Managing uncertainty through supply chain flexibility: reactive vs. proactive approaches

Abstract

The purpose of this paper is to obtain insights into the typology of uncertainty and relevant strategies adopted by manufacturing companies to achieve better supply chain flexibility. Strategies are classified into reactive (buffering) and proactive (redesigning). We develop a framework that links supply chain uncertainty, the two types of strategies for achieving supply chain flexibility and the relevant objectives to be achieved. Four case studies are compared in terms of uncertainty typology and strategies being adopted to improve supply chain flexibility. We present three propositions as a result of the study. First, to achieve better flexibility, companies have been focusing more on buffering than on proactive or redesign strategies. Second, companies tend to focus on internal operations rather than collaborating with external parties, and third, the power structure in a supply chain governs the type and configuration of supply chain flexibility.