Reconceptualizing Intuition in Supply Chain Management

AuthorLutz Kaufmann,Claudia M. Wagner,Craig R. Carter
DOIhttp://doi.org/10.1111/jbl.12154
Published date01 June 2017
Date01 June 2017
Reconceptualizing Intuition in Supply Chain Management
Craig R. Carter
1
, Lutz Kaufmann
2
, and Claudia M. Wagner
2
1
Arizona State University
2
WHUOtto Beisheim School of Management
Studies in the psychology and management disciplines suggest that intuition might be able to complement rationality as an effective
decision-making approach. Yet, a review of how decision makers in supply chain contexts can benet from using their intuition demon-
strates that our discipline lacks a unifying conceptualization and operationalization of the complex intuition construct. Our study addresses this
opportunity by following an extensive mixed-method approach, in which we rst use qualitative content analysis and quantitative testing to
conceptualize intuition as a multidimensional construct consisting of experience-based, emotional, and automatic-processing dimensions. We
then operationalize and empirically assess multidimensionality using a multiple study format, and perform an inferential analysis to begin to
assess nomological validity. Our reconceptualization of intuition allows for a richer understanding of this key facet of supply chain management
decision making, and our accompanying scale provides evidence of its multidimensionality and efcacy in making decisions in the uncertain
and time-constrained environments that supply chain managers often face.
Keywords: intuition; supply chain management; decision making; supplier selection; mixed-method approach
INTRODUCTION
Intuition has become a recent construct of interest in the supply
chain management (SCM) literature. This is due to the increasing
uncertainty and complexity supply chain managers face, making
it almost impossible to rely solely on a rational decision-making
process in those contexts (Knemeyer and Naylor 2011; Schoen-
herr et al. 2014; Flynn et al. 2016). And, intuitive processing has
been reported to be effective under conditions of time pressure
and uncertainty, for example, through taking a more holistic per-
spective in complex situations (Burke and Miller 1999; Khatri
and Ng 2000; Sadler-Smith 2016), while other research in turn
highlights the disturbing, biased effect of intuitive processing in
some cases (Carter et al. 2007; Elbanna et al. 2013). However,
the SCM studies that integrate intuition in their research models
rely on different, fragmentary conceptualizations of this complex
construct (Tazelaar and Snijders 2013; Kaufmann et al. 2014;
Stanczyk et al. 2015). Similarly, in the broader decision-making
literature, a substantial body of research containing several con-
ceptualizations and operationalizations of intuitionall fragmen-
tarily focusing on different dimensions of intuitionhas been
developed over the past three decades (Akinci and Sadler-Smith
2012). While intuition research mainly refers to dual-process
theory, which differentiates between one rational and one intu-
itive-processing system (Evans 2010), recent intuition research in
psychology refers to multiprocess theories and distinguishes
among several interacting cognitive systems in decision making
(Brocas and Carrillo 2014). Those theories are based on neuro-
scientic research, which has found that several coordinated
cognitive systems fulll important roles in decision making
(Al
os-Ferrer and Strack 2014; Brocas and Carrillo 2014). To
facilitate comparisons of results of cross-disciplinary intuition
research, it therefore seems necessary to develop a unifying
framework(Sinclair 2011, 3) which combines the different
dimensions of intuition, and to build corresponding measurement
scales for these intuition dimensions (Akinci and Sadler-Smith
2012; Tazelaar and Snijders 2013).
To reduce ambiguity, we advocate that there is the need for a
reconceptualization of the intuition construct in general and
specically for SCM contexts. Thus, the purpose of this study is
twofold: rst,todene the intuition construct with its different
dimensions, and second, to develop a quantitative measurement
instrument that can be used for the supplier selection context in
particular, and potentially adapted to other SCM contexts.
We chose the supplier selection decision for two reasons:
First, the selection of suppliers is a supply chain process that
entails strategic importance for the company as the decisions can
affect companiescosts, net sales, and risk proles, which are
critical for their competitive advantage (Verma and Pullman
1998; Krause et al. 2001); and second, scholars have theorized
that supplier selection decisions are surrounded by increasing
uncertainty, which limits rational decision making and likely
increases intuitive decision making (Carter et al. 2007; Knemeyer
and Naylor 2011; Li and Zabinsky 2011). Possible reasons for
this uncertainty are that in the selection of a new supplier, for
example, decision makers often do not have reliable information
on hand and thus have to make estimations, for example, about
volatile commodity prices and currency rates. Further, time pres-
sure can force a supply manager to decide quickly for or against
a supplier (Thomas et al. 2011). As a result, this uncertain and
time-pressured environment can hinder analytically based predic-
tions and makes the quality of the results of such analyses ques-
tionable in some cases (Elbanna et al. 2013). Instead, it is likely
that intuition is used in supplier selection in an effort to over-
come the barrier of bounded rationality (Kahneman and Klein
2009; Katsikopoulos and Gigerenzer 2013).
Our assumptions are based on psychology and decision-mak-
ing research that stress the dependency of decision processing on
the decision context (Payne et al. 1993; Evans 2014; Phillips
et al. 2016). Thus, not surprisingly, dualand multiprocessing
research is highly motivated by the question of what determines
the occurrence of intuitive processing (Evans 2010), like the
Corresponding author:
Craig R. Carter, W.P. Carey School of Business, Arizona State
University, PO Box 874706, Tempe, AZ, USA; E-mail: crcarter
@asu.edu
Journal of Business Logistics, 2017, 38(2): 8095 doi: 10.1111/jbl.12154
© Council of Supply Chain Management Professionals
demands of the task and inuences of the surrounding environ-
ment (Payne et al. 1993). In line with that, a recent meta-analysis
by Phillips et al. (2016) reports that intuitive and reective think-
ing styles are context dependent. But their study does not distin-
guish between several intuitive-processing dimensions; rather, it
refers to dual-processing studies. We address this research gap
by combining the multiprocess view and the context-dependency
assumption of decision-processing dimensions.
Specically, we examine the inuence of time pressure and
information uncertainty on several decision-processing dimen-
sions in SCM. Thus, we strengthen the importance of distin-
guishing among multiple processes when examining decisions in
supplier selection contexts.
In the next section, we motivate our research by outlining the
need to develop an overarching framework of intuition in more
detail. We then conduct a content analysis, which leads to the
identication of three dimensions of the intuition process: experi-
ence-based, emotional, and automatic decision making. Next, we
assess the validity of these dimensions using two independent
samplesone retrospective survey and one experimental vignette
study with experts in supplier selection. We conduct inferential
analyses examining antecedents of the derived processing scales
before we conclude by discussing the implications for further
research and practice.
The need to reconceptualize intuition in SCM contexts
Most intuition research is based on the assumptions of dual-
process theory, which assumes the interaction of two decision-
making systems, the unconscious, emotional, intuitive system 1
and the conscious, reasoning, rational system 2 (e.g., Giunipero
et al. 1999; Stanovich and West 2000; Kahneman 2003; Dane
and Pratt 2007; Epstein 2010; Evans 2010). Similarly, recent
management research distinguishes between the rapid, automatic,
affective, reexive X-system and the rather slow, deliberative,
reective C-system (Healey et al. 2015), or contrasts a holistic,
integrative, emotional nonlinear versus a cognitive, analytical,
data-driven linear thinking style (Ettlie et al. 2014). However,
recent decision-making research in psychology points to the term
dual-processingas being misleading due to the posited engage-
ment of several systems in decision making (Evans 2014).
Accordingly, the human mind should be characterized as an or-
ganization of systemswhich are combined and interact to make
decisions, solve problems, or perform motor tasks (Brocas and
Carrillo 2014). The assumption of multiple cognitive systems
also nds support in imaging (brain scan) studies (Evans 2010).
Consequently, decision-making research in psychology calls for
research to rst focus on the different underlying systems, cogni-
tive mechanisms, or processes, before further investigating
performance effects (Gl
ockner and Witteman 2010).
Conceptualizations of intuition vary widely and lack clarity
(Sinclair and Ashkanasy 2005; Salas et al. 2010). Akinci and
Sadler-Smith (2012) provide a detailed overview of the develop-
ment of general intuition research. Their broad review uncovers
the diversity of research streams, concepts, and denitions in dif-
ferent research elds such as behavioral and brain science since
1930. Research focusing on risk assessment in supply chains also
points to the intuition construct as not being well dened, under-
scoring the need for further research to investigate the different
intuition dimensions and to develop an accordant measurement
instrument (Tazelaar and Snijders 2013). In addition, recent deci-
sion-making research in the SCM discipline adds to this diversity
and lack of consensus about dening intuition. For example, in
their study of global sourcing decisions, Stanczyk et al. (2015)
focus on intuition at the individual level and conceptualize two
intuition constructs: creative and justied intuition. While the
former comprises the reliance on gut feelings (difcult to com-
municate), the latter comprises the reliance on past experiences
(easier to communicate). In their study of sourcing team deci-
sions, Kaufmann et al. (2014) instead focus on experience-based
and automatic processing when characterizing intuition. Experi-
ence-based processing relates to the justied intuition dimension
of Stanczyk et al. (2015) as it draws on past expertise and infor-
mation stored in memory, and automatic intuition is dened as a
rapid, facile information-processing mode and may thus partly
overlap with the creative dimension (Kaufmann et al. 2014).
Due to this inconsistency of denitions of intuition and the
assumption of several involved dimensions or systems of intu-
ition in the general decision-making literature and the SCM dis-
cipline, we join Sinclair (2011) and Tazelaar and Snijders (2013)
in their call for a unifying frameworkand a more elaborate
scaleof intuition. We chose a mixed-method research design of
the initiation type (Golicic and Davis 2012) and begin to answer
this call by (1) conceptualizing intuition via a systematic litera-
ture review and expert interviews, and (2) developing and vali-
dating a scale that measures intuition in the context of supplier
selection (Churchill 1979; DeVellis 2011).
CONCEPTUALIZING INTUITION IN SUPPLY CHAIN
MANAGEMENT
For our initial construct development, we conduct a content anal-
ysis based on theory (via an extensive literature review) and
practice (using transcripts of in-depth interviews with SCM
experts). Content analysis as a scientic technique can yield rich
insights from texts or transcripts, and can provide a more
detailed understanding of a focal research question or construct
(Krippendorff 2004).
Literature review
Our construct development process began with a systematic
review of the existing literature (Churchill 1979; Hinkin 1998).
We followed six steps based on the systematic literature review
methodology (Denyer and Traneld 2009; Hohenstein et al.
2015).
First, we specied our literature review research questions as
RQ1,How and with which dimensions is intuition dened in
the extant management, SCM, and psychology research?and
RQ2,Which scale items are used to measure intuition?
Second, we located core peer-reviewed articles to answer our
research questions. We focused on the 19902015 time period
due to the occurrence of important decision-making theories from
the 1990s onward, including dual-process theories, and the
emerging central question about how to dene and conceptualize
intuition (Akinci and Sadler-Smith 2012). We searched in aca-
demic publishing databases (e.g., ABI/Inform, Elsevier Science
Reconceptualizing Intuition 81

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