Antecedents of proactive supply chain risk management – a contingency theory perspective

Abstract

Since supplier insolvencies are a major source of supply chain disruptions, scholars have continuously suggested managing supply chain risk management (SCRM) proactively in order to avoid their occurrence. However, business practice seems to fail with this task. This paper investigates antecedents which foster proactive SCRM implementation from a contingency theory perspective. As a major contingency we choose past supplier insolvencies as an indicator for the level of vulnerability of organisations and investigate inter-organisational, intra-organisational, and individual antecedents. By consulting supply chain management and management accounting literature, hypotheses are developed and tested via content analysis in 63 interviews with representatives from the automotive industry. The findings demonstrate that a mechanistic management control system, a rational cognitive style and relational buyer–supplier relationships have positive impacts on proactively managing supplier insolvency risks. Furthermore, past experience with supplier insolvencies has a moderating, though not a direct, effect on proactiveness. This research suggests that a holistic risk management approach is required to proactively mitigate supplier insolvency risk.

Keywords:

• supply chain risk management
• contingency theory
• management control systems
• buyer-supplier relationships
• insolvency
• content analysis
• multi-method

Acknowledgments

We would like to express our gratefulness to Dr. Michael Henke for his vital support to this research project. Without his inspiration and insights, this study would not have been possible. Moreover, we would like to thank Dr. Gernot Kaiser for his comments on the methodological section.

Notes

1. The last two authors have both contributed an equal amount to the manuscript.

2. Integrative liaison devices are devices “such as task forces and committees that allow regular, personal, and intensive contact among experts and decision makers of different departments greatly facilitate such collaboration” (Miller 1988, p. 286).

3. Note that we ran Kolmogorov–Smirnov tests on all items before controlling for group differences. As the assumption of normality had to be rejected, we were not allowed to run parametrical group comparison (t-tests) and conducted the reported non-parametrical tests instead. We attribute the results of the K-S tests to our restricted sample size.