The Interplay of Network Architecture and Performance in Supply Chains: A Multi-Tier Analysis of Visible and Invisible Ties

Abstract

While supply chain competition increasingly occurs at the network level, most research remains limited to dyadic or triadic relationships, failing to capture the full complexity of multi-tier supply networks. This research investigates the influence of four distinct types of network ties-contractual, transactional, professional, and personal-on supply chain performance, evaluated across five dimensions: cost, quality, delivery, flexibility, and innovation. The analysis draws on data gathered from 153 component-level supply networks, encompassing a total of 1852 entities within South Korea's automotive and electronics manufacturing sectors. We employed social network analysis with a directed-valued network approach to capture asymmetric relationships. Results reveal that network architecture affects performance dimensions differently: centralized professional knowledge sharing enhances delivery performance, while concentrated personal ties prove detrimental; for innovation, dense network connections and dominant transactional hubs unexpectedly hinder performance by fostering conformity; cost performance shows mixed effects, with transactional centralization impeding efficiency while professional and personal leadership facilitates cost reduction. The influence of the original equipment manufacturer on supplier selection moderates these relationships, particularly mitigating negative impacts of personal tie centralization. These findings challenge conventional assumptions about network density benefits and demonstrate that supply network competence-the ability to configure and leverage network architecture-requires careful consideration of multiple tie types and their distinct effects on different performance outcomes.