Disruption Management

by Charles Hofacker


In Business-to-Business Markets, Special issue of Industrial Marketing Management; Deadline now 30 Jun 2020


Author: Chun Zhang


Call for Papers

Disruption management in business-to-business markets

Deadline for submission: June 30th, 2020

Industrial Marketing Management announces a call for papers for a special issue on disruption management in business-to-business markets.

Overview and Purpose of the special issue

Disruption management is an important domain of research in supply chain management (Bode and Wagner, 2015; Snyder et al., 2016). Business-to-business (B2B) marketing scholars, however, have not paid sufficient attention to this topic despite its growing relevance to suppliers and B2B customers (Falkenreck & Wagner, 2017; Zhang, Bai, & Gu, 2018). Although there is a large body of marketing literature on managing buyer-seller relationships and business networks (Ibeh & Kasem, 2011; Inemek & Matthyssens, 2013; Skarmeas, Saridakis, & Leonidou, 2018; Voldnes, Grønhaug, & Nilssen, 2012), these studies rarely examine how to manage such relationships in the face of disruptions in the macro-environment such as political conflicts and trade tensions and how firms may adjust their marketing strategies in response to external disruptions that are beyond any firm’s control. A case in point is the current, still escalating, US-China trade war. So far, the US has imposed tariffs on the USD 250 billion worth of imports and threatened to expand tariffs to all Chinese imports while China imposed tariffs on its USD 110 billion worth of U.S. imports. The trade war is changing the macro-environment suppliers and B2B customers operate in.

Suppliers and customers in B2B markets are under unprecedented pressure to reconfigure their supply chains and marketing channels to cope with trade policy changes of such a scale. According to Clara Chan, the head of a lobby group for 150 Hong Kong manufacturers that employ more than 1 million people in China, “while factory executives were used to managing disruptions from rapid wage rises to raw material price increases, the scale of the uncertainty connected to the [U.S.-China] trade war made it a ‘very different’ challenge” (Bland, 2018). The levies imposed by the US government on imports from China are said to “destabilize the international supply chains that multinationals have spent years building up, linking factories inside and outside China, and all but promise serious economic consequences down the road no matter who wins in the short term” (Nakayama, Otsuka, Harada, & Nikkei staff writers, 2018). According to the IMF, the worsening US-China trade war might cost the world more than USD 430 billion of lost GDP (Yao, 2018) but the real impact of this trade war on B2B customers and suppliers is yet to be evaluated.

The B2B marketing literature conceptualizes external disruptions to B2B suppliers and customers from the perspective of (1) institutionalization (e.g. disruption of institutions and its impact on innovation) (Vargo, Wieland, & Akaka, 2015); (2) innovation and new technologies (e.g. disruptions caused by “the internet of things” or digital servitization) (Falkenreck & Wagner, 2017; Nagy, Schuessler, & Dubinsky, 2016; Vendrell-Herrero, Bustinza, Parry, & Georgantzis, 2017); (3) changes in relationships and networks (e.g. disruptions created by a merger or pressure within the eco-system) (Zhang, Henke and Griffith, 2009; Aarikka-Stenroos & Ritala, 2017); (4) responses to natural disasters (e.g. Tsao, Raj, & Yu, 2018); and (5) adjustments in governance mechanisms to exchange disruptions (Bello et al., 2010; Zhang et al., 2018). While existing studies on disruption management in B2B markets have shed light on this topic, few studies have examined how macro-environmental factors such as trade policy changes within trading countries or trading blocks cause disruptions to B2B customers and suppliers operating within or between the countries or trading blocks and what marketing strategies suppliers and customers can undertake in anticipation of or in response to disruptions. B2B marketing scholars might need to incorporate broader perspectives that draw insight from other disciplines such as international relations and political economy to examine the sources and consequences of macro-environmental influences on marketing channels and supply chains and to evaluate how firms should manage in the face of potential disruptions caused by changes in macro-environmental factors.

Furthermore, understanding how B2B customers and suppliers can foresee macroenvironment changes and undertake proactive measures to mitigate the impact of the disruptions from these changes is also of great value (Sheffi and Rice, 2005; Fiskel et al., 2015). The literature on preventing supply chain disruptions heavily relies on risk identification based on available data. In the context of the current US-China trade war, abrupt changes in the US government’s trade policies with China have been signaled since the most recent presidential election campaigns. Some factory owners began moving manufacturing out of China (as the largest exporter of manufactured goods) to other developing countries such as Bangladesh, Cambodia, and Vietnam over the past decade “in search of cheaper wages and a hedge against the political and economic risk that comes from reliance on one country” (Bland, 2018). The precautionary move can be seen as a proactive response to political and economic uncertainties in the global market. However, many aspects of political risks (e.g. when the tariff exchange will occur; the magnitude of the tariffs; the spread from trade disputes focused on tariffs to other areas of political conflicts, e.g. investment restriction, political sanction) are not predictable since statistical information may not exist, which makes risk identification difficult (e.g. Knight, Mitchell, & Gao, 2009; Fiskel, et al., 2015). B2B customers and suppliers need to evaluate the political situations closely so that they can monitor and evaluate macro-environmental changes, adapt quickly once changes occur, and more importantly, adapt with other network members together (Knight et al., 2009). So far, little B2B marketing research examines how firms communicate international political risk within marketing channels and global supply chains and collaborate to develop resilience to incoming changes in macro-environmental factors.

In the Chinese language, crisis is called “Wei Ji”, meaning both a jeopardy and an opportunity. The trade tensions between the US and China may negatively affect many brand name customers operating within or between the two countries and trigger “guilt by association” effects (Gao, Knight, Zhang, & Mather, 2013) while providing opportunities for others who are adept at adjusting their supply bases and navigating obstacles in an interconnected and uncertain global business environment (Gao, Ballantyne, & Knight 2010; Velu, 2016; Gao, Ren, & Miao, 2018). More research is needed to examine how marketing strategies such as market selection, brand (re)positioning, product innovation, channel and supply chain management, and pricing strategies can be adjusted in the event of broader macroenvironmental uncertainties that influence B2B customers and suppliers.

The objective of this special issue in Industrial Marketing Management is to broaden and deepen our understanding of how potential disruptive macro-environmental forces such as changes in international trade policies affect B2B customers and suppliers, their relationships, alliances, networks, and channel management strategies. We aim to propel B2B marketing scholars to look for new lenses, develop new frameworks, and embrace real life context to examine this topic.

In this special issue, both conceptual and empirical papers are welcome. While the current trade tension between the US and China would be an interesting research context due to its high-profile and high-impact, any significant changes in macro-environmental factors (e.g. U.S.-Canada, U.S.- Mexico trade dispute, natural disasters, industry-wide technological innovation) that cause disruptions to B2B customers and suppliers’ businesses, buyer-supplier relationships, alliances, and marketing channel management are considered valuable. We welcome topic areas that include but not limited to the following:

  • How do changes in macro-environmental factors influence a firm’s marketing strategies? Under what conditions are these strategies effective at maintaining, recovering, or even enhancing market performance?
  • How can brand name customers (e.g., Apple and Walmart) strategically source, assemble, and label their products to avoid the “country of origin” liability highlighted in trade tensions?
  • With the wide spread of value-added activities in multiple countries within a global value chain, to what extent do consumers and B2B customers associate COO (country of origin) of products and suppliers with political tensions or ideological conflicts? To what extent can B2B customers and suppliers strategically reap general COO cost benefits while avoiding the COO liability during trade tensions?
  • How can suppliers and B2B customers conceptualize response strategies (e.g. establishing relational ties with a network of suppliers, buyers, and distributors, changing sourcing locations, lobbying) to disruptions caused by macro-environmental forces?
  • What are the marketing strategy implications of U.S.-China trade wars for buyers and suppliers located in other countries such as Vietnam, Japan, Canada, Mexico, the EU, Brazil, and Australia?
  • How can buyers and suppliers in B2B markets deploy flexible forms of governance to adapt to changes in macro-environmental forces (e.g. adjustments, information management, and risk sharing)?
  • How can buyers and suppliers effectively renegotiate and adjust formal and relational contracts after the occurrence of macro-environmental disruptions?
  • What resources and capabilities are required for adjusting marketing channel and supply chain strategies in response to changes in macro-environmental forces? How do the competency and experience of B2B customers and suppliers play a role in dealing with macro-environmental disruptions?
  • How can B2B customers and suppliers monitor and evaluate macro-environmental changes, adapt once changes occur, and, more importantly, adapt with other marketing channel members together?
  • How do integration, “upgrading”, and new business opportunity identification within B2B supplier-customer relationships and networks occur in the event of macro-environmental uncertainties?
  • How can B2B customers and suppliers innovate and develop new products to capture the opportunities presented by disruptions and changes in macro-environmental forces?
  • Under what conditions can B2B customers and suppliers adjust prices of their products to absorb cost increases resulting from macro-environmental disruptions?
  • How can B2B customers and suppliers adjust their target markets strategically to mitigate disruptions from macro-environmental factors?
  • How can B2B customers and suppliers achieve a dynamic balance between political/ institutional power and economic/market power when operating in multiple markets that are directly affected by international trade conflicts?
  • How may the changes in the global trade environment impact perceptions, attitudes, and behaviors of individual boundary spanners at managing B2B customer-supplier relationships?

Preparation and submission of paper and review process

Papers submitted must not have been published, accepted for publication, or presently be under consideration for publication elsewhere. Submissions should be about 6,000-8,000 words in length. Copies should be uploaded on Industrial Marketing Management’s homepage through the EVISE system. Please select “SI: B2B Disruption management” as the issue type under the “Enter Manuscript Information” step of the submission process. For guidelines, visit http://www.elsevier.com/wps/find/journaldescription.cws_home/505720/authorinstructions. Papers not complying with the notes for contributors (cf. homepage) or poorly written will be desk rejected. Suitable papers will be subjected to a double-blind review; hence, authors must not identify themselves in the body of their paper. (Please do not submit a Word file with “track changes” active or a PDF file.)

Please address all questions to the guest editor(s):

Chun Zhang
Grossman School of Business
University of Vermont
Tel: 802 656-4116
Email: chun.zhang@uvm.edu

Hongzhi Gao
School of Marketing and International Business
Victoria University of Wellington
New Zealand
Tel: (64) 21 1130518
Email: hongzhi.gao@vuw.ac.nz

Aarikka-Stenroos, L., & Ritala, P. (2017). Network management in the era of ecosystems: Systematic review and management framework. Industrial Marketing Management, 67, 23-36

Bello, D. C., Katsikeas, C. S., & Robson, M. J. (2010). Does Accommodating a self-serving partner in an international marketing alliance pay off? Journal of Marketing, 74(6), 77-93

Bland, B. (2018). US-China trade war prompts rethink on supply chains. Financial Times (September 3rd, 2018), https://www.ft.com/content/03e4f016-aa9a-11e8-94bdcba20d67390c

Bode, C., & Wagner, S.M. (2015). Structural drivers of upstrea supply chain complexity and the frequency of supply chain disruptions. Journal of Operations Management, 36, 215–228

Falkenreck, C., & Wagner, R. (2017). The Internet of Things – Chance and challenge in industrial business relationships. Industrial Marketing Management, 66, 181-195

Gao, H., Ballantyne, D., & Knight, J. (2010). Paradoxes and Guanxi Dilemmas in Emerging Chinese-Western Intercultural Relationships. Industrial Marketing Management, 39 (2), 264-72

Gao, H., Knight, J. G., Zhang, H., & Mather, D. (2013). Guilt by association: Heuristic risks for foreign brands during a product-harm crisis in China. Journal of Business Research, 66, 1044-1051

Gao, H., Ren, M., & Miao, Q. (2018). Toward a yin-yang balancing perspective of relational (guanxi) gatekeeping in international exchange relationships in China. Journal of International Marketing, 26(2 (June)), 22-42

Ibeh, K., & Kasem, L. (2011). The network perspective and the internationalization of small and medium sized software firms from Syria. Industrial Marketing Management, 40(3), 358-367

Inemek, A., & Matthyssens, P. (2013). The impact of buyer–supplier relationships on supplier innovativeness: An empirical study in cross-border supply networks. Industrial Marketing Management, 42(4), 580-594

Knight, J., Mitchell, B., & Gao, H. (2009). Riding out the Muhammad cartoons crisis: contrasting strategies and outcomes. Long Range Planning, 42, 6-22

Nagy, D., Schuessler, J., & Dubinsky, A. (2016). Defining and identifying disruptive innovations. Industrial Marketing Management, 57 (C), 119-126

Nakayama, S., Otsuka, S., Harada, I., & Nikkei staff writers. (2018). US-China tariff showdown uproots global supply chains. Nikkei Asian Review (August 24th, 2018), https://asia.nikkei.com/Economy/Trade-War/US-China-tariff-showdown-uprootsglobal-supply-chains

Skarmeas, D., Saridakis, C., & Leonidou, C. N. (2018). Examining relationship value in cross-border business relationships: A comparison between correlational and configurational approaches. Journal of Business Research, 89, 280-286

Snyder, L. V., Atan, Z., Peng, P., Rong, Y., Schmitt, A. J., & Sinsoysal, B. (2016). OR/MS models for supply chain disruptions: A review. IIE Transactions, 48(2), 89-109

Tsao, Y.-C., Raj, P. V. R. P., & Yu, V. (2018). Product substitution in different weights and brands considering customer segmentation and panic buying behavior. Industrial Marketing Management. DOI: 10.1016/j.indmarman.2018.09.004

Vargo, S. L., Wieland, H., & Akaka, M. A. (2015). Innovation through institutionalization: A service ecosystems perspective. Industrial Marketing Management, 44, 63-72

Velu, C. (2016). Evolutionary or revolutionary business model innovation through coopetition? The role of dominance in network markets. Industrial Marketing Management, 53(C), 124-135

Vendrell-Herrero, F., Bustinza, O. F., Parry, G., & Georgantzis, N. (2017). Servitization, digitization and supply chain interdependency. Industrial Marketing Management, 60(C), 69-81

Voldnes, G., Grønhaug, K., & Nilssen, F. (2012). Satisfaction in buyer–seller relationships— Influence of cultural differences. Industrial Marketing Management, 41(7), 10811093

Yao, A. (2018). The worsening US-China trade war might cost the world much more than US$430 billion of lost GDP. China Morning Post (September 27th, 2018), https://www.scmp.com/comment/insight-opinion/united- states/article/2165755/worsening-us-china-trade-war-might-cost-world

Zhang, Chun, John W. Henke Jr. and David A. Griffith (2009), “Do Buyer Cooperative Actions Matter under Relational Stress? Evidence from Japanese and U.S. assemblers in the U.S. automotive industry,” Journal of Operations Management, 27, 479-494.

Zhang, C., Bai, X., & Gu, F. F. (2018). Contract learning in the aftermath of exchange disruptions: An empirical study of renewing interfirm relationships. Industrial Marketing Management, 71, 215-226