Recovering Global Supply Chains from Sourcing Interruptions: The Role of Sourcing Strategy

Problem definition: Fast recovery from sourcing interruptions is a key objective for global supply chains and business continuity professionals. In this paper, we study the impact of different chain strategies—supplier diversification use long-term relationships—on ability to recover interruptions. Academic/practical relevance: Improving chains’ has been an important focus area both practitioners academics. Collectively, available anecdotal evidence theoretical analyses provide ambiguous recommendations driven by competing effects strategies. Our paper provides first rigorous large-scale empirical relating strategies Methodology: We develop compound estimator chain’s rate that can be constructed using limited data (only time series firms’ actual behavior). Using more than two half million import manifests, extract maritime transactions estimate rates firm-category publicly traded U.S. firms. Results: find supplier associated with slower interruptions, whereas relationships faster recovery. A one standard deviation decrease in former 16% recovery, like increase latter 20% Managerial implications: brings hitherto debate on chains. therefore actionable advice design