Analyzing Supply Chain Uncertainty to Deliver Sustainable Operational Performance

Discussion and Conclusions

This study provides empirical support for RDT in explaining the relationship between SCU and SCS, which leads to firms' OP. By focusing on uncertainty and strategy this study contributes towards context specific sustainable supply chain management research, as prescribed by Busse and Mollenkopf. Also, fsQCA provides a more fine-grained analysis of SCU and strategy alignment. Findings from both PLS-SEM and fsQCA constitute a significant contribution to and an extension of the literature in supply chain management. For researchers, this study also demonstrates that the application of PLS-SEM, along with fsQCA, allow one to test an interlinked set of hypotheses simultaneously in a prediction oriented modeling because the model in this study contained a series of dependence relationships.

This study also illustrates predictive validation testing of models using holdout samples and testing for causal asymmetry. From a research implication standpoint, this research contributes by illustrating a PLS-based estimation for a rapidly emerging field of study of supply chain management. In an uncertain environment, supply chain partners tend to work in close collaboration; they often become more dependent on each other. However, instead of just collaborating, firms should seek supply chain-wide integration and avoid dependencies.

Based on the results, we found support for hypotheses H1 and H2. This implies that SCU internally leads to the selection of a specific strategy that will contribute to firms' OP. In addition, the empirical findings lend support for hypothesis H3, which illustrates that SCS has a mediating role in a firm's OP. This finding is due to businesses that engage in managing SCS look for ways to enhance each other's competitiveness.
Overall, this study contributes to the literature on the most debated link between SCU and OP which is mediated by the SCS. The combined causal relationship investigated through fsQCA nuances those contributions. Unlike Paulraj and Chen, who found that demand uncertainty has no impact on SCS, this study shed insights into the link between SCU and SCS. Indeed, this study shows that in the relationship leading to OP, SCU dimensions offer alternative decision-making approaches (see Solutions 1a and 1b).

According to the adopted theoretical premise of RDT, under uncertain (both supply and demand) circumstances, due to resource scarcity, firms attempt to collaborate with their supply chain partners to respond to the volatile environment. This finding is also supported by Berti and Mulligan that, in an uncertain market environment firms typically experience declining profit and the reduced cost price. As a result, sustainability of firms may be at stake that leads to increased barriers to market access with the inevitable effect of market abandonment.

From a methodological perspective, this study illustrates the usefulness of applying complementarities of PLS-SEM and fsQCA in empirically unpacking the OP differentials as they are examined in SCU and SCS research. The PLS-SEM methodology is suitable in explaining the causal paths through which SCU and SCS ultimately affect performance, whereas fsQCA provides a deeper understanding of the complex, non-linear, and synergistic effects of supply chain risk management in conditioning the effect of SCU and SCS on performance. The PLS-SEM results demonstrate the general tendency, whereas fsQCA uncovers the multiple realities that exist in terms of achieving the desired state. Ultimately, this study confirms that the use of PLS-SEM supplemented with fsQCA approach suggests that the scholarly community may apply such combinative approach to make this multi-mixed approach a formidable statistical tool.

The findings of the research have several meaningful implications for managers in the global marketplace. Before formulating a strategy, managers should analyse the nature and source of inherent uncertainty within their supply chain, and align this source with an appropriate strategy. This will contribute to better OP. Solutions 2 and 5 indicate that whether or not uncertainty is apparent, managers do not need/have an SCS to achieve OP (Solution 2), whereas in an uncertain supply environment, one needs to have a strategy for high performance (Solution 5).

The practitioners may utilize this knowledge as a guideline to ensure that a "strategic fit" between firm and supply chain partners is created and to support the improvement of decision-making to ensure that there is an appropriate strategic approach for the customer and supplier to best influence a firm's OP. We are also aware that core to fsQCA is to consider each indicator of the latent constructs with equal importance in the causal paths. Using importance-performance map analysis (IPMA), we might gain a deeper understanding of the importance which each indicator composing SCS and SCU intervenes in the causal paths to sustainable OP. IPMA enables managers to prioritize their organizational and managerial actions. It also helps managers to identify important areas for the improvement of marketing or management activities. In this study, both PLS-SEM and fsQCA results show that SCS and SCU have the highest importance on sustainable OP. Therefore, practitioners may note that a one-point increase in the performance of SCU and SCS are expected to increase the performance of OP by the value of the total effect (0.46) and (0.17) respectively.