Analysis of power dynamics in sustainable supply chain under non-linear demand setup

This paper investigates joint sustainability initiatives and power dynamics in a sustainable supply chain. The study considers a dyadic supply chain under a non-linear demand setup. It develops and analyzes nine different decentralized scenarios arising from different joint sustainability efforts and power structures. The study evaluates supply chain agents’ sustainability efforts, pricing strategies, and profits under various scenarios and subsequently compares them to obtain the most preferred strategy. The findings show that the supply chains structure significantly influences players’ sustainability efforts and profits in a supply chain. We also compare the players’ profit between different structures of power dynamics, and the results reveal that if a player is responsible for greening efforts and holds a leadership position, it always leads to a win-win situation for supply chain agents. Interestingly our study also formulates the Hawk and Dove strategic leadership game. The study attempts to coordinate the supply chain using contract mechanisms. It reveals that the revenue sharing mechanism fails to coordinate the supply chain. Thus, the study proposes a hybrid contract to coordinate the sustainable supply chain. This paper provides a nuanced understanding to managers to share sustainability responsibility with supply chain partners and choose the right leadership decisions for a sustainable supply chain.