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New research on supply chains from Harvard Business School faculty on issues including supply chain management, digital supply chains, and improving global supply chains.
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Are Overlooked Forces Shielding the US from Severe Economic Downturns?

by James Heskett

SUMMING UP: Many of Jame's Heskett's readers believe that one factor more than any other could kills expansion of the United States economy: actions by the Federal Reserve. Open for comment; Comment(s) posted.

Walmart's Workforce of the Future

by Julia Hanna

A case study by William Kerr explores Walmart's plans for future workforce makeup and training, and its search for opportunities from digital infrastructure and automation. Open for comment; Comment(s) posted.

If the Key to Business Success Is Focus, Why Does Amazon Work?

Re: Sunil Gupta

Sunil Gupta explores the infiltration of Amazon into dozens of industries including web services, grocery, and movie production. What’s the big plan? Is the company spread too thin? Open for comment; Comment(s) posted.

Managed Ecosystems and Translucent Institutional Logics: Engaging Communities

by Elizabeth J. Altman, Frank Nagle, and Michael Tushman

Organizations increasingly rely on engagement with external communities of contributors. This paper explores transitions to a managed-ecosystem governance mode and its implications for strategy and innovation. To be successful, firms must develop the capabilities to shepherd communities, leverage without exploiting them, and share intellectual property rights.

The Secret Life of Supply Chains

by Michael Blanding

While US policymakers and politicians focus on reviving the manufacturing sector, Mercedes Delgado and Karen Mills unearth a source of better jobs hidden in plain sight. Call it the supply chain economy. Open for comment; Comment(s) posted.

The Better Way to Forecast the Future

by Roberta Holland

We can forecast hurricane paths with great certainty, yet many businesses can't predict a supply chain snafu just around the corner. Yael Grushka-Cockayne says crowdsourcing can help. Open for comment; Comment(s) posted.

Op-Ed: The Trouble with Tariffs

by Willy C. Shih

The world's economies are interconnected by globalization, which makes threats of tariff wars doubly dangerous, says Willy Shih. Open for comment; Comment(s) posted.

The Supply Chain Economy: A New Framework for Understanding Innovation and Services

by Mercedes Delgado and Karen G. Mills

This study shows that a large and dynamic supply chain economy plays a crucial role in innovation and in the creation of well-paid jobs. Traded service suppliers are particularly important. Policies that help suppliers access skilled labor, buyers, and capital could be beneficial for fostering innovation and economic growth.

A New Categorization of the US Economy: The Role of Supply Chain Industries in Innovation and Economic Performance

by Mercedes Delgado and Karen G. Mills

This paper provides a novel industry categorization that quantifies the supply chain economy in the United States. Suppliers of goods, and particularly services, to business and government are a distinct and large sector, and play an important role in national innovation and economic performance.

Transaction Costs and the Duration of Contracts

by Alexander MacKay

When buyers transact with sellers, they select not only whom to transact with but also for how long. This paper develops a model of optimal contract duration arising from underlying supply costs and transaction costs. The model allows for the quantification of transaction costs, which are often unobserved, and the impact of these costs on welfare.

Organizational Structures and the Improvement of Working Conditions in Global Supply Chains: Legalization, Participation, and Economic Incentives

by Yanhua Z. Bird, Jodi L. Short, and Michael W. Toffel

Suppliers face increasing pressure from the institutional environment as well as demands from buyers to improve working conditions. This study analyzes the internal organizational dynamics of more than 3,000 supplier firms in 55 countries. Findings call for looking beyond the symbolism of organizational structures and attending to how they can be linked with real implementation and improvement.

Inventory Management for Mobile Money Agents in the Developing World

by Karthik Balasubramanian, David F. Drake, and Douglas Fearing

Mobile money agents in the developing world face a key inventory management challenge: How much cash and e-float should be held to minimize both stockouts and excess working capital? The authors develop two inventory models and show substantial inventory cost reduction with a large dataset of East African mobile money transactions.

Amazon, Whole Foods Deal a Big Win for Consumers

by Jose Alvarez and Len Schlesinger

What does Amazon's $13.4 billion deal for Whole Foods say about the future of retail? Harvard Business School professors Jose Alvarez and Len Schlesinger see good times ahead for consumers as well as both companies. Open for comment; Comment(s) posted.

What Brands Can Do to Monitor Factory Conditions of Suppliers

by Michael Blanding

For better or for worse, it’s fallen to multinational corporations to police the overseas factories of suppliers in their supply chains—and perhaps make them better. Michael W. Toffel examines how. Open for comment; Comment(s) posted.

Beyond Symbolic Responses to Private Politics: Examining Labor Standards Improvement in Global Supply Chains

by Andrea R. Hugill, Jodi L. Short, and Michael W. Toffel

Global supply chain factories improve their working conditions to a greater extent when their buyers take a cooperative approach to monitoring them, when the auditors are more highly trained, and when the factories face greater risk of poor conditions being exposed, according to findings in this research.

Multi-Product Duopoly with Cross-Product Cost Interdependencies

Multi-product firms in many industries lack the flexibility to choose different quality tiers for different product lines. Once committed to a certain quality tier, either high or low, in one product line, it is usually more costly to offer another product line in a different quality tier instead of offering it in the same tier. This paper probes the strategic implications of this combination of brand stickiness and operational complexity for duopoly competition.

Eyes Shut: The Consequences of Not Noticing

by Max H. Bazerman

In his new book The Power of Noticing: What the Best Leaders See, Max Bazerman explains how and why many executives fail to notice critical information in their midst. Open for comment; 6 Comment(s) posted.

Decommoditizing the Canned Tomato

by Maggie Starvish

Most commodity producers look to cut costs aggressively. So why is Mutti S.p.a, an Italian producer of tomato products, paying farmers more than competitors? Mary Shelman discusses her case study. Closed for comment; 6 Comment(s) posted.

What Shapes the Gatekeepers? Evidence from Global Supply Chain Auditors

by Jodi L. Short, Michael W. Toffel & Andrea Hugill

Private gatekeepers, from credit rating agencies to supply-chain auditors, are supposed to provide unbiased, objective assessments of companies' internal operations, and such private assessments play a central role in contemporary regulatory regimes. While the impartiality of gatekeeping organizations has come into question over the past decade, little is known about what drives the decisions of the individual accountants, auditors, analysts, and attorneys who work at these organizations. Using data from a private, third-party social auditing firm that assesses global supply chain factories' adherence to corporate codes of conduct governing workplace conditions, this study reveals that external auditors' findings are shaped by a combination of economic incentives and social factors. The study highlights opportunities to design and staff audits to maximize their impartiality and credibility. Key concepts include: Gatekeepers, such as accountants, attorneys, auditors, and analysts, typically have substantial professional discretion to make vital gatekeeping decisions on the ground. In the supply-chain auditing context, gatekeepers are influenced by conflicts of interest and by social factors, including ongoing relationships with clients, on-the-job experience, professional training, and gender diversity. Companies using auditors and other gatekeepers should consider not only which organization to hire, but also the characteristics of the staff deployed on the gatekeeping teams. Auditing teams can benefit from gender diversity, professional training, and experience, although the marginal benefits of the latter attenuate over time. Regulatory systems reliant on private gatekeepers should be designed to mitigate the effects of conflict of interest and leverage social factors of team compositions to enhance the reliability and integrity of gatekeeping decisions. Closed for comment; 0 Comment(s) posted.

Reinforcing Regulatory Regimes: How States, Civil Society, and Codes of Conduct Promote Adherence to Global Labor Standards

by Michael W. Toffel, Jodi L. Short & Melissa Ouellet

Multinational corporations are under increasing pressure to manage their global supply chains in ways that are environmentally sustainable and socially responsible. Many companies have responded to this pressure by asking their suppliers to adhere to codes of conduct governing labor conditions and environmental management. This paper examines the conditions under which tens of thousands of suppliers across many countries are more likely to adhere to the labor practices these codes of conduct call for. Findings indicate that suppliers are more likely to adhere to codes of conduct in countries that not only have made binding domestic and international legal commitments to protect workers' rights, but that also have high levels of press freedom and nongovernmental organization activity. Greater code of conduct adherence is also found among suppliers that serve buyers located in countries where child labor is a more salient issue. This research reveals the critical importance of maintaining multiple, overlapping, and reinforcing governance systems, and urges caution to those hoping that private regulatory regimes can substitute for effective government regulation. Overall, this paper points the way toward building more effective private regulatory regimes. Key concepts include: Global labor standards were most successfully implemented in countries that made significant formal and binding connections to the international community through their labor treaty ratifications and reinforced these connections by enacting stringent domestic employment legislation. By maintaining a free press, national governments also play a key role in promoting adherence to global labor standards. National governments can influence labor practices in their country not only by enacting legislation and signing international treaties, but also by protecting press freedom and non-governmental organizations to enable civil society scrutiny and mobilization. Political and consumer pressure in multinational corporations' home markets can have a substantive impact on how these companies manage working conditions in their global supply chains, well beyond the mere symbolic act off deploying codes of conduct. Closed for comment; 0 Comment(s) posted.