Supply chain elasticity and performance in uncertain environments: a dynamic capabilities perspective

Abstract

Technological, geopolitical and market disruptions are reshaping global supply chain operations and requiring firms to develop capabilities that support coordinated adjustment under uncertainty. This study aims to conceptualize supply chain elasticity (SCE) as a dynamic capability and to develop a multidimensional SCE scale. It also examines the association between SCE and supply chain performance through supply chain learning capability and whether the relationship between the learning capability and performance varies with environmental unpredictability. The study uses a two-phase mixed-method design. In Phase 1, a Delphi study with supply chain experts (n = 18) was followed by expert interviews (n = 15) to refine the conceptual domain of SCE, identify candidate dimensions and generate the initial item pool. In Phase 2, exploratory factor analysis (n = 256) was used to assess the dimensional structure of the SCE scale. A large-scale survey dataset (n = 2,000) from firms operating in the emerging markets supply chain context was then used for confirmatory factor analysis, and covariance-based structural equation modeling to test the hypotheses. The results support SCE as a dynamic capability composed of volume, network, contractual, temporal and financial elasticity. The findings indicate that SCE is positively associated with supply chain performance both directly and indirectly through supply chain learning capability. The positive association between supply chain learning capability and performance was also stronger at higher levels of environmental unpredictability. The study provides managers with a validated scale for assessing SCE and guidance on where to invest capability-building efforts. The findings suggest that firms should not focus only on rapid response or disruption recovery, but also on the coordinated ability to resize, reconfigure and financially support supply chain commitments under unpredictable conditions. This study advances supply chain management by defining SCE as a distinct dynamic capability, differentiating it from flexibility, agility and resilience and validating a multidimensional measurement scale. It also clarifies the mechanism through which SCE enhances performance by showing that learning capability converts elastic adjustment capacity into realized supply chain outcomes.