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OM Forum—Supply Chain Finance Redefined: A Supply Chain-Centric Viewpoint of Working Capital, Hedging, and Risk Management

Author

Listed:
  • Panos Kouvelis

    (John M. Olin School of Business, Washington University in St. Louis, St. Louis, Missouri 63130)

Abstract

Problem definition: The narrow definition of supply chain finance (SCF) as a financing scheme for accounts receivables fails to capture the knowledge creation of MSOM research scholars of the last 25 years who labored in the area under this label. A redefined definition of the research-and-application field, under the acronym integrated SCF (iSCF), better reflects the interplay of operational, financial, and risk management decisions our scholars and practitioners care about. The foundational knowledge of this field is ready to come into the classroom and elevate SCF courses from the typical “accounting and finance for supply chain managers” content to a supply-chain-centric viewpoint of important decisions in working capital management, effective cash-flow hedging, and integrated risk management of global supply chain risks. We outline the main research themes behind the iSCF research, and teaching, field; highlight concepts ready for the classroom; and pose some open research questions pointing to the future promise of the field. Methodology/results: Forum paper. MSOM Fellow opinion on topic of supply chain finance and risk management based on his published research. Managerial implications: A supply-chain-centric view on state-of-the-art practices for improved working capital, hedging, and risk management in global supply chains (integrated supply chain finance).

Suggested Citation

  • Panos Kouvelis, 2023. "OM Forum—Supply Chain Finance Redefined: A Supply Chain-Centric Viewpoint of Working Capital, Hedging, and Risk Management," Manufacturing & Service Operations Management, INFORMS, vol. 25(6), pages 2074-2084, November.
    • Handle: RePEc:inm:ormsom:v:25:y:2023:i:6:p:2074-2084
    DOI: 10.1287/msom.2022.0606
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    References listed on IDEAS

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    1. Sopranzetti, Ben J., 1998. "The economics of factoring accounts receivable," Journal of Economics and Business, Elsevier, vol. 50(4), pages 339-359, July.
    2. Mike Burkart & Tore Ellingsen, 2004. "In-Kind Finance: A Theory of Trade Credit," American Economic Review, American Economic Association, vol. 94(3), pages 569-590, June.
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    5. Jan A. Van Mieghem, 2007. "Risk Mitigation in Newsvendor Networks: Resource Diversification, Flexibility, Sharing, and Hedging," Management Science, INFORMS, vol. 53(8), pages 1269-1288, August.
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    2. Liao, Ziling & Prataviera, Lorenzo Bruno & Ghadge, Abhijeet & Abushaikha, Ismail, 2025. "A sustainable supply chain finance ecosystem: A review and conceptual framework," International Journal of Production Economics, Elsevier, vol. 286(C).

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