Journal of Operations Management

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  • Modelling supply chain adaptation for disruptions: An empirically grounded complex adaptive systems approach
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  • The role of intellectual capital in new product development: Can it become a liability?

    Given the increasingly high cost of new product development (NPD), it is important for firms to terminate unsuccessful NPD projects as soon as possible. This article investigates the role of intellectual capital in the discontinuation of NPD projects. The three dimensions of intellectual capital (human, structural, and social capital) are posited to decrease the likelihood of discontinuation of NPD projects, while contextual factors such as the firm's discontinuation experience and the size of the drug development portfolio are expected to affect this relationship. The research model is tested using a unique data set of 1,168 drug discovery and development projects. The results suggest that NPD projects rich in all three dimensions of intellectual capital are less likely to be discontinued. The size of the firm's drug development portfolio, however, is found to mitigate these effects, while discontinuation experience enhances the relationship between intellectual capital and discontinuation duration. As only a fraction of new product development initiatives result in success, timely discontinuation of unsuccessful projects is critical for sustained performance of organizations. Our findings make an important contribution to this stream of work. By highlighting the role of intellectual capital in the discontinuation process, we offer an interesting twist to the literature that invariably assumes intellectual capital to be important for innovation.

  • Deviations from aspirational target levels and environmental and safety performance: Implications for operations managers acting irresponsibly

    The relationship between sustainable operations and a firm's financial performance has been an ongoing focus of operations management scholars. Previous literature has extensively explored the impact of acting responsibly on financial performance. This article applies the behavioral theory of the firm and prospect theory to assess the much‐neglected reverse relationship, exploring whether a firm's relative aspirational financial performance impacts its likelihood of acting irresponsibly. Furthermore, we explore whether operational slack in the form of capacity, productivity, and inventory attenuates a firm's likelihood of acting irresponsibly when its actual financial performance deviates from its aspirational level. We use a matched pair design with privately held manufacturing firms in the United Kingdom who acted irresponsibly matched with similar firms who did not act irresponsibly. While most firms do not act irresponsibly, we find that the further a firm moves (positively or negatively) from its aspirational level of financial performance, the more likely it is to act irresponsibly. The results also indicate that slack generally does not prevent managers from acting irresponsibly, especially when performing relatively well. This study contributes to the sustainable operations literature and provides important theoretical, managerial, and policy implications.

  • Spillover effects of supply chain news on consumers' perceptions of product quality: An examination within the triple bottom line

    The purpose of this research is to examine the impact that news about supply chain operations related to the triple bottom line (TBL) has on consumers' perceptions. Specifically, it focuses on how sustainability successes and failures in a company's supply chain operations influence consumer perceptions of product quality. These perceptions are based on a spillover effect. The research study is set up across three experiments. Study one tests for the spillover effect in supply chain TBL‐related news and demonstrates that negative supply chain news across all three TBL dimensions reduces quality perceptions. Study two examines the effect across three levels of negative news intensity and finds that the spillover effect is consistent, even with stronger levels of negativity. Study three investigates whether a firm can improve damaged quality perceptions and purchase intentions through a recovery effort. The results of study three suggest that consumers' perceptions and purchase intentions are generally reparable. Collectively, the findings should encourage firms to more rigorously consider how news about their supply chain operations may impact consumers' perceptions and intentions toward the firm's products.

  • Taking stock of consumer returns: A review and classification of the literature

    Coincident with the rapid growth of consumer returns and their corresponding importance in the retail marketplace, academic interest in the area of consumer return policy design has significantly increased. In fact, the growth in academic publications has been tremendous, with almost half of the published works appearing within the past 6 years. The influx of new and evolving research spans across multiple disciplines and various methodologies. To provide clarity for the continued evolution of the field, we provide a comprehensive review and classification of the literature predicated on a holistic conceptual framework. The scope of the review includes all peer reviewed journal articles published prior to the end of 2018, along with any working papers cited therefrom, that specifically address (a) managerial decision‐making related to return policies or (b) consumer behavior in response to such decision‐making. Examining the state of the literature and practice on return policy design through the lens of a unified conceptual framework—a framework that spans both analytical and empirical research—reveals numerous managerial and theoretical opportunities for future research.

  • Demand and order‐fulfillment planning: The impact of point‐of‐sale data, retailer orders and distribution center orders on forecast accuracy

    Industry consultants claim that investing in systems that base forecasting on point‐of‐sale (POS) data throughout the supply chain will improve forecast accuracy. We explore what actually happens to forecast accuracy for demand and order‐fulfillment planning when the forecast demand signal is based on POS, retailer orders, or distribution center (DC) orders. We begin by comparing the forecast accuracy for different demand signals using daily demand and operating data from a large consumer‐products supply chain. We then extend the analysis by varying the demand and supply‐chain parameters to evaluate their impact on demand signal performance. We find that POS data improve forecast accuracy for demand planning but not for order‐fulfillment planning. These findings thus challenge consulting‐firm claims about the ability of POS‐based forecasting systems to improve forecast accuracy across all contexts.

  • Does supply chain visibility affect operating performance? Evidence from conflict minerals disclosures

    Firms are increasingly held accountable for their suppliers' transgressions. Consequently, firms need to develop upstream visibility to exercise control over their supply chains. An emerging body of work has recognized the importance of supply chain visibility and has examined it using analytical models, behavioral methods, and case studies. Still, large‐sample empirical evidence on the benefits of supply chain visibility remains elusive. We seek to bridge this gap by examining conflict minerals disclosures (mandated by the 2010 Dodd‐Frank Wall Street Reform and Consumer Protection Act) and financial reports to evaluate whether firms with greater visibility into their conflict minerals supply chains achieve improved operating and market performance. We use the data from conflict minerals disclosures (Form SD) to distinguish between firms that have high or low visibility into their conflict minerals sources. Then, we use event study methods to analyze differences in operating and market performance between firms with high visibility and firms with low visibility. We find that firms with high visibility into their conflict minerals supply chains achieve higher profitability than comparable firms with less visibility. In addition, we find that firms with high visibility into their conflict minerals supply chains realize improved sales performance and stock market valuations. Our results are relevant to managers because they show that firms can attain operational and market benefits by improving visibility in their supply chains.

  • Forecasting for remanufacturing: The effects of serialization

    Remanufacturing operations rely upon accurate forecasts of demand and returned items. Return timing and quantity forecasts help estimate net demand (demand minus returns) requirements. Based on a unique data set of serialized transactional issues and returns from the Excelitas Group and one of their defense contractors, Qioptiq, we assess the empirical performance of some key methods in the area of returns forecasting. We extend their application (for net demand forecasting), by considering that demand is also subject to uncertainty and thus needs to be forecast. Information on remanufacturing costs allows for an evaluation of the inventory implications of such forecasts under various settings. A foray into the literature on information technologies enables a discussion on the interface between information availability and forecast accuracy and utility. We find that serialization accounts for considerable forecast accuracy benefits, and that the accuracy of demand forecasts is as important as that of returns. Further, we show how the combined returns and demand forecast uncertainty affects the inventory performance. Finally, we identify opportunities for further improvements for the operations of Qioptiq, and for remanufacturing operations in general.

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