A Mixed-Method Approach to Develop a Model to Manage the National Strategic Reserve for Critical Intermediate and Final Products in Saudi Arabia

Abstract

In recent years, the idea of “strategic reserve” has become a prominent public policy concern. COVID-19, Brexit, war, and some other similar cases will leave/have left us with a lesson that has impacted the supply chain in almost all product types. Countries have now recognized that some goods cannot be sustained in a situation of uncertainty. This research covers the gap in developing the purchasing portfolio model from an organizational level to a national/country level to manage critical intermediate and final products. Through investigating the relationship between two factors: the casual factor supply risk (independent factor); and the impacted (dependent factors) political, economic, sociocultural, and technological (PEST) factors, this study has a significant contribution to the theoretical, empirical, and practical knowledge in terms of classifying critical intermediate and final products using the principle of Resource Dependency Theory and Portfolio Theory. A mixed-method research approach (exploratory sequential design) was determined to be the most suitable approach in order to fulfil the academic purposes of this exploratory research. The semi-structured interview was conducted with 23 experts in Saudi Arabia that have been selected for the purpose of this study. The qualitative study identified 30 key measurement variables for both factors, in which 19 variables were confirmed using the factor analysis technique. The second phase of this research is quantitative research, where a questionnaire was developed based on the qualitative research results. It was then shared with 152 experts in four critical intermediate and final products in Saudi Arabia to test the model quantitatively resulted a positive significant relationship (.297) between the model’s dimensions. A Multidimensional Scale (MDS) technique was used to classify and determine the criticality level of tested products, which resulted in rice as a leveraged product, gasoline as a non-critical product, semiconductors as a strategic product, and insulin as a bottleneck product on a “national level” which was validated by Saudi’s experts as the final step in this research. However, it’s important to note that the study is limited to one country, Saudi Arabia, and has a relatively small sample size; therefore, a number of future studies have been recommended including the context and study sample size.