Identifying emergent supply chain logics during disruptive geopolitical events: A study of Brexit, the US-China trade war and COVID-19

Presenter: Sam Roscoe, University of Sussex, UKTPO

Discussant: Sam Lowe, Centre for European Reform

Chair: Mattia Di Ubaldo, University of Sussex, UKTPO

Abstract: This paper seeks to explain why senior executives design supply chains using a finite set of approaches, given they compete in common environments of high geopolitical uncertainty. Using a theory-building approach, we develop a constrained system of reasoning that executives employ to navigate uncertain global operating environments, which we call “supply chain logics”. Data are gathered from 40 interviews with senior executives working in 28 companies across 9 industries, spanning the highly disruptive global environment of 2016- 2020. The study builds on the institutional logics perspective by finding that managerial decision making is constrained by three primary factors: sources of institutional pressures, the perceived severity of disruption risk, and the relative mobility of suppliers and supply chain assets. Intense government pressure and persistent geopolitical disruption risk create a ‘copycat’ effect, resulting in the supply chain design of companies in the same industry being similar. However, a dominant supply chain logic only emerges in industries with immobile suppliers and supply chain assets. Our findings suggest significant variation in supply chain logics over time based on the institutional environment and the cognitive perceptions of disruption risks. These findings inform a framework of the factors that influence managerial decision-making in environments of high uncertainty.

This presentation was delivered on Wednesday 3 November 2021 as part of the UK Trade Policy Observatory’s fourth annual conference on Inclusive Trade Policy.