COLLABORATION ACROSS THE DISRUPTION PHASES TO INCREASE SUPPLY CHAIN RESILIENCE

(1)

COLLABORATION ACROSS THE DISRUPTION PHASES

TO INCREASE SUPPLY CHAIN RESILIENCE

by

TIM DOPPENBERG

University of Groningen Faculty of Economics and Business PreMsc Supply Chain Management

June 2020

Word Count: 6.495 (excluding tables and figures)

t.doppenberg@student.rug.nl

(2)

2

ABSTRACT

(3)

3

INTRODUCTION

Nowadays, firms engage in complex business environments, where demand increases for responsive and efficient supply networks. This complexity broadens the horizon of risks, which results in more exposure to disruptions. The impact of these disruptions can create higher levels of vulnerability, which may negatively affect the performance of a firm (Fugate et al., 2015; Hohenstein et al., 2015). For example, the disruption of the corona-virus has dismantled the current state in which supply chains are deployed. Pijpker & Van de Walle (2020) described that this disruption had decreased the capacity of the suppliers, where the buyers are facing more costs and cannot fulfil the demand. It increased the need to decrease the consequences of disruptions. In research, supply chain resilience (SCRES) describes this as such as the ability to increase the preparedness for these disruptions and recover to the firm’s former state or even grow to a better state to gain a competitive advantage (Jüttner & Maklan, 2011; Pettit, et al., 2013).

SCRES can be managed into the phases of pre-disruption (readiness), peri-disruption (responsiveness), and post-disruption (recovery and growth) (Jüttner & Maklan, 2011; Ponarov & Holcomb, 2009). Readiness focuses on avoiding threats and being prepared for disruptions (Cabral et al., 2012; Wieland, 2013). When disruptions are occurring, the phase of responsiveness takes place, which focusses on reacting fast and effectively to reduce the impact of disruptions (Pettit et al., 2013; Wieland, 2013). After a disruption has occurred, firms are willing to return quickly to their normal state before the disruption, which is performed in the phase of recovery (Ponomarov & Holcomb, 2009; Yang & Yang, 2010). However, firms can move to a new state in the phase of growth, in which their position improves in comparison to competitors (Pettit et al., 2013; Wieland, 2013).

In literature, several elements are reviewed to mitigate the consequences of disruptions throughout these phases. Supply chains need to react adequately to changes (flexibility) and need to react and recover efficiently from disruptions (velocity) to enhance resilience. Furthermore, by guaranteeing access to information (visibility) and sharing this information (collaboration), resilience can be further increased. (Jüttner & Maklan, 2011; Wieland & Wallenburg, 2013).

(4)

4 However, research suggested that collaboration can potentially hurt SCRES. Collaboration tends to be resource and labour-intensive, which misdirect resources and attention and lead to less flexible supply chains (Fawcett et al., 2015; Marrone, 2010). Higher levels of interdependencies are created by collaboration, which may lead to higher risks of misinterpretation of information and may lead to less efficient responsiveness (Fawcett et al. 2015; Kembro & Selviaridis, 2015).

Whereby collaboration has positive and negative effects on supply chain performance, there is still research needed to know the effects of collaboration across the disruption management phases. The main question to answer this gap will be: “How should firms collaborate across each of the disruption management phases to strengthen their resilience?”

The purpose of this research is to contribute which level of collaboration is needed throughout each phase to strengthen resilience. Managerial implications provides the contribution on the practical level.

(5)

5

THEORY Supply chain resilience

Supply chain resilience (SCRES) reflects the supply chain’s ability to prepare and react to uncertain events or disruptions in a period to return to its former state, or even grow to a new and better state after the disruption has occurred (Ponarov, 2009; Tukamuhabwa et al., 2015).

Managing resilience in a supply chain is divided into phases of pre-disruption (readiness), peri-disruption (responsiveness) and post-disruption (recovery) (Ponomarov & Holcomb, 2009). However, in more recent research the stage of growth is added as the stage after recovery (post-disruption).

Growth emphasis the increased firm’s performance level after the disruption, in contrast to the firm’s pre-disruption state (Hohenstein et al., 2015; Tukamuhabwa et al., 2015). During the pre-disruption phase (readiness) firms tend to take a proactive approach to reduce the impact of (potential) disruptions, in which investments are made through increasing stock levels or sourcing at multiple suppliers (Cabral et al., 2012; Hohenstein et al., 2015). On the peri-disruption phase (responsiveness), firms are experiencing disruptions in which they must react quickly with no mistakes to reduce the overall disruption impact and shorten the recovery time (Blackhurst et al., 2011; Manuj & Mentzer, 2008). Shortening the recovery time takes place in the post-disruption phase. The emphasis in this phase can be distinguished be quickly returning to the original state (recovery) or even recovering faster than competitors to grow into a better state than before the disruption (growth) (Bakshi & Kleindorfer, 2009; Ponis & Koronis, 2012).

Supply chain resilience constructs

In research, several elements are examined to analyze and measure SCRES (Ponis & Koronis, 2012; Tukamuhabwa et al., 2015) The main elements, or antecedents, can be constructed into a SCRES framework to understand and measure the concept of SCRES. The well-applied (Scholten & Schilder, 2015) framework of Jüttner & Maklan (2011) is used, which contains four main antecedents: flexibility, velocity, visibility and collaboration.

Flexibility is the way supply chains can change their options easier to manage several

(6)

6 are occurring, increasing resilience (Hohenstein et al., 2015; Scholten et al., 2014).

Velocity is the reaction speed of a supply chain to market changes or events. Velocity

determines the pace at which disruption events take place. It focuses more on responding and recovering efficiently on disruptions, where flexibility focuses on approaching disruptions effectively (Jüttner & Maklan, 2011). Velocity is present throughout all three phases, by differentiating velocity as the speed of discovery (pre-disruption), speed of risk events (peri-disruption), and speed of recovery (post-disruption) (Jüttner & Maklan, 2011; Manuj & Mentzer, 2008).

Visibility is the extent of access or sharing timely information about supply chain

operations, members and management, to supply chain actors. It is the ability to see from one end of the pipeline to another (Jüttner & Maklan, 2011). The level of visibility can make or break a supply chain in several stages. Visibility is related to respond to and recover from disroptions effectively. Higher visibility will result in better identifying threats and increasing resilience, where monitoring tools can be applied to achieve this in practice (Boone et al., 2013; Jüttner & Maklan, 2011).

Collaboration is defined by working together and willing to make joint efforts by two

or more parties. Jüttner & Maklan (2011) suggest collaboration as a formative element, due to the network-wide interlinked approach of SCRES.

Collaboration

Collaboration refers to the ability to work effectively in the supply chain for mutual benefit, reducing uncertainty, increasing transparency, sharing costs, risks and knowledge to increase resilience (Bakshi & Kleindorfer, 2009; Pettit et al., 2013). It enhances other elements throughout several disruption phases to be more resilient. For example, collaboration can increase the willingness to share information, related to (potential) risks, which will enhance visibility to respond to and recover from disruptions. (Faisal et al., 2006). Furthermore, collaboration enables supporting behaviour by suppliers, which provides more flexible responses (peri-disruption) (Tukamuhabwa et al., 2015). To further elaborate the construct of collaboration, Cao et al. (2010) conceptualizes collaboration into several activities,

(7)

7

Table I Collaborative activities adopted from Cao et al. (2010) (Adopted from Scholten &

Schilder, 2015)

Element Construct Definition

Collaboration

Information-sharing

The extent to which a firm shares a variety of relevant, accurate, complete and confidential ideas, plans, and procedures with its supply chain partners in a timely manner

Goal congruence

The extent to which supply chain partners perceive their objectives are satisfied by accomplishing the supply chain objectives

Decision

synchronization

The process where supply chain partners orchestrate decisions in supply chain planning and operations that optimize supply chain benefits

Incentive alignment

The process of sharing costs, risks, and benefits among supply chain partners

Resource-sharing

The process of leveraging capabilities and assets and investing in capabilities and assets with supply chain partners

Collaborative communication

The contact and message transmission process among supply chain partners in terms of frequency, direction, mode, and influence strategy

However, where collaboration can have a positive impact on SCRES, research has also shown drawbacks. Collaboration tends to create a misalignment of decision-makers, due to the higher complexity of structure by focusing on functional and firm centralized observations. This decreases visibility concerning decisions and outcomes (Fawcett et al., 2012). Furthermore, supply partners can develop tension between doing what is best for the alliance’s interests and doing what is best for the firm’s interests. This creates rivalry among inter-firm

partners and the risk of opportunistic behaviour, which can decrease resilience. (Fawcett et al.,

(8)

8 collaboration can lead to more exposure to risks. In literature, collaboration and trust tend to be linked, in which lower trust levels can create withholding information by the dependent actor. This leads to less visibility, which can lead to more exposure to risks (Day et al., 2013; Fugate et al., 2012; Fawcett et al., 2015). Furthermore, collaboration can lead to higher risk exposure due to misinterpretation of information. This may lead to less efficient responsiveness, when, for example, managers have to interpret information in time-pressured situations (Fawcett et al., 2015; Kembro & Selviaridis, 2015).

Finally, an in-depth multiple case study is performed to explore these relationships and effects to strengthen resilience in the supply chain. Furthermore, a conceptual framework is made to capture the context into a modelled perspective (See Figure 1).

Figure I Conceptual framework

(9)

9

METHODOLOGY Research design and case selection

This research provides a multiple case study design (Eisenhardt & Graebner, 2007) to explore supply chain resilience and the level of collaboration across the different disruption phases. Case study research is a qualitative research method to investigate real-life concepts more in-depth (Yin, 2009). Within the context of this research, the concept of supply chain resilience, its antecedent collaboration, and the disruption management phases are examined. The unit of analysis in this study is the inter-firm relationship due to the focus in collaboration. The six companies are focal positioned, with suppliers and customers on both ends of their supply chain (excluding Company D).

All companies vary from size, sector and number of employees, where they are selected by having a common denominator: a recent disruption in the company’s supply chain. Variations in disruptions of the focal firms will share many inputs, which can expand the knowledge of processes of the firms during the disruption phases.

Data collection

The primary source of data in this study was six semi-structured interviews, collected in the first three weeks of April 2020. Each case or organization is organized in (online) face-to-face meetings (Table II). Before the conduction of the interviews, an interview protocol has been developed. This interview protocol allowed this research to compare answers and improve the reliability of the study (Yin, 2009). The interviews were structured into general questions, central questions and closing questions. The general questions were about the background of the company and interviewee, and characteristics about the firm’s supply chain. The main questions were structured into more detailed questions about the disruption(s) that have occurred within the cases of analysis, where collaboration was discussed between the internal departments and external actors like suppliers and customers. These questions were organized into the three disruption phases: pre-disruption, peri-disruption and post-disruption, with specific questions about the impact of collaboration throughout these phases and other elements of supply chain resilience.

(10)

10

Data analysis

The analyzing process of the interviews was done by the three steps provided by Miles and Huberman (1994): data reduction, data display and conclusion. The process was started by reducing the data to quotes, sentences or paragraphs for relevant information for answering the research question (first-order quotes). The data was examined from three perspectives: link to disruption phases, link to collaboration and link to supply chain resilience. The data from the first perspective were mostly structured from the interview proposals. The second perspective and third perspective were examined separately from each other.

First, the data were analyzed concerning collaboration. All first-order codes were coded into descriptive second-order codes such as “joint solution plans”, “organization hierarchy” or “vertical integration”. The link of collaboration by advantages and drawbacks was determined into the third-order theme. The link with supply chain resilience was done after this step, where the data was focused on collaborative activities from the well applied (Scholten & Schilder, 2015) conceptualization of Cao et al. (2010) and the drawbacks adjusted from Fawcett et al. (2015).

Next, the perspectives of linkage with phases and linkage with collaboration were cross-analyzed to explore how collaborative activities were influencing the different disruption management phases. Table III shows an extract of the analysis process, which demonstrates the process from data reduction (first-order codes) to descriptive codes (second-order codes) to the third-order themes.

(11)

Table II Case and interview details

Case A B C D E F

Sector Manufacturing Manufacturing IT Third-party

Logistics Manufacturing Automotive No. employees ± 200 (worldwide) ± 250 ± 110 ± 35 with ± 100-150 flex employees ± 550 ± 180

Supply Chain Position Focal-to-downstream

Focal

Focal-to-downstream

Various Focal Focal

Position interviewee Purchaser Head of Operations

Strategic Purchaser IT Manager Purchasing Manager Supply Chain Manager

Length interviewee (min) 75 80 70 90 90 65

Type of disruptions mentioned

Natural disaster Natural disaster, forecasting Natural disaster, distribution error Natural disaster, planning

Various, f.e. delays and errors due to internal processes and downstream demands

Natural disaster, disruptions in whole supply chain

Most important phase (interviewee perspective)

(12)

12

Table III Coding extract

Link to disruption

phase

Data reduction (first-order quotes) _{(second-order codes)}Descriptive code

Link to collaborative activity (second-order theme) Link to supply chain resilience (third-order theme)

Pre "You have to imagine that a standard ordering process, set up through EDI... So basically we're shooting digital data at each other." (Case E)

EDI Collaborative

communication

Visibility "Of course, we already had a number of customers and

suppliers connected to us through EDI, so to speak." (Case B)

EDI Collaborative

communication

Visibility "The moment you shoot low, you'll reach your target

sooner. So at that moment there wasn't really a trigger to make a realistic or high forecast. So at that moment we actually see, based on the past and the growth we have seen, that we are just running into bottlenecks. But our forecast numbers say you don't have to do anything yet. At the beginning of last year, we found that if you continue like this, this will not go well". (Case B)

Different internal forecasting approaches. Approaches differ from a commercial perspective vs. cost-effective perspective Decision misalignment and inter-firm rivalry Velocity and Visibility

Peri "So, for example, if a seal isn't close enough. This is escalated by the project leader, who in turn has to take action. ... Well what happens then, that it will be scaled up after management. And based on that, the management of our supplier is called in. Because this can cause a major problem, or it already is." (Case E)

Lack of responsibility to

disruptions Risk exposure Velocity

"So that hierarchy between the production manager and project manager is actually a kind of impediment to collaboration. ... Yes, but the approach is very reactive: a disturbance has been reported, haven't I?" (Case E)

Organization hierarchy Risk exposure

Velocity

(13)

13

Table III

phase

Data reduction (first-order quotes) _{(second-order codes)}Descriptive code Link to collaborative activity (second-order theme) Link to supply chain resilience (third-order theme)

Peri "At the time when the first problems arose, we had already moved stocks from the supplier to us. And only then did those factories close down, and it was no longer possible to get the stuff out of them." (Case F)

Joint solution seeking Decision

synchronization

Flexibility

"Look... which is often an obstacle: if you have multiple suppliers... Um... That you have double clearance. And we also have products that have a certain lifespan. And then you have, for example, a test trailer at a customer's. Yes... and then which product are you going to use? Are you going to do this product, or that product, or both? That does give a certain complexity." (Case F)

Increasing complexity due to multiple

sourcing

Risk exposure Flexibility

Post "So for example when powder-coating at one of our aluminum suppliers, we also delivered directly ourselves. So there are suppliers where we sit around the table who can deliver better profiles." (Case E)

Joint optimization Information-sharing and collaborative communication

Flexibility

"… but E7, for example, if you're talking about supply chain: it's not the need of materials", but... you're doing for a plastics company that it's implemented so far that the whole aftercare part of that company has been given up." (Case E)

Vertical integration, joint process integration

Resource-sharing Velocity

"We've created some sort of administrative function for them. To keep track of their job confirmations. And vice versa just the same." (Case E)

Joint process

monitoring Information-sharing and decision

synchronization

(14)

FINDINGS

In the process of data-analyzing, we were able to explore details on the relationship between collaborative activities across the different disruption phases, with possible impacts on SCRES constructs. The activities are visualized in a table1_{(See Table IV), to provide general guidance}

of analyzing.

Pre-disruption

Our findings highlight the importance of decision synchronization in increasing velocity and

flexibility in the pre-disruption phase, in which information-sharing and collaborative

communication results in higher levels of visibility. Furthermore, goal congruence is an essential activity for more flexibility.

To achieve decision synchronization firms and suppliers create joint solution plans to

discover disruptions quicker. Joint solution plans can be created by “making agreements […]

and having predefined rules of play” (Case E) with highly-sensitive suppliers. The emphasis on mutual agreements with the supplier and focal firm is due to not only reduce risks or discovering risks quicker. It can also create less uncertainty about service levels, e.g. service level agreements (Case B). The next step of decision synchronization by including the customer is also emphasized through the approval process of gaining a second supplier (Case F) or by having joint agreements about stocks (Case A). These joint agreements of stock create a more

flexible supply chain when market changes occur, as illustrated by Case A: "So we have special

stock agreements with suppliers on bottleneck products as well as several routine products or leverage products."

From our findings, decision synchronization is about decreasing risks by having agreements within the buyer-supplier relationship that exceeds in a network approach of supplier-focal firm-buyer relationships. We also find that decision synchronization is closely related to information-sharing and collaborative communication, through the approval process of a second supplier (Case F) but also joint product launching (Case F) and forecast sharing:

“[…] For example, you're going to keep more stocks etc. and share forecasts. In order to classify on changed market situations. " (Case A)

This form of information-sharing and collaborative communication will increase visibility due to sharing information about supply chain operations. Interestingly, this sharing of information

1_{Cautionary note: Table IV is not statistical approached, and will therefore only be used as an overview of}

(15)

15 can create flexibility in operations due to classifying this information on changed market situations. This creates a more visible pipeline, but also an effective preparedness to disruptions.

Furthermore, the importance of information-sharing to increase visibility is highlighted in the pre-disruption phase, where the focus is on the completeness of information. This is illustrated by having insights into potential problems (Case F) and each other’s processes (Case B). Information-sharing and collaborative communication are strictly related to increase

visibility, by sharing forecasts (Case A & F) for example. This relationship is logically linked,

due by having collaborative communication with suppliers you share information about operations, by communicating with “[…] production and warehouse managers […] and planners, […] and then we know how and what role we have to play in this” (Case D).

Lastly, goal congruence achieves more flexibility. Case F is determined to satisfy the customer to evenly have (expensive) transport solutions when market changes beforehand. Some buyer-supplier-relationships go further by expecting the supplier to train salespeople and technicians and purchase from prescribed distributors. In return of this flexibility, the supplier will have economic benefits like “good pricing, discounts and marketing campaigns”, which can benefit resilience through enhanced collaboration (Case C).

However, our findings also highlight the impact of risk exposure, which reduces velocity and

visibility. Furthermore, decision misalignment indicates lower levels of visibility.

Collaboration tends to be opportune in the pre-disruption phase when the focus is too narrow-sided. This will negatively affect velocity, because this result in “certain risks, such as delivery times or legal risks […] Risk analysis is sometimes done too late.” (Case E). Discovering (potential) disruptions will process slower, which also is the case when suppliers work in old-fashioned ways. This can clash with the focal firm because “you have many different suppliers, and you see that you have to grow together.” (Case B).

(16)

16

Peri-disruption

Our findings indicate that information-sharing and collaborative communication are essential activities to generate more visibility and velocity during the events of disruption. Furthermore, goal congruence can positively affect flexibility.

Information-sharing and collaborative communication tend to be interlinked during the events of disruption to create visibility, by sharing information about the consequences of risks through different departments from both actors (i.e. collaborative communication) (Case F). Furthermore, by increasing resilience within these activities, a linkage with velocity has been shown in our findings. Sharing information and communicating with customers during a disruption is critical to react quickly to sudden market changes, as illustrated by Case D: “[…] when our goods pile up, we are going to communicate with our customer. […] sending us goods/order but first, make sure that your factory in China can receive the goods”. Even more interesting, when a signal from the market (i.e. information-sharing) is received, firms tend to react as soon as possible, without considering what if the solution is the best (i.e. flexibility) (Case B).

The focus of information-sharing during the peri-disruption phase differentiates from the pre-disruption phase (i.e. completeness) because the stakes are high and time is running short (B). Quality of decisions in the peri-disruption phase can be debatable (Case C), as illustrated by Case C: "Or you should tell that customer, do you mind waiting longer? No, I do not. Okay. It will sort itself out at some point.". Hence, velocity is not only linked with visibility; our findings shows that the focus is on the speed level (i.e. velocity), rather than on completeness.

(17)

17 demand, […] you are going the other way around. What happened next […] we lowered the capacity again. At the end of the year, we were in a reasonable position to fulfil demand.”

Lastly, intending to deliver a quick and effective response to sudden market events or disruptions as such, a positive relationship with the firm’s supply chain partners is crucial in a manufacturing setting (Case F), and in a service setting:

"That's the best part, hey, if your relationship is in order, and in general, we're okay. If your relationship is in order, the distributor can also say to you, I know you order that type of laptop often. Attention! I've still got

some, will you." (Case C)

However, when disruptions are occurring, supply chains tend to expose more to risks that influence velocity. Decision misalignment tends to affect velocity and visibility.

When disruption occurs, and the firm wants to react fast and effective, a high level of collaboration can create tardiness in the process through the mass storage of e-mails (i.e. information flooding) (Case F), which results in exposure to risks and decreasing levels of

velocity. Furthermore, the organization hierarchy tends to slow down the process of disruption

handling, which creates a form of resistance to actual problem solving, as illustrated by Case E: "[…] hierarchy between the production manager and project manager is [..] a impediment to collaboration. […] the approach is very reactive: I already report that disruption, so it is out of my hands”.

By managing disruptions across different departments, decision misalignment can occur, which affects the response speed to disruptions, as illustrated by Case F: "[…] technicians who want their solutions as soon as possible. While, from a logistical point of view, we want a little more certainty in the supply chain."

(18)

18

Post-disruption

Lastly, our findings suggest decision synchronization and goal congruence as important activities for increasing velocity in the post-disruption phase. Resource-sharing and joint knowledge creation increase flexibility, and information-sharing will enhance visibility within our findings.

When affected clients are involved quicker in the decision process, more velocity is experienced. This is further illustrated by Case F that “they’ve […] been made […] part of the problem”, so the process of releasing orders can be fulfilled faster (Case F). Furthermore, by implementing a Supply Chain Assessment after experiencing disruptions, firms can monitor suppliers and make them part of their strategy. This can result in a more efficient (i.e. velocity and growth) process as illustrated by Case B: “[…] we will periodically monitor anything […] we want to deliver to the top and middle segment and at an efficient cost (strategy).”.

Evaluating suppliers can amplify radical changes, where suppliers have not integrated objectives to satisfy the buyer (i.e. goal congruence). This increase of uncertainty and lack of goal congruence made the affected firm to decide to start second-sourcing to fulfil customer demands and to increase velocity (Case F). This post-event has led to evaluation, which leads to prevention of known disruptions, which shows a cycle of prevention-responding-recovering (and growing).

Relationships can also grow after disruptions have happened. When supplying actors have provided a justified reaction during the peri-disruption phase in the perspective of the focal firm, resources can be shared (i.e. flexibility) and the level of trusts can increase as shown in the following quote:

"That cost him quite a lot of money […] Now the scope of this assignment from him is also worthwhile I think […] he just solved it perfectly. […] that relationship has become tremendously good. " (Case A) Even so, when evaluating and learning (i.e. joint knowledge creation) from previous

disruption experiences, other strategies in line with resource-sharing can be implemented. By recovering from a disruption, Case B mentioned an outsourcing strategy of logistical issues through their experiences which also increases relationships with these (external) partiers (i.e.

flexibility):

"[…] We have them packaged as standard in a pallet format, half a pallet format or smaller shapes. In that chain you often saw shortages, so we simply pulled in external parties. That helps us with those kinds of problems".

(Case B)

(19)

19 forecasts with suppliers as an initiative (Case A) and joint solution-seeking through learning by experimentation and information-sharing, which is a “kind of business case to see how [to] see can make this growth come true” (Case B).

Lastly, information-sharing has been an important activity to increase visibility during the previous phases. After disruptions have occurred, this activity is present during the previously mentioned evaluation meetings with suppliers (Case C, F & D) in which not only firms recover faster from disruptions but they have access to relevant information.

When supply chains are recovering or growing to a better state, our findings highlight an evident absence of adverse collaboration effects across all constructs during the post-disruption, except for risk exposure to decrease visibility.

Case A mentioned a hypothetical event where recovery is integrated with the focal firm and suppliers, which creates independencies to each other. This can lead to risk exposure, if the focal firm is collaborating with uncertain suppliers in a “worst-case scenario”:

(20)

Table IV Mentioned collaborative activities per phase per construct

Pre Peri Post

Flexibility Velocity Visibility Flexibility Velocity Visibility Flexibility Velocity Visibility

Information-sharing _0% _13% _32% _5% _40% _46% _20% _17% _30% Goal congruence _27% _7% _7% _30% _0% _0% _0% _25% _20% Decision synchronization _33% _40% _4% _23% _7% _12% _20% _33% _30% Incentive alignment _7% _7% _0% _0% _0% _0% _10% _0% _0% Resource-sharing _7% _0% _0% _5% _0% _0% _20% _8% _0% Collaborative communication _13% _0% _21% _9% _25% _23% _10% _8% _10%

Joint knowledge creation _0% _0% _0% _5% _0% _0% _20% _8% _0%

Decision misalignment _0% _7% _18% _6% _10% _8% _0% _0% _0%

Rivalry among inter-firm partners _7% _7% _7% _9% _0% _4% _0% _0% _0%

(21)

DISCUSSION AND CONCLUSION

This paper highlights collaborative activities that increases SCRES across the different phases. The findings of this research contributes to the importance of each construct per phase by the different characterizations from these phases.

Pre-disruption

Building readiness in the supply chain is approached proactively to increase resilience. This is performed by generating more insights and investing in preventive measures, like safety stocks (Hohenstein et al., 2015; Jüttner & Maklan, 2011). Our findings highlight this aspect by the importance of visibility and flexibility.

Visibility is enhanced through the collaborative activities of information-sharing and

collaborative communication within our findings. The focus is on the completeness of information to prepare for disruptions, by having insights in potential problems and in each other’s processes. According to Scholten & Schilder (2015), generating insights and visibility in processes of the other company can detect possible disruptions early on. Furthermore, the importance of early warning communication and (real-time) information-sharing is highlighted to build readiness in the supply chain (Hohenstein et al., 2015). Our findings contribute to this by sharing and monitoring forecasts and to detect disruptions as early as possible.

Flexibility is increased by decision synchronization and goal congruence within our

findings. Joint agreements about stock, joint product launching and forecast sharing are methods of decision synchronization to create a more effective preparedness to disruptions. Multiple-sourcing and increasing (or appointing special) stock are important strategies to provide more flexibility to increase resilience (Blackhurst et al., 2011; Bode et al., 2011).

However, collaboration is hard to integrate and tend to fail, due to resistors as low trust or information hoarding (i.e. risk exposure) (Fawcett et al., 2015), which indirectly affects resilience. Our findings confirms this aspect that suppliers are withholding information, if the buyer is willing to increase collaboration by enhancing transparency (i.e. low trust).

Peri-disruption

Responding quickly (velocity) to disruptions increases resilience during the peri-disruption phase. Even so, by a rapid response firms can recover quicker (post-disruption) and reduce the overall disruption impact (Jüttner & Maklan; Manuj & Mentzer, 2008).

(22)

22 communication not only velocity can be increased, but also visibility. These two constructs are interlinked in this phase, because sharing information and communicating with customers during a disruption is key to react quick to sudden market changes, which contrasts the focus of completeness in the pre-disruption phase. This focus on speed on both constructs is underlined by Scholten & Schilder (2015), who found accessing the right time of information leads to more velocity to detect, react and recover from disruptions. Furthermore, communicating and information-sharing is important for quickly redesigning supply chain to increase resilience (Blackhurst et al., 2011; Hohenstein et al., 2015).

However, due to the linkages between trust and collaboration, integrating collaboration in a low-trusting environment results in information hoarding and reduces visibility (Day et al., 2013; Fugate et al., 2012). Our findings contributes to this by sharing information with your customer about possible failures, the firm can lose control about decision making. This will not only increase risk exposure, but also decision misalignment within our findings. Furthermore, if actors are faced with the threat of change due to collaboration efforts, the response will be weakened (velocity) (Fawcett et al., 2015). Our findings adds the negative effects on velocity, by having an organization hierarchy which slows down the process of disruption handling, which will reduce reaction speed to disruptions.

Post-disruption

Resilient supply chains emphasizes the speed of recovery (velocity), which enables the (potential) growth to a better state (Bakshi & Kleindorfer, 2009; Ponis & Koronis, 2012).

The speed of information-sharing is crucial for a fast recovery or growth. If information is not shared early on, a lack of information can be created which decreases the speed of recovery (velocity). Furthermore, joint knowledge creation increases velocity and visibility. Overreactions and wasteful decisions are prevented, and insights in each other’s processes are obtained (Scholten & Schilder, 2015).

Our findings indicates both constructs as important constructs to increase resilience in the post-disruption phase, however synchronizing decisions increased velocity within our data. When affected clients are involved quicker in the decision process, more velocity will be experienced. By creating Supply Chain Assessments, due to the experience of disruptions, a more efficient process can be designed, which enables growth.

(23)

23 creating new initiatives through evaluation and learning, the relationship between actors evolves to provide more options and create competitive advantage.

Theoretical implications

This research extends to the effects of collaboration across different disruption management phases to increase resilience. The results of this research indicates the dominance of particular SCRES construct(s) per disruption management phase to increase resilience overall. The focus on collaborative activities to enhance supply chain resilience is in line with previous research (Jüttner & Maklan, 2011; Scholten & Schilder, 2015). However, this research has identified the lack of possible drawbacks of collaboration to enhance supply chain resilience. With the inclusion of drawbacks from Fawcett et al. (2015), this research contributes to fill this lack of elements and provide empirical evidence that negative effects of collaboration can affect supply chain resilience.

Managerial implications

This research provides practical contributions for managers to manage resilience in their firm and supply chain. Our findings offer guidance to manage resilience with different collaborative activities across different phases. For example, if a firm wants to proactively prepare for disruptions, our research suggest to focus on information-sharing and collaborative communicate to increase visibility. The focus on these specific collaborative activities in the construct of e.g. visibility can provide choices of management to invest in gaining insights and preventive monitoring to reduce the impact of disruptions in this phase.

(24)

24

Limitations and research implication

The generalizability of this research has been conducted by interviewing different organizations in different sectors. With the usage of an interview protocol, a clear structure has been provided for collecting and analyzing data which increases reliability (Yin, 2009). However, we’ve presented some limitations related to this research to examine the outcomes and research question in the future.

First, this research has provided six interviews for data collecting and analyzing. For increasing reliability and validity of the outcomes we recommend to provide more interviews in a variety of sectors in future research.

Due to focusing only on the firm, network effects from its suppliers and customers are only given by the firm itself, which limits this research. For future research, having multiple cases can create a wide set of information to mitigate limitations (Yin, 2009).

For discovering importance of collaborative activities the used method (Table IV) is not statistically approached.. For future research implications, this can be a possible improvement to validate the outcomes. Furthermore, the research analyzes are approached subjectively. This reduces the repeatability of the research. We suggest to create a database in which multiple researchers can determine the second-order and third-order theme.

(25)

25

REFERENCES

Bakshi, N. & Kleindorfer, P. 2009. “Co-opetition and investment for supply-chain resilience”,

Production and Operations Management, 18(6): 583-603.

Blackhurst, J., Kaitlin, S.D. & Craighead C.W. 2011. “An empirically derived framework of global supply resiliency”, Journal of Business Logistics, 32(4): 374-391.

Bode, C., Wagner, S.M., Petersen, K.J. & Ellram, L.M. 2011. Understanding responses to supply chain disruptions: insights from information processing and resource dependency perspectives, Academy of Management Journal, 54(4): 833-856.

Boone, C., C. Craighead, B. Hanna, & A. Nair. 2013. “Implementation of a System Approach for Enhanced Supply Chain Continuity and Resiliency: A Longitudinal Study.” Journal

of Business Logistics, 34(3): 222–235.

Cabral, I., Grilo, A. & Cruz-Machado, V. 2012. “A decision-making model for lean, agile, resilient and green supply chain management”, International Journal of Production

Research, 50(17): 4830-4845

Cao, M., Vonderembse, M., Zhang, Q. & Ragu-Nathan, T.S. 2010. Supply chain collaboration: conceptualization and instrument development, International Journal of

Production Research, Vol. 48(22): 6613-6635.

Day, M., Fawcett, S.E., Fawcett, A.M. & Magnan, G.M. 2013. “Trust and relational embeddedness: exploring a paradox of trust pattern development in key supplier relationships”, Industrial Marketing Management, 42(2): 152-165.

Eisenhardt, K.M. & Graebner, M.E. 2007. Theory building from cases: opportunities and challenges, Academy of Management, 50(1): 25-32.

Faisal, N., Banwet, D.K. an&d Shankar, R. 2006. “Supply chain risk mitigation: modeling the enablers”, Business Process Management Journal, 12(4): 535-52.

Fawcett, S. E., McCarter, M. W., Fawcett, A. M., Webb, G. S., & Magnan, G. M. 2015. Why supply chain collaboration fails: the socio-structural view of resistance to relational strategies. Supply Chain Management, 20(6): 648–663.

Fawcett, S.E., Fawcett, A.M., Watson, B.J. & Magnan, G.M. 2012. Peeking inside the black box: toward an understanding of supply chain collaboration dynamics, Journal of

Supply Chain Management, 48(1): 44-72.

Hohenstein, N. O., Feise, E., Hartmann, E., & Giunipero, L. 2015. Research on the phenomenon of supply chain resilience: A systematic review and paths for further investigation,

International Journal of Physical Distribution and Logistics Management, 45(2005):

(26)

26 Jüttner, U. & Maklan, S. 2011. “Supply chain resilience in the global financial crisis: an empirical study”, Supply Chain Management: An International Journal, vol. 16 no. 4: 246-259.

Kembro, J., & Selviaridis, K. 2015. Exploring information sharing in the extended supply chain: An interdependence perspective. Supply Chain Management, 20(4): 455–470.

Marrone, J. A. 2010. Team boundary spanning: A multilevel review of past research and proposals for the future, Journal of Management, 36(4): 911–940.

Miles, M.B. & Huberman, M.A. 1994. Qualitative Data Analysis, Saga Publications, London Pettit, T. J., Croxton, K. L., & Fiksel, J. 2013. Ensuring supply chain resilience: Development and implementation of an assessment tool, Journal of Business Logistics, 34(1): 46– 76.

Pijpker, J. & Van der Walle, E. 2020. Met Covid-19 vragen bedrijven zich af: wanneer komt alles weer op gang? Available at: https://www.nrc.nl/nieuws/2020/02/14/hoe-snel-komt-alles-weer-op-gang-a3990549 (accessed 18 June 2020).

Ponarov, S. Y., & M. C. Holcomb. 2009. Understanding the Concept of Supply Chain Resilience. The International Journal of Logistics Management, 20(1): 124–143 Ponis, S., & Koronis, E. 2012. Supply Chain Resilience: Definition of Concept and Its

Formative Elements, Journal of Applied Business Research, 28(5): 921–930.

Scholten, K., & Schilder, S. 2015. The role of collaboration in supply chain resilience. Supply

Chain Management, 20(4): 471–484.

Scholten, K., Sharkey-Scott, P. & Fynes, B. 2014. Mitigation processes – antecedents for building supply chain resilience, Supply Chain Management: An International

Journal, 19(2): 211-228.

Tukamuhabwa, B. R., Stevenson, M., Busby, J., & Zorzini, M. 2015. Supply chain resilience: Definition, review and theoretical foundations for further study. International Journal

of Production Research, 53(18): 5592–5623.

Wang, Q., Li, J. J., Ross, W. T., & Craighead, C. W. 2013. The interplay of drivers and deterrents of opportunism in buyer-supplier relationships. Journal of the Academy of

Marketing Science, 41(1): 111–131.

Wathne, K. H., & Heide, J. B. 2000. Opportunism in interfirm relationships: forms, outcomes, and solutions. Journal of Marketing, 64(4): 36–51.

Wieland, A. 2013. Selecting the right supply chain based on risks. Journal of Manufacturing

(27)

27 Wieland, A. & Wallenburg, C.M. 2013, The influence of relational competencies on supply

chain resilience: a relational view, International Journal of Physical Distribution &

Logistics Management, 43(4): 300-320.

Yang, B. & Yang Y. 2010. “Postponement in supply chain risk management: a complexity perspective”, International Journal of Production Research, 48(7): 1901-1912. Yin, R.K. 2009. Case study research: design and methods, Essential Guide to Qualitative

(28)

APPENDICES Appendix A – Interview Protocol

Interview Protocol

1. General Questions (± 10 min)

1.1. Could you please give a brief overview of your organization and its supply chain (upstream and downstream)?

Core activities and/or products Organizational goals

Key aspects (organization size, turnover, number of employees) Number of suppliers (upstream) and customers (downstream)

1.2. Could you please introduce yourself and your role in the organization? Function

Team Department

A brief overview of background, education, and experience

2. Main Part (± 45 min)

2.1. Please recall a recent disruption/problem in your supply chain. Could you outline the event in detail: What was the cause, what was the impact, who was involved, was it foreseeable?

Cause

Impact (financial/operational) Affected suppliers/customers Indications/warnings of disruption

2.1..1. In general, how did you react to and resolve this disruption?

2.2. How does [Company name] prepare for disruptions? What actions are taken?

With whom are they collaborating? o Why with these parties? o Who initiated the cooperation?

o What was the reason that no other parties were included? o Was there also cooperation with competitors? Why yes/no? o Were there obstacles/disadvantages to cooperation?

(29)

29 o Communication (how, frequency)

§ In what extend? To what extend? What are the examples? o Shared information and resources

§ In what extend? To what extend? What are the examples? o Shared decisions

§ In what extend? To what extend? What are the examples? o Shared goals

§ In what extend? To what extend? What are the examples? o Experiences from previous disturbances

§ In what extend? To what extend? What are the examples? o Obstacles/disadvantages?

§ In what extend? To what extend? What are the examples?

Which (other) activities/skills/elements/aspects are important in the preparation? 2.2.1. Is the impact of scenarios determined? If so, how?

What dimensions?

What is most important here?

2.2.2. Are disruptions preceded by investments in measures? If so, what kind of measures and where does this lead to?

More information (visibility)

More alternative choices (flexibility) Faster reaction (velocity)

More collaboration (collaboration)

2.3. Hoe does [Company name] react to disruptions? What actions are taken?

How did the various parties (customers, suppliers, competitors, etc.) collaborate? o Communication (how, frequency)

(30)

30 o Obstacles/disadvantages?

Which (other) activities/skills/elements/aspects are important while responding to a disruption?

2.3.1. What measures are taken during disruption? What kind of measures are taken and where does this lead to?

More alternative choice possibilities (flexibility) Faster reaction (velocity)

2.4. How is the post-disturbance phase treated? How is this phase organized? What actions are taken?

How did the various parties (customers, suppliers, competitors, etc.) collaborate? o Communication (how, frequency)

§ In what extend? To what extend? What are the examples? o Obstacles/disadvantages?

Which (other) activities/skills/elements/aspects are important after/during the recovery of a disruption?

2.4.1. Are investments made in measures after a disruption? If so, what kind of measures and were does this lead to?

(31)

31 And why?

What are the main differences between the phases? Why are there these differences?

Has the degree of cooperation changed during the different phases? o Why?

o How?

Is competitive advantage gained?

2.5.1. Which activities would you say were the most important for resolving the disruption? Why?

More collaboration (collaboration) 2.5.2. Are there things you would do differently?

2.5.3. What have you learned? And how was this implemented?

2.5.4. Has cooperation helped to solve the disruption and minimize the impact? Collaboration?

Benefits of collaboration

Disadvantages of working together

Which leads to cooperation (more info, more reaction speed, more choices) 2.5.5. Is cooperation reflected with the supplier and how it can be improved?

2.5.6. Do you think you could reduce the impact by working less together focusing more on other internal processes?

2.5.7. Does cooperation with the supplier (e.g. sharing experiences) help to improve resilience after the disruption? If so, why/what?

2.5.8. Have the choices regarding the measures taken changed after the disruption?

3. Closing questions (± 5 min)

3.1. Are there topics about the supply chain, disruptions, and collaboration that have not been covered in this interview but that you had expected or that you would like to share your thoughts about?

(32)

32

End of the interview

● Thank the interviewee for his/her time and information;

● Ask whether the interviewee would like to receive your thesis once it has been finalized and graded (Would you like to receive the research paper as soon as it is/are finished?); and

(33)

Appendix B – Coding Tree

Construct Definition Sub-categories Description

Collaboration

"The extent to which supply chain partners internally and

externally facilitates joint-planning, real-time information exchange, benefit-, reward- and risk-sharing to synchronize and synergize the operations from

the original firm and the involved parties."

Information-sharing

The extent to which a firm shares a variety of relevant, accurate, complete and confidential ideas, plans, and procedures with its supply chain partners in a timely manner

Goal congruence The extent to which supply chain partners perceive their objectives are satisfied by accomplishing the supply chain objectives

Decision

synchronization

The process where supply chain partners orchestrate decisions in supply chain planning and operations that optimize supply chain benefits Incentive

alignment

The process of sharing costs, risks, and benefits among supply chain partners

Resource-sharing The process of leveraging capabilities and assets and investing in capabilities and assets with supply chain partners

Collaborative

communication The contact and message transmission process among supply chain partners in terms of frequency, direction, mode, and influence strategy Joint knowledge

creation

The extent to which supply chain partners develop a better understanding of and response to the market and competitive environment by working together

"The extent to which supply chain partners internally and externally facilitates negative

effects for firm's supply resilience, where collaboration can lead to

more exposure of risks, misalignment of

decision-makers, rivalry among partners."

Decision

misalignment The extent to which supply chain partners, notably the decision-makers, create misalignment regarding links between decisions and outcomes within a high-complex structure, which worsen existing conflicting motives

Rivalry among inter-firm partners

The extent to which internal supply partners develop tension between doing what is best for the alliance’s interests and doing what is best for the firm’s individual interests

Risk exposure The extent to which supply chain partners create interdependencies which increases potential risks and decreases resilience, e.g. low trust, information hoarding and opposition to change

Disruption management

phases

"The practical implication of managing disruptions throughout the phases of

(34)

34

disruption, peri-disruption and post-disruption to increase resilience in a firm's

supply chain"

Post-disruption Reactive strategy of recovery and growth in a supply chain

Supply chain resilience

"The adaptive capability of a supply chain to prepare for

and/or respond to disruptions, to make a timely

and cost-effective recovery, and therefore progress to a

post-disruption state of operations – ideally, a better

state than before the disruption”

Flexibility The ease with which a supply chain can change its range number (i.e. the number of possible “options”) and range heterogeneity (i.e. the degree of difference between the “options”) to cope with a range of market changes/ events while performing comparably well

Velocity The speed with which a supply chain can react to market changes/events Visibility The extent to which actors within the supply chain have access to or share timely information about supply chain operations, other actors and management which they consider as being key or useful to their operations

Collaboration The extent to which supply chain partners internally and externally facilitates joint-planning, real-time information exchange, benefit-, reward- and risk-sharing to synchronize and synergize the operations from the original firm and the involved parties

(35)

35

Appendix C – Coding Case

phase

Data reduction (first-order quotes) Descriptive code (second-order codes) Link to collaborative activity (second-order theme) Link to supply chain resilience (third-order theme)

Peri "What I really notice is that information at certain companies is very difficult to get through the supply chain. China, for example, had a delivery of screws for the fans last week. Apparently there was a shortage of raw materials and that shortage had been known for months. That only comes to us two weeks before the delivery of the product." (Case A)

Information-sharing quality level differs with suppliers

Risk exposure Velocity and

Visibility

Peri "... an emergency meeting has been called, as a result of which we are going to draw up a statement that we want to have priority within the companies. This was also drawn up the same day, companies were of course called. ... This is our position here, we understand that it is a force majeure situation but we do expect that you will try to get something done towards the government and if that does not work then we expect at least when the factory starts up again that we get priority regarding our orders". (Case A)

Communication about expectations during the reaction phase of the disrupted suppliers Information sharing and decision synchronization Velocity and Visibility

Peri "And in the end it was decided to keep it with the Italian supplier after all. That's actually based on the fact that a number of orders were already quite far in production, so in principle it's already a

semi-manufactured product, so it no longer needs the entire lead time. We were hoping for the good news that they could start again." (Case A)

Keeping continuity in disrupted suppliers with current orders.

Collaborative communication

(36)

36

Peri "Now it's just the other way around because the new supplier has problems with delivery and we're going back to the Czech supplier" (Case A)

Second sourcing strategy during reaction phase

Flexibility

Peri "We want to be kept up to date, but they had some requests. One of them was, of course, a management statement from our side. They also drew up an official document. And that has to be exchanged, management has to sign it." (Case A)

Information sharing and goal congruence

Visibility

Peri "We then drew up a management statement because we are in that essential industry and it is extremely

important that we are delivered. In short, what that statement says is that we expect our supplier to give us priority over other customers who purchase non-essential items.... ... We had contact with the Italian supplier in question, who reacted very positively to this immediately". (Case A)

Decision alignment with suppliers; prioritization of Case A

Decision

synchronization

Flexibility

Peri "We are because we already had some trouble with the first case in Wuhan in China, because we also get a number of components from China or through a Dutch distributor. More generally, there is a higher stock of certain components. "(Case A)

Higher stock level due to expecting disruption (proactive)

Flexibility

Pre "They have drawn up a document, which we have also signed. In which, in principle, something similar is said. If you work in the medical sector or you supply to it, or to the food industry. Then we can ask the

government for an exception. So they also see an interest in it and that's a good right." (Case A)

Contracting or documentation of supplying to "crucial-sector" firms Decision synchronization Velocity

Pre "Decisions like that are made in consultation. For example, you're going to keep more stocks etc. and share forecasts. In order to classify on changed market situations. " (Case A)

(37)

37

Pre "So we have special stock agreements with suppliers on bottleneck products as well as a number of routine products or leverage products." (Case A)

Joint agreements Decision

synchronization

Flexibility

Post "That cost him quite a lot of money, because that was quite a lot of pallets. I think that cost him around €15,000 and maybe even more. Now the scope of this assignment from him is also worthwhile I think, nevertheless it was also something he could not do much about the components and he just solved it perfectly. And I have to say that so far, that

relationship has become tremendously good. " (Case A)

Increasing relationship level due after disruption

Resource-sharing Flexibility

Post "So he always has some stock, and that's a dynamic system that gives you a relatively safe trajectory and actually keeps stocks to a minimum. So your capital doesn't get completely locked up. That's something we do together and set up with the supplier. That's why a slightly higher price has been introduced to

accommodate the part of the stock he takes. " (Case A)

System of rolling forecast after learning from disruption. Incentive alignment due to sharing costs of stocks.

Incentive alignment and joint knowledge creation