Does global supply chain integration payoff? The case of maritime shipping firms

Global supply chains operate in a volatile environment characterized by risks like the 2008-2009 financial crisis, trade disputes, and the COVID-19 pandemic. Maritime shipping firms, the backbone of global supply chains, are particularly affected by this volatility. In response, these firms have pursued two strategies. First, they have acquired tangible assets to increase their capacity. These assets, however, are neither easily re-deployable to other uses nor quickly adjustable, preventing firms from flexibly matching supply and demand. Second, these firms have pursued global supply chain integration by acquiring similar firms or firms in their upstream or downstream supply chain to diversify into other supply chain activities. Anecdotal evidence suggests that some firms have successfully pursued these strategies, but others have failed, eventually exiting the market. We posit that one explanation for this difference may be how effectively these firms manage their assets relative to their supply chain integration activities. We test this proposition by drawing from resource-based theory and transaction cost economics and using longitudinal data for 148 maritime shipping firms. We also test post hoc whether typically acquired supply chain activities are beneficial. Our findings offer insights into asset management and global supply chain integration and offer advice to practitioners.