Impact of e-business on perceived supply chain risks

Abstract

Purpose – The purpose of this paper is to understand the risks managers and individual supply chains perceive from e-business. Design/methodology/approach – This research takes a long-term, staged view of the risks managers and individual supply chains perceive from e-business. By taking a two-stage approach, investigating four supply chains at a three year interval, the research considers perceived risks from e-business and the extent to which these risks obtained. Findings – E-business has the potential to deliver substantial benefits, but it also involves new and different risks. This research finds that small firms (SMEs) adopted a “watching brief” rather than implemented e-business. Between the two studies it emerges that e-business can support rather than detract from inter-organisational relationships. Global forces are in evidence in terms of low cost competition, but low cost competitors are not e-enabled. Research limitations/implications – Limitations, pragmatism and opportunism in the sampling is acknowledged. For example, the work and concepts that led to the expectation of e-business dominating and decimating industrial supply chains may have been based in chains more open to external forces than the ones examined here. Further research is required that identifies the minimum critical mass necessary to retain national manufacturing capacity at a chain or sector level, and empirical work is needed on the suggested link between supply chain stability and certainty of payment. The cases here are based on four UK supply chains, so various chain forms are likely to have been excluded. Originality/value – This research, by taking a staged approach and going back to the same chain and reviewing perceived risks, identifies how the build up of numerous – but small – events, for example factory closures, can aggregate over time to be just as significant as high profile, headline-worthy risks. Methods that produce a snapshot such as a one-off survey may be inadequate for fully exploring an area such as risk. Especially if the risks are hard to assess and are biased toward high profile events – catastrophic risks rather than accumulations of smaller, less noticeable risks.