Information Services and Operations Research Community Seminar – Professor Atanu Chaudhuri
Title: Financial and Operational Consequences of Blockchain Implementations in Supply Chains: Insights from Event Studies and Case Studies
Date: 23 May 2024
Time: 14:00-15:30
Venue: NUBS.2.03
If you would like to attend, please register using the following link:
Speaker:
Professor Atanu Chaudhuri is a Professor in Technology & Operations Management at Durham University Business School. He has around 9 years of industrial experience spanning automobile manufacturing, operations and supply chain consulting and research. He has worked with firms like Tata Motors, ECS Limited and Deloitte Research. He also has 9 years of academic experience and has held academic positions at Indian Institute of Management, Lucknow and at Aalborg University, Denmark. He had received the Best Teacher Award from the Study Board of Business and Industry at Aalborg University in 2017. He also leads the Digital Supply Chain working group of Mobility goes additive, a leading network for advancement and adoption of 3D Printing in mobility related industries and has been invited to speak at multiple industry forums on additive manufacturing in Denmark and Sweden.
Abstract:
Firms are increasingly adopting blockchain technology (BCT) in their supply chains. However, there is little guidance in the literature on how firms benefit from BCT adoption, specifically under contingencies such as the status of adoption, namely intent versus action, the motivation of adoption, namely internal versus external, firm’s operational and financial vulnerability, and the industry context, namely competitive intensity, and growth. We use event study and difference-in-difference methodology on a sample of 128 firms announcing BCT adoption between 2016 and 2020, and provide empirical evidence on the relationship between BCT adoption in supply chains, market returns, and operational performance under different contingencies of adoption. We show that a firm’s announcement of BCT adoption increases the firm’s Cumulative Average Abnormal Returns (CARs) by 5.6% over a 15-day event window. Additionally, we find that the CARs for announcements of future adoption intent (speculative) are 6.3% lower than for announcements backed by actual implementation efforts (non-speculative). Furthermore, industry growth and the industry competitive intensity significantly explain the higher CARs, improvement in return on assets (ROA), and decrease in the total cost on sales (TCOS) of firms. BCT adoption due to internal motivation reduces TCOS; however, no significant impact on cost occurs when the adoption motivation is external. We find that the improvement in ROA is mediated through the decrease in the TCOS from BCT adoption. Practically, this study acts as a guide to managers in understanding the financial and operational value of BCT in supply chains under different contingencies. In the second part of this talk, I will discuss the socio-technical capabilities needed for BCT implementation by service providers using multiple case study of projects with transaction time reduction and quality improvement objectives and the role of outcome and behavioural mechanisms in improving social sustainability and reducing supply chain risks through BCT implementation.