The Impact of Executives with Supply Chain Management and Operations Management Experience on Recall Performance and Risk Management

Abstract

This dissertation investigates the impact of the growing presence of executives with supply chain management and operations management (SCOM) experience on the top management team. My dissertation focuses on two major strategic areas in which an executive with SCOM experience may influence firm strategy and firm performance. The first area I have chosen to study is a firm's propensity to engage in product recalls along with their responsiveness to the quality glitches that lead to recall. The second area of study is risk and resilience within a firm’s supply chain. Essay 1 explores the impact of an executive with SCOM experience on product recall propensity and firm responsiveness. We utilize a unique dataset collected from multiple sources on executives’ backgrounds and product recalls, and we find that firms having top management executives with SCOM backgrounds have fewer recalls and faster recall responsiveness. The findings also indicate that the shortened speed to recall is enhanced when a firm engages in a proactive recall strategy. The second essay studies the impact of top executives with SCOM experience as well as top executives with finance experience. We then propose original hypotheses regarding the impact of these two forms of experience on the firm’s supply chain risk profile. We utilize a dataset of manufacturing locations over a three-year period. Our findings indicate that firms with SCOM experience on their top management teams have lower levels of location risk and higher levels of resilience at their production locations. On the other hand our findings indicate that firms with top management teams with finance experience are more likely to take on location risk at their production locations but are similar to firms with SCOM on their top management team in that they also have high levels of resilience. Lastly we explore the impact of an SCOM executive when the firm uses offshore production. My findings for both essays contribute to upper echelons theory (UET) by proposing and testing novel hypotheses regarding the impact of the presence of executives with SCOM experience and finance experience on recall performance and supply chain risk management.