3 Development of Conceptual Framework
3.2 Existing Supply Chain Resilience Frameworks
The works of Ponomarov et al., Pettit et al., and Blackhurst et al. propose supply chain resilience models. Their works are qualitative and exploratory with the purpose of theory building. The works provide basic necessary theory of supply chain resilience.
103 Ponomarov & Holcomb, 2009, p. 131
Figure 6 Existing Framework of Supply Chain Resilience104
The consensus among supply chain resilience researchers is that it is multidimen- sional construct with supply chain process vulnerability, adaptive capability and resilience.
3.2.1 Adaptive capability
Adaptive capability is invoked when a system is hit by change event and the functioning is adversely affected105. While many researchers looked into supply chain for resilience through agility, responsiveness, visibility, flexibility, redun- dancy, reduction of uncertainty106, adaptive capability considers alternative re- sources and methods within the supply chain unit, among the supply chain enti- ties and the location from which the supply chain process extract input. The al- ternate resources and methods are called into action in the face of disruptions in order to save the actual occurrence of process discontinuities, reduce the adverse effects if after all discontinuities do occur or help the process to resume normal operations in case of severe effects of disruption107. Resilience is termed as more
104 Pettit, Fiksel, & Croxton, 2010 and Blackhurst, Dunn, & Craighead, 2011
105 Ponomarov & Holcomb, 2009, p. 132
106 Christopher & Peck, 2004 / Chopra & Sodhi, 2004
proactive in practice than the commonly stated concept with emphasis on re- sponse or reaction to disruption108. Developing supply chain firms adaptive capa- bility is one aspect, the location of the supply chain firms may offer many an al- ternate resources and approaches to tackle the situation of disruptions. Supply chain entity itself and surrounding environment with all its resources and capital help to gain sourcing, production and disruption flexibility109. The framework of resilience by Blackhurst et al. includes physical, human and organizational capi- tal and resources as enhancers of supply chain resilience. Adaptive capability is different from coping capacity of system as the former is invoked in case disrup- tion over powers the inbuilt response capacity of system. Adaptive capability is acquired through the use of other resources that help system back to desired func- tioning. Adaptive capability is used only in such situation and is not suggested to be used under normal conditions because this would lead to redundancy and di- minish the profit110.
3.2.2 Disruption Vulnerability
Supply chain vulnerability is the tendency to disruption of processes related to input resources, operations or the entity responsible for carrying out the opera- tions111. This is system based approach to grasp the concept of supply chain vul- nerability. The discontinuities may occur in inbound or out bound logistics, sup- ply of raw material and production operations caused by internal or external change event. Vulnerability represents the system sensitivity to both internal and external disruptive events which deviates the system from its standard working conditions and is manifested in terms of damages to performance due to the in- trinsic system incapacity to react to change event112. While risk management is
108 Waters, 2011, p. 189
109 Pettit, Fiksel, & Croxton, 2010, p. 19
110 Ponomarov & Holcomb, 2009, p. 132
111 Pettit, Fiksel, & Croxton, 2010, p. 19
preparedness for possible losses so as the vulnerability with additional considera- tion for the structural capacity to cope with the disturbance that determine sensi- tivity or preparedness for eventualities by incorporating provisions in planning the activities.
3.2.3 The Resilience
Supply chain resilience is unanimously defined at least in terms of the restoration to early state113, recovering to normal performance114 or maintaining continuity of operations at the desired level of structure and function115 after the system is be- ing affected by disruptive event. The objective of supply chain process is to pro- vide 'the right products in the right quantities, at the right place at the right time and at the minimum cost'116. Supply chain firm aims at ensuring quality of prod- ucts, at competitive prices and shorter lead times117. In locations with high vola- tile situation arising from internal or external change events, supply chains are trying to maintain the required resilience through risk management and vulnera- bility reduction through proactive and reactive approaches with the ultimate aim to ensure the required amount of products, with specified quality, within sched- uled time and at minimum cost.
Supply chain resilience frameworks by Petite et al. and Blackhurst et al. postulate that there is negative relationship between vulnerability and resilience and that there is positive relationship between adaptive capability and resilience. Supply chain process is affected by external, internal, chain or network environments. Adaptive capability of a firm or chain moderates and mediates the effect of vul- nerability on resilience that demonstrate resilience. These frameworks provide
113 Christopher & Peck, 2004, p. 2
114 Falasca, Zobel, & Cook, 2008, p. 596
115 Ponomarov & Holcomb, 2009, p. 131
116 Cutting-Decelle, et al., 2000, p. 75
constructs of vulnerability, capability and resilience. The limitation is that resili- ence is suggested as a part of supply chain resilience that is contradictory to measure resilience by itself. Again, the studies are focused on vulnerability and capability but none of the studies have discussed the construct of resilience. There is no clear consideration of the factors representing construct of resilience. In order to address the gap, this study suggest service level as the outcome of disruption vulnerability and adaptive capability.
This study aims at developing the construct of resilience such that it is measura- ble and could be empirically tested. A fully operational model will help to inves- tigate the research question that asks the impact of country condition on interna- tional supply chain resilience.