The role of personal relationships in supply chain risk information sharing: Perspectives from buyers and suppliers of logistics services

Abstract

Keith Ferrazzi, a New York Times best-selling author, was quoted saying: ‘Power comes from sharing information, not withholding it’. Likewise, information technology (IT) innovations are shaping the modern-day supply chain and, as a result, firms and their supply chain partners (SCPs) are becoming progressively more dependent on information sharing among one another (Colicchia et al. 2018:5; Kache & Seuring 2017:11). Today, the collection and sharing of information is faster and simpler, allowing supply chains to operate in a globally connected environment (Colicchia et al. 2018:5). South Africa is recognised as the most developed country in Africa in terms of the third-party logistics (3PL) industry. As a result, the majority of logistics activities on the continent are performed by South African 3PL service providers (Nel, De Goede & Niemann 2018:2). The utilisation of 3PL service providers creates a network among buyers and suppliers for potential information sharing and risk mitigation (Huong Tran, Childerhouse & Deakins 2016:1103). The purpose of sharing information is to ensure real-time information processing and decision-making between the firm and its 3PLs (Prajogo & Olhager 2012:514–516). Third-party logistics partners can provide timely feedback, outsource processes and track service activities by sharing information (Zacharia, Sanders & Nix 2011:43–44). Information sharing enables firms to experience improved resilience and increased supply chain visibility (Brandon-Jones et al. 2014:56–57). Background: The frequent occurrence of supply chain disruptions highlights the importance of sharing supply chain risk information (SCRI) among buyers and suppliers in third-party logistics (3PL) services. Business relationships and long-term collaboration among supply chain partners (SCP), such as 3PLs and their clients, lead to the sharing of SCRI. Risk information sharing (RIS) cannot be effectively carried out unless these relationships are based on more than just transactional information sharing. Therefore, a better understanding is needed of how personal relationships influence RIS among these partners.