Building Adaptive Supply Chains Through Digital Social Capital: Implications for Supply Chain Performance in Emerging Economies

Abstract

The current technological evolution, geopolitical turbulence and customer's preferences have created a situation of volatility, uncertainty, complexity and ambiguity (VUCA) in global value chains. The increased challenges have made supply chains more adaptive and resilient, which is crucial for companies to survive in volatile contexts. Especially, companies in emerging economies are under greater pressure to improve their adaptability and performance of their supply chains. In this context, digital transformation has revolutionized the way firms construct and use relational networks within and outside the boundaries of the firm. Through the use of Digital technologies like enterprise systems, cloud platforms and collaborative communication software, companies can build Digital Social Capital (DSC) and share information, coordinate and collaborate in real time. While there is increasing interest in digital supply chains, previous research has tended to focus more on the technological enablers and overlooked the digitally enabled relationship resource. Furthermore, the links between the digital social capital and the performance of the supply chain are not well understood. The study follows the Social Capital Theory (SCT) and the Dynamic Capabilities View (DCV) that emphasizes the knowledge, trust, and coordination benefits from internal and external relational networks enabled by digital technology. SCT explains how digital interactions within and outside the firm facilitate resource access and knowledge sharing, while DCV explains how these relational resources are transformed into adaptive capabilities that enable firms to respond to environmental uncertainty. Using a quantitative, cross-sectional survey design, data are collected from supply chain and operations managers in Pakistani manufacturing firms. The proposed relationships are tested using Partial Least Squares Structural Equation Modeling (PLS-SEM).  The model posits that both Internal Digital Social Capital (IDSC) and External Digital Social Capital (EDSC) positively influence SCA, which in turn enhances SCP. In addition, SCA is expected to mediate the relationships between digital social capital dimensions and supply chain performance. The study contributes by integrating SCT and DCV to explain the resource–capability–performance link in an emerging economy context and highlights supply chain adaptability as a key mechanism for improving performance in digitally transforming manufacturing firms in Pakistan.