Supply chain and operations management on the TMT: A study of recall propensity

Abstract

This study investigates the drivers of product quality failures as manifested through recalls. More specifically, this research develops theory regarding supply chain and operations management (SCOM) representation in organizational top management teams (TMT) and this representation's association with the frequency of recalls, the type of recalls, and the severity of recalls. The moderating effect of both recent and historical organizational recall knowledge is also explored. This study uses unique data sets, collected from multiple sources, containing executives' backgrounds, firm characteristics, and product recalls. The study finds that firms with SCOM representation on their TMTs have fewer recalls overall and fewer severe recalls. We also find that firms with SCOM representation on the TMT are less likely to suffer from subsequent recalls after a history of recalling. Lastly, we discover interesting nuances with respect to the form of SCOM representation present on the TMT (CEO and functional executive).