Supplier Justice Practice in Building Buyers’ Resilience: A Mediated-Moderation Model

Abstract While justice practice in the buyer–supplier relationship has been well-researched, its impact has mainly been discussed in achieving various relational outcomes (such as satisfaction, commitment, collaboration, etc.) and various firm performances (such as social, operational, financial, etc.). This study extends the application of justice practice beyond this traditional focus and investigates its role in building resilience, a critical capability to survive during a disruptive environment. The purpose of this study is not only to understand the relationships among the dimensions of supplier justice practices but also to understand the usefulness of the supplier justice practice in building buyers’ resilience through supplier flexibility practice. The contingent role of firm size and firm age is also examined with the link between supplier flexibility and buyers’ resilience. We collected data from 205 Australian firms to examine the theoretical framework. Following the PLS-SEM technique, our findings show that suppliers’ interactional justice positively influences both distributive and procedural justice. Our result further reveals that only suppliers’ procedural justice directly influences buyers’ resilience and distributive and interactional justice impacts buyers’ resilience through supplier flexibility. This confirms the presence of supplier flexibility as a mediator between distributive justice, interactional justice, and buyers’ resilience. Our findings further show that only firm size positively moderates the effect of supplier flexibility on buyers’ resilience. We also present the theoretical and managerial implications of the study based on the findings.