Facing Supply Chain Disruptions: Strategies to Ensure Relational Continuity

Abstract

The COVID-19 pandemic is not comparable for extension and implications to any other crisis faced by organizations over the last decades. Understandably, in its first and most acute phases, managers have focused their attention on how companies could ensure business continuity at the organizational level, by guaranteeing safe operating conditions and reshaping working procedures. Yet, for companies operating in business markets, adjusting internal processes to face a supply chain disruption is not enough to ensure business continuity, as these companies also need to sustain the network of external relationships in the whole supply chain in which they operate. To avoid jeopardizing their long-term survival, maintain their scope of action, and keep up with the challenges of the new normal, business companies need to engage in effective strategies that focus on a different component of business continuity, which we call relational continuity. After a brief review of the literature, the chapter first introduces the relational continuity concept in supply chain relationships. Drawing on a series of qualitative in-depth interviews with managers from the industrial machinery industry, whose sampled firms are actually connected through a direct supplier-client relationship, the chapter identifies three strategies that industrial companies should implement to ensure relational continuity with their key partners (suppliers and especially clients): supply chain intelligence, relational slack and key partners’ integration. Their full-fledged implementation proved to smooth and strengthen relationships among all players in the supply-chain and make business companies more responsive and capable to address the relational challenges of the “new normal” scenario.