Aligning the risk hedging strategy with supplier collaboration and manufacturing competitiveness: a resource-based and contingency approach

Abstract

Purpose The purpose of this study is to examine the alignment between the risk hedging strategy and supplier collaboration and its effect on manufacturing competitiveness. Design/methodology/approach Building on the resource-based view (RBV) and contingency theory (CT), this study is guided by a positivist philosophy and employs a survey strategy to investigate both the direct relationship between the risk hedging strategy and manufacturing competitiveness and the moderating role of supplier collaboration using data collected from 397 respondents of manufacturing firms. Partial least squares structural equation modeling (PLS-SEM) technique is used to analyze collected data and to present the research findings. Findings Consistent with the RBV and CT, study findings indicate that a significant positive relationship exists between the risk hedging strategy and manufacturing competitiveness and that this relationship becomes stronger when supplier collaboration is interactively aligned. Study findings provide important insights on the role of the risk hedging strategy in promoting manufacturing competitiveness. Furthermore, supplier collaboration as a moderator accounts for a significant proportion of the relationship between the risk hedging strategy and manufacturing competitiveness. Research limitations/implications Internal resources provide an explanation of the competitive differences among firms employing the risk hedging strategy. However, the environment presents opportunities for firms to acquire additional resources to fulfil the unique collaborative requirements of the risk hedging strategy. This study has used the moderation perspective to explain the interaction between the risk hedging strategy and supplier collaboration and its effect on manufacturing competitiveness. Future studies could incorporate other alignment concepts such as mediation and systems approach and compare the results to improve the theory. Originality/value This study can be considered as its kind in the supply chain management literature and both practitioners and researchers can benefit from the experience of resource-based and contingency analysis research and the results of aligning the risk hedging strategy with supplier collaboration for higher levels of manufacturing competitiveness.