Strategic leadership, environmental uncertainty, and supply chain risk: An empirical investigation of the agribusiness industry

Abstract

The present study aims to examine the influence of strategic leadership and environmental uncertainty on supply chain (SC) risk in the agribusiness industry. The notion of SC risk refers to supply risk, delivery risk, and manufacturing process risk, and it is argued that these risks are an outcome of environmental uncertainty. This study postulates that strategic leadership mitigates the detrimental effect of environmental uncertainty on SC risk. On the basis of data collected from 227 agribusiness-related firms, the analysis was performed using partial least squares structural equation modelling (PLS-SEM) to test the hypothesized relationships. The findings suggest that environmental uncertainty has a direct influence on each dimension of SC risk. In addition to that, a high level of strategic leadership mitigates the impact of environmental uncertainty on supply risk and delivery risk. However, the data did not support moderation for manufacturing process risks. Findings imply that firms operating in highly uncertain environments are more prone to risks; however, high levels of strategic leadership help manage uncertainties and mitigate risks.

Keywords

• disruptions in supply chain
• firm performance
• risk-mitigating role of strategic leadership
• role of the external environment
• supply chain risk mitigation