SCResilienceand Performance

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Supply chain resilience and performance of manufacturing firms: role of


supply chain disruption

Article  in  Journal of Manufacturing Technology Management · March 2023


DOI: 10.1108/JMTM-08-2022-0307

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Supply chain resilience and Role of supply


chain
performance of manufacturing disruption

firms: role of supply


chain disruption 361
Zulaiha Hamidu, Francis O. Boachie-Mensah and Kassimu Issau Received 25 August 2022
Revised 23 November 2022
Department of Marketing and Supply Chain Management, University of Cape Coast, Accepted 17 January 2023
Cape Coast, Ghana

Abstract
Purpose – The current study sought to investigate the moderating effect of supply chain disruptions (SCD)
(supply chain – supply disruption, catastrophic disruption and infrastructure disruption) on the relationship
between supply chain resilience (SCR) and supply chain performance (SCP) of manufacturing firms in Ghana.
Design/methodology/approach – The quantitative research approach and explanatory research designs
were utilised. A sample of 345 manufacturing firms were drawn from a population of 2,495 manufacturing
firms in the Accra metropolis. The Partial Least Squares Structural Equation Modelling (PLS-SEM) was
employed to accomplish the research objectives.
Findings – First, the study revealed that SCR has a significant positive effect on SCP. Second, the authors
found reasonable evidence to support that SCD have a significant positive moderating effect on the relationship
between SCR and SCP, except for supply chain catastrophic disruption which had a negative impact. It can be
concluded that the components of SCD have heterogeneous impact in the SCR and SCP nexus.
Research limitations/implications – The study is limited to manufacturing firms in Ghana and does not
make a distinction among resilience strategies.
Practical implications – Increased SCR boost manufacturing companies’ supply chains’ performance and
aid to lessen the adverse effects of SCD relating to infrastructure and supply. It implies that supply chain
managers are able to reduce the effects of infrastructure and supply disruptions. Also, techniques that reduce
the adverse impact of SCD relating to catastrophe would be beneficial for supply chain managers in Ghana and
other countries with comparable economic environments.
Originality/value – The study provides a unique contribution on the moderating role of the dimensions of
SCD (supply, infrastructure and catastrophic) on the nexus between SCR and SCP in a developing economy
context in a dynamic changing environment. Policymakers would get better insights into instituting the
required policies needed to revamp firms with weak supply chains as a result of supply chain disruption.
Keywords Dynamic capability theory, Supply chain infrastructure disruption, Supply chain supply
disruption, Supply chain catastrophic disruption
Paper type Article

1. Introduction
Global supply chains have been severely disrupted as induced by the COVID-19 pandemic.
As can be noted from the potential recovery from the adverse impact of the pandemic by most
manufacturing firms due to resilience strategies put in place, the advent of the Russian
Ukraine war ignited a new set of disruption. Examples of disruptions brought about as a
result of the Russian Ukraine war being a catastrophic disruption related to supply of raw
materials, foodstuff and energy which had a significant impact on most manufacturing firms
(UNIDO, 2022). These problems led to rising commodity prices and generalised inflation
across the world. Along with the ongoing distortions in the global supply chain logistics,
Journal of Manufacturing
Technology Management
Vol. 34 No. 3, 2023
Funding: No funding was received. pp. 361-382
Data availability statement: The data is available upon request. © Emerald Publishing Limited
1741-038X
Conflict of interest: The authors declare that they have no conflict of interest. DOI 10.1108/JMTM-08-2022-0307
JMTM it has prompted governments, policymakers and supply chain actors to develop actions to
34,3 resuscitate the performance of the supply chain with much concern for the manufacturing
sector.
The purpose of the manufacturing sector is to increase wealth through improving
products and selling them (Singh et al., 2020a). All manufacturing businesses must be able to
control the flow of materials from suppliers, through processes that generate value and
through distribution channels to customers. The nature of the modern business environment
362 arguably makes it difficult for individual firms to compete as separate entities. This is more
so when these firms must strive as active members of a much larger network of
interconnected businesses and partnerships that interdepend on each other, otherwise known
as the Supply Chain (Lambert and Cooper, 2000). Many supply chains are subject to a wide
range of global challenges because they span huge geographic areas (Ben-Daya et al., 2019).
The complexity of products is also expanding as a result of the high clock speed in many
industries as a result of quick technological advancements and the continuous introduction of
new items to the market (Ben-Daya et al., 2019). This aims to show that there is a risk of an
unplanned interruption in every action a supply chain takes. This is as a result of the dynamic
environment that has necessitated relevant theories like the dynamic capability theory (DCT).
This capability manifests itself in learned and persistent patterns of behaviour by which a
company produces and adapts its method of doing things in order to become more effective
(Brusset and Teller, 2017). To achieve short- and long-term objectives, manufacturing
organisations, in particular, must successfully overcome a number of hurdles (Kissi et al.,
2020; Sabahi and Parast, 2020).
As a result, supply chains must be built to include readiness, enable a resourceful and
operative reaction and be capable of returning to their previous form or even better after a
disruption (Ponomarov and Holcomb, 2009). In addition, supply chain resilience (SCR)
denotes a firm’s ability to restore supply chain operations from unforeseen disturbances
(Wong et al., 2020). It helps mitigate disruptions by planning, preparing and taking actions
ahead of time, such as preserving production and inventory buffering capacity (Wong et al.,
2020; Chopra and Sodhi, 2014). SCR increases supply chains’ adaptive capabilities to lower
the likelihood of vulnerabilities disrupting operations, to resist the spread of any negative
impacts, and to respond and recover quickly after a disruption to return operations to a stable
state (Kissi et al., 2020).
According to a 2013 study by the World Economic Forum and Accenture, 80% of
organisations place a high importance on SCR. Consequently, SCR is gaining attention from
researchers and practitioners. Consequence to the dynamic capability theory, enabling
supply chains to resuscitate and sustain the steadiness of material, information and currency
flows in the face of disruptions is a necessary course of action (Chowdhury and
Quaddus, 2017).
Businesses have become conscious that supply chain disruption (SCD) can have
unfavourable operational and financial consequences due to the worldwide reach of supply
chain, increased customer demands and shorter product lifecycles. The impact of SCD on
developing countries, including Ghana is even severe. According to African Development
Bank in 2019, manufacturing firms contribute to about 10% to Ghana’s economic growth.
However, Ghanaian businesses have had difficulty competing in the fiercely competitive
global market because it is difficult to match supply and demand on a broad scale. This
makes the context of the Ghanaian economy worthy of investigation on the role of SCD on the
nexus between SCR and SCP.
Notable forms of SCD in Ghana include the loss of a crucial supplier, a significant fire at a
manufacturing facility, flood, raw materials and external uncertainty shocks cause
disruptions that have an adverse effect on both income and costs. The COVID-19, for
instance, being a catastrophic disruption had a substantial impact on the manufacturing
industry, and caused prices of extractive goods to drop on the international market (Aduhene Role of supply
and Osei-Assibey, 2021; Laing, 2020). In this regard, SCD has an adverse impact on supply chain
chain performance (SCP) by causing significant delivery delays, decreased revenues, sales
declines and production halts (Ivanov and Dolgui, 2020; Sabahi and Parast, 2020; Tan et al.,
disruption
2020; Ekanayake et al., 2021). In light of the above forms of SCD, the study inculcates three
kinds of SCD which are supply, infrastructure and catastrophic disruptions following the
study of Wong et al. (2020).
Sequel to SCD, SCR is a dynamic skill that can provide a competitive advantage (Teece, 363
2007) to achieve SCP. Therefore, the DCT will help explain the relationship between SCR and
SCP, and the extent to which SCD could strengthen or weaken the relationship (Wong et al.,
2020). Hence, the presence of SCD dimensions stimulates the need to investigate their effect on
the relationship between SCR and SCP of manufacturing firms.
The study that mimics ours is that of Wong et al. (2020) conducted in Taiwan who revealed
that relevance of assessing the quantitative influence of SCD on the SCR and SCP nexus.
However, Wong et al. (2020) viewed SCR as information processing mechanism in line with
the organisational information processing theory (OIPT) without directly considering the
dynamic environment, especially during periods of severe economic shocks like the
COVID-19 pandemic. Accordingly, as the OIPT is relevant that supply chains build
the capacity to engage in proactive communication with stakeholders during uncertainties,
the DCT goes beyond the management of information to cater for all other flows (finance and
material flows) in the supply chain (Hamidu et al., 2022).
For studies conducted in Ghana, the closest study to ours is that of Dey (2016) who
examined strategies on SCP and how they mitigate SCDs with less focus on the
manufacturing sector, and conducted through a qualitative study. However,
manufacturing firms are relevant to be investigated because they are highly susceptible to
SCD which necessitate that effective and efficient resilience strategies are introduced (Singh
et al., 2019). Considering the limited studies conducted on manufacturing firms in Ghana and
the role of unpredictable environments, it is of much interest to quantitatively further assess
the moderating role of SCD on the nexus between SCR and SCP as a contribution to prior
studies.
We make a unique contribution to literature in the following ways. First, we revisit the role
of SCD on the nexus between SCR and SCP in the context of manufacturing firms. Second, the
study is performed in a developing economy context where a quantitative emphasis of
the aforesaid relationship is ignored. Third, we seek to situate the discussion in the context of
the DCT which alludes to the fact that firms operate in a dynamic environment requiring
resilience strategies with practical experience from the COVID-19 pandemic which distorted
most economic activities around the globe. Hence, we advocate that implementing resilience
strategies in a dynamic environment for an enhanced competitive advantage would
contribute to addressing the changing environmental concerns rather than relying on just
management of available information as supported by the OIPT. Fourth, due to the
asymmetric influence of SCD, the study considers effects of three different forms of
disruptions relating to – supply, infrastructure and catastrophic.
Findings from the study revealed that the influence of SCR on SCP is favourable.
Moreover, we found reasonable evidence to support the idea that the dimensions of SCD
effects on the SCR–SCP nexus are not the same. Particularly, we found positive
moderating influence of supply chain infrastructure and supply disruptions, whereas a
negative moderating effect was revealed with supply chain catastrophic disruption. This
implies that in the presence of SCD, the nexus between SCR and SCP is asymmetric, and it
is pertinent that supply chain actors such as distributors, suppliers, customers,
employees, policymakers, government, to mention a few, observe this relationship with
caution.
JMTM The next of this section is literature review which briefly elucidates the theoretical
34,3 underpinning of the study and relevant conceptual reviews. The research methods and
results and discussions are subsequently presented. The study ends with conclusion which
highlights implications, recommendations and direction for future studies.

2. Literature review
364 2.1 Dynamic capability theory
Since the 1990s, relentless competition has driven firms to produce, extend and adapt their
resources through adapting, integrating and reconfiguring in order to achieve a specific goal
(Mandal et al., 2016; Pereira et al., 2020). This notion is captured in the dynamic capability
theory (DCT) (Teece et al., 1992, 1997). This capability manifests itself in learned and
persistent patterns of behaviour by which a company produces and adapts its method of
doing things in order to become more effective (Brusset and Teller, 2017). It is critical to
remember that the value of dynamic capabilities varies depending on the situation (Wilden
et al., 2013) and that there is no one-size-fits-all approach to general effectiveness.
Firms must develop, integrate and restructure their internal and external resources and
capacities to adapt to dynamic settings, according to DCT. This might be a source of
competitive advantage for the company (Mandal et al., 2016; Teece, 2007). This idea aligns
with the concept of SCR as it attempts to develop certain organisational processes and
resources to ensure sustainable competitive advantage at least from the firm level (Pereira
et al., 2020). DCT assumes that a company may establish a market position by developing
capabilities (SCR) that will enable it to operate better in unpredictable environments (achieve
desired performance levels in the face of disruptions) (Piening and Salge, 2015). For example,
SCR is a dynamic skill that can provide a competitive advantage and is critical during times of
disruption (Teece, 2007) to achieve SCP. Therefore, the DCT will help explain the relationship
between SCR and SCP, and the extent to which SCD could strengthen or weaken the
relationship (Wong et al., 2020).

2.2 Conceptual review


2.2.1 Supply chain resilience and performance. SCR enables speedy recovery from
interruptions and guarantees the continuity of material supply and product delivery,
which lessens the negative effects of uncertainties and increases the value and pleasure of end
consumers (Chowdhury and Quaddus, 2017; Singh et al., 2020b). In particular, the
requirement for industrial activities and customer service is the constant material supply.
Without consistent material flows from suppliers, supply chain activities cannot be sustained
and customer needs cannot be met. As a result, improving SCR sets the groundwork for
improving SCP (Gu et al., 2020).
Collaboration across different departments and supply chain partners is encouraged by
supply chain resiliency (Bakshi and Kleindorfer, 2009). Additionally, it gives businesses the
adaptability they need to take advantage of market openings and customer demands (Remko,
2020). Nonetheless, by maintaining supply chain redundancy, businesses are able to manage
numerous suppliers, safety stock, excess capacity and backup suppliers, allowing them to
create products that satisfy client needs (Ivanov, 2021). We formulate the following research
hypothesis following the above arguments;
H1. There is a significant positive effect of SCR on SCP.
2.2.2 Supply chain disruption. Each year, about 70% of organisations experience a SCD, which
is defined as a situation that impairs the flow of supplies, funds or resources and affects an
organisation’s capacity to provide services to customers (Scholten et al., 2019). Supply chains
can be disrupted in a variety of ways. While some problems occur within the supply chain, Role of supply
such as a production line breakdown, IT problems, demand fluctuations, sustainability chain
problems, production delays, poor packaging, delivery delays, subpar products, logistical
problems, or quality problems, others occur outside the supply chain and are brought on by
disruption
things like labour disputes, regulatory changes, weather conditions, financial instability,
terrorism, war and counterfeiting, among others. This variety of risks also serves as a
reminder that disruptions can be produced by either man-made factors, which are easier to
regulate, or by naturally occurring factors, which are more unexpected. Occasionally, both 365
common and uncommon disasters affect supply chain operations and every firm’s supply
chain is vulnerable to a variety of risks.
According to real-world cases and research, three major types of disruptions namely,
supply disruption (Ambulkar et al., 2015), catastrophic disruption (Kleindorfer and Saad,
2005) and infrastructure disruption (Ambulkar et al., 2015) often result in interruptions to
supply chain activities. As a result, the current study will build on previous literature to
assess the impact of each SCD (supply, infrastructure and catastrophic) on the relationship
between SCR and SCP.
2.2.2.1 Supply disruption. Supply disruption is a worry when it comes to the ability of
suppliers to provide and deliver the quantity and quality of goods needed to support the
operations of a firm (Wong et al., 2020). Supply disruptions can result from incidents outside
of the supply chain or from a variety of risk factors that are present inside it (Zsidisin and
Wagner, 2010). Supplier quality, delivery dependability, production capacity, technological
aptitude, financial difficulties or even bankruptcy are all factors that create supply
disruptions (Tomlin, 2006).
2.2.2.2 Infrastructure disruption. The “breakdown or failure of systems such as an
information network, a production line, or transportation infrastructure that prevent
communication, information sharing, and the movement of commodities in a supply chain” is
referred to as infrastructure disruption (Wong et al., 2020; Chopra and Sodhi, 2014).
Accidents, technology malfunctions, disasters, human errors or cyber-attacks can all disrupt
supply chain operations, leaving them unable to synthesise internal and external information
to support supply chain coordination. It is linked to a firm’s systematic vulnerabilities since it
interrupts a supply chain’s chain of actions due to a loss of connectedness among supply
chain partners (Wong et al., 2020).
2.2.2.3 Catastrophic disruption. Natural disasters and political crises frequently impair
supply chain operations, causing catastrophic disruption (Wong et al., 2020). Catastrophic
events are unanticipated or routine events that have a low likelihood but significant outcome.
“Economic (recessions, hostile takeovers), physical (industrial accidents, product failures),
personnel (strikes, exodus of key employees, workplace violence or vandalism), informational
(theft of proprietary information, tampering with company records), reputational (tampering
with logos, rumour mongering)” and national security (theft of proprietary information)
crises, as well as floods and fires, are some examples of crises that can occur.
Due to the lack of early notice, catastrophic disruption is largely unanticipated and the
consequence of the disruption is impossible to forecast until the events unfold. Decision- and
policymakers have faced significant effects as a result of the recent worldwide pandemic
disruption in all economic sectors around the world in an unanticipated scenario (Phan and
Wood, 2020).
2.2.3 Role of SCD on the nexus between SCR and SCP. Performance is affected by the
magnitude and duration of the disturbance, as well as the supply chain’s knowledge and
experience in addressing risks and disruptions. Some companies are better than others at
reducing the severity and duration of SCDs, and it is suggested that this is because they are
more resilient (Scholten et al., 2019). This study seeks to find this by building three SCD
JMTM (supply, infrastructure and catastrophic) on resilience and performance of the supply chain
34,3 identified in empirical literature.
In order to find and secure new sources of supply, which are supported by retaining
collaboration, flexibility and redundancy in supply management, SCR helps businesses
alleviate the problem of supply (Mishra et al., 2021). However, the DCT contends that in the
event of a minimal supply interruption, SCR may not help to improve SCP (Wong et al., 2020).
That is, in the event of a little disruption to the supply chain, the extra capacity set aside to aid
366 in the recovery of supply chain operations cannot be fully utilised, resulting in a waste. As a
result, the relationship between SCR and SCP is moderated by SCD.
In the case of infrastructure disruption however, firms with SCR have surplus capacity
and resources. Such capacity enables organisations to respond quickly to these disruptions
by allowing them to make modifications to products and/or processes in order to maintain
services and fulfil client orders (Zhang et al., 2021). When infrastructure disruption does not
occur, however, the surplus capacity held in organisational processes is unlikely to have an
impact on SCP improvement.
Catastrophic disruption can last for a long time and has been linked to significant financial
losses (Merz et al., 2021). According to Sandanayake et al. (2018), if a facility is lost due to a
catastrophic event, for example, the results could have an impact on supply chain operations,
financial flows and possibly information flows as well. Because of the losses and supply chain
costs generated by catastrophic disruptions, these infrequent but catastrophic disruptions
constitute an extreme form of unpredictability in supply chains, necessitating considerable
buffers to cope with and minimise their effects (Wong et al., 2020; Bradley, 2014). Unexpected
incidents have shown humanity’s susceptibility and lack of readiness for such circumstances
throughout history. Nissan can however recover more swiftly than its major competitors
following the 2011 Thailand floods because it has access to alternative suppliers and design
knowledge substitutability (Haraguchi and Lall, 2015). Hence, the presence of SCR will help
minimise the effect this disruption presents in the supply chain. Following from the above, we
formulate the following research hypotheses.
H2. There is a significant moderating effect of SCDS on the nexus between SCR and SCP
H3. There is a significant moderating effect of SCDI on the nexus between SCR and SCP
H4. There is a significant moderating effect of SCDC on the nexus between SCR and SCP

3. Research methods
3.1 Overview of the research process
This study employs the quantitative research approach. This is because the quantitative
approach gives the researcher the opportunity to assess numerical and objective
investigations of the research objectives (Creswell, 2014; Saunders et al., 2016).
Additionally, the current study adopted the explanatory research design. This is because
the researcher sought to assess the degree of association between the study variables
considering the influence of one variable on the other, the moderating effect of variables on
the nexus between other variables (Saunders et al., 2016).
The study was conducted in the Accra Metropolis. As the capital city of Greater Accra
region and the most popular city with many firms in manufacturing, the Accra Metropolis
forms the major financial, commercial and industrial hub of the country (Akubia and Bruns,
2019; Asare and Angmor, 2015). The Metropolis is also the home to heavy manufacturing
industries like textiles, food and beverage, chemical and pharmaceutical, timber and paper
manufacturing. This concentration of many manufacturing firms with respect to their
activities consequently led to the chosen study area.
A flow diagram showing the holistic view of the study from the introduction through to Role of supply
the conclusion is shown in Figure 1. chain
disruption
3.2 Population sampling
The targeted population is supply chain managers or managers responsible for the supply
chain activities of manufacturing firms in the Accra metropolis of Ghana. A sample of 345
was selected from a total population of 2,495 which is acceptable sample size based on 367
Yamane’s (1967) sample size determination formula. The sampling procedure was simple
random since differences within the unit of analysis is not the focus of this study. Hence, the
manufacturing firms were considered to be homogeneous.
The study designed and administered structured questionnaire to collect primary data
from supply chain managers of manufacturing firms. The study adopted a seven-point
Likert scale to measure various constructs from 1 - Strongly disagree to 7 - Strongly agree.
The questionnaire in support of the study was adapted from various sources which
ensured convergent validity and corresponds to the study’s setting (Mandal et al., 2016;

Relationships among SCR, SCP and SCD Dynamic capability


theory

Effect of SCR on
SCP

Moderating effect of SCD on the


nexus between SCR and SCD
• Quantitative research
approach
• Explanatory design
• Manufacturing firms at
Research Methods Accra Metropolis
• Simple random sampling
• Validity and reliability of
instruments
Results and Discussion • Model estimation with
PLS-SEM

Empirical Practical Theoretical


Support Implications Confirmation

Figure 1.
Flow diagram for the
Conclusion
entire study
JMTM Wong et al., 2020; Chowdhury et al., 2019). Categorically, the questionnaire was adapted
34,3 based on review of literature from the sources indicated to suit the context of this study.
The questionnaire utilised in support of the current study is attached as an Appendix.

3.3 Pretesting
A preliminary investigation of the survey was performed to ensure that the instructions,
368 questions and scale item errors are minimised (Pallant, 2016). A sample size of 10 was selected
for the pre-testing which is in line with the assertion of Saunders et al. (2016) on the
benchmark for pilot studies by students. The outcome from the pre-testing depicted those
scales were clear to the respondents and considered appropriate for further analysis.
The reliability of the study’s constructs was examined to ensure consistency and minimise
biases in the study. To accomplish this purpose, the Cronbach’s alpha coefficient as shown in
Table 1 was estimated on the pre-test data. A look at the Cronbach’s alpha coefficients with
values beyond 0.7 in Table 1 shows that the study’s constructs have good internal
consistency.

3.4 Data processing and analysis


The data received from the supply chain managers was entered in excel software and cleaned
for further statistical analysis. To minimise errors in data entry, codes were assigned to each
questionnaire and matched with the required entry on the excel software. The researcher
employed both preliminary statistics (mean, standard deviation, skewness, kurtosis, etc.) and
inferential statistics (PLS-SEM). The PLS-SEM was employed to achieve all the four research
objectives. The PLS-SEM estimation technique from the Smart PLS version 4 statistical
software was used to accomplish the study’s purpose. The choice of the PLS-SEM statistical
tool was based on its efficacy in effectively examining relationships between latent variables
(Hair et al., 2012).

4. Results and discussion


4.1 Descriptive statistics of constructs
As shown in Table 2, the average values for supply chain disruptions (SCDC, SCDI and SCDS)
are less than 5, implying moderate to low levels. On the other hand, SCR and SCP recorded
mean values above 5 indicating high scoring. There is also a consistency in responses except
for firm age and firm size (measured by the number of employees) as indicated by the
standard deviation.
Most of the variables are negatively skewed indicating that there are lower scoring values
than higher values. It can be confirmed from the Jarque–Bera statistic that the data is not
normally distributed (p-value < 0.01). The assumption of nonnormality permits the
application of a non-parametric test for this study. Hence, the PLS-SEM approach is
specifically utilised in this study.

Constructs No. of items Cronbach’s alpha

Supply chain resilience 18 0.898


Supply disruption 7 0.821
Infrastructure disruption 5 0.889
Table 1. Catastrophic disruption 6 0.790
Construct reliability Supply chain performance 10 0.879
Mean Std. Dev Skewness Kurtosis Jarque–Bera
Role of supply
chain
AGE 7.354 4.128 0.732 4.130 49.123*** disruption
SCDC 4.001 0.808 1.225 4.841 135.035***
SCDI 3.970 1.701 0.046 2.100 11.758***
SCDS 3.920 0.946 0.927 3.226 50.110***
SCP 5.830 0.919 2.044 8.597 690.460***
SCR 5.890 1.106 2.368 8.809 807.447*** 369
SIZE 149.467 539.882 7.613 63.953 56,738.520***
Note(s): *** denotes significance at 1%. Age and Size signify age of business and number of employees (firm Table 2.
size) respectively Preliminary statistics
Source(s): Author’s Construct (2022) of constructs

4.2 Validity of the research instrument


The PLS-SEM findings begin with a model evaluation to determine its fitness by analysing
the construct’s reliability (as measured by Cronbach’s alpha and rho_A), the indicator’s
reliability (loadings), convergent validity and discriminant validity (Nitzl, 2016). Construction
dependability was also assessed using composite reliability (CR).
Cronbach’s alpha (CA) and rho_A were used to evaluate construct reliability from Table 3,
which displays the percentage of an indicator’s variance that can be explained by its
underlying latent variable (Hair et al., 2012). The cut-off is that rho_A scores and CA should
be at least 0.70 to ensure satisfactory and acceptable results.
Table 3 also displays the study’s convergent validity based on the average variance
extracted (AVE) score (Hair et al., 2012). The AVE describes how the concept captures the
variation of an indicator in relation to the total variance and the variance due to measurement
error (Hair et al., 2012). As recommended by Bagozzi and Yi (1988), the general rule is that all
AVE scores must be at least 0.50 for each build.
Table 3 reveals that all the indicators loaded well with at least 0.7 loading coefficient which
is considered acceptable (Hair et al., 2014). The Cronbach’s alpha (CA) and rho_A loadings at
Table 3 confirm the indicator’s rule of thumb of 0.7. The composite reliability (CR) presented
in Table 3 also explains the extent to which combined indicators of distinct constructs are
sufficiently measuring those constructs (Ringle et al., 2012). Table 3 shows that the constructs
have composite reliability (CR) values above 0.7 in all cases, indicating that the constructs are
resilient (Straub, 1989).
Additionally, all indicators with AVE values greater than 0.6 are loaded to exhibit
convergent validity (Hair et al., 2014). From Table 3, the least AVE is 0.675 which is in line with
the recommendation by Fornell and Larcker (1981), indicating that the products have higher
volatility on average than the variance described by the concept. Because all hidden variables
have an AVE beyond 0.5, the results show the model’s convergent validity.

4.3 Discriminant validity


Table 4 shows the model’s quality by evaluating the constructs’ discriminant validity (Hair et al.,
2012). According to Hair et al. (2014), the discriminant validity evaluates the structural model for
collinearity problems. The discriminant validity is tested using the Fornell–Larcker criterion.
According to Fornell–Larcker (1981, p. 8), “for discriminant validity to be appropriate, the
square roots of each construct’s AVE should be higher than the correlations of that construct
with all other constructs.” When viewed both vertically and horizontally, the figures in
boldface are larger than other correlation values among the latent variables, as seen in
Table 4. This indicates that the discriminant validity criteria have been met.
JMTM LV Loadings CA Rho_A CR AVE
34,3
Age 1.000 1.000 1.000 1.000 1.000
SCDC 0.917 0.921 0.931 0.731
SCDC1 0.758
SCDC2 0.913
SCDC3 0.867
370 SCDC4 0.915
SCDC5 0.812
SCDI 0.949 0.953 0.955 0.841
SCDI1 0.957
SCDI2 0.954
SCDI3 0.935
SCDI4 0.815
SCDS 0.921 0.967 0.943 0.805
SCDS1 0.881
SCDS2 0.925
SCDS3 0.912
SCDS4 0.871
SCP 0.939 0.943 0.949 0.675
SCP2 0.746
SCP3 0.857
SCP4 0.749
SCP5 0.835
SCP6 0.806
SCP7 0.841
SCP8 0.869
SCP9 0.861
SCP10 0.818
SCR 0.977 0.978 0.979 0.770
SCR1 0.897
SCR2 0.865
SCR3 0.888
SCR4 0.896
SCR5 0.897
SCR6 0.889
SCR7 0.909
SCR8 0.913
SCR9 0.908
SCR10 0.858
SCR11 0.861
SCR12 0.827
Table 3. SCR13 0.835
Summary of SCR14 0.835
measurement scale Size 1.000 1.000 1.000 1.000 1.000

Age SCDC SCDI SCDS SCP SCR Size

Age 1.000
SCDC 0.082 0.855
SCDI 0.053 0.001 0.917
SCDS 0.097 0.773 0.011 0.897
Table 4. SCP 0.009 0.129 0.059 0.155 0.821
Fornell–Larcker SCR 0.025 0.069 0.172 0.126 0.545 0.877
criterion Size 0.124 0.021 0.075 0.045 0.032 0.037 1.000
4.4 Predictive relevance Role of supply
Table 5 presents the predictive relevance of the various possible indicators and constructs chain
which acted as dependent variables in the SEM. The Q2 assesses the predictive relevance of
each indicator or construct. According to Hair et al. (2014), predictive relevance is evaluated
disruption
by excluding a portion of the data matrix, estimating the model, and then forecasting the
portion that was left out using the estimates. Q2 value > 0 for exogenous variables is
preferred (Henseler et al., 2009). As a result, the closer the Q2 to the adjusted R2, the better.
Henseler et al. (2009) provided Q2 values criteria; 0.02 ≤ Q2 < 0.15 (weak effect), 371
0.15 ≤ Q2 < 0.35 (moderate effect) and Q2 > 0.35 (strong effect).
It could be seen that SCP strongly predicts the model. From Table 5, the possible
independent variable has a predictive relevance in the PLS regression model. As a result, their
corresponding dependent variables reliably explain them. This is indicated by the closeness
of the Q2 to the adjusted R2. Also, the positive value of the Q2 suggests that the prediction
error of the PLS-SEM outcome is lower than the prediction error of utilising the mean values.
In this case, a better predictive performance of the PLS-SEM model can be inferred.

4.5 Results
After achieving constructs and indicator reliability, as well as convergent and discriminant
validity, the study goes ahead to examine the research hypotheses. This work was completed
by analysing the direction and strength using the coefficients, p-values reflecting the degree
of significance using 5,000 bootstraps in Figure 1, coefficient of determination (R2 Adjusted),
effect size (f2) and variance inflation factor (VIF) in Table 6.
In this study, SCP is the endogenous variables. The moderating effect of supply chain
supply disruption (SCDS), supply chain infrastructure disruption (SCDI) and supply chain
catastrophic disruption (SCDC) on the relationship between SCR and SCP are examined. The
model provided by the effect of all other variables on SCP from Table 6 denotes that SCR,
SCDS, SCDI and SCDC explain 40% of the variations in SCP. From Table 6 the maximum VIF

Table 5.
Latent variable Adjusted R2 Q2 RMSE MAE Constructs and
indicators predictive
SCP 0.402 0.368 0.806 0.616 relevance

Path Beta (O) Ϭ O/Ϭ p-value f2 VIF Decision rule

H1: SCR → SCP 0.397 0.061 6.469 0.000 0.179 1.509 Supported
H2: SCDS 3 SCR → SCP 0.546 0.120 4.533 0.000 0.156 2.966 Supported
H3: SCDI 3 SCR → SCP 0.131 0.071 1.857 0.063 0.031 1.155 Not Supported
H4: SCDC 3 SCR → SCP 0.319 0.145 2.209 0.027 0.047 2.493 Supported
SCDS → SCP 0.044 0.071 0.623 0.533 0.001 2.536 NA
SCDI → SCP 0.024 0.053 0.445 0.656 0.001 1.041 NA
SCDC → SCP 0.089 0.075 1.182 0.237 0.005 2.527 NA
Size → SCP 0.051 0.035 1.435 0.151 0.004 1.039 NA
Age → SCP 0.003 0.041 0.066 0.948 0.001 1.043 NA
2 2
R Adjusted R
SCP 0.418 0.402
Note(s): → shows effect from one variable (exogenous variable) to another (endogenous variable). O, Ϭ, O/Ϭ, f2 Table 6.
and VIF signify original beta values, standard deviation, T statistics, effect size and variance inflation factor Diagnostic tests of
respectively coefficients
JMTM of 2.966 which is lower than 5 (Hair et al., 2014) reveals that the pathways are free of
34,3 multicollinearity.
The summary fit outcome in Table 7 has the model’s Standardised Root Mean Square
Residual (SRMR) which ought to be less than 0.08 (see, Hu and Bentler, 1999; Henseler et al.,
2016) while the closer the Normed fit index (NFI) value to 1.00 the better the fit. The model’s
Chi-Square which is evaluated by dividing the estimated value of the Chi-Square by the
degrees of freedom (number of observations minus number of independent variables) should
372 be lower than 3 (Mantel, 1963).
It can be noticed from Table 7 that the model’s SRMR values of 0.037 and 0.038 are lower
than 0.08 indicating a good model fit of minimal discrepancies between observed and
expected correlations. Furthermore, the NFI value is higher than the cut-off 0.8, hence, the
model is deemed to have marginal fit.
The study further presents the PLS structural equation modelling path coefficients and
significance in Figure 2 after accomplishing the diagnostics tests. Figure 2 gives the opportunity
to address the research hypotheses in a single model. The factor loadings are excluded to enhance
clarity for easy interpretation. The study employs the number of employees as an appropriate
measure of firm size and age of business to control for the effects on SCP.
From Figure 2, SCR has a significant positive effect (β 5 0.397, p-value < 0.01) on SCP of
manufacturing firms in Ghana. This can be explained that a unit increase in SCR corresponds
to a 0.397 unit increase in SCP. Additionally, research hypotheses of the moderating effect of

Saturated model Estimated model

SRMR 0.037 0.038


d_ULS 1.032 1.059
d_G 0.835 0.836
Table 7. χ2 1589.128 1593.942
Summary fit NFI 0.880 0.880

Figure 2.
Path coefficients and
bootstrapping
supply chain disruption (SCDS, SCDI and SCDC) on the relationship between SCR and SCP Role of supply
are assessed. It can be seen that SCDS (β 5 0.546, p-value < 0.01) have a significant positive chain
effect on the relationship between SCR and SCP.
SCDI on the other hand presents a positive effect at a 10% significance level (β 5 0.131,
disruption
p-value < 0.10). Nonetheless, the SCDC was supported by a negative and significant path
coefficient (β 5 0.319, p-value < 0.05). It can be concluded that the components of SCD have
heterogeneous impact on the relationship between SCR and SCP. Specifically, as SCDS
strengthens the relationship between SCR and SCP, SCDC rather weakens the relationship. It 373
can be concluded that SCDS and SCDC, and possibly SCDI moderate the relationship between
SCR and SCP.

4.6 Robustness
The study examines the direct effects of SCR, SCDI, SCDS and SCDC on SCP of
manufacturing firms in Ghana. To accomplish this purpose, the importance-performance is
used as shown in Figure 3.
From Figure 3, it can be seen that SCR is important in enhancing SCP. The next two close
variables are SCDC and SCDS which should be monitored with care to help mitigate its
impact on SCP.
The study further examines the exact degree to which SCR, SCDI, SCDS and SCDC
directly influence SCP of manufacturing firms in Ghana. To accomplish this purpose, the total
effects test is employed as presented in Table 8.
Table 8 demonstrates the total effects (direct) on SCP. It can be seen from Table 8 that SCR,
SCDI, SCDS and SCDC have a direct impact on SCP to a degree above 45%. Improvement in
these factors would have serious repercussions on the SCP of manufacturing firms in Ghana.

Figure 3.
Importance
performance-map
JMTM 4.7 Discussion of results
34,3 It was found that SCR positively influences SCP. Hence, improvement in resilience strategies
is relevant to enhancing the SCP of manufacturing firms in Ghana. Additionally, SCR was one
of the important factors which contributes to SCP. This is in line with the qualitative study by
Dey (2016) performed on supply chain managers in Ghana. Considering studies conducted
outside Ghana, the findings of empirical studies such as Chowdhury and Quaddus (2017) in
Bangladesh, Mandal et al. (2016) in India, Wong et al. (2020) in Taiwan, Piprani et al. (2020) in
374 Pakistan, Gu et al. (2020) in China support the current study.
The moderating effect of SCDs on the relationship between SCR and SCP was also
investigated. Since different levels of disruptions are known to influence the nexus between
resilience and SCP (Wong et al., 2020), three sub-dimensions of disruption were employed.
These are supply chain supply disruption (SCDS), supply chain infrastructure chain
disruption (SCDI) and supply chain catastrophic chain disruption (SCDC).
It was revealed that the sub-dimensions of SCD moderated between SCR and SCP differently.
First, we found that in the presence of SCDS, the relationship between SCR and SCP is
strengthened. Second, although the relationship between SCR and SCP is reduced to a smaller
extent amid SCDI at a 10% significance level. This implies that in the midst of SCDS and SCDI,
SCR strategies were still relevant to enhancing SCP. Conversely, the positive relationship between
SCR and SCP is reduced entirely to arouse a negative outcome in light of SCDC among
manufacturing firms in Accra Metropolis. Sequel to this, SCR strategies employed by these firms
are not absolutely robust in enhancing SCP as far as SCDC is concerned. It can be concluded here
that the components of SCD have heterogeneous effect on the relationship between SCR and SCP.
The negative impact of SCDC is not surprising because, in the Ghanaian context, although
infrastructure disruptions seldom occur, but when they happen, their impact is severe (Damoah
et al., 2020). This can be noticed in natural disasters such as floods which is commonplace for
manufacturing firms in the Accra Metropolis. Therefore, in such cases, SCR strategies might do
less in enhancing performance, and can be largely attributed to the havoc impact of the
COVID-19 pandemic and other natural disasters germane to geographical area including flood.
In part, the study supports the findings of Wong et al. (2020) to the extent of a positive
moderating effects of SCDS and SCDI. However, Wong et al. revealed that SCR and performance
nexus is rather strengthened in the presence of SCDs. Additionally, the negative significant
effect of SCDC on the relationship between SCR and SCP in this study substantially deviates
from the outcome of Wong et al. Moreover, findings from the current study are less consistent
with the outcome of Shekarian and Parast (2020) who revealed a significant contribution of SCR
in reducing SCD for the enhancement of business growth and prospects.
This illustrates that SCR is less critical in contributing to catastrophic risk management toward
the improvement of SCP among manufacturing firms in Accra Metropolis. Hence, the recovery rate
after the occurrence of a disruption may be low to resuscitate SCP during such periods. This brings

Constructs Performance (%)

Age 23.532
SCDC 74.376
SCDI 48.544
SCDS 72.901
SCP 80.017
SCR 81.478
Table 8. Size 2.951
Importance- Note(s): Important-performance diagnostics presented for the direct impact of supply chain resilience and
performance values disruption on supply chain performance
to notice insights from the study of Dey (2016) that the speed with which stakeholders work Role of supply
together after a disruption impacts the degree of the cost and the time it takes to recover. chain
The study’s managerial and practical implication is that increased SCR boost
manufacturing companies’ supply chains’ performance and aid to lessen the adverse
disruption
effects of SCD (particularly SCDI and SCDS). It implies that supply chain managers are able to
reduce the effects of SCDI and SCDS by overcoming infrastructure (local interruptions,
downtime or loss of own manufacturing capacity, IT infrastructure disruption, reduction in
production capacity caused by technical issues) and supply (inadequate or variable supply 375
quality, sudden death of vendors and failure of suppliers to deliver on significantly higher
volume demands) challenges respectively. Techniques that reduce the adverse impact of
SCDC would be beneficial for supply chain managers in Ghana and other countries with
comparable economic environments. This can be done by intensifying resilience strategies
such as collaboration, flexibility, agility and redundancy. Finally, because of the adverse
effect of SCDC, governments would get greater understanding of how to implement the
necessary policies to restructure businesses with shoddy supply chains.
In light of the dynamic capability theory, the outcome from this study provides that
manufacturing firms operate in a dynamic environment requiring resilience strategies to deal
with different forms of disruptions. Hence, enabling supply chains to resuscitate and sustain the
steadiness of material, information and currency flows in the face of infrastructure and supply
disruptions is a necessary course of action. Sequel to SCD, SCR is a dynamic skill that can
provide a competitive advantage to achieve SCP. Therefore, the DCT has played out in
explaining the nexus between SCR and SCP, and the extent to which the dimensions SCD could
strengthen (SCDI and SCS) or weaken (SCDC) the relationship. Indeed, capability manifests itself
in learned and persistent patterns of behaviour by which a company produces and adapts its
method of doing things in order to become more effective (Brusset and Teller, 2017). As revealed,
it must therefore be noted that the value of dynamic capabilities varies depending on the
situation and that there is no one-size-fits-all approach to general effectiveness.

5. Conclusion
We assessed the moderating role of SCD considering sub-dimensions to include SCDS, SCDC
and SCDI on the relationship between SCR and performance. The explanatory research design
and quantitative research approach were utilised to achieve the study’s purpose. A structured
questionnaire was used based on extensive reviews of prior empirical studies to glean data from
a sample of 345 managers who are responsible for supply chain activities of manufacturing
firms in Accra Metropolis. The descriptive (mean, standard deviation, skewness, kurtosis and
Jarque–Bera) and inferential (multiple regression with PLS-SEM) were used.
The study revealed that SCR has a significant positive effect SCP of manufacturing firms
in Ghana. It was found that SCDS and SCDI have a significant positive effect on the
relationship between SCR and SCP. This implies that in the presence of SCDs (SCDS and
SCDI), SCR still enhances SCP. Conversely, SCDC recorded a negative significant effect on the
nexus between SCR and SCP. Hence, the existing relationship between SCR and SCP is only
strengthened, in the presence of SCDS, but with a negative nexus amid SCDC. This addresses
the heterogeneous impact of the components of SCD on the nexus between SCR and SCP in
line with the DCT. Findings from the study partly differ from the outcome revealed by
Wong et al. (2020) conducted in a developed country context with much emphasis on the
processing of information in times of disruption. Hence, the current study relying on the DCT
in the Ghanaian environment highlights the novelty of the study’s findings through the
differences in response of the nexus between SCR and SCP to SCD.
It can be concluded that SCR enables speedy recovery from interruptions only to the
extent of SCDS, and possibly SCDI. However, the presence of SCDC mitigates the relationship
JMTM between SCR and SCP. It is recommended that Ghanaian supply chain managers should
34,3 cultivate a mindset and an interest in figuring out how a disruption in the supply chain will
play out before it does. It is pertinent that every organisation designs its own internal
strategy, and it should be continually enhanced based on the lessons learned and the best
practices offered by partners and rivals. The study is limited to the use of single construct for
SCR. Further studies can investigate the role of SCD considering different resilience
strategies such as collaboration, flexibility, redundancy, agility, among others.
376
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Appendix
Questionnaire

Section A: Demography of respondents


Kindly tick where appropriate in the box corresponding to your choice with regards to each statement.
(1) Age of business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2) Number of employees (Specify) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3) Which sector do you belong?
[ ] Mining
[ ] Clothing and textiles
[ ] Food and beverage
[ ] Oil and gas exploration and production
[ ] Chemical and pharmaceutical
[ ] Pulp and paper
[ ] Agricultural production
[ ] Electronics
[ ] Other. Specify . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
JMTM Section B: Supply chain resilience
34,3 Instruction. Kindly indicate your level of agreement or disagreement by putting a checkmark in the
appropriate box. Please select the number that best represents your opinion.
Where 1 5 Least agreement and 7 5 Strong Agreement

380 Least Strong


Supply chain resilience agreement 1 2 3 4 5 6 agreement 7

SCR1 Our company collaborates with its main suppliers to


achieve shared objectives
SCR2 “Our company creates strategic goals in collaboration
with our supply chain partners.”
SCR3 Our business equally distributes benefits and risks with
its supply chain partners
SCR4 Our business collaborates with the main participants in
its supply chain for mutual gain
SCR5 Demand forecasting is done jointly by us and supply
chain partners
SCR6 “We undertake joint planning and decision-making
with our supply chain partners.”
SCR7 To lessen a disturbance, our company’s supply chain
can change the quantity of orders from suppliers
SCR8 Our company’s supply chain can modify the supplier’s
order delivery deadline to minimise a disturbance
SCR9 The supply chain of our company has the ability to
change production capacity in reaction to a disturbance
SCR10 Our company’s supply chain has the ability to alter
delivery schedules in response to disruptions
SCR11 In terms of order volume and manufacturing schedule,
we are flexible in our production
SCR12 To satisfy consumer needs, we produce a variety of
items
SCR13 We have spare parts, equipment, and logistical
Table A1. assistance available
Supply chain resilience SCR14 Two or more supply sources
Section C: Supply chain performance Role of supply
Instruction. “Kindly indicate your level of agreement or disagreement by putting a checkmark in the chain
appropriate box. Please select the number that best represents your opinion.”
Where 1 5 Least agreement and 7 5 Strong Agreement disruption

Least Strong
Supply chain performance agreement 1 2 3 4 5 6 agreement 7 381
SCP1 Our company’s capacity to handle threats has
improved compared to three years ago
SCP2 Our company’s ability to handle risk has increased
since three years ago
SCP3 Our company’s operational flexibility has improved
since three years ago
SCP4 Our company’s client loyalty is higher than that of
our main rival
SCP5 Our company has higher customer satisfaction than
our main rival
SCP6 When compared to our main rival, our company’s
corporate image has improved
SCP7 Our company has the capacity to react to and account
for variations in demand, such as seasonality
SCP8 Periods of subpar production performance can be
accommodated and responded to by our company
(machine breakdowns)
SCP9 Periods of subpar supplier performance can be
accommodated and responded to by our company Table A2.
SCP10 Our company is able to adapt to and deal with periods Supply chain
of subpar delivery performance performance
JMTM Section D: Supply chain disruption
To what extent are these disruptions likely to happen in your organisation. Please select the number that
34,3 best represents your opinion.
1. Never 7. To a large extent

Least Strong
382 agreement 1 2 3 4 5 6 agreement 7

a) Supply disruption
SCDS1 Suppliers’ subpar logistics performance (e.g. delivery
dependability, order fulfilment capacity)
SCDS2 Inadequate or variable supply quality
SCDS3 Sudden death of vendors (e.g. due to bankruptcy)
SCDS4 Failure of suppliers to deliver on significantly higher
volume demands
b) Infrastructure disruption
SCDI1 Due to local interruptions, downtime or loss of own
manufacturing capacity (e.g. “labour strike, fire,
explosion, industrial accidents”)
SCDI2 Internal IT infrastructure disruption or failure
SCDI3 External IT infrastructure interruption or failure
SCDI4 Reduction in production capacity caused by technical
issues (e.g. machine deterioration)
c) Catastrophic disruption
SCDC1 Civil unrest, conflict, political instability or other
sociopolitical issues
SCDC2 Illnesses or pandemics (e.g. COVID-19, SARS, EBOLA)
SCDC3 Natural catastrophes (e.g. earthquake, flooding, fire
Table A3. outbreak)
Supply chain SCDC4 Unexpected termination of crucial personnel
disruption SCDC5 Trade union actions (Strikes)

Corresponding author
Zulaiha Hamidu can be contacted at: hzulaiha1@gmail.com

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