Moderating effect of supply chain complexity in governance mechanisms and operational performance relationship: Evidence from a sub-Saharan African market

ABSTRACT

This study draws on the tenets of transaction cost economics to examine the moderating effect of supply chain complexity on the relationship between formal control and social control mechanisms, and operational performance. The study argues that under conditions of increased supply chain complexity, the effect of formal control mechanism on operational performance is weakened while the effect of social control mechanism on operational performance is strengthened. These propositions are tested on a sample of 331 firms in a sub-Saharan Africa market, Ghana. Findings from the study show that at higher levels of supply chain complexity, formal control and social control have negative and positive effects on operational performance, respectively. These findings provide nuanced perspectives on how the performance consequences of formal and social controls vary under the same organizational circumstance. Theoretical and managerial implications are discussed.

KEYWORDS:

• governance mechanisms
• formal control
• social control
• operational performance
• supply chain complexity
• Ghana

Disclosure Statement

No potential conflict of interest was reported by the authors.

Additional information

Notes on contributors

Emmanuel Kwabena Anin

Emmanuel K. Anin (PhD, Kwame Nkrumah University of Science & Technology) is a Senior Lecturer at the Department of Procurement and Supply Chain Management, Kumasi Technical University, Ghana. Dr. Anin’s current research interests revolve around the interface between institutional environment, governance of inter-firm relationship, procurement management, and supply chain performance. His research has been published in academic journals, including International Journal of Quality and Service Sciences, International Journal of Business Analytics, and International Journal of Business and Management.

Nathaniel Boso

Nathaniel Boso (PhD, Loughborough University) is the Dean of KNUST School of Business and Oliver R. Tambo Africa Professorial Research Chair in International Marketing and Strategy. He is also a Visiting Professor to University of Pretoria’s Gordon Institute of Business Science (South Africa) and Strathmore University (Kenya). He was previously an Associate Professor of Marketing at the University of Leeds in the UK. His research focuses on the interface between international entrepreneurship, marketing and supply chain strategy. He has published in high impact journals including Journal of Business Venturing, Journal of Product Innovation Management, Journal of Business Ethics, Journal of International Marketing, Journal of Business Research and International Journal of Production Economics.

David Asamoah

David Asamoah (PhD, Kwame Nkrumah University of Science & Technology) is an Associate Professor of Supply Chain and Information Systems at the Kwame Nkrumah University of Science and Technology (KNUST) School of Business, Ghana. David’s research interest focuses on supply chain management, enterprise systems, procurement management, inter-organizational systems and information systems in supply chain management. He has published a total of 35 peer reviewed and conference proceedings in many reputable journals including Communication of the Association for Information Systems (CAIS), International Journal of Logistics Management, International Journal of Information Management and Information Systems Frontiers. David serves as ad-hoc reviewer for many reputable supply chain and information systems’ journals including Supply Chain Management: an International Journal and European Journal of Information Systems.