.
On the other hand, contracting suppliers generates another type of social connection upstream since they are built upon series of satisfied rules of agreements, in other words contractual governance. From body language of interviewee 4B, the data revealed that contracted partners who are “very reliable” (Con-4B) contribute to how stakeholders perceive on another. Furthermore, similar to preferred partners, collaboration showed instances of social interactions and communication, “they [suppliers] visit us a lot of times in a year” (Con-4B) and “we have a colleague over there [Indian contracted partner] and he is our main
contact” (Con-4C). The amount of social interactions also helps in building SCRes since “contact with our colleague over there (..) creates best possibilities [for customers and suppliers] (Con-4C). In this way, communication within the supply chain is better aligned as
such more agile and flexible responses to disruptions can be executed.
Collaboration to attain the social right of first supply exceeds generic buyer-supplier relationships. Moreover, organization 1 “really worke[d] close together with Supermarket 1
and Supplier 1, in like a triangle” (Pre-1C). Furthermore, “they visit those suppliers twice a year” [with the triangle]” which helps in “building really strong relationships with suppliers”
4.1.2 Agility and Flexibility
Similar to literature, preferred resource allocation and contracting supply were measures which allowed to obtain either the social or the legal right of first supply. The advantage is that you obtain secure supply or following Con-3C “we will be the last party that suffers from
a stop of [the Chemical supplier] “ and following Pre-1C “we just [supply] other customers less and you always get supplied”. By obtaining secure supply, all cases wereable to become more agile in their responses to demand side disruptions. As stated by Pre-1B: “And that [secure
supply of farmers] helped us in wanting to produce anything necessary.” Therefore, one could
state that companies are able to better prepare for disruptions because of increased flexibility. On the other end, competitors are affected in the responsive phase. Competitors are lower on the list to receive critical raw materials during disruptions as stated by Pre-1C: “because they all [raw materials] went to us [organization 1]”!. The flexibility of competitors was hampered since “competitor 1 had a lot of availability issues in the past weeks (Pre-1C). More specifically, competitors are unable to effectively deploy responses to the disruption. This is supported in contracting supply since competitors “have to do a lot of work to get the
bags” 3C) and have production issues since suppliers “ only supply to us in Europe”
(Con-4C). In other words, engaging companies prepare their supply chain to respond quickly to demand changes whereas competitors become susceptible for availability issues. Besides, the increased difficulty in responding to changes in demand, contracting supply may lead to
“customer complaints because of less time available for quality control” (Con-3C).
4.1.3 Redundancy
Organization 1 was characterized by perishability of goods. As Pre-1C stated : “Our stock is
around 1.5 to 2 days. Not more because the quality of [products] goes down.” Therefore,
redundancy practices were unable to perform consequently organization 1 was forced into upstream competitive actions in order to secure supply. Furthermore, preferred resource allocation increases responsiveness to disruptions, and consequently made companies less reliant on safety stocks. A good example is stated by Pre-1B: “And that [secure supply of
farmers] helped us in wanting to produce anything necessary.” Organization 2 had similar
supplied”(Pre-1C). Consequently, competitors observe supply uncertainty which makes them
more dependent on spare inventories. In addition, competitors are forced into responsive procurement at alternative suppliers to ensure sufficient supply (Pre-1C).
Finally, contractual agreements influence redundancy in two ways. First, engaging firms obtain secure supply. Since, engaging companies become “the last party to suffer from a
stop”(Con-3C) the need for attaining high stocks to respond is low. Engaging companies are
during a disruption just “leaning back and see their [contracted] goods coming in”(Con-3C). Second, since competitors have availability issues and consequently have to “do a lot of work
to get the [materials]”(Con-3C). Therefore, redundancy practices such as spare inventories
which competitors can invoke because of insufficient supply or responsive procurement strategies are critical in order to remain competitive. This was proven in Contracting supply 4, competitors were unable to engage in redundancy practices since “we (Packaging industry)
do not have any standard stock items” and “all [products] are completely tailor made, so every customer has its own specific [product]” (Con-4C). In addition, their last resort was the
incoming flow of goods from foreign production facilities however they closed because of foreign lockdowns. Consequently, “many competitors were not able to deliver [products to
customers]” (Con-4A).
4.2 Vertical competitive actions
4.2.1 Collaboration, agility and flexibility
Vertical competitive actions are revolved around incentive alignment. Since, they are about creating mutual benefit created by series of social exchanges. A good example of a social exchange was providing supplier contact information to a competitor. As stated by Inf-1C: “I
have been called by this kind of company, we don't need the stuff maybe you need it.”.
Consequently, competitors get the sense of returning the favor, in other words (mutual) reciprocity. In the data this was also visible since Inf-1C thought “competitors are in the same
amount of good intentions [about sharing valuable information to deal with disruptions]. If they get questions from suppliers and they have enough themselves that they call us [if we are in trouble]”. Mutual reciprocity helps competitors to build better relationships and gain trust
in one another. In addition, based on valuable information, responses to disruptions can be deployed with a higher velocity to mitigate the effects. According to the data, another example of valuable social interactions could be experience sharing during disruptions. As stated by Inf-1B: “Informally I asked about the situation there” and “do you have problems”. Consequently, by engaging in informal conversations both parties learn more about the nature of the disruption and may be able to detect problems within their supply chain earlier. In this way, companies are able to more effectively prepare for upcoming events. Besides preparing, if more urgent “problems” might arise companies will be able to make better decisions and act straightaway.
4.2.2 Redundancy
Information sharing contributed to the ability of the competitor of Inf-1 to retrieve alternative supply. As Inf-1C stated: “[I know about the availability issues at competitor 1] I tried to help
the external supplier [and competitors during COVID-19] to sell [their supply] it to competitor 1 or competitor 2.”
4.3 Downstream competitive actions
Downstream competitive actions create SCRes in three ways. First, by becoming more sensitive to the demand changes or “impacting the market” (Cre-4C) by own innovation projects. Second, the ability to control demand patterns with the usage of pricing strategies which decreases unawareness of demand fluctuations. Third, the data indicated that power plays a significant role in competing during disruptions for customer demand. In itself, power influences pricing strategies and creative destruction as well. However, since in the data there are very specific characteristics for pricing and creative destruction these are taken separately.
4.3.1 Collaboration
In the data, two separate collaborative principles were observed being strategic collaboration with downstream parties and the creation of an hostile competitive environment. First, by“
trying to collaborate with physicians and looking with customers” (Cre-2C) organization 2 was
trying to come out strong of the crisis. Based on this input, they “focus [on] improve[ing] their
current set of products by introducing new products” (Cre-2B). Consequently, more stable
demand can be realized when they can “prove that our products are faster than our
competitor then they will make the change to our products” which is highly important since
physicians have to “find efficient ways to quickly eliminate the queue of people [that] are
waiting for a procedure” (Cre-2C). All in all, close cooperation downstream creates
opportunities to create innovative products which “can outperform competitors” and consequently create demand side visibility because customers will opt for your product. On the other hand, the relationship with the competitors becomes pressurized by intentional moves from competitors since they harm their relative position. In contrast to organization 1, organization 2 and 4 were emphasizing also with body language that: “we are not
Whereas organization 3 states to have a good relationship however competitors were not actively involved in one another.
4.3.2 Agility and Flexibility
As previously introduced, secure demand increases demand side visibility. Furthermore, all three of the competitive actions contribute significantly to secure demand and consequently agility and flexibility. The underlying reason is that by securing demand organizations guarantee themselves with “market information from their customers”(Pri-4A). Since, they do not “get any calls or information from competitors”(Pri-4A), customers are often the only source to detect alterations in the demand. By “obtaining market information”(Pri-4A), organizations prepare themselves for future demand side disruptions.
This vital market information can be extracted by pricing strategies, power display and creative destruction. In case of power display, one is able to gain control over the demand patterns. After analyzing, two different power displays were identified being resource power and brand power.
In case of resource power, by having power over competitors in terms of resources one is able to gain control over the demand patterns. This started by the an initial problem statement. Since, “we were able to fix production [since foreign lockdowns limited production capacity]
to another [facility] and this was not the case for competitors” (Pow-4A). Consequently, “many competitors were not able to deliver big bags which came to a situation that many new customers came up and made inquiries”(Pow-4A). In other words, the internal resources
allowed flexible responses to the demand increase. Consequently, the customer base was more dependent on organization 4. For instance, Pow-4C stated: “customers had their bags
earlier than from the old supplier”. Organization 4 were “making lists of which bags are most urgent and needed” and had [a lot] direct contact with customers” (Pow-4C). Consequently, “we were able to plan according to the demand and switch orders” (Pow-4A). In other words,
In case competitors “have a strong brand name”(Pow-2C), organizations become unaware of demand influences as stated by Pow-2C: “sometimes there are things going on but you do not
know what is going on [external power influence of competitors]”. In addition, the data
perfectly illustrates this since “our product is not chosen even though we have one of the best
[compared to competitors with brand name]”(Pow-2C). In other words, competitors have low
demand side visibility since they are unaware of the practices of engaging companies. Consequently, the agility of competitors are decreased since they have no idea what kind of change they have to respond to.
In case of pricing strategies, competitors observe that the distance to the customer base increases. As Pri-4C states: “you can see it, you can [slowly] see the decrease in demand” and
“we know those issues [ of customers become more withdrawn and chose for cheaper alternatives]. The degree of information sharing reduces and customers inform competitors
less. This hampers the visibility downstream. Furthermore, the data showed that more demand uncertainty will be developed because of lower levels of visibility. Furthermore, responding to disruptions will be increasingly hard because of the lack of demand side visibility.
4.3.3 Redundancy
In the data, only resource power showed a singular quote related to redundancy. No secondary data or quotes indicated an influence on redundancy by either pricing strategies or creative destruction. Although, it seems logical that these downstream competitive actions influence redundancy practices no empirical foundation was found for this effect. When returning to resource power, the ability “to switch to alternative production locations” (Pow-4A) showed an effect on the creation of SCRes of organization 4. More interestingly, “this was
not the case for competitors” (Pow-4A). This indicates that the focal organization had the
5 Discussion
The goal of this paper was to explore how competitive actions contribute to building SCRes for engaging companies and competitors. Research has indicated that competitors and consequently competitive actions help in building SCRes (Scholten and Schilder, 2015; Tukamuhabwa et al., 2017). While competitive actions has had significant amount of attention in other fields of literature, scholars have overlooked its impact on building SCRes. This study shows that companies engaging in competitive actions have beneficial effects on their agility, flexibility, redundancy and collaboration. Whereas, upstream and downstream competitive actions increase the need for SCRes for horizontal members. Furthermore, this study contributes empirical insights about how competitive actions affect SCRes to better prepare, respond and recover for disruptions. Interestingly, by identifying in which phase of the disruption horizontal members and engaging companies were affected a common trend was observed. Upstream and downstream competitive actions cause a delayed effect on competitors (see table 5.1), similar to Scholten and Schilder (2015) vertical competitive actions were perceived as responsive. Therefore, the underlying reason for the finding shown in table 5.1 will be discussed in the final paragraph. In addition, the first three paragraph emphasize on the comparison between literature and the findings of each of the interaction directions.
Competitive action Direction of competitive action
Affected phase of disruption for engaging party
Affected phase of disruption for competitors
Delayed response for competitors?
Preferred resource allocation
Upstream Preparation Response
Contracting supply Upstream Preparation Response
Buying resources Vertical Response Response
Table 5.1: Overview when competitive actions create delayed responses for competitors
5.1 Discussing upstream competitive actions
After initial literature review, I was able to describe upstream competitive actions as observable moves in order to obtain resources to better prepare, respond and recover from disruptions whilst (un)knowingly impacting rivals. Furthermore, initial empirical insights showed that responsive procurement was one of the constructs belonging to upstream competitive actions (Sheffi and Rice, 2005; Latour, 2001). However, from the data, it became clear that companies primarily secure their supply in advance with the use of preferred resource allocation and contracted supply. This observation seems logical since the social or legal right to obtain critical raw materials gives more assurance than being dependent on purchasing strategies to obtain (alternative) supply. Another interesting point, the data solely consisted out of exclusivity contracts. In other words, obtaining the sole right to alternative channels or prevent a competitor from supplying itself with a critical resource (Bell et al., 2015). This differentiated, preferred resource allocation and contracting supply, since contracting supply therefore harms the creation of SCRes of competitors on purpose. In relation to preferred resource allocation, this paper confirms the statements that preferred resource allocation contributes to attaining the social right of obtaining first supply (Hüttinger et al., 2012; Pulles et al., 2016). Furthermore, this paper extends the current view on preferred resource allocation since it explains what the effects of preferred resource allocation are on competitors in light of SCRes. Since, preferred resource allocation is primarily researched to create competitive advantage by receiving preferential resources compared to competitors to the best of my knowledge. This paper shows that it also hampers competitors in terms of agility and flexibility. In addition, this research shows that not only quality of competitors may be affected by obtaining lower quality resources but also because they obtain resources at a later stage. Finally, based on the findings proposition 1a and 1b were composed.
Creative destruction Downstream Preparation/Response Response/Recover /
Pricing strategies Downstream Preparation Response
5.2 Discussing vertical competitive actions
Initial literature review, showed that vertical competitive actions revolve around mutual benefits of risk sharing, incentive alignment and sharing processes (Barratt, 2004; Scholten and Schilder,2015). Furthermore, sharing processes rely on reciprocity principles (Scholten and Schilder,2015). Following the results in this paper, it can be confirmed that reciprocity plays a indeed significant role in the social interaction between competitors. The underlying mechanism are series of social interactions were competitors have the feeling to return favors.
This paper introduced the construct “learning from competitors” (Scholten et al., 2019) in order to create routines for uncommon events in order to become more agile in responding to disruptions. Similarly, our findings reveal that competitors are capable of learning from competitors to enhance preparation and response for disruptions. Consequently, this paper backs up their previous indication that competitors play a role in learning during a disruption. In the theoretical background, several indications that competitors collaborate to innovate products or production processes were found (Lager, 2012; Sjödin, 2018; Helferich and Cook, 2002). However, in the data no signs of innovative collaboration were found. The results showed that the organizations considered in this paper were reluctant to share knowledge since they would lose their competitive advantage which relied on innovation, which is in line with Ritala et al. (2015). The underlying reason for these results could be the selection of the organizations involved in this paper. Since, organization 3 had a limit amount of competitors which led to quick accusations of cartel agreements at the slightest doubt of intensive collaboration. Furthermore, organization 2 heavily relied on their innovation capabilities to differentiate from competitors, which made them reluctant to share. The organizational structures in the packaging industry was really competitive, and any sensitive information was kept for themselves, claimed Organization 4. Therefore, the only remaining option was
organization 1, however in this industry the role of innovation was limited. Finally, based on the findings proposition 2 was composed.
5.3 Discussing downstream competitive actions
Although, literature have shown limited research on demand side resilience. This paper unraveled the effect of three downstream competitive actions on SCRes. The main finding was that these actions impact demand side visibility on stakeholders within the industry. Demand side visibility reduced the mismatch between actual demand and an organizations projected demand (Oke and Gopalakrishnan,2009), in other words more security can be created on fluctuations in demand which was also found in this paper. Consequently, by dictating the market and reducing market uncertainty prematurely responses can be deployed. More interestingly, would be discussing how competitors respond when they are affected by downstream competitive actions. This paper argues that downstream competitive actions will most likely lead to chains of downstream competitive action depending on the awareness, motivation and capabilities of competitors (Chen et al.,2007). Since, competition is an ongoing process where competitors try to outmaneuver each other constantly. In marketing literature, empirical evidence exists about price wars between supermarkets for instance shows how already the expected consequence (Heil and Helsen, 2001). All in all, based on the findings propositions 3a,3b and 3c were composed.
Proposition 3a: Downstream competitive actions affect demand side visibility.
Proposition 3b: Companies engaging in downstream competitive actions become more aware of customer demand fluctuations. Therefore, these companies are more flexible and agile in their responses to any customer changes.
5.4 Discussing the delayed effect on competitors
The findings revealed that by engaging in competitive upstream and downstream actions companies have the ability to affect the SCRes of a horizontal member. More interestingly, the actual effect on competitors is postponed to a later phase of the disruption. This is caused by the underlying mechanism of visibility in the supply chain of opponents. Data coding showed that companies were focusing on internal operations and were unaware of what competitors were up to in their supply chains. Therefore, this paper suggests that competitors are unaware of most of the competitive actions until the effects impact them. Following AMC framework of Chen et al.(2007), the impact on the competitors are not mitigated by preventive counter actions. Although, it is straightforward that to become truly resilient you have to become aware of competitive actions, it is considerably harder to extract information about the supply chain of an opponent. Based on this observed delayed effect in the data, proposition 4 was generated.
Proposition 4: Upstream and Downstream competitive actions affect competitors in a later phase of the disruption than the competitive action was initiated in. Therefore, competitors are
6 Conclusion
This exploratory research contributes to the ongoing research on the topic of SCRes. It enriched the current view of SCRes practices and strategies by shedding light on the role of competitive actions on SCRes. In this paper, I was able to unravel specific underlying mechanism of upstream, vertical and downstream competitive actions and their contributions to a resilient supply chain, which were explained by the propositions outlined in the discussion. In addition, this paper explains that competitors have increased difficulties in building SCRes after being affected by upstream and downstream competitive actions. Consequently, this research confirmed one of the conclusions outlined in Scholten and Schilder (2015) considering the role of competitors. In addition, competitors do in fact determine the level of resilience in a supply chain.
6.1 Managerial Implications
Besides, addressing the literature gap, the data showed some specific managerial implications which needs to be covered.
First, the creation of SCRes is affected by competitive actions. From the data, it became clear that visibility in the supply chain of an opponent is low. Therefore, companies are currently unable to effectively react to inflicted unfavorable situations. Consequently, I would suggest managers to carefully observe competitors moves and track them. In this way one is able to create competitors profiles following the AMC framework of Chen et al. (2007). These competitor profiles enables companies to determine the likelihood of responses and aggressiveness of competitors in future disruptions. Furthermore, this paper gives managers insights in the possible effects if competitive actions succeed, in this way managers may engage in alternative practices and strategies to build SCRes.
then valuable information can be gathered regarding the firms aggressiveness to compete for the competitor profile proposed in the previous paragraph.
Third, this paper shows that upstream and downstream competitive actions can be used to create competitive advantages during disruptions. Since, these competitive actions enable companies to secure production and secure demand during disruptions whilst making it harder for competitors.
6.2 Limitations and Future Research
First, this paper aimed to explain how the creation of SCRes was affected by competitive actions instead of addressing the underlying differences for companies to opt for one competitive action over another one. Although, our data was not specifically gathered for this purpose I tried to this phenomenon with the data available. However, research directly focused on a specific interaction direction is able to confirm and extend the underlying reasons for competitors to engage in a specific competitive action. A good example could be an in-depth extension of the effects of vertical competitive actions since this study only included two constructs and literature showed several alternative vertical competitive actions.
Second, this paper addressed only four different organizations for data collection. First, although this sample provided very specific detail on several competitive actions, a larger sample would provide generalizability of some propositions and findings. In addition, to enhance generalizability I would like to motivate scholars to extensively research the impact of competitive actions with the use of quantitative data. Second, the perspective and data of those four organizations were used to determine the influence on their competitors. This may lead to external factors of competitors or engaging company not taken into consideration. Therefore, future research should focus on including direct focal organization-competitor relationships such that the effect of competitive actions on competitors can be evaluated and extended. In addition, exchanging dialogues in meetings where direct competitors are present simultaneously could be insightful.
