Guest editorial: Impact of COVID-19 on strategic sourcing decisions and business performance

Citation

Bag, S., Kilbourn, P., Wood, L.C. and Giannakis, M. (2023), "Guest editorial: Impact of COVID-19 on strategic sourcing decisions and business performance", Journal of Global Operations and Strategic Sourcing, Vol. 16 No. 2, pp. 181-186. https://doi.org/10.1108/JGOSS-05-2023-113

1. Introduction

The COVID-19 pandemic has disrupted the entire world for almost two years. The pandemic has taken away millions of lives and affected businesses severely (Bag et al., 2021). The restrictions imposed during the COVID-19 pandemic have impacted businesses primarily through changes in customer demand and obstructions in the transportation of goods (Bag et al., 2022). Purchasing and supply management became very challenging during the COVID-19 pandemic (Glas et al., 2021). Procurement managers struggled due to the non-availability of industrial supplies. Even where industrial supplies were available with some suppliers, abnormally high pricing applied. Due to restrictions in China, industrial goods supply was heavily affected. In addition, there was a scarcity of containers, and due to port congestion, the import clearance and container release processes took longer than usual. Every industry, including automotive, mining, metals, chemicals and semiconductors, got affected due to this supply crisis. As a result, the production schedules of manufacturers had to be changed frequently.

Procurement strategies changed during the COVID-19 pandemic as buyers realised that dependence on a single local supplier for strategic items could be problematic since the non-regular local suppliers were inclined not to collaborate and instead showed opportunistic behaviour. Buyers have also experienced the high risk of relying solely on international supply sources. In both scenarios, in the absence of supplies, the buyer firm’s ability to finish manufacturing activities as per schedule, would be affected, jeopardising customer deliveries. Earlier, Kırılmaz and Erol (2017) emphasised adopting proactive tactics in reducing supply risks. The COVID-19 pandemic severely affected those businesses which did not consider risk criteria in supply planning (El Baz and Ruel, 2021).

El Baz and Ruel (2021) indicated various gaps in the purchasing and supply chain literature in context to the COVID-19 pandemic including (a) risk categories hardly discuss or even touch on logistics difficulties, (b) providers of specialised services are not mentioned, (c) almost no attention is paid to feedback loops or lessons learned from supply disruptions, (d) there is currently a very limited understanding of risks, (e) external assistance for current and potential future disaster risks is not mentioned, (f) recovery from supply interruption management fails to take into account long-term repercussions and (g) procurement and supply management (PSM) are part of an integrated system. It also indicates that PSM lacked proper attention by businesses and research communities. Some recent articles, for instance, Bag et al. (2021) highlighted that firms need to collaborate and work jointly with suppliers to enhance supply chain resilience.

Furthermore, Sachan et al. (2022) pointed out that inventory categorisation can help better inventory management during the COVID-19 pandemic. Different authors have provided different strategies to run sourcing activities smoothly. However, there is a need for more evidence about how the COVID-19 pandemic impacted strategic sourcing decisions and how industrial buyers evaluated supplier performance during the pandemic. Hence, we ask the research question:

RQ.

What is the impact of COVID-19 on strategic sourcing decisions and business performance?

The next section provides a review of existing literature followed by unique contributions made in this special issue. The final section highlights the implications of these findings and future research directions.

2. Literature review

A search on the Scopus database using the keywords: COVID-19, strategic sourcing and business performance, yielded more than 200 documents. However, filtering them based on certain criteria resulted in 47 documents.

Further analysis of the data (refer Figure 1) shows a trend where the number of publications has risen since 2021. The results indicated that the maximum number of papers is published in the domain of business management and accounting. Most of the published research comprises research articles and a few review papers. Lastly, the number of research outputs is increasing in India. In the next section, we highlight the contributions made by this special issue.

3. Contribution

We have attracted several important papers in response to the call for papers. Those papers considered a poor fit for the Special Issue (SI) were desk rejected to allow the authors to find more suitable outlets for their manuscripts. In addition, we undertook an extensive review process guided by the journal guidelines. Finally, we accepted 14 papers that we believe contributed significantly to the topic of strategic sourcing during the COVID-19 pandemic. We now discuss each contribution. Our SI addresses some critical issues related to COVID-19, strategic sourcing and supply chain management with 14 articles.

The first article, “Mapping the key challenges and managing the opportunities in supply chain distribution during COVID-19: a case of Myanmar pharmaceutical company”, aims to identify the key supply chain challenges and manage the opportunities executed by a pharmaceutical company to improve the supply chain process during the COVID-19 outbreak. From the data analysis and results, “Impact of political factor”, “Delay in import process”, “Weak internet connection”, “Weak knowledge of the use of digital platform”, “Poor information sharing online by employees” and “Information flow from top management to operational level”, have been identified as top and bottom three key challenges, respectively. Whereas “Inventory management”, “Selection of transport method”, “Operational cost”, “Marketing and brand Innovation”, “Online delivery of products” and “E-commerce enablement (Launching applications, tracking system)” are identified as the top and bottom three opportunities to be managed, respectively.

The second article, “Post-COVID-19 strategic sourcing decisions for escorting stakeholders’ expectations and supplier performance in construction project works”, focused on the impact of COVID-19 on supplier performance and how it influenced stakeholders’ thinking towards selecting supplier sources and making strategic sourcing decisions for a convincing arrangement of construction management resources. The study demonstrated “Lead time” as the most crucial, “Product Range” as the second and “Customers dealings and relationship” as the third crucial aspect considered by the stakeholders for selecting supplier sources based on the attainment of a performance score of 0.1338, 0.1273 and 0.1268, respectively. It is found that high lead time stimulates the stakeholders to divert their orders to other competent supplier sources holding a low degree of lead time.

The third article, “Optimizing firm’s supply chain resilience in data-driven business environment”, aims to investigate the impact of a firm’s supply chain capabilities on supply chain resilience and the impact of supply chain resilience on sustainable supply chain performance in a data-driven business environment. The study also aims to explore the function of supply chain resilience in mediating the relationship between a firm’s supply chain capability and sustainable supply chain performance. Findings show that a firm’s supply chain capabilities include information technology, leadership and collaboration. Supply chain capability is positively associated with supply chain resilience. The resilience of a firm’s supply chain is also positively correlated with its sustainable supply chain performance. Supply chain resilience plays a mediating role in the relationship between a firm’s supply chain capabilities and its sustainable supply chain performance.

The fourth article, “COVID-19 turbulence and positive shifts in online purchasing by consumers: modeling the enablers using ISM- MICMAC analysis”, aims to analyse the positive shifts in online purchasing by consumers and to identify and model the enablers of positive transformations in online purchasing by consumers. Several significant categories of enablers like health, trust, convenience, work from home, referral buying, panic purchase and overstocking possess a strong influence on the shift to online due to the pandemic. The results will help policymakers, suppliers, retailers, managers and practitioners with insights to plan, prepare for challenges and make decisions towards preparation and shifting to the emergent digital world. In addition, the study provides academicians scope for further research in the related area.

The fifth article, “Crowdsourced product returns in C2B e-commerce: a post-pandemic no-contact consumer incentive-based model”, aims to investigate the conditions for the financial feasibility of an incentive-based model for self-drop or crowdsourced drop of the product to be returned at designated drop boxes (thereby ensuring a contactless process). Findings indicate that crowdsourcing is viable when product returns are no more than 15%–20% of the overall products, with a logistics cost differential of 15%–25%. These were only viable when the product return incentive was within the range of 15%–20% of the product cost and the penalty was in the range of 25%–40% for wrong returns.

The sixth article, “Supply chain integration and firm performance in the COVID-19 era: the mediating role of resilience and robustness”, shows how resilience and robustness help supply chain integration to improve firm performance.

The seventh article, “Purchasing challenges in times of COVID-19: resilience practices to mitigate disruptions in the healthcare supply chain”, aims to identify supply chain management practices applied to purchasing capable of improving the resilience of the healthcare supply chain and mitigating the effects of material and service disruption during pandemics. This article suggests five propositions of resilient practices that can increase purchasing resilience in the face of pandemics such as COVID-19. The proposed practices are (1) collaboration, (2) flexibility, (3) visibility, (4) agility and (5) information sharing, which suggests a sequence for the adoption of management practices based on the number of occurrences and importance found in the analysed studies.

The eighth article, “Procurement system for resilient supply chain amid the COVID-19 pandemic: a systematic literature review”, aims to provide a rich learning opportunity from the COVID-19 crisis for making a resilient supply chain by adopting new strategies for the procurement system. The study exhibits that the procurement function makes a significant contribution to creating supply chain resilience during the time of the COVID-19 pandemic. The COVID-19 emergency has forced companies to operate in new ways to face supply chain disruptions. The new strategies and actions appropriate for a resilient procurement system have been identified.

The ninth article, “An integrated Industry 4.0-Sustainable Lean Six Sigma framework to improve supply chain performance: a decision support study from COVID-19 lessons”, portrays 31 Industry 4.0-SLSS practices and 22 performance metrics identified through a literature review to improve the manufacturing supply chain performance.

The tenth article had the title: “Improving supplier performance and strategic sourcing decisions by integrating jobshop scheduling, inventory management and agile new product development”. In this article, a comprehensive literature review is conducted to identify job shop scheduling, inventory management and agile new product development indicators along with performance metrics, and the hierarchical structure is developed with the help of expert opinion.

The 11th article, “Exploring the application of analytics in the supply chain during COVID-19 pandemic: a review and future research agenda”, aims to comprehend the application of analytics in the supply chain during the ongoing COVID-19 crisis and to identify the emerging themes. The findings show that artificial intelligence, machine learning, the Internet of Things and blockchain are trending topics. In addition, the author identified five themes by topic modelling, including “social media information in supply chain”.

The 12th article, “Towards measuring SMEs performance amid the COVID-19 outbreak: exploring the impact of integrated supply chain drivers”, aims to explore supply chain disruptions during the COVID-19 pandemic in the small and medium enterprise (SME) sector in Oman. This study analyses the impact on selected supply chain drivers – facilities, inventory, transportation and sourcing. It further intends to explore whether the supply chain challenges faced by the SME sector in Oman impact their overall performance. The results showed a significant relationship between supply chain drivers and SMEs’ overall performance in Oman, except for supply chain inventory. The results have demonstrated that the COVID-19 pandemic has affected the SMEs’ supply chain drivers in Oman and, consequently, their overall performance.

The 13th article, “The production and distribution of face masks to other countries: a strategic approach of Taiwan during COVID-19 outbreak”, explore how COVID-19 has exaggerated the supply chain of the production and distribution of Taiwan-based face masks and investigates the conscientious factors and subfactors for it. The results of this AHP model suggest that “Safety” is the most important and top-ranked factor, followed by production, price, work environment and distribution.

The 14th article, “Supply chain management practices, retail outlets attributes and organisational performance: a case of organised food retailers in India”, examine the impact of supply chain management practices and retail outlet attributes on the performance of organised food retailers in India during COVID-19 pandemic. The findings of this study reveal that most of the supply chain management practices (i.e. information technology, level of information sharing, customer relationship, supplier relationship and goal congruence) have a positive impact on performance except the quality of information sharing. The results show that in the pandemic, the retail outlet attributes (image, service quality and convenience) have no significant relationship with the food retailer’s performance. At the same time, supply chain management practices are necessary to achieve better performance for food retailers.

4. Conclusion

The articles accepted under this special issue have uniquely contributed to the strategic sourcing literature. Future researchers can further perform research on developing local supplier capabilities keeping in mind ethics and sustainability aspects. Also, future researchers can explore the role of digital technologies in developing local suppliers. Resilience and robustness have attracted much attention during the pandemic. However, more focus is required on viable sourcing strategies.

Figures

Figure 1.

Analysis of Scopus data