Blockchain-based Governance Implications for Sustainable Supply Chain Management

While the changes that would result from implementing blockchain solutions are worth studying, we also need to gain a deeper understanding of how these blockchain solutions are to be operated and by whom.


Research team

Sara Saberi

PI, Sara Saberi, Ph.D., is an Assistant Professor of Operations and Industrial Engineering at WPI. She recently completed her second PhD in Business Administration with a concentration in Management Science from the University of Massachusetts Amherst. Her main research interests lie at the intersection of supply chain management, game theory and network optimization. Dr. Saberi’s work has been published in leading logistics and operations management journals such as European Journal of Operational Research, Transportation Research Part E, and Service Science and regularly presented at relevant conferences. Drs. Saberi and Sarkis have also received support from APICS Research Grant on The Future of Supply Chains for a project entitled, “Blockchain Technology’s Contributions to Supply Chain Business and Sustainability Value” in 2017. Learn more about Sara here.

Joseph Sarkis

Co-PI Joseph Sarkis is Professor of Management within Worcester Polytechnic Institute’s Foisie Business School. He earned his Ph.D. from the University of Buffalo. His research covers topics in supply chain management, sustainability, and technology management. He has been recognized as a Highly Cited Researcher by the Web of Science and which noted him as one of the world’s “most influential scientific minds.” He is the editor of IEEE Engineering Management Review and the Springer-Nature “Greening of Industry Networks” book series. He serves on the editorial boards of some of the most influential journals in environmental, supply chain, and operations management. He has published ten books on topics relating to sustainable supply chains and technology. He has been cited over 37,500 times and has an h-index of 91 on Google Scholar. Learn more about Joseph here.

Project description

Corporate decisions are driven by information. Information volume, e.g. big data, is growing quickly bringing greater organizational challenges in making sense of information necessary for managing their networks and supply chains. Blockchain technology is a disruptive information-based technology incorporating characteristics of decentralized ‘trustless’ databases and ledgers allowing for global-scale transactions, process disintermediation, and decentralization amongst supply chain entities. 

Blockchain technology can support information required for timely provenance of goods and services, in a secure manner that is clear and robust enough to trust, creates more effective information flow in the supply chain, and evolves a product-based economy to an information-customization economy.

Between now and 2023, the global blockchain in supply chain market is estimated to reach a total valuation of $424 million and an over 48% growth rate. This substantial market growth will occur as a significant fraction of companies seeks to benefit from blockchain technology within their supply chain and its sustainability. While the changes that would result from implementing blockchain solutions are worth studying, we need to gain a deeper understanding of how these blockchain solutions are to be operated and by whom. 


Research questions

Objective 1: Explore distributed/decentralized, hybrid/synergistic governance mechanisms; define their features and components within a sustainable blockchain-enabled supply chain; and establish the motivations for their adoption.

Objective 2: Identify important and causal relationships between sustainable supply chain practices in a decentralized and hybrid governance system and analyze these relationships for optimum decision-making in blockchain-based supply chains. 

Questions to consider include: 

  • What factors could potentially influence a blockchain-based supply chain in identifying appropriate governance mechanisms to manage the network? 
  • How can blockchain participants encourage shifts toward a more environmentally sustainable and equitable pattern of development? 
  • How can supply chains integrate technological benefits of blockchains with strategies, culture and desired ethics of the supply chain partners and various external stakeholders, in order to attain business objectives, capitalize on the utilization of this new technology, and orient development to achieve desirable sustainability objectives?
  • What blockchain governance mechanisms and frameworks exist and what are their implications on maintaining the sustainability of supply chain networks and their governance? 

Methodology

We will first evaluate existing governance models, their attributes, and their performance in preserving ethical and responsible, sustainable, business and technological development. Then, using qualitative archival research, we will focus on decentralized and hybrid governance models in blockchain platforms, to define their features and goals and their effect on sustainability.

The Decision Making Trial and Evaluation Laboratory (DEMATEL) tool will be applied to determine interdependencies among the sustainability practices under a new governance model in a blockchain-enabled supply chain. Our two main research objectives will be investigated over a 14-month period using the following steps:

  1. General evaluation of sustainable supply chain practices and their governance;
  2. Develop a conceptual framework for decentralized and hybrid governance systems features and their relationships to sustainable supply chain practices;
  3. Evaluate relationships between sustainable practices in a decentralized/hybrid governance environment using DEMATEL.

Broader impacts

The academic literature has not effectively explored the questions nor addressed the objectives listed. Obtaining and disseminating theoretical and practical insights will be the goal of this work.