Supplier non‐retention post disruption: What role does anger play?

• Author: M. Johnny Rungtusanatham,Rebecca W. Reczek,A. Michael Knemeyer,Mikaella Polyviou
• DOI: http://doi.org/10.1016/j.jom.2018.07.001
• Published date: 01 July 2018
• Date: 01 July 2018

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Journal of Operations Management

journal homepage: www.elsevier.com/locate/jom

Supplier non-retention post disruption: What role does anger play?

Mikaella Polyviou

a,∗

, M. Johnny Rungtusanatham

b

, Rebecca W. Reczek

c

, A. Michael Knemeyer

c

a

Department of Supply Chain Management, W. P. Carey School of Business, Arizona State University, P.O. Box 874706, Tempe, AZ, 85287-4706, USA

b

Department of Management Sciences, Fisher College of Business, The Ohio State University, 600 Fisher Hall, 2100 Neil Avenue, Columbus, OH, 43210, USA

c

Department of Marketing and Logistics, Fisher College of Business, The Ohio State University, 500 Fisher Hall, 2100 Neil Avenue, Columbus, OH 43210, USA

ARTICLE INFO

Handling Editor: Sriram Narayanan

Keywords:

Supply disruptions

Anger

Supplier non-retention

Scenario-based role-playing experiment

ABSTRACT

We analyze the direct and indirect effects of two critical-component supply-disruption attributes (CONTROLL-

ABILITY and RESPONSIBILITY) on supplier non-retention post disruption. Using a scenario-based role-playing

experiment with 253 purchasing professionals, we find that the likelihood that a recovery lead (i.e., the in-

dividual assigned to the disruption-recovery task) recommends non-retention of an incumbent critical-compo-

nent supplier post disruption is higher when the recovery lead perceives that the supplier, rather than nature,

had control over the supply disruption. Moreover, this direct effect is partially explained by the amount of

ANGER that the recovery lead feels due to the supply disruption. Neither the direct nor the indirect effect of

RESPONSIBILITY on supplier non-retention post disruption is, however, detected. This paper is among the first to

offer theoretical and empirical evidence that supplier non-retention in a supply-disruption context is a function

of who had control over the supply disruption. Furthermore, this paper considers the effects of emotions and

illustrates that supply-management decisions are not based solely on rational (i.e., cognitive) processes but also

on emotional processes. Finally, this paper challenges conceptual arguments about the association between

supplier selection and retention, at least in the supply-disruption context and with regard to the individual

participating in both tasks. Our findings also have several managerial implications for supplying and buying

firms.

1. Introduction

A supply disruption is an interruption in the physical flow of goods

from a supplying firm (i.e., supplier) to a buying firm (i.e., buyer). It is

triggered by an unexpected event (Craighead et al., 2007) that may

occur at a supplier node or while goods are in transit from the supplier

to the buyer (Kim et al., 2015). Firms sourcing and competing globally

consider supply disruptions of critical components to be a major con-

cern (APICS, 2016). Their concern is justified, as supply disruptions

negatively affect a firm's performance (Hendricks and Singhal, 2003,

2005). Unsurprisingly, much attention has been levied on supply dis-

ruptions with reference to their economic and interfirm ramifications

(Bode et al., 2011;Hendricks and Singhal, 2003,2005;Primo et al.,

2007;Wagner and Bode, 2008), the conditions that cause firms to ex-

perience more frequent and severe supply disruptions (Bode and

Wagner, 2015;Craighead et al., 2007;Habermann et al., 2015), and

strategies that firms can employ to prevent supply disruptions

(Knemeyer et al., 2009;Tang, 2006) or to mitigate their effects and

recover more quickly from them (Ambulkar et al., 2015;Craighead

et al., 2007;Tang, 2006).

When critical-component supply disruptions occur, buyers typically

assign the recovery task to an individual or a team of individuals

(Mitroffand Pearson, 1993;Pearson and Clair, 1998). In the latter case,

a single individual (i.e., the recovery lead) often coordinates the actions

of the team and the overall response of the firm to mitigate and recover

from the supply disruption (Coombs, 2007;Deloitte, 2015;Dubrovski,

2004;Lerbinger, 1997;White, 2014). A key issue considered during the

recovery effort is whether to retain the incumbent critical-component

supplier, insource (Grover and Malhotra, 2003), or shift all or part of

the sourcing volume to other suppliers (Bode et al., 2011;Wagner and

Friedl, 2007). Toyota, for example, shifted part of its steel-sheets

sourcing volume from Nippon Steel to other steel makers after a blast at

a Nippon Steel mill interrupted the supply from that site (Automotive

News, 2003). BMW, likewise, is working to develop alternative sup-

pliers for parts sourced from Meridian after a fire at a Meridian plant

caused a parts shortage and interrupted production at BMW

(Automotive News, 2018).

Our paper focuses on supplier non-retention post disruption and

https://doi.org/10.1016/j.jom.2018.07.001

Received 6 April 2017; Received in revised form 7 June 2018; Accepted 3 July 2018

∗

Corresponding author.

E-mail addresses: Mikaella.Polyviou@asu.edu (M. Polyviou), rungtusanatham.1@osu.edu (M.J. Rungtusanatham), reczek.3@osu.edu (R.W. Reczek),

knemeyer.4@osu.edu (A.M. Knemeyer).

Journal of Operations Management 61 (2018) 1–14

Available online 17 July 2018

0272-6963/ © 2018 Elsevier B.V. All rights reserved.

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