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Transportation Research Part E 72 (2014) 159172

Contents lists available at ScienceDirect

Transportation Research Part E


journal homepage: www.elsevier.com/locate/tre

The clock is ticking: The role of uncertainty, regulatory focus,


and level of risk on supply chain disruption decision making
behavior
David E. Cantor , Jennifer V. Blackhurst, Juan David Cortes
Department of Supply Chain and Information Systems, College of Business, Iowa State University, 2340 Gerdin Business Building, Ames, IA 50011, United States

a r t i c l e

i n f o

Article history:
Received 14 February 2014
Received in revised form 27 August 2014
Accepted 10 October 2014

Keywords:
Supply chain risk management
Disruptions
Vignette-based eld experiment
Decision making

a b s t r a c t
Supply chain employees must make decisions on when and how to react to potential and
realized supply chain disruptions. Drawing on regulatory focus theory, we examine how an
individuals regulatory focus, level of risk, as well as the uncertainty of the supply chain
disruption affect willingness to pursue a new disruption mitigation strategy. Employing
a vignette-based eld experiment, we present and discuss ndings related to supply chain
risk decision making. These ndings have implications for future behavioral supply chain
risk research.
2014 Elsevier Ltd. All rights reserved.

1. Introduction
Risk management has become an important topic in the eld of supply chain management (Hult et al., 2010; Wagner and
Bode, 2008; Kleindorfer and Saad, 2005). Because of the complexity associated with managing todays supply chains, rms
undoubtedly experience supply chain disruptions that result in negative outcomes (Craighead et al., 2007). Examples of supply chain disruptions include a labor port strike, natural disaster at manufacturing facility, and a supplier who experiences
nancial difculty manufacturing a critical component for its customer. Even though many rms have developed contingency plans to address potential points of vulnerability, it is the rms supply chain employees who, often without much
warning, must make decisions on how to best react, or not react, to potential supply chain risks or supply chain disruptions.
For example, a supply chain employees risk mitigation strategy can involve re-routing sourced materials away from a potential disruption in the supply chain. Wagner and Bode (2008) point out that supply chain decision makers are often caught
off guard in the face of a supply chain disruption. In addition, supply chain employees are responsible for understanding
when risk situations exist and when the risk warrants action (Zsidisin and Wagner, 2010). Undoubtedly, supply chain
employees must decide on whether or not to take action in anticipation of a potential disruption or wait until a disruption
has already occurred (Tomlin, 2006). Making supply chain disruption mitigation decisions is often challenging because the
exact time, location, and severity of a disruption are rarely known in advance with complete certainty.
The purpose of this paper is to examine how the role of uncertainty, risk level, and an individuals regulatory focus affect
supply chain disruption decision making behaviors. In so doing, this study examines the individual level determinants of
supply chain disruption decision making. A burgeoning amount of research is also beginning to examine how uncertainty

Corresponding author.
E-mail addresses: dcantor@iastate.edu (D.E. Cantor), jvblackh@iastate.edu (J.V. Blackhurst), davidco@iastate.edu (J.D. Cortes).
http://dx.doi.org/10.1016/j.tre.2014.10.007
1366-5545/ 2014 Elsevier Ltd. All rights reserved.

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affects decision making behavior (see for example: Shipp, 2013; Shipp et al., 2009; Ancona et al., 2001). In this paper we
focus on the uncertainty of when a disruption may occur. Finally, we investigate the impact of the type of risk (e.g., high risk
and low risk situations) on supply chain disruption decision making behavior.
This study makes several important theoretical and empirical contributions to the supply chain risk management literature. There is a growing scholarly interest in examining individual level behavior in the supply chain risk literature
(Bendoly et al., 2010; Tokar, 2010; Gino and Pisano 2008). We contribute to this literature by leveraging the regulatory focus
theoretical framework to increase our understanding of how an individuals promotion-focus, prevention-focus, perception
of uncertainty, and level of risk inuences their supply chain disruption decision making behavior. Scant supply chain literature has examined how individuals make supply chain disruption decisions from this behavioral perspective. Making supply chain disruption decisions has been found to be important in prior research (e.g., Craighead et al., 2007) and we
contribute to this literature by examining these issues at the individual level of analysis. In so doing, we empirically test
our research model using a vignette-based eld experiment that was distributed through the Amazon Mechanical Turk service
(mTurk) using an on-line survey instrument, which is responsive to the call for the use of innovative data sources in supply
chain management by Boyer and Swink (2008). We next turn to the development of the theoretical model.
2. Theoretical framework and hypotheses development
2.1. Regulatory focus theory
Regulatory focus theory is the theoretical lens for this study. In this section, we discuss this theoretical basis in the context of supply chain risk. Grounded in the social psychology and organizational behavior literatures, regulatory focus theory
provides insight into how the personality of an individual affects their attitudes towards risky decision making behavior
(Higgins, 2002). Regulatory focus theory posits that individuals have two basic self-regulation systems (e.g., goals)
(Higgins, 1997, 1998). One self-regulation system focuses an individual on the achievement of rewards (promotion focus),
while the other self-regulation system focuses an individual on the avoidance of punishments (prevention focus). It is our
contention that regulatory focus theory can provide important insights into how individuals either adopt a promotion or prevention focus as a part of their supply chain disruption decision making behavior. In particular, regulatory focus theory is a
useful theoretical framework that can be used to increase our understanding of an individuals risky processing information
style (Frster et al., 2003) and an individuals motivation to handle uncertain situations (Molden and Higgins, 2004).
Individuals who have a promotion focus are eager to regulate their behavior toward advancement, aspirations, and
accomplishments and utilize more creative problem-solving skills (Kark and Van Dijk, 2007). These individuals are risk seeking (Gino and Margolis, 2011). Promotion-focused individuals strategically work to achieve a goal and pay special attention
to advancements and gains. They are motivated to engage in risky behavior especially when there is the presence of rewards.
These individuals are ambitious and strive to reach their aspirations as reected in a tenacious goal pursuit focused on maximal goals (Keller et al., 2008). Promotion oriented individuals explore the advantage of creative and novel behaviors.
Brockner and Higgins (2001) note that individuals with a promotion focus think about outcomes as gains (i.e., a favorable
outcome) or non-gains (i.e., an unfavorable outcome). Promotion focused individuals react cheerfully when given positive
feedback, and react dejectedly or disappointedly when provided with negative feedback.
In contrast, individuals who have a prevention focus are comfortable with maintaining the status quo. These individuals
act in more careful and cautious ways compared to promotion-oriented individuals. Prevention-focus individuals are sensitive to the presence or absence of negative outcomes. These individuals regulate their behavior away from risky situations
and are less likely to choose new and innovative courses of action. Prevention focused individuals are more concerned with
duties and obligations and experience emotions ranging from agitation or anxiety to quiescence or calmness (Keller et al.,
2008). These individuals are either risk averse or risk neutral and possess a defensive orientation in the pursuit of minimal
goals. Therefore, staying a course of action is viewed as a safe decision. Individuals who focus on prevention hold values
based on security, tradition, and conformity (Kark and Van Dijk, 2007). We contend that an individuals promotion and prevention foci together inuence her or his willingness to pursue a new disruption mitigation strategy. In our setting, an individual approaches supply chain risk situations using varying regulatory focus levels depending on the uncertainty and
potential severity of the disruption. In Table 1, we highlight the main attributes of promotion and prevention-focused
individuals.
2.1.1. Contextual factors within regulatory focus theory
We now discuss two contextual factors which are also important aspects of regulatory focus theory (Molden and Hui,
2011; Brockner and Higgins, 2001). We discuss how these factors play a role in an individuals risky decision making behavior. The rst contextual factor is the level of uncertainty that an individual faces in the organization. Regulatory focus theory
provides an important basis for examining how the level of uncertainty an individual faces affects their willingness to pursue
a new disruption mitigation strategy. Drawing-upon regulatory focus theory (RFT), Molden and Higgins (2004) explore how
different types of uncertainty affected decision making performance. Also leveraging RFT, Hazlett et al. (2011) suggest that
individuals who are focused on growth and advancement (i.e., promotion) perform better when they adopt an optimistic
forecast of the future whereas those individuals who are more comfortable with safety and security (i.e., prevention) perform

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Table 1
Attributes of promotion and prevention.
Promotion-focused attributes

Prevention-focused attributes

Risk seeking
Eager to achieve a goal
Seeks novel and creative solutions
Willingness to take chances
Concerns with attainment of aspirations and accomplishments
Motivated by presence or absence of rewards
Values advancement, aspirations, and accomplishments
Possess an offensive orientation
Proactively works to achieve a goal

Risk averse or risk neutral


Comfortable with maintaining status quo
Seeks safe and certain solutions
Careful and Cautious
Concerned with attainment of responsibilities and safety
Motivated to avoid punishment
Values security, tradition, and conformity
Possess a defensive orientation
Pursues a steady course of action

better when adopting a pessimistic outlook. We apply this logic in this study when we examine how individuals manage
uncertainty by presenting individuals with either a known (certain) situation; namely a realized (recovery) disruption in
the supply chain, or an unknown (uncertain) situation. Specically, we present some of the individuals in our study with
forewarning that a potential situation may cause a disruption in the supply chain.
Examining how individuals respond to uncertainty in the supply chain is important because, as Tang (2006) notes, supply
chains are rife with uncertainty. Individual supply chain managers are tasked with protecting supply chains from risk and
disruptions (Chopra and Sodhi, 2014). As such, uncertainty must be considered as individual supply chain managers, in some
cases, have little time to prepare for a potential event that might occur in the future. Alternatively, supply chain managers
may be reacting to an event that already has occurred. Knemeyer et al. (2009) discuss the importance of understanding how
people frame risk events as this will affect the individuals decision making process regarding risk events. Depending on the
uncertainty of the timing and occurrence of the disruption (e.g., level of advanced warning related to a disruption that might
occur or lack of warning related to a disruption that has already occurred) individuals utilize different decision making processes when attempting to mitigate supply chain risks.
The second contextual factor that inuences an individuals willingness to pursue a new disruption mitigation strategy is
namely, the type of risk that must be addressed. Specically, we examine two types of risk: a high risk and a low risk situation. In a high risk situation, the individual is provided with information that there is low stability in the supply chain
because there is the potential for the disruption to cause high levels of impact and damage in the supply chain. Conversely,
in a low risk situation, there is a higher level of stability in the supply chain with a lower potential for the disruption to cause
high levels of impact and damage in the supply chain. We contend that type of risk is an aspect of regulatory focus theory
because some individuals have a preference for high stability situations and others have a preference for low stability situations. Leveraging regulatory focus theory, Higgins (1997, 1998) predicted that promotion-oriented individuals prefer less
stable (high risk) situations compared to prevention-focused individuals who prefer greater stability in the environment
(low risk). Further, Liberman et al. (1999) nd that prevention-oriented individuals are more resistant to change when
accounting for both situational induction and chronic personality differences of individuals. In summary, leveraging
regulatory focus theory, we explore how the type of supply chain risk predicts an individuals willingness to pursue a
new disruption mitigation strategy.
2.2. Hypotheses
In this section we present hypotheses for each of the relationships specied in our theoretical model which is also
depicted in Fig. 1.

Fig. 1. Theoretical model.

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The rst factor in our model is an individuals promotion focus. A promotion focused decision making approach entails
acting proactively, exhibiting risk-seeking traits, pursuing new or alternative courses of action, adapting to challenging
job assignments, and pursuing lofty goals and aspirations (Gino and Margolis, 2011; Kim et al., 2009; Frster et al., 2003;
Freitas et al, 2002). Promotion focused decision makers think in broad, conceptual and strategic terms and are willing to
explore the benet of new behaviors (Liberman et al, 1999). Promotion focused individuals are willing to engage in new
courses of action. The regulatory focus literature has shown that individuals who are promotion focused act in risk-seeking
ways (Zhou and Pham, 2004; Levine et al., 2000). Crowe and Higgins (1997) nd that promotion focused individuals exhibit a
risk bias. In a supply chain risk context, this risk bias is exhibited as the willingness to try a completely new course of action
as opposed to staying with a safe or known way to manage the supply chain. In the context of our study, supply chain
employees who are willing to route shipments to alternative ports is an example of proactive and risky behavior. In fact,
Liberman et al. (1999) point out that promotion focused individuals are more willing to pursue new courses of action as compared with prevention focused individuals and thus exhibit more proactive behavior than prevention focused individuals.
People who think more creatively and consider the strategic ramications of their decisions are more likely to pursue
new disruption mitigation strategies. Based on these arguments, we propose:
H1. The greater the individuals promotion focus, the greater the probability the person will be willing to pursue a new disruption
mitigation strategy.
Regulatory focus theory also provides insight into how and why individuals make supply chain disruption mitigation
decisions from a prevention focused perspective. The regulatory focus literature has shown that individuals who are prevention focused exhibit risk-averse traits and make decisions that are focused on the pursuit of minimal goals. Higgins (1997)
posits that prevention focused individuals are motivated to be risk averse and pursue safe and secure alternative courses of
action. Friedman and Frster (2001) suggest that prevention focused individuals pursue activities that involve repetition
rather than those tasks that require creative or novel behaviors. Therefore, we contend that prevention focused individuals
are less likely to adapt to new situations and are unwilling to pursue a new or unknown disruption mitigation strategy. In the
context of our study, prevention-focused individuals would not be willing to pursue routing shipments to alternative ports of
call because this form of supply chain action would require the person to act outside their comfort zone. Based on these
arguments, we propose:
H2. The greater the individuals prevention focus, the lower the probability the person will be willing to pursue a new disruption
mitigation strategy.
The next factor in our model is the type of risk situation that is perceived by the supply chain decision maker. As mentioned above, we investigate two types of supply chain risk situations; namely, a high risk (unstable) situation and a low risk
(stable) situation. In a high risk situation, there is the potential of the disruption to cause high levels of impact and damage in
the supply chain. Conversely, in a low risk situation, there is a lower potential of the disruption to cause high levels of impact
and damage in the supply chain. In examining these risk situations, we provide empirical evidence of how individuals perceive and react to high and low risk situations in the supply chain. Previous supply chain risk literature has provided limited
empirical insight into how individuals react to supply chain disruption situations. For example, Zsidisin and Wagner (2010)
investigate managerial perceptions of supply side risk and classify sources of risk into several categories including supplier,
the market and item characteristics. Similarly, Ellis et al. (2010) investigate buyer perceptions of supply disruption risk. Ellis
et al. (2011) look at the formation of perceptions and adoption of mitigation strategies through the development of a framework using enactment theory. These and related studies highlight the importance of understanding how perceptions of risk
motivate people to pursue new supply chain disruption strategies (Zwikael and Sadeh, 2007). We believe individuals are
more willing to pursue an alternative course of action when there is instability in the situation (i.e., a high risk situation)
compared to a low risk (i.e., stable) situation. Based on these arguments, we propose:
H3. In a high risk supply chain situation compared to a low risk situation, the greater the probability the person will be willing to
pursue a new disruption mitigation strategy.
The next factor in our model is the uncertainty of the supply chain disruption. We examine supply chain disruption
uncertainty using the concepts of forewarning and recovery. Forewarning refers to the anticipation that a supply chain disruption may occur and recovery refers to concept that a risk event has already occurred. Undoubtedly, the level of forewarning (uncertainty) of the supply chain disruption affects an individuals risk decision making behavior. Leveraging regulatory
focus theory, we contend that longer time horizons provide individuals with a greater opportunity to process information
(Florack and Hartmann, 2007). Achievement-oriented individuals value information that enables them to make proactive
decisions. These individuals have a strong desire to experiment with creative options and the opportunity to experiment
with different aspects of information over longer time horizons is very rewarding (Higgins, 1998, 1997). However, an individual who is provided with a longer time horizon might actually make a poor strategic decision because the person may
have spent scarce resources on problem-solving activities where it might not be needed. In fact, Chopra and Sodhi (2004,
p. 60) state that managers must keep a vigilant eye on the trade-off between the risk and the cost of building a reserve
to mitigate it. While it is important to monitor the supply chain for warning signals of a potential (but uncertain) supply
chain disruption, it may be more effective to respond to the situation after it has occurred due to cost-benet reasons

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(Jttner and Maklan, 2011; Craighead et al., 2007; Tomlin 2006). As Tomlin (2006) points out, actions taken in advance of a
disruption incur cost regardless of whether the disruption occurs or not. Therefore, individuals may choose to accept the
potential risk of a possible disruption by postponing the decision to take action until the incident actually occurs. Based
on these arguments, we contend that individuals recovering from a disruption will be more likely to pursue a new disruption
mitigation strategy.
H4. Individuals who are presented with a supply chain recovery disruption situation (as compared with individuals who are
presented with a supply chain disruption forewarning situation), the greater the probability the person will be willing to pursue a
new disruption mitigation strategy.
We now turn to examining the moderating effects of uncertainty, risk level, and an individuals regulatory focus on risk
decision making. Uncertainty enhances the effect of regulatory focus (Avnet and Sellier, 2011; Kim et al., 2009; Florack and
Hartmann, 2007; Kelly and Karau, 1999). In particular, Avnet and Sellier (2011) provide empirical evidence that an individuals regulatory state should be aligned with how an individual prefers to handle uncertainty (e.g., the temporal aspects of
the persons goals). Thus, the examination of the role of uncertainty and regulatory focus in tandem has thus been a topic of
great interest in the organizational behavior literature (Liberman et al., 2007). In our setting, the recovery situation presents
a sense of urgency where decisive action is needed. Promotion oriented individuals are willing to make creative decisions
and try new courses of action on the pursuit of maximizing positive outcomes. In recovery situations, promotion focus
people are willing to take action and consider alternative strategies. Therefore, we conjecture that promotion focused individuals who are facing a disruption that has actually occurred (as opposed to one that might or might not occur in the future)
will be more willing to pull the trigger and make decisive disruption decisions more so than prevention focused
individuals.
H5. In the recovery scenario situation, the greater the individual is promotion focused, the greater the probability the person will
be willing to pursue a new disruption mitigation strategy.

H6. In the recovery scenario situation, the greater the individual is prevention focused, the lower the probability the person will be
willing to pursue a new disruption mitigation strategy.
The combination of the uncertainty of the situation and perceived severity of the risk event can also inuence an individuals decision to engage in a new disruption mitigation strategy. The level of risk perceived by the individual will inuence
their willingness to pursue a new course of action and, in doing so, incur costs. Even though a rm may have contingency
plans in place (e.g., Kleindorfer and Saad, 2005), an individual must decide when to take action in order to minimize the
impact of the disruption (Craighead et al., 2007). When an employee has forewarning of a situation that could impact the
ow of goods or services in the supply chain, the individual is able to adequately prepare for the event but may be hesitant
to allocate resources when the disruption is not certain. While advanced warning (e.g., forewarning of an event) may provide
the individual with more time to prepare to act, we contend that an individual is more willing to take action only after the
disruption has occurred (e.g., recovery situation) and there is the perception that there is a high level of risk associated with
the situation. Therefore, we present:
H7. In a recovery scenario and in a high risk situation compared to a low risk situation, the greater the probability the person will
be willing to pursue a new disruption mitigation strategy.
3. Methodology
3.1. Vignette-based eld experiment
Because of recent calls to focus more supply chain research at the individual level, our research question, research design
and methodology, and data collection were explicitly implemented at the individual level (Bendoly et al., 2010; Tokar, 2010).
To examine how an individuals regulatory focus (promotion or prevention focus) contributes to risk decision making behavior in the supply chain, we developed a vignette-based eld experiment that was distributed using an on-line survey instrument in the Spring semester 2013. Stated differently, we embedded the vignette into a survey instrument. Vignettes are
dened as short descriptions of a person or a social situation which contain precise references to what are thought to be
the most important factors in the decision making or judgment making processes of respondents (Alexander and Becker,
1978). Vignettes or scenarios have been found to be useful tools for evaluating the intended reasoning, decision making
processes, and/or the intended behaviors of respondents (Eckerd and Bendoly, 2013). The use of vignettes embedded in surveys is increasing in many disciplines, such as information systems (Siponen and Vance, 2010; DArcy et al., 2009; Moores
and Chang, 2006). The use of vignettes works well when asking respondents what they could or would do under the
same or similar situations, rather than what they did or have done (Moores and Chang, 2006). This is an important point
because it may be expected that individuals might be unwilling or uncomfortable to report their own actions related to sensitive topics. By using vignettes there is an increased probability that the respondent will provide honest and reliable

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answers (Eckerd and Bendoly, 2013; Rungtusunatham et al., 2011). It has also been noted that the use of vignettes is effective
when offering realistic scenarios that place the subject in a decision making role (Harrington, 1996). Our vignette-based eld
experiment is also responsive to the call for the use of innovative data sources in supply chain management by Boyer and
Swink (2008).
Our supply chain risk vignettes meet the design guidelines suggested by Rungtusunatham et al. (2011) and Mantel et al.
(2006). In the pre-design stage, we became familiar with the context and we note that the authors on this paper have studied
the area of supply chain risk management for a number of years. In fact, the context of the vignettes was based on real world
events occurring at the time of the study design reported in the popular press. The factors of interest were based on a review
of the literature and research experiences. We did not nd any existing vignettes in the supply chain risk literature that
would t our study. In the design stage, we paid particular attention to making our vignettes realistic, plausible and interesting and developed experimental cues as discussed by Rungtusunatham et al. (2011). In the post design stage, the external validity of these vignettes was veried in several ways. First, we received feedback on our vignettes from multiple supply
chain managers. Next, once the Port strike vignettes were thoroughly dened and revised, a pre-test was conducted using a
sample of 62 MBA students with professional experience who were enrolled in a supply chain course. The intent was to
assess whether the vignette was posing a credible, realistic scenario to the average targeted respondent. The use of MBA student samples for pre-test purposes is well-accepted. These subject pools have been shown to provide sound feedback on simulated business situations (Remus, 1986; Fernandez and Perrewe, 1995). Therefore, we do not believe that the external
validity of our scenarios is a concern.
Next, we describe the scenarios in our vignette. Our vignette-based eld experiment was designed to contain varying versions of a descriptive vignette deployed to convey information and context about specic factors of interest (i.e., independent
variables) to human subjects. In developing our vignette, we followed the guidelines discussed in Rungtusunatham et al.
(2011, p. 12) that call for a common module of the vignette which provides contextual information that is intended to
be invariant across varying versions of the vignette and for the experimental cues of the vignette to provide information
on the factors of interest, with each necessary version of the vignette systematically varying to convey specic but different
levels of the factors of interest to human subjects. We also noted the participants role in the vignette (Hora and Klassen
2012). The details of the vignette including participant role, common module and experimental cues (Rungtusunatham
et al., 2011) are presented in Table 2 and are described in more detail as follows.
The vignette describes an east coast port strike as the disruptive event in the supply chain. This vignette is drawn from
real events occurring at the time of the development and deployment of our study. The vignette was carefully developed
allowing for the manipulation of the factors of interest in the experimental cues: uncertainty of the disruption (is there a
potential it will occur: forewarning or the disruption has occurred and recovery has begun) and risk level of the disruption
(high or low). In terms of uncertainty, forewarning intends to study how the experimental participants risk decision making
is affected when notied of a possible pending disruption in the supply chain, without absolute certainty that it will occur.

Table 2
Description of the vignette: common module and experimental cues.
Participants role: supply chain manager at performance brands
You are the director of supply chain management for performance brands, a U.S. based manufacturer located near the east coast
Common module: port strike
Recently, there were several news reports of an impending strike of workers covering 14 U.S. East Coast and Gulf Coast ports. The multi-year master
contract that covers more than 14,500 jobs at ports is estimated to handle 95 percent of container shipments last year in an area running from Maine
to Texas. A similar strike on the West coast in 2002 cost the economy an estimated $2 billion dollars per day. You can choose to re-route your parts
from your overseas suppliers through the West Coast or leave your supply chain as is: routing parts in through the East coast. Although re-routing will
be costly, if the strike does occurs, it may give you the ability to keep your supply chain running
Experimental cues: four cues varying factors of interest level of risk (2) and uncertainty of risk (2):
There are 4 experimental cues which vary a combination of the factors of interest: risk level and uncertainty as outlined in below (per the
recommendation of Rungtusunatham et al. (2011). This resulted in four scenarios in our 2  2 experimental design: (1) high risk & forewarning, (2)
low risk & forewarning, (3) high risk & recovery, and (4) low risk & recovery
Factors of interest

Levels of the factor of interest


High

Low

Factor 1: risk level

Your supply base is approximately 80% overseas and 20%


U.S. based. Your supply chain operations are dependent
upon parts from these suppliers and the majority of your
suppliers will be affected by this potential strike. You see
this situation as relatively high risk

Your supply base is approximately 20% overseas and 80%


U.S. based. Your supply chain operations are dependent
upon parts from these suppliers but the majority of your
suppliers will not be affected by this potential strike.
You see this situation as relatively low risk

Factor 2: uncertainty

Forewarning
The extension of the labor contract will expire in 2 months
and an agreement has still not been reached

Recovery
An agreement could not be reached and the workers
went on strike 2 months ago. Negotiations are still in
progress but goods through the East Coast and Gulf
Coast ports are at a standstill

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Conversely, the recovery factor presents a disruption that has already taken place and the experimental participant has to
decide how to recover from the situation. In terms of risk level, the vignette outlines that the port strike will contain either
a low level of risk or a high level of risk of disrupting the supply chain based on the percentage of suppliers that are shipping
materials into the U.S. from overseas through the east coast ports. Low risk is characterized by how the companys supply
base was eighty percent U.S. based suppliers and twenty percent foreign suppliers and high risk is characterized by how the
companys supply base had eighty percent foreign suppliers and twenty percent U.S. based suppliers. In doing so, we created
a total of four scenarios from our port strike vignette (two levels of risk x two levels of uncertainty). These were the only
variables manipulated with all other elements of the vignette held constant (Rungtusunatham et al., 2011; Mantel et al.,
2006).
Following Hora and Klassen (2012), we distributed two scenarios to each participant in our study. First, the respondents
answered the regulatory focus questions. Next, the respondents were presented with the rst scenario. After reading the rst
scenario, the respondent completed a series of questions including an item that assessed the probability that the person will
be willing to pursue a new disruption mitigation strategy (e.g., the dependent variable in our study). A manipulation check
was included for the uncertainty of the situation (forewarning or recovery) and type of risk factor (e.g., high or low risk). This
process was repeated with a second, different scenario. Finally, respondents provided demographic information. Each
respondent completed the task within 20 minutes, on average.
3.2. Sample and administration of vignette-based eld experiment
The vignette-based eld experiment was administered by a large public university located in the United States. Because
traditional survey databases are becoming increasingly over-utilized, the tough market for survey research, and a shrinking respondent pool (Frohlich, 2002, p. 54 and p. 61), we selected the Amazon Mechanical Turk service (mTurk) to distribute
our vignette-based experiment. mTurk is a crowdsourcing service that coordinates tasks that require human participants to
complete (Paolacci et al., 2010). Recently, researchers are increasingly using the mTurk service across a variety of disciplines
including marketing and psychology (see for example, recent papers such as Archak et al., 2011; Shah and Oppenheimer,
2011; Sussman and Olivola, 2011). Knemeyer and Naylor (2011) recommends the use of mTurk to study supply chain behavioral issues. We distributed our vignette-based eld experiment task to mTurk participants who are located in the U.S.A. A
total of 460 unique mTurks responded to our request and successfully completed the vignette-based eld experiment. Each
of the 460 mTurks completed 2 scenarios for a total 920 completed scenarios and the scenarios were equally distributed
across respondents. Because the mTurk database has a vast number of mTurks, we were unable to calculate a response rate.
Fifty-percent of the sample held director or above responsibilities in their respective organization with the remainder holding positions such as manager or analyst. For those who indicated their job duties, the majority of the mTurks had experience
in operations and manufacturing roles in their respective companies. On average, each respondent was 40 years of age.
We required that the mTurks have supply chain experience and a current supply chain role. In order to test their familiarity of supply chain management, we conducted a prescreening test at the beginning of the instrument to determine
whether the respondent had a general supply chain background. The pre-screening test consisted of ve multiple-choice
questions, which included the classication or denition of a purchase order, supplier development program, 3PL, supply
chain risk management and supply chain disruptions. Each question had one correct answer, which provided one point,
and a minimum passing grade of three points was dened in the back-end javascript programming of the web-based eld
experiment. On average, respondents achieved a score of 4.12 out of 5.0 on the pre-screening questions. Data were collected
on all respondents, regardless of their score on the pre-screening test. We found that there no signicant differences on the
key variables of interest in our study between the respondents with lower scores than those with higher scores. Because of
potential concerns that the supply chain respondents have sufcient knowledge on this topic, we restricted our analysis of
the data provided by respondents to those key informants who achieved a perfect score on the pre-screening test (n = 217).
We evaluated potential nonresponse bias among the mTurks by comparing responses of the early versus late respondents. Prior research has found that the prole of late respondents may resemble those of non-respondents (Malhotra
and Grover, 1998). No signicant differences were found between the early and late respondents on the demographic
variables in our study.
3.3. Manipulation checks
We performed a series of manipulation checks in the study. The manipulation checks helped us determine whether the
experimental procedure needed any revisions (Kidd, 1977), and to shed light on any methodological problems that can
obstruct causality among our constructs (Wetzel, 1977). We used either a ve or seven-point response format, as well as
no less than ve response options across the instrument to prevent any bias imposed in the respondent by establishing a limited
number of possible response options for each question (Weber, 1992). We embedded the manipulation checks into a series of
questions after the treatments. This would prevent the respondents from making any connections, noticing them, or reacting
to them (Wetzel, 1977). The manipulation checks were implemented as follows. After each respondent read and responded
to the vignette, the key informant responded to manipulation check questions. Our rst manipulation check question
assessed the key informants knowledge of when the presented scenario (vignette) occurred (e.g., the uncertainty of the disruption). Second, the respondent was asked to rate the level of supply chain risk that was described in the scenario using a

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seven-point response format (1 = low risk; 7 = high risk). As expected, the responses were statistically different across groups
(Type of risk: t = 14.257, p < .001; Uncertainty: t = 12.596, p < .001).
3.4. Measurement of variables
The dependent variable in our research is the probability the person will be willing to pursue a new disruption mitigation
strategy. We measured the dependent variable using a response format that ranged from zero to 100 (0% = Denitely not reroute the parts; 100 = Denitely re-route the parts). This measure and response format is adapted from Sitkin and Weingarts
(1995) research on decision making behavior in the face of risky situations.
One independent variable in this study is promotion focus. Promotion focus is measured using items adapted from
Lockwood et al. (2002) that employed a nine-point response format (i.e., 1 = not at all true of me; 9 = very true of me).
The next independent variable is prevention focus that is measured using items adapted from Lockwood et al. (2002) that
employed a nine-point response format (i.e., 1 = not at all true of me; 9 = very true of me). We also specied the type of risk
situation in our model. High risk is coded as a one if the scenario represents a high risk situation; zero otherwise. Because we
examine uncertainty in terms of either recovery from or forewarning of a potential supply chain disruption we operationalize uncertainty as follows. If the vignette provided to the respondent is a supply chain disruption recovery situation, then
recovery is coded as a one; zero otherwise. We specied several control variables in our model. First, we measured an individuals supply chain risk propensity, which is derived from Sitkin and Weingart (1995). We also measured the individuals
gender and overall work experience.
A summary of the variables along with descriptive statistics, AVE, construct reliability, Cronbach alpha, and correlation
matrix is found in Tables 35. As shown in Table 3, the means of promotion and prevention provide us with insight as to
the nature of the personality (regulatory focus) of the average respondent in our sample. The promotion mean of 5.2 and
a prevention mean of 3.7 suggest that the average respondent is more promotion-focused than prevention-focused.
Approximately half of the sample is composed of male respondents. 50% of the sample was presented with the high risk
and recovery vignettes.
4. Results
4.1. Measurement model analysis
Conrmatory factor analysis (CFA) is used to assess the validity and adequacy of the factor structure pertaining to the
measurement model. This model includes the latent factors pertaining to promotion, prevention, and supply chain risk propensity. Maximum-likelihood estimation is used in the measurement model (Hu and Bentler, 1999; Anderson and Gerbing,
1998). The CFA results of the measurement model suggest a high level of accuracy associated with the latent variables. As

Table 3
Descriptive statistics.
Variable

Mean

Std. deviation

New disruption mitigation strategy


Prevention
Promotion
Supply chain risk propensity
High risk
Recovery
Work experience
Gender

69.346
3.718
5.264
3.267
0.500
0.490
15.572
0.491

28.915
1.310
1.150
1.245
0.501
0.500
10.815
0.500

Table 4
Correlation matrix.

*
**

Variable

1.
2.
3.
4.
5.
6.
7.

Prevention
Promotion
Supply chain risk propensity
High risk
Recovery
Work experience
Gender

Signicant at p = .05 level.


Signicant at p = .01 level.

0.115*
0.102*
0.083
0.036
0.185**
0.01

1
0.105*
0.056
0.029
0.152**
0.022

1
0.007
0.075
0.175**
0.173**

1
0.011
0.026

1
0.023
0.039
0.01

0.087

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D.E. Cantor et al. / Transportation Research Part E 72 (2014) 159172


Table 5
Measurement model.
Latent variable

Indicator

Unstandardized
loadings

Standard
error

Standardized
loadings

Promotion (AVE = 0.635;


CR = 0.874; Cronbach = 0.869)

I often think about the person I would ideally like to be in the


future
I typically focus on the success I hope to achieve in the future
My major goal in my job right now is to achieve my career
ambitions
I see myself as someone who is primarily striving to reach my
ideal self to fulll my hopes, wishes, and aspirations
I am anxious that I will fall short of my responsibilities and
obligations in my life
I often think about the person I am afraid I might become in the
future
I often worry that I will fail to accomplish my professional goals
I often imagine myself experiencing bad things that I fear might
happen to me
I choose risky supply chain alternatives based on the assessment
of my supply chain
I select risky supply chain alternatives which rely upon
technically complex analyses
I consider risky supply chain alternatives which could have an
impact on the strategic direction of my supply chain
I am willing to initiate a strategic supply chain action which has
the potential to backre
I support a supply chain decision where I am aware that relevant
analysis was completed but there are several missing pieces of
information

1.049

0.056

0.751

1.006
1.249

0.052
0.065

0.773
0.766

1.283

0.054

0.889

1.511

0.072

0.826

1.229

0.07

0.721

1.374
1.448

0.071
0.067

0.775
0.839

1.161

0.065

0.729

1.182

0.061

0.776

1.294

0.061

0.829

1.133

0.061

0.75

1.025

0.062

0.689

Prevention (AVE = 0.627;


CR = 0.870; Cronbach = 0.869)

Supply chain risk propensity


(AVE = 0.572; CR = 0.869;
Cronbach = 0.869)

Note: AVE = average variance extracted; CR = composite reliability.

Table 6
Summary results (OLS & Tobit regression models). Dependent variable: new disruption mitigation strategy.

Promotion
Prevention
High risk
Recovery

OLS model (1)

OLS moderation model (2)

Tobit model (3)

Tobit moderation model(4)

2.763*
(1.211)
0.246
(1.057)
8.456**
(3.016)
39.343**
(3.003)

4.122*
(1.907)
0.200
(1.570)
13.046**
(4.920)
43.965**
(4.516)
0.483
(1.966)
3.017
(2.243)
9.436
(6.094)
0.865
(1.228)
3.405
(3.091)
1.067
(1.355)
40.761**
(7.289)
217
0.51

2.512*
(1.217)
0.046
(1.020)
13.772**
(4.850)
44.517**
(4.362)

3.943*
(1.930)
0.244
(1.551)
13.301**
(4.945)
44.303**
(4.499)
0.514
(1.939)
2.821
(2.255)
9.712
(6.057)
0.880
(1.206)
3.359
(3.061)
1.112**
(1.337)
40.229**
(7.280)
217

Recovery  prevention
Recovery  promotion
Recovery  high risk
Supply chain risk propensity
Male
Work experience
Constant
Observations
R-squared
Log likelihood

1.061
(1.236)
4.056
(3.056)
1.020
(1.327)
42.626**
(6.693)
217
0.50

0.993
(1.214)
3.447
(3.077)
1.206
(1.308)
39.318**
(6.994)
217
962.261

961.491

Robust standard errors in parentheses.


*
Signicant at 5% level.
**
Signicant at 1% level.

shown in Tables 5 and 6, the t indices for the overall measurement model and for each latent variable suggest the CFA accurately reected the underlying variance-covariance structure tying the indicator variables according to the criteria by Hu and
Bentler (1999). Since all loadings are statistically signicant (p < .01) and none of the standardized residuals is above or
below 2.0 and 2.0, the CFA results provide evidence of discriminant validity, convergent validity, and one-dimensionality

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(Anderson and Gerbing, 1998). All construct reliability estimates are greater than .70 that suggests good reliability. Overall,
the measurement model t is sufcient (v2 = 274.998/df) = 62 = 4.435, root mean square error of approximation = .085, comparative t index = .934, TuckerLewis index = .916, incremental t index = .934).
4.2. Model results
A standard ordinary least squares model was used to test the proposed theoretical relationships. Table 6 presents our
results. All of our hypotheses are supported except for hypotheses 2, 5, 6 & 7. We will discuss our ndings in the discussion
section. Because our dependent variable is censored, we also estimated the models depicted in Table 7 using a Tobit regression model approach. Tobit models are employed when there is censoring in the dependent variable. As shown, our results
are largely consistent with the OLS models. To address potential omitted variable bias concerns, we conducted a Ramsey and
linktest to evaluate this concern (OConnell and OSullivan, 2011; Morgan and Rego, 2009; Ramsey, 1969). Our Ramsey and
linktest results show that omitted variable bias is not a serious concern (F = 0.7991, p > .10 and b = 0.0007, p > .10;
respectively).
5. Discussion
5.1. Theoretical and managerial implications
Our research has developed and tested a theoretical model of how an individuals regulatory focus promotion and prevention personality factors contributes to supply chain risk decision making behavior. While most research in supply chain
risk has examined factors primarily at the organizational level (Bode et al., 2011), there is also an increasing amount of interest in examining supply chain research questions at the individual level of analysis (Knemeyer and Naylor, 2011). This perspective is discussed in Gino and Pisano (2008) who argue for supply chain researchers to consider behavioral and cognitive
factors into their models. Our study responds to this call for more individual level research in supply chain management by
leveraging regulatory focus theory from the social psychology and organizational behavior literatures to hypothesize on two
types of personality factors: promotion focus and prevention focus (Higgins, 1998; Higgins, 1997). Our research also
responds to the call to examine the topic of supply chain risk from an individual level perspective (Ellis et al., 2011) because
limited insight exists to date on the social and psychological mechanisms related to supply chain disruption decision making.
In addition to demonstrating statistical signicance, our model has theoretical and managerial implications as outlined
below.
We contend that it is important for supply chain scholars to study the role of human behavior as an explanation as to why
supply chain processes and systems fail (Bendoly et al., 2006). Indeed, it is challenging to understand how well-trained and
rational managers make unproductive or even detrimental decisions (Bendoly and Speier, 2008). Supply chains are highly
complex and human behavior is a central driver (Gino and Pisano 2008, p. 781). Supply chain disruption research is beginning to incorporate behavioral aspects but this stream of research is in its early stages and the extant research currently provides limited insight into the social and psychological mechanisms related to supply chain disruption decision making
(Ellis et al. 2011, p. 82). Our paper responds to the recent calls for additional insight into how individual level factors affect
supply chain risk management (Hult et al., 2010; Sodhi et al., 2012; Ellis et al., 2010).
Our study makes additional theoretical contributions to the supply chain risk management literature. We contribute to
the literature by leveraging regulatory focus theory to examine how an individuals regulatory focus and perceptions of
uncertainty inuences supply chain disruption decision making behavior. Decisions related to managing supply chain disruptions are important (e.g., Craighead et al., 2007) and we extend this literature by examining these issues at the individual
level of analysis.
Our study also contributes to the literature by exploring how uncertainty of a potential supply chain disruption affects
individual supply chain risk decision making behavior. Indeed, there is an increasing amount of interest in examining
how individuals and organizations consider uncertainty in formulating their disruption mitigation strategy (Craighead
et al., 2007). The concept of uncertainty is also discussed in Tomlin (2006) who differentiates between actions taken in
advance of a disruption occurrence versus after the disruption. Finally, Knemeyer et al. (2009) states that proactive planning
should be a priority for supply chain managers in the context of catastrophic risk events. Our research builds upon the supply
chain risk literature by examining how the role of uncertainty of when a disruption may occur affects supply chain risk decision making using the concepts of forewarning and recovery (Craighead et al., 2007; Blackhurst et al., 2005).
We now turn to discussing the implication of our empirical results. We provide empirical evidence that an individuals
promotion focus affects an individuals risk decision making behavior. This nding is interesting because it points to the fact
that an individuals promotion orientation does matter in the context of supply chain disruption decision making behavior.
Our results are consistent with the social psychology literature that has shown how individuals who are promotion focused
act in risk-seeking ways (Zhou and Pham, 2004; Levine et al., 2000).
In real-world supply chains, rms can benet from employees who act more proactively to the changing competitive and
operating environment. Failure to do so can result in disastrous consequences to the rm including lost customers, declining
market share, or even company bankruptcy. Our work supports the notion that there are situations where it is important for

D.E. Cantor et al. / Transportation Research Part E 72 (2014) 159172

169

employees to pursue strategic goals and hence exhibit risk-seeking traits, meaning they are willing to pursue a new course of
action or disruption mitigation strategy once a disruption has occurred. The managerial implication is that organizations
may wish to implement training programs that assist their employees on focusing on the pursuit of ambitious supply chain
disruption goals such as practices that can lead to improvement in product quality.
We expected to nd that prevention focused supply chain employees regulate their behavior away from pursuit of a new
disruption mitigation strategy. Prevention focused individuals are typically more concerned with duties and obligations.
While we did not nd support for this hypothesis, a possible explanation is that individuals in this sample are more promotion-oriented than prevention-oriented. Thus promotion-oriented traits are more impactful in this study. Future research is
needed to uncover the precise nature of how an individuals regulatory focus interacts with the severity of the supply chain
disruption situation.
Leveraging regulatory focus theory, we also examined how individuals respond to uncertainty in the supply chain. We
empirically tested this relationship because uncertainty is prevalent in supply chains (Tang, 2006). We found support that
the perceived uncertainty of the supply chain disruption situation does matter because individuals are more willing to pursue a new and untested disruption mitigation strategy in a recovery scenario. Our results show that individuals were comfortable with delaying action because they possibly believe that a longer time horizon could result in a poorer strategic
decision. Stated otherwise, at the time that the disruption occurs, individual are ready to deploy a new disruption mitigation
strategy they are willing to go out on a limb to try to deal with the disruption quickly and effectively by using new strategies that are not the norm or have not been tested before. Firms should assist managers with conducting risk assessments
so that the organizations are aware of the cost-benet trade-offs of when to take action on supply chain risk situations. There
is the potential of spending scarce resources where it might not be needed. Thus a trade-off exists between the benet of
mitigating the risk and the cost of allocating nancial resource to a disruption that may never occur. We also examined
two types of supply chain risk situations; namely, a high risk situation and a low risk situation. In a high risk situation, there
is the potential of the disruption to cause high levels of impact and damage in the supply chain. Leveraging regulatory focus
theory, we believe that some individuals have a preference for high stability (low risk) situations and others have a preference for low stability (high risk) situations. Our results provide evidence that the perceived level of risk greatly inuences the
likelihood that an individual is willing to pursue a new disruption mitigation strategy. On average, the individuals in our
sample prefer to change a supply chain strategy only when there is high potential for a disruption to occur to the supply
chain. An important managerial implication is that organizations need to accurately assess the levels of risk that their rms
face so that managers can take appropriate action to mitigate the risk. One way that rms can improve their risk assessment
capabilities is through the integration of advanced information technology systems. Future research should conduct a longitudinal investigation that focuses on how small and seemingly low risk disruptions events may, in reality, grow in size and
severity of impact.
In hypotheses 5 and 6 promotion or prevention foci are considered in tandem with uncertainty (recovery). We found surprising results that these two moderation hypotheses were not supported. While we did not nd the expected relationship,
at a minimum, organizations should continue to implement information technology systems to assist promotion and prevention focused individuals to make better and informed supply chain disruption decisions. Individuals, depending on their
regulatory focus, will have a natural inclination to make more (or less) proactive decisions regardless of the warning they
have (or lack thereof) in advance of a disruption. Therefore, our results provide some evidence that advanced warning of
a situation will not exclusively inuence risk decision making. We think this has potentially impactful ramications for rms
as they choose to train people and where they choose to spend scarce resources.
Finally, unexpectedly we did not discover that the level of risk in conjunction with uncertainty (forewarning and recovery) inuences supply chain disruption decision making behavior. We continue to contend that an individual is more willing
to take action only after the disruption has occurred and there is the perception that there is a high level of risk associated
with the situation. Surprisingly, individuals in our sample are not willing to take action when they perceive that there are
high consequences for not doing so. Supply chain scholars should explore this nding in more detail by conducting a deep
and long interview with supply chain managers about how the level of risk and uncertainty of certain types of situations
manifests into supply chain disruption behavior.
5.2. Implications of using mTurks
There is increased interest in using innovative data sources to conduct supply chain research (Boyer and Swink, 2008).
One innovative data source that has generated attention in the supply chain community is the mTurk platform
(Knemeyer and Naylor, 2011; Rungtusunatham et al., 2011; Mantel et al., 2006). We utilized this data collection platform
for several reasons. The mTurk platform is very desirable because it provides rapid connectivity to a broader group of human
participants than has been previously possible. This data collection platform enables scholars to test new research methods
(e.g. vignettes) and disseminate ndings faster compared to traditional data collection techniques (e.g., commercial survey
mailing lists). An important implication, then, is that this platform can facilitate the rapid exploration of follow-up research
questions to this and other studies thus enabling the supply chain community to contribute to the literature faster than previously possible. The mTurk setting offers several other attractive features, leading to further research implications. First, the
mTurk platform enables scholars rapid access to a larger sample of participants from a diverse community compared to traditional data collection approaches such survey mailing lists and college laboratory facilities. This benet has implications

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from a research methods perspective because the supply chain community has potentially over utilized traditional mailing
list databases (Larson, 2005). Second, several studies such as Buhrmester et al. (2011), Goodman et al. (2012), Mason and Suri
(2012) provide evidence that researchers can obtain high quality data inexpensively through use of the mTurk platform.
Goodman et al. (2012) point that mTurk participants produce reliable results consistent with standard decision making
biases and in do so with almost no signicant differences in effect sizes from other samples. The implication here is that
supply chain scholars can have condence that the mTurk platform has been utilized to obtain quality data. Lastly, use of
crowd-sourcing data in supply chain research is very important given the increased interest in topics such as big data, business intelligence, and predictive analytic techniques (Waller and Fawcett, 2013). The supply chain community will be served
well by exploring how these novel data collection methodologies can advance the state of the art in supply chain research.
6. Conclusions
The contribution of our paper is the creation and testing of a model based on regulatory focus theory to explain an individuals promotion and prevention focus on risk decision making behavior. Indeed, there is a growing interest in examining
individual level behavior in the supply chain risk literature (Bendoly et al., 2010; Tokar, 2010; Gino and Pisano 2008). We
contribute to this literature by leveraging regulatory focus theory to examine the individual level determinants of supply
chain disruption decision making behavior. Scant supply chain literature has examined how individuals make supply chain
disruption decisions from this theoretical perspective. Making supply chain disruption decisions has been found to be important in prior research (e.g., Craighead et al. 2007) and we contribute to this literature by examining these issues at the individual level of analysis. To the best of our knowledge, previous supply chain research has utilized regulatory focus theory to
do so. Our study also contributes to the literature by demonstrating how an innovative use of the mTurk database can be
used to conduct a eld-based supply chain risk experiments.
Leveraging regulatory focus theory, we found that an individuals promotion-focus personality trait impacts risk decision
making behavior. We also found that the type of risk and uncertainty of the supply chain event (e.g., the recovery from a
disruption event) does impact an individuals risk decision making behavior. Our research can serve as the basis for future
research where the individual supply chain employee is the unit of analysis in supply chain risk management research.
While individuals are provided with discretion to make daily supply chain decisions, it is important for future research to
examine how teams arrive at supply chain decisions. Future studies should investigate the how the decision making process
of individuals compares to team decision making related to supply chain disruptions. Additionally, future research should
expand upon this study to examine the regulatory focus of dyads and/or teams of supply chain decision makers and how
their personality affects the decision making process and subsequent team performance. Another interesting extension
would be to examine how the perception of time affects supply chain disruption decision making. A potential theoretical
lens is construal level theory (CLT) which posits that the temporal distance of a decision impacts decision making where
longer time horizons facilitate the making of strategic decisions and shorter time horizons focus the individuals on making
operationally focused decisions (Cantor and Macdonald, 2009; Liberman et al., 2007). Temporal distance changes decision
making though the manner in which the individual mentally represents events over time (Trope and Liberman, 2003). Future
research should explore these phenomena.
Subsequent studies should also look into other individual level variables that may impact supply chain decision making
behavior in the face of a disruption event. Future research should delve deeper into contextual elements of this research (e.g.,
uncertainty and type of risk) to examine how the speed of response by the individual both in anticipation of a disruption or
the speed after it occurs affects risk decision making behavior. Likewise, future research could also explore how the cost
involved with changing supply chain decision making behavior affects overall rm performance. We also believe that future
research should consider alternative ways to operationalize risk propensity. Our approach to operationalize risk propensity
is based on the work of Sitkin and Weingart (1995). Future research should also consider estimating risk propensity using the
Holt and Laury (2002) approach. For example, Sodhi et al. (2012, p. 11) note a lack of commensurate research on response to
supply chain risk incidents. Therefore, more empirical work examining how decisions are made related to responding to
pending and realized disruptions is needed. Thus, there are numerous exciting research opportunities in this area.
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