A view of the collapsed Rana Plaza building on the outskirts of Bangladesh capital Dhaka in 2013
In contrast, consumers attributed the same amount of responsibility to the focal firm independent of:
• Varying organisational distance from the supplier, ie whether the focal firm had a direct contract with the harmful supplier or it was an indirect sub-supplier
• Focal firm size – small start-ups are held responsible as much as big conglomerates
• Strategic importance of the supplied product
• Whether the focal firm had systems in place to protect the environment
Concluding, this research found a ‘chain liability effect’ since from the consumer perspective the focal firm is responsible for the entire supply chain.
In a follow-up project, we investigated the ‘what if’ scenario and shed light on how the focal firm should handle the supplier relationship after an incident in order to repair damaged trust. The results show that emphasising that the unsustainable incident happened at a supplier or sub-supplier rather than within the focal firm did not go down well with consumers. Aiming to shift attention and blame the supplier further aggravates consumer trust in the focal firm and leads to consumer punishment, which can have disastrous economic consequences.
In contrast rectifying activities – those addressing the cause of the incident – helped improve consumer trust. Three main rectifying activities are common: collaboration with suppliers, monitoring the supplier or terminating the relationship. Generally, supply chain experts see collaboration as the most effective action to make a difference in the supply chain.
However, for consumers the three rectifying activities are equally effective at repairing trust. Supply chain managers can decide which option works best and adapt to the circumstances, but for sure they need to act and rectify, just shifting blame increases consumers’ anger and further damages trust.
More information on Sabine and her research can be found at
sabinebenoit.com and at
youtu.be/juVKYuZSiOs
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