MIST Speaker Series - Dr. León Valdés

Friday, October 23, 2020 11:00am to 12:00pm

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Consumer Trust in Social Responsibility Communications: The Role of Supply Chain Visibility 

Consumers are becoming more knowledgeable – and skeptical – about companies’ social responsibility (SR) practices. In this paper, we examine when a company can strengthen consumer trust by investing to increase the visibility into its supply chain. We employ an incentivized, human-subject laboratory experiment to investigate the impact of visibility on consumer trust in a company’s SR communication, and as a result, its impact on consumers’ purchase decisions. To further enhance our understanding of consumer behavior, we examine how consumer heterogeneity and workers’ conditions in the upstream supply chain influence our results. We apply causal mediation analysis to answer our research questions.

 

We find that increasing supply chain visibility always strengthens consumer trust. Furthermore, opportunities exist for a trust-driven revenue benefit due to greater visibility. In particular, when consumers are highly prosocial or have low general trust beliefs, or when the impact of an SR initiative is small, then the increase in consumer trust due to greater visibility can in turn increase sales. Our results underscore the crucial role that supply chain visibility plays in engendering consumer trust and highlight when a company can leverage this effect to increase sales.

 

This talk is based on joint work with Tim Kraft (NC State University) and Karen Zheng (MIT). 
 

Speaker Bio

León Valdés is an Assistant Professor in Business Analytics and Operations at the University of Pittsburgh, Katz Graduate School of Business. His main research interests include behavioral operations management, socially responsible supply chains, and nonprofit operations. His work received the Best Student Paper award from the POMS College of Sustainable Operations (2015) and was the Runner-Up in the Best Working Paper competition from the INFORMS Behavioral Operations Management Section (2015).

 

León holds a Ph.D. in Operations Management from MIT, an M.S. in Engineering from Ecole Centrale Paris, and a B.S. in Industrial Engineering from the University of Chile. 

 

The semester’s complete speaker series schedule can be found at:          http://mist.ucmerced.edu/seminars

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