Direct and indirect effects of risks on service-oriented supply chain: A COVID-19 pandemic perspective

Purpose – A solid service-oriented foundation is required to make supply chain management a competitive advantage, especially in this Covid-19 pandemic. A well-established service-oriented supply chain becomes more adaptable to changing client expectations. This study aims at analysing the direct and indirect impact of risks on the service-oriented supply chain from a pandemic perspective.

Design/methodology/approach – The Q-sort method is applied with the participation of nine top-level managers to initially review the reliability, validity, and unidimensionality of research concepts. Then a questionnaire containing these measuring variables is developed to obtain the opinions of those who are experienced in logistics and supply chain management. These empirical data are analysed based on Structural Equation Modelling (SEM) to evaluate direct and indirect effects of risks on supply chain performance.

Findings – The risk is inherent in service-oriented supply chains, affecting both direct and indirect performance. The proposed risk model explains 33.6 percent of Supplier performance, 46.4 percent of Operational performance, 47.1 percent of Customer satisfaction, and 46.5 percent of Finance variation. We found that service-oriented supply chains effectively monitor demand risk. External risk has the smallest impact on supply chain performance measures, whereas demand risk has the smallest effect. That a service-oriented supply chain is focused on meeting customer demand and managing demand-related risks is reinforced by these findings.

Research limitations/implications – In the literature on supply chain risk management, resilience studies and disruption management receive less attention than studies on risk assessment and risk mitigation (Katsaliaki et al., 2021). Future supply chain risk management research should differentiate between risk-as an event and/or risk-as a process since they have different periodic effects on response management and resilience.

Originality/value – This is a pioneering study looking at the risk side of service-oriented supply chain. The data using in this research is from a large-scale survey supported by Japanese Government to promote ASEAN sustainable socio-economic development. This dataset collected during the Covid-19 pandemic to validate our models is an interesting and topical point of this study.

Paper type: Research paper.

Risk, Supply chain performance, Supply chain risk management, Service dominant logic, Service-oriented supply chain, Covid-19 pandemic.