Management and Marketing - Research Publications

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Author: Kurnia, Sherah × Author: Mannaperuma Mudiyanselage, Buddhika × End date: 2018 × Start date: 2016 × Type: Abstract ×

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    Moderating influence of the business environment on suppliers’ contractual embeddedness and sales probability: complex adaptive system view
    Mannaperuma, B ; Singh, P ; Ho, W ; Kurnia, S (Virtual Observatory for the Study of Online Networks, 2018)
    Businesses that are unable to withstand the market domination and product surpluses increasingly use internet enabled alternative distribution channels. These online platforms lead to coexistence and simultaneous coevolution of both the open contractual and the real supply networks that emerged in a single complex adaptive system (CAS). The existing mere CAS applications to the supply networks are not adequate to understand how these two network evolutions vary by the business environmental conditions such as dynamism, munificence and complexity. Therefore, in light of CAS theory, social network analysis (SNA) technique and the business environment literature, this paper proposes a conceptual model to recognise how a supplier’s contractual embeddedness determines its sales probability in the supply network while adapting the business environment. With the support of panel logit regression model, the empirical data from the Australian based Open Food Network from 2012 to 2016 validate the positive associations between a supplier’s contractual embeddedness as informed by degree and closeness centralities and the sales probability in supply network. Both dynamic and complex environments improve the positive association between a supplier’s degree centrality and the sales probability. Though munificence increases the positive association between a supplier’s closeness centrality and the sales probability, dynamism lowers this relationship. This paper first extends the CAS theory with significant system level interactions and secondly develops network diagrams using SNA to illustrate the local optimisation behaviour of network clusters and their evolutions into different network patterns such as scale free, block diagonal and centralised connected through structural holes. Third, this is the first longitudinal study to analyse how a supplier’s contractual embeddedness contributes to its sales probability in the real supply network subjecting to environmental conditions.