Despite the co-existence of commercial, public-sector and social-welfare mindsets in business processes, the knowledge is limited about how and why these logics affect supply chains (SC). The purpose of this study is to investigate how such logic-infused activities enhance the overall performance and resilience of SC by affecting the level of trust among SC actors.
A sequential mixed-methods design was followed to develop an integrated perspective. First, a survey was conducted on a sample of 174 retailers in the pharmaceutical SC, and partial least-squares structural equation modeling was used for data analysis. In the qualitative study, we conducted interviews with 17 managers and thematically analyzed.
Hypothesis testing results reveal that risk avoidance-oriented, collaboration-oriented and community-oriented activities positively affect trust among SC members; in turn, trust reinforces both SC resilience and performance. In contrast, performance-oriented activities have a negative effect. Both supporting and expanding these results, the qualitative findings show that while community, social-welfare and public-sector logics complement each other through trust-based mechanisms (e.g. knowledge-sharing, traceability, loyalty and collective risk management), commercial logic contrasts them and hinders positive SC outcomes.
This study proposes that SC context is shaped not only by commercial and public-sector logics but also by social-welfare logic. As a twofold construct, social-welfare logic influences the trust-building capacity of SC members by imposing unique and frequently opposing pressures.
The study suggests that engaging in activities that do not prioritize commercial goals could be particularly effective in trust-building and attaining positive SC outcomes. Moreover, shared concerns and attempts by SC members toward improved societal welfare determine trust, resilience and performance to the highest degree.
The study deepens the understanding of developing countries where there is a highly complex SC setting that is mostly vulnerable to opportunistic behaviors from SC actors, which can significantly undermine trust.
To the best of the authors’ knowledge, this is the first study that identifies four unique institutional logics and compares their relative importance in the SC context by exploring the role of trust. The study also highlights the importance of collaboration and community-oriented activities, manifesting themselves in socially responsible behaviors inside and outside of SC.
