Blockchain Implementation and Shareholder Value - a Complex Adaptive Systems Perspective (科研通-Ablesci.com)

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Blockchain implementation and Blockchain and

shareholder
shareholder value: a complex value
adaptive systems perspective

Xi Zhang, Rui Chang, Minhao Gu and Baofeng Huo
College of Management and Economics, Tianjin University, Tianjin, China
Received 1 December 2022
Revised 16 April 2023
Abstract Accepted 20 July 2023
Purpose – Blockchain is a distributed ledger technology that uses cryptography to ensure
transmission and access security, which provides solutions to numerous challenges to complex supply
networks. The purpose of this paper is to empirically test the impact of blockchain implementation on
shareholder value varying from internal and external complexity from the complex adaptive systems
(CASs) perspective. It further explores how business diversification, supply chain (SC) concentration and
environmental complexity affect the relationship between blockchain implementation and
shareholder value.
Design/methodology/approach – Based on 138 blockchain implementation announcements of listed
companies on the Chinese A-share stock market, the authors use event study methodology to evaluate the
impact of blockchain implementation on shareholder value.
Findings – The results show that blockchain implementation has a positive impact on shareholder value,
and this impact will be moderated by business diversification, SC concentration and environmental
complexity. In addition, environmental complexity exerts a moderating effect on SC concentration. In the
post hoc analysis, the authors further explore the impact of blockchain implementation on long-term
operational performance.
Originality/value – This is the first research empirically examining the effect of blockchain
implementation on shareholder value varying from internal and external complexity from the CASs
perspective. This paper provides evidence of the different effects of blockchain implementation on short-
and long-term performance. It adds to the interdisciplinary research of information systems (IS) and
operations management (OM).
Keywords Blockchain, Supply chain complexity, Complex adaptive systems perspective, Event study,
Stock market reaction
Paper type Research paper
1. Introduction
Blockchain is a distributed ledger technology that uses cryptography to ensure
transmission and access security (Du et al., 2017). With the characteristics of
decentralization, stability, security, traceability and immutability, blockchain has
attracted the attention of the business community. According to a PwC survey, 84% of
companies are dabbling in blockchain (Rooney, 2018). The World Economic Forum (2015)
predicts that 10% of the world’s GDP will be stored on the blockchain network by 2027.
Although it has great potential, blockchain implementation is still risky, with technical and
operational challenges (Babich and Hilary, 2020). It is still uncertain whether blockchain
can bring competitive advantages to companies. On the one hand, blockchain has inherent
technical problems, such as scalability, which will increase storage space and reduce
propagation speed (Yin et al., 2019), and the proof method of work needs a lot of energy to
calculate, which will waste too much energy (Zheng et al., 2018). On the other hand, great
The study is funded by funds from National Key R&D Program of China (No. 2020YFA0908600) and
International Journal of Operations
from National Natural Science Foundation of China (No. 72241432 and 72002151 and 72091210/ & Production Management
72091214). © Emerald Publishing Limited
0144-3577
Conflict of interest: The authors declare that they have no conflict of interest. DOI 10.1108/IJOPM-11-2022-0711
IJOPM specific investments are required to align blockchain with companies’ strategies and
operations (Durach et al., 2021). Additionally, the Black-box effect and lack of
standardization also hinder companies from achieving profits from blockchain
implementation (Babich and Hilary, 2020). Therefore, it is an important research
question to explore the relationship between blockchain implementation and company
performance.
Blockchain can be implemented in many fields, among which supply chain (SC)
management is one of the most promising application scenarios (Babich and Hilary, 2020).
Blockchain enables information shared across SC members to be more credible and
immutable, which provides solutions to numerous challenges to complex supply
networks at a time when SC agility, speed and transparency are critical (Cole et al.,
2019). Hastig and Sodhi (2020) posited that blockchain implementation improves SC
traceability, which further facilitates sustainability and SC coordination. Martinez et al.
(2019) claimed that the implementation of blockchain in order management can reduce the
average lead time and improve SC visibility. Deloitte (2020) predicts that the proportion of
commercial applications of blockchain in the SC will increase from 5% to 54% in the next
five years. Companies including Amazon, IBM and Maersk are exploring use cases for
this technology in their SCs (Babich and Hilary, 2020; Rooney, 2018). IBM and Maersk use
blockchain to improve logistics and shipping (Box, 2018). Nestle and other food giants
have implemented blockchain to trace food contamination in SCs (Rooney, 2018). Nike is
exploring blockchain for SC data collection and uses Hyperledger to upload SC data to
blockchain (Haig, 2020). In addition, the World Trade Organization’s (WTO’s) white
paper also published many successful blockchain-based SC cases (WTO, 2019). In China,
large companies have applied blockchain in managing their complex SC networks. For
example, JD.com has improved the overall information transmission efficiency with its
enormous number of suppliers and consumers through the BaaS platform (https://baas.
jd.com/). Lenovo has developed a shared ledger based on blockchain to solve the problems
of e-procurement and order information processing between suppliers and distributors
(https://brand.lenovo.com.cn/).
SC networks can be regarded as complex adaptive systems (CASs) (Choi et al., 2001;
Yeoman and Santos, 2019; Zhao et al., 2019). CASs is a self-organizing system, which evolves
and develops continuously through links between agents and adapting to the environment
(Choi et al., 2001). In a complex SC network, blockchain implementation can change the
relationship between SC partners (Babich and Hilary, 2020) and create new business models
(Lumineau et al., 2021), while adapting to the complex internal and external environment for
coordinated convolutions. Compared with the centralized information system, the
decentralized blockchain can support the dispersed and globally distributed SC partners,
improve the autonomy and spontaneity of the agents and promote the complex SC’s self-
organizing behavior (Swierczek, 2023). This paper would explore how blockchain play a role
in complex SC networks based on the CASs perspective. Specifically, it would explore the
mechanism of how blockchain implementation impacts company stock reaction by
considering the contingency effect of business diversification, SC concentration and
environmental complexity.
First, business diversification is a key issue in strategic management and represents
internal complexity (Tang et al., 2019). Previous research has examined the effects of business
diversification in different aspects. However, there is still a gap in the relationship between
business diversification and blockchain implementation (Su and Tsang, 2015). On the one
hand, business diversification increases complexity and leads to higher internal coordination
costs. Companies would have more difficulties monitoring the business processes (Su and
Tsang, 2015; Tang et al., 2019). On the other hand, the decentralization and sharing
characteristics of blockchain may solve the potential problem of business diversification
because it can play a positive role in information transfer and resource sharing between Blockchain and
multiple business units (Wang et al., 2021). Therefore, there is a need to verify the impact of shareholder
business diversification on the value of blockchain implementation.
Second, from the operational point of view, although great attention has been paid to
value
blockchain implementation in SCs, previous research mainly focused on blockchain technical
characteristics and overlooked SC characteristics (Babich and Hilary, 2020; Hastig and Sodhi,
2020). With the wide application of new-generation technologies, SCs have become more
intelligent but also more complex (Hastig and Sodhi, 2020; Lam et al., 2019; Olsen and Tomlin,
2020). The complex SC involves many suppliers and customers, which may affect the value of
blockchain implementation (Fosso Wamba et al., 2020). SC concentration (including supplier
and customer concentration) emphasizes the reduction of network complexity (Giannoccaro
et al., 2018; Kim, 2017). A complex SC not only reduces operational efficiency, it is also a
precursor to SC disruption (Bozarth et al., 2009). Blockchain can make information sharing
between SC members more credible and immutable, and more likely to be leveraged to solve
challenges in complex networks (Cole et al., 2019). Therefore, more empirical evidence is
needed to explore the influence of SC concentration on the value of blockchain
implementation.
Third, firms need to configure their business to adapt to the ever-changing and complex
environment (Azadegan et al., 2013). According to the CASs perspective, the external
environment influences the adaptive behavior of agents in the network (Choi et al., 2001; Zhao
et al., 2019). Traditionally, firms rely on contractual and relational tools to coordinate
diversified business units and govern transactions with SC partners. They have to make
specific investments if the environment is complex and uncertain, which leads to high
transaction costs (Lumineau et al., 2021). Blockchain technology is considered as a useful
governance tool in the complex environment (Lam et al., 2019). The decentralized and
traceable characteristics of blockchain can help firms to obtain reliable information and
establish a technology-driven trust relationship with upstream and downstream partners
(Lumineau et al., 2021; Wang et al., 2021). Extra resource investments due to environmental
complexity would be economized if firms implement blockchain in their operations.
Therefore, we further explore how blockchain implementation influences shareholder value
in a complex environment.
In summary, two pertinent research questions are explored in this study: (1) Does
blockchain implementation improve stockholder value? (2) Do business diversification, SC
concentration and environmental complexity affect the relationship between blockchain
implementation and stockholder value? The empirical analysis is based on 138 blockchain
implementation announcements of listed companies on the Chinese A-share stock market.
The time frame is from January 2015 to December 2021. The results show that blockchain
implementation has a positive impact on stockholder value, and this impact will be
moderated by business diversification, SC concentration and environmental complexity.
In the post hoc analysis, we further explore the impact of blockchain implementation on long-
term operational performance.
The findings will make the following contributions. First, our research shows the effect of
blockchain implementation on shareholder value varying from business diversification, SC
concentration and environmental complexity. Specifically, companies with higher
diversification have brought more significant stock returns to blockchain implementation.
Interestingly, customer concentration and supplier concentration have different moderating
effects on blockchain implementation and stock market reaction. Companies with lower
customer concentration gain more positive shareholder value with blockchain
implementation. However, the stock market reaction to blockchain implementation is not
affected by supplier concentration. In addition, the implementation of blockchain in a low-
complex environment will have a higher positive impact on stock returns. The research
IJOPM results may help to solve the dilemma of blockchain implementation in the upstream and
downstream of the SC and guide the follow-up research. Second, this paper provides evidence
of the different effects of blockchain implementation on short- and long-term performance.
Our research gives further evidence that blockchain implementation can lead to positive
stock returns in the short term but hurts long-term operational performance. In addition, in
the post hoc analysis, this paper provides initial evidence that the moderator effect of
customer concentration on long-term operating performance is opposite to that of short-term
performance. This finding seems to be particularly critical for blockchain implementation in
complex SC networks and provides preliminary evidence for future research. Third, this
research gives a more comprehensive explanation of the mechanisms of blockchain
implementation from the CASs perspective and contributes to the theory by adding a
technology component to CASs. The theoretical findings help to explain how firms
implement blockchain to gain competitive advantages by simultaneously considering
internal operational complexity and external environmental complexity.
The remainder of the paper is organized as follows. Section 2 will review the relevant
literature. Section 3 will develop the research hypotheses. Section 4 will outline the
methodology with a brief description of blockchain announcements and samples. Section 5
will present the research results. Section 6 will present the post hoc analysis, followed by
discussions and implications in Section 7.
2. Theoretical background
2.1 Blockchain and its implementation
With the characteristics of openness, tamper-proof modification, anonymity, decentralization
and traceability, blockchain can improve information credibility and transparency, realize
the trusted transaction process and reduce cost (Du et al., 2017; Yin et al., 2019). Studies on
seeking the impact of blockchain implementation have recently emerged (Fosso Wamba et al.,
2020; Hastig and Sodhi, 2020). For example, Danese et al. (2021) discovered that the
application of blockchain in product counterfeiting can effectively prevent counterfeiting.
Pun et al. (2021) discussed how the government can incentivize manufacturers to implement
blockchain to deal with counterfeiting challenges. Chod et al. (2020) discovered that
blockchain implementation can help a company get favorable finance terms at a lower signal
cost. Wang et al. (2021) built a transparent and fair SC data contribution mechanism through
blockchain to promote data sharing. Kurpjuweit et al. (2021) claimed that blockchain is
expected to increase the competitiveness of additive manufacturing and reduce
logistics costs.
From a financial view, previous studies have shown that investors will respond
positively to IT investment (Bose and Leung, 2019; Nishant et al., 2017). Similar to IT
investment, blockchain announcements can also send a positive signal to investors and
stakeholders that companies have realized the potential advantages of blockchain applied
in business models (Klockner et al., 2022). In addition, institutional investors are usually
concerned about data security (Bose and Leung, 2019), and the decentralization and
traceability of blockchain contribute to information transmission between companies,
which can reduce data fraud problems (Danese et al., 2021) and prevent counterfeiting
(Chod et al., 2020; Pun et al., 2021). Some empirical evidence also shows the positive effect of
blockchain implementation. Klockner et al. (2022) validate the financial performance
improvement due to blockchain implementation from a case, project and company
perspective. Cheng et al. (2019) and Cahill et al. (2020) found a positive investor reaction to
blockchain announcements.
Despite the great progress of blockchain implementation in recent years, previous studies
also proved that implementing blockchain is still risky, with technical and operational
challenges (Babich and Hilary, 2020). First, scalability is an inherent technical problem of Blockchain and
blockchain. Each transaction adds another block to the history of all transactions, and each shareholder
block carries the complete history of all transactions (Yin et al., 2019). Second, privacy is
another important issue. Hackers can infer the actual transaction output with 80% accuracy
value
(Li et al., 2020). Once a hacker enters the blockchain, all customer information will be exposed
because the information is permanently stored. Third, the proof of work method needs a lot of
power to perform the calculation. Therefore, blockchain will waste power energy excessively
(Zheng et al., 2018). Additionally, the Black-box effect and lack of standardization also hinder
companies from implementing blockchain (Babich and Hilary, 2020).
Previous literature used different research methods, such as mathematical modeling,
survey, and case study to explore the opportunities and challenges of blockchain
implementation (Chod et al., 2020; Pun et al., 2021). For example, Ziolkowski et al. (2020)
analyzed the decision-making problems of blockchain systems through case studies. Danese
et al. (2021) used a multiple-case study to explore how to design a blockchain system to
prevent counterfeiting. Kurpjuweit et al. (2021) combined inductive in-depth interviews and
Delphi methods to discuss the impacts and obstacles of blockchain implementation. Chod
et al. (2020) explored the benefits to different types of companies or SCs brought by
blockchain implementation through a parsimonious model. Falcone et al. (2021) adopted
situation-based investigations to understand managers’ views and wishes concerning
blockchain implementation. However, empirical evidence regarding whether and to what
extent blockchain implementation will affect company performance is still lacking.
2.2 Contingency factors

Companies are facing challenges of managing complexity, which comes from internal
operations, such as diversified business units and production lines, the decentralized supply
and demand network and a large number of supplier and customer relationships (Bozarth
et al., 2009). The external environment, such as market uncertainty, industrial competition,
technological dynamics and political instability also increases complexity (Capaldo and
Giannoccaro, 2015; Xu et al., 2019). This study proposes that the value of blockchain will be
influenced when it is implemented in a complex context.
First, business diversification refers to the extent to which a company operates in different
lines of business (Hendricks et al., 2009). A company with high business diversification can
give full play to its advantages in resources, market, brand and technology so that it can
allocate resources to the maximum extent (Xie et al., 2021). Business diversification increases
complexity and leads to higher internal coordination costs, thus companies would have more
difficulties monitoring the business processes (Su and Tsang, 2015; Tang et al., 2019).
Blockchain has the characteristics of decentralization and sharing (Babich and Hilary, 2020),
which can effectively solve the problems of resource sharing and supervision costs in
diversified companies (Wang et al., 2021), so as to maximize the value of the blockchain.
Second, a complex SC involves many suppliers and customers, which increases
supervising difficulties (Brandon-Jones et al., 2014), SC disruption risks (Bode and Wagner,
2015) and information asymmetry (de Leeuw et al., 2013). SC concentration is an indicator to
measure the interconnectedness of the SC, including two dimensions: supplier and customer
concentration, which respectively reflect the degree of dispersion of upstream and
downstream SC partners (Lanier et al., 2010; Schwieterman et al., 2018). Customer
concentration refers to the degree to which a company’s sales come from several major
customers, while supplier concentration refers to the degree to which a company purchases
from a few major suppliers (Schwieterman et al., 2018). Blockchain has the characteristics of
cross-network distribution and traceability, it is an ideal application for a multi-organization
environment (Babich and Hilary, 2020). Although blockchain can provide solutions to many
IJOPM challenges (Babich and Hilary, 2020), it still faces challenges of SC complexity, which may
affect the effectiveness of its implementation (Fosso Wamba et al., 2020).
Third, environmental complexity refers to the heterogeneity and diversity of competitors
faced by a company (Capaldo and Giannoccaro, 2015; Xu et al., 2019). Environmental
complexity increases the resource requirements to successfully implement blockchain (Lam
et al., 2019). When the external environment is complex and dynamic, companies need to
make intensive resource investments and develop diversified business to adapt to the ever-
changing environment (Azadegan et al., 2013; Xu et al., 2019). The deployment of blockchain
requires a lot of tangible and intangible resource investments (Klockner et al., 2022). Although
the blockchain can also create new business models (Lumineau et al., 2021) and competitive
advantage (Babich and Hilary, 2020), the lack of sufficient resources in the highly competitive
environment may affect the effectiveness of blockchain implementation.
3. Hypothesis
3.1 The direct effect of blockchain implementation on shareholder value
As an emerging technology, blockchain can not only bring competitive advantages by
reshaping processes and promoting new business models (Babich and Hilary, 2020; Hastig
and Sodhi, 2020), it can also solve the obstacles that exist in other technologies (Chanson et al.,
2019). The aggregation of blockchain eliminates the need for personal trust and can increase
mutual trust based on high-quality information (Babich and Hilary, 2020). Blockchain also
enables companies to track the entire order process and improve operational visibility (Hastig
and Sodhi, 2020). Martinez et al. (2019) found that blockchain implementation reduces the
average order time and improves operational efficiency. Danese et al. (2021) claimed that
blockchain applied in product counterfeiting can effectively prevent counterfeiting. Chod
et al. (2020) hold that blockchain ensures the verifiability of transactions so that small and
medium-sized companies can transmit high-quality information and obtain favorable
financing conditions.
Previous studies have shown that the announcement of IT plans can generate stock
market value (Nishant et al., 2017). Therefore, we believe that the market will react positively
to blockchain implementation. Abnormal returns refer to the stock return difference between
implementing blockchain or not (Lam et al., 2019). Previous studies have also shown that
blockchain implementation can bring positive stock market returns. Cheng et al. (2019) found
an overly positive investor reaction to blockchain mania. Cahill et al. (2020) found that the
stock market reaction to blockchain correlates with Bitcoin price. Klockner et al. (2022)
validate the financial performance improvement due to blockchain implementation from a
case, project and company perspective. Although hypothesis 1 is not novel, we propose it as
the basic baseline of the follow-up research questions (Schmidt et al., 2020).
H1. The market will react positively to blockchain implementation.
3.2 The moderating effect of business diversification and SC concentration

3.2.1 The moderating effect of business diversification. To keep competitiveness, companies
are developing increasingly differentiated products and business models (Jacobs, 2013).
Companies with business diversification expand their business by entering new products,
new markets and new activities (Hendricks et al., 2009). Business diversification actively
helps companies to broaden the scope of a business beyond industry-specific contexts
(Salampasis and Mention, 2019). However, when companies share resources and co-specialize
to achieve economies of integration, monitoring the business processes is more complex and
difficult (Su and Tsang, 2015; Tang et al., 2019), leading to a higher likelihood of opportunistic
behaviors (Ljubownikow and Ang, 2020).
Previous studies have shown that business diversification increases the complexity of Blockchain and
tasks involved in operations (Chari et al., 2008), thereby increasing the need for information shareholder
processing capabilities and IT capabilities to manage internal information flows (Gomez et al.,
2016). Companies with business diversification are more likely to implement blockchain to
value
handle the information processing and coordination of complex tasks. In addition, the
decentralization and sharing characteristics of blockchain technology are helpful for
information transfer and resource sharing among multiple business models and reduce
internal coordination costs (Babich and Hilary, 2020; Wang et al., 2021). Therefore, the value
of blockchain implementation will be enhanced in companies with a higher business
diversification. It will help them to better coordinate diverse business units.
We hypothesize that:
H2. The stock market reaction to blockchain implementation will be more positive for
companies with higher business diversification.
3.2.2 The moderating effect of SC concentration. According to the CASs, a complex SC
network is a self-organizing system (Choi et al., 2001; Swierczek, 2023). Compared with the
centralized information system, the decentralized blockchain can support the decentralized
SC partners, improve the autonomy and spontaneity of the agents and promote the SC’s self-
organizing behavior (Swierczek, 2023). We argue that more concentrated SCs will reduce the
value of blockchain implementation. A concentrated SC shows that the focal company has
embedded connections with SC partners in the network and is dependent on them (Saboo
et al., 2017; Schwieterman et al., 2018). Customer concentration refers to how many of a
company’s sales come from several major customers. It reflects the degree of dispersion of
downstream partners (Lanier et al., 2010; Schwieterman et al., 2018). Customers are usually
better able to spot market trends and predict product demand (Wang et al., 2021). When a
company has a high customer concentration, it is likely to maintain a stable relationship with
few customers (Crawford et al., 2020). High-customer concentration businesses can build
strong bonds with their most important customers, so as to achieve information sharing and
reduce conflicts and risks (Schwieterman et al., 2018). But for companies with lower customer
concentration, the information sharing between them and their customers is complicated, and
the decentralization and traceability functions of the blockchain can better exert its value,
reduce the cost of information acquisition and improve information sharing efficiency
(Wang et al., 2021). Therefore, we propose:
H3a. The stock market reaction to blockchain implementation will be more positive for
companies with lower customer concentration.
Supplier concentration refers to how many a company purchases from a few major suppliers.
It reflects the degree of dispersion of upstream partners (Lanier et al., 2010; Schwieterman
et al., 2018). Suppliers have information advantages in terms of purchased materials and
products, and proper information sharing can reduce transaction costs and improve
transaction efficiency (Lee et al., 1997; Wang et al., 2021). Research on social networks shows
that social relationships can be divided into strong and weak relationships (Kim and Zhu,
2018). Low supplier concentration means companies have weak relationships with their
suppliers. They will have more alternatives and be more likely to gain mobilized resources
(Borgatti and Li, 2009). However, companies have difficulties governing a less concentrated
supply network. Implementing blockchain guarantees information security and improves
supply visibility and traceability, and reduces transaction costs due to supply complexity
(Liu et al., 2020). Therefore, we propose:
H3b. The stock market reaction to blockchain implementation will be more positive for
companies with lower supplier concentration.
IJOPM 3.2.3 The moderating effect of environmental complexity. Previous studies have shown that
while information technology creates value, benefits can quickly evaporate because of
competition (Ren and Dewan, 2015). For example, Lam et al. (2019) find that the benefits of
implementing 3D printing in less competitive environments are greater. The deployment
of blockchain requires extra resource investments (Klockner et al., 2022), as well as the
combinative use of other information technologies (Babich and Hilary, 2020). In the low-
complex environment, rich resource investments can support companies to implement
blockchain successfully. In Contrast, there are many competitors in a highly complex
environment (Capaldo and Giannoccaro, 2015; Xu et al., 2019), and the implementation of
blockchain may be imitated and copied by other companies, thus reducing the first-mover
advantage (Lam et al., 2019). Therefore, the implementation of blockchain in a low-complex
environment will have a higher impact on stock returns. Therefore, we propose:
H4. The stock market reaction to blockchain implementation will be more positive for
companies with lower environmental complexity.
The CASs perspective shows that SC can be described as a complex and adaptive system
(Choi et al., 2001; Zhao et al., 2019). SC network is complex because SC partners operate in
an interactive and dynamic network (Yeoman and Santos, 2019). It is adaptive because
companies need to deal with diversified business models and upstream and downstream
relationships to adapt to the external dynamic environment (Swierczek, 2023).
In addition, the development of SC is reflected not only in the dynamic interaction
between agents, but also in the interaction between agents and the environment (Yeoman
and Santos, 2019).
In the ever-changing business environment, companies need to develop diversified
business and SC relationships to gain competitive advantage (Azadegan et al., 2013). When
environmental complexity is at a low level, companies intend to concentrate the resource
investment and focus on specific businesses (Azadegan et al., 2013; Xu et al., 2019). The
decentralization and traceability of blockchain can help companies to process true
information, coordinate different business units and establish trust relationships with
upstream and downstream partners to adapt to the changing environment (Lumineau et al.,
2021; Wang et al., 2021). In a less complex environment, companies with complex business
and SC relationships can apply blockchain to operationalize processes through sufficient
resources and financial support, thus helping companies to gain more competitive
advantages. However, when the environment is highly complex, companies would feel
risky to implement blockchain and cannot ensure sufficient resource investments, not to
mention they can reconfigure the rapidly changing diversified business and SC relationships
to fit blockchain characteristics (Azadegan et al., 2013; Zheng et al., 2018). Therefore, we
propose:
H5a. In lower environmental complexity, the stock market reaction to blockchain
implementation will be more positive for companies with higher business
diversification.
H5b. In lower environmental complexity, the stock market reaction to blockchain
implementation will be more positive for companies with lower customer
concentration.
H5c. In lower environmental complexity, the stock market reaction to blockchain
implementation will be more positive for companies with lower supplier
concentration.
The research model is presented in Figure 1.
External Complexity Blockchain and
Environmental
shareholder
Complexity value
Blockchain H1 H4
Shareholder value
Implementation
H5b
H5c H5a
H3a H3b H2
Customer Supplier Business

Concentration Concentration Diversification
Internal Complexity
Figure 1.
Research model
Source(s): Authors own creation
4. Sample and methodology

4.1 Sample collection
We searched for blockchain implementation announcements from the Shanghai Stock
Exchange website and the Shenzhen Stock Exchange website (He et al., 2016). We also
supplemented the announcements from newspapers designated by the China Securities
Regulatory Commission, including China Securities News, Shanghai Securities News,
Securities Daily and Securities Times (Zhao et al., 2013). In addition, we supplemented and
verified the blockchain announcement from Eastmoney Website (Yang et al., 2014) and Wind
Database (Chen et al., 2023). The use of the multiple sources to identify blockchain
announcement can produce a more complete and accurate dataset than a single source. The
sample consists of announcements from January 2015 to December 2021. We downloaded all
the announcements with keywords (i.e. blockchain, bitcoin, or cryptocurrency(ies)) (Cheng
et al., 2019). In addition, we collected daily stock trading data and other financial data from the
China stock market trading database (CSMAR). We followed the sample selection procedure
from the literature to generate the final blockchain implementation announcements (Arora
et al., 2020; Lam et al., 2019).
(1) We checked the headlines and lead paragraphs of all announcements with keywords
in the Shenzhen/Shanghai Stock Exchange websites during the period 2015–2021. In
this step, we exclude special treatment (* ST) companies with poor financial
conditions and which may be delisted.
(2) Announcements should involve blockchain applications in companies’ business
practices. We exclude announcements that are only related to blockchain words but
without specific business applications.
(3) To capture the market response to the announcement, we only reserve the
announcement of blockchain implementation issued by the company for the first
time. However, the announcement reported different blockchain implementation
types were included.
IJOPM (4) To avoid confounding effects, we searched the Shanghai/Shenzhen Stock Exchange
websites within a three-day window (±1 trading day) around the event
announcement day, companies that claimed other significant announcements
during the event period were excluded.
The final sample includes 138 blockchain implementation announcements from 86
companies. Table 1 shows the basic information of companies that issued blockchain
announcements. Panel A reports Total Assets, Market value, Sales and Net Profits. Panel B
shows that most of the announcements were announced between 2018 and 2021, indicating
blockchain is wining popularity among companies in recent years. Panel C reports that most
of the companies that announced blockchain implementation are from the manufacturing and
service industries.
4.2 Methodology
We use the event study method proposed by Brown and Warner (1985) to evaluate the impact
of blockchain implementation on shareholder value. The event study method is widely used
in operation management, such as SC glitches (Schmidt et al., 2020), SC strategic cooperation
(Liu et al., 2020) and SC scandals (Jacobs and Singhal, 2020). To avoid the lag effect caused by
the too-short estimation period and confusion of other events caused by the too-long
estimation period, this study chooses a 200-day estimation period, starting on day 210 and
ending on day 11 (Jacobs and Singhal, 2020; Schmidt et al., 2020).
We adopt the Fama-French four-factor model to calculate abnormal returns (ARs) (Jacobs
and Singhal, 2020).
Rit ¼ αi þ Rft þ βi1ðRmt Rft Þ þ βi2 SMBt þβi3 HMLt þ βi4 UMDt þ εit (1)
Mean Median SD Max Min
Panel A: Characteristics of BC implementation announcing companies

Total assets (CNY million) 25725.47 4304.96 60402.20 617688.09 382.65
Market value (CNY million) 8538.10 5857.70 19130.80 157295.05 1804.50
Sales (CNY million) 9993.70 1824.35 22046.38 187927.76 219.30
Net profits (CNY million) 547.45 158.79 1732.72 18856.88 2552.66
Year Number Percentage
Panel B: Distribution year for announcements

2016 3 2.17%
2017 7 5.07%
2018 31 22.46%
2019 38 27.54%
2020 44 31.88%
2021 15 10.87%
Total 138 100.00%
Industry Number Percentage
Panel C: Sample industry description (Industry two-digit CSRC code)

Manufacturing 63 45.65%
Soft and IT services 34 24.64%
Construction and real estate 19 13.77%
Table 1. Others 22 15.94%
Descriptive statistics Source(s): Authors own creation
Where Rit is the Day t return of stock i; Rmt is the Day t return of market return; Rft is the risk- Blockchain and
free return on Day t. SMBt is the difference between rates of return. HMLt is the difference shareholder
between book-to-market ratio stocks. UMDt is the difference between stock prices. αi, βi1 , βi2,
βi3, βi4 are linear regression coefficients, εit is the error term for stock i on Day t.
value
The abnormal return ARit for company i on Day t is estimated:

ARit ¼ Rit ðαi þ Rft þ βi1ðRmt Rft Þ þ βi2 SMBt þ βi3 HMLt þ βi4 UMDt (2)
To investigate the impact of events on the overall security pricing, it is also necessary to
calculate the average abnormal return (ARit):
1 XN
ARit ¼ ARit (3)
N i
where N is the number of sample companies on day t.

During the 200-day estimation period, the average abnormal return is calculated as:
¼ 1 Xt¼−11
ARit ¼ ARit (4)
200 t¼−210
The standard deviation from the mean daily abnormal returns is estimated as:
vffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffi,
u X
u t¼−11
b ARit ¼ t
S n ARit ARit 199 (5)
t¼−210
The test statistic TS t is estimated as:

TS t ¼ ARit b ARit
S (6)
For a given period [t1 ; t2], the cumulative abnormal return (CARit) is estimated:
Xt2
CAR ½t1 ; t2 ¼ t¼t
ARit (7)
1
The test statistic for a j-day event period, TS j is derived like that for a single day:
Pt2
t¼t AR it
TS j ¼ 1 (8)
b ARit pffij
S
To ensure the accuracy of the results, this study calculates the median and percent positive
abnormal returns and uses a nonparametric test to supplement t test. Wilcoxon signed-rank
test is also used to determine whether the median of abnormal return is significantly different
from zero. The generalized sign test is used to determine whether the percentage of the
positive abnormal returns is different from 50%.
5. Results
5.1 Market reaction to blockchain implementation
We adopt the Fama-French four-factor model to calculate the ARs of blockchain
implementation announcements on the announcement Day 0 and conduct a t test and two
nonparametric tests. Table 2 presents daily ARs and CARs. For 138 announcements, the ARs
IJOPM for day 0 are significantly positive at the 1% level. The Day 0 median AR is 0.97%,
significantly greater than zero at the 1% level. The percent positive ARs for day 0 is 55.80%,
as 55.80% of companies experience a positive abnormal stock return. For the two-day event
period (1,0), the mean CARs are 1.06%, significantly greater than 0 at the 1% level. And
52.17% of companies experience a positive abnormal stock return. Overall, the results
indicate that the stock market reacts positively to blockchain implementation.
5.2 Moderation effect tests

The dependent variable is the ARs calculated by the event research method described in
Equation (7). The explanatory variables are measured as follows:
Customer Concentration (CC_ Concentration). Customer concentration is measured as the
ratio of the major customer sales to the total annual sales. Specifically, we choose the
proportion of the top five customers’ sales in total sales to measure customer concentration
(Campello and Gao, 2017; Patatoukas, 2012).
P5
Salesi;j;t
j¼1
Customer concentrationit ¼ (9)
Salesi;t
Where Salesi;j;t means the company i’s sales to major customer j in the most recent fiscal year t.
Salesit means the total sales of the company i in the most recent fiscal year t.
Supplier Concentration (SC_ Concentration). The measurement for supplier concentration
is similar to that of customer concentration, in which sales are replaced by purchases
(Campello and Gao, 2017; Patatoukas, 2012).
P5
Purchasesi;j;t
j¼1
Supplier concentrationit ¼ (10)
purchasesi;t
Customer Concentration HHI (CCHHI_ Concentration). Since the above measurements do not
consider the number of major customers, we follow the method mentioned in Patatoukas
(2012) and use the Herfindahl-Hirschman Index (HHI) to measure the number of major
customers and their importance to the company’s sales.
X5 2
Salesi;j;t
Customer concentration HHI it ¼ (11)
j¼1
Salesi;t
Date Day–1 Day0 Day1 Day[1,0] Day[0,1] Day[1,1]
n 138 138 138 138 138 138

Mean abnormal return 0.16% 0.97%*** 0.09% 0.81%** 1.06%*** 0.90%**
t-statistic 0.75 4.38 0.41 2.60 3.38 2.35
Median abnormal return 0.18% 0.47%** 0.55% 0.14% 0.25% 0.33%
Wilcoxon signed-rank Z- 1.21 2.21 1.15 0.77 0.72 0.10
Table 2.
Event period abnormal statistic
returns for the 138 Abnormal returns positive 44.20% 55.80% 40.58% 50.72% 52.17% 47.10%
blockchain generalized sign test(Cowan) 2.69*** 5.39*** 1.61 4.13*** 4.49*** 3.23***
implementation Note(s): *p < 0.1, **p < 0.05, ***p < 0.01
announcements Source(s): Authors own creation
Supplier Concentration HHI (SCHHI_ Concentration). Similarly, we use the HHI by Blockchain and
calculating the ratio of the volume of purchasing from the top five suppliers to the total shareholder
purchase volumes.
value
X5
purchasesi;j;t 2
Supplier concentration HHI it ¼ (12)
j¼1
purchasesi;t
Business Diversification (BD_ Diversification). We use business diversification to measure

business complexity based on four-digit ISIC.
Xm
DT ¼ pi ln ð1=pi Þ (13)
i¼1
Herfindahl Index (BDHHI_ Diversification).

X
DT ¼ pi2 (14)
Environmental Complexity (EC_Complexity). We use the mean industry competition of the

past three years to measure environmental complexity (Tang and Chen, 2020).
XN 2
salesi;j;t
EC it ¼ 1 (15)
i
Total sales of firms in the same industry
Control variables comprise Market-to-book (MTB), Firm Size (Firm_size), Firm Growth
(Growth), Financial Leverage (Leverage), Inventory turnover (Inventory), R&D intensity
(RD), Industry size (Indus_size) and Bitcoin price (Bitcoin), which are mentioned in
previous literature that may affect shareholder value (Jacobs and Singhal, 2020; Schmidt
et al., 2020; Xia et al., 2016). Companies with a larger size, higher growth, higher R&D
intensity, MTB_ratio and lower financial leverage may have more financial resources and
superior technological skills to support blockchain technology (Xiong et al., 2021).
Inventory turnover can measure the operational efficiency of a business, which
determines how reliant a business is on emerging technologies such as blockchain
(Xiong et al., 2021). Industry size might affect the extent of benefits that firms can capture
from new technology implementation (Shou et al., 2021). Referring to previous studies, we
also use Bitcoin price as a control variable (Cheng et al., 2019; Klockner et al., 2022). In
addition, we control industry (two-digit SIC codes) and time (Year) effect. We also control
industry (two-digit SIC codes) and time (Year) effect. Table 3 presents the measurement
details for hypothesized and control variables.
The regression model is:
ARi ¼ β0 þ β1 BD Diversificationi þ β2 CC Concentrationi þ β3 SC Concentrationi
þ β4 EC Complexityi þ β5 Bitcoini þ β6 Inventoryi þ β7 MTBi þ β8 RDi
þ β9 Firm sizei þ β10 Growthi þ β11 leveragei þ β12 Indus sizei þ β13 Ind i þ β14 Year i
þ εi
(16)
Table 4 presents the correlations of variables used in this study.

IJOPM Variable Measurement Data source Reference
Pt2
Cumulative CAR ½t1 ; t2 ¼ t¼t1 ARit
CSMAR Arora et al.
abnormal return (2020), Jacobs
(CAR) and Singhal
(2020)
Customer P
5
CSMAR Campello and
Salesi;j;t
Concentration Gao (2017),
Customer concentrationit ¼ j¼1
(CC_ Complexity) Salesi;t Patatoukas
(2012)
Supplier P
5
CSMAR Campello and
Purchasesi;j;t
Concentration Gao (2017),
Supplier concentrationit ¼ j¼1
(SC Complexity) purchasesi;t Patatoukas
(2012)
Customer 5
P 2 CSMAR Campello and
Salesi;j;t
Concentration Customer concentration HHI it ¼ Salesi;t Gao (2017),
j¼1
HHI (Robust Patatoukas
Check) (2012)
Supplier 5
P 2 CSMAR Campello and
purchasesi;j;t
Concentration Supplier concentration HHI it ¼ purchasesi;t Gao (2017),
j¼1
HHI (Robust Patatoukas
Check) (2012)
Business Entropy measure based on four-digit ISIC Annual Report Hendricks
Diversification P
m
et al. (2009)
DT ¼ pi ln ð1=pi Þ
(BD_Complexity) i¼1
Business Herfindahl index Annual Report Tang et al.
P
Diversification DT ¼ pi2 (2019)
(Robust Check)
Environmental N
P 2 CSMAR Lam et al.
salesi;j;t
Complexity (EC) EC it ¼ 1 − Total sales of firms in the same industry (2019)
i
Bitcoin price Bitcoin Price on announcement day Investing.com Klockner et al.
(2022)
Market-to-book MTB is measured by the ratio of market value to the CSMAR Jacobs and
(MTB) book value of equity Singhal (2020)
R&D intensity R&D expenses/Sales in the most recent fiscal year CSMAR Lam et al.
(RD) (2019)
Firm size (Firm_ The natural logarithm of total sales in the most CSMAR Lam et al.
size) recent fiscal year (2019)
Leverage Total debts to total equity in the most recent fiscal CSMAR Klockner et al.
year (2022)
Growth Annual percentage change in total sales in the most CSMAR Klockner et al.
recent fiscal year (2022)
Inventory The COGS divided by average inventory in the most CSMAR Xiong et al.
turnover recent fiscal year (2021)
(Inventory)
Industry size The natural logarithm of the total assets of all CSMAR Shou et al.
(Industry_Size) companies in the same two-digit industry in the most (2021)
recent fiscal year
Industry Dummy variables for two-digit SIC codes CSMAR Klockner et al.
Table 3. dummies (2022)
Measurement details Year dummies Dummy variables for announcement years Announcement Lam et al.
for hypothesized and (2019)
control variables Source(s): Authors own creation
1 2 3 4 5 6 7 8 9 10 11 12 13
1. CAR 1
2. CC_ 0.019 1
Concentration
3. SC_ 0.012 0.322*** 1
Concentration
**
4. BD_ 0.202 0.033 0.031 1
Diversification
5. EC_ 0.020 0.067 0.051 0.040 1
Complexity
6. Bitcoin 0.157* 0.064 0.152* 0.053 0.097 1
7. Inventory 0.036 0.157* 0.274*** 0.055 0.200** 0.034 1
8. MTB_ratio 0.126 0.0650 0.063 0.111 0.027 0.018 0.168** 1
9. RD 0.180** 0.188** 0.171** 0.066 0.158* 0.031 0.124 0.236*** 1
10. Firm_size 0.029 0.244*** 0.030 0.196** 0.014 0.011 0.080 0.450*** 0.432*** 1
11. Leverage 0.031 0.179** 0.052 0.049 0.026 0.073 0.042 0.114 0.234*** 0.575*** 1
12. Growth 0.021 0.119 0.148* 0.056 0.028 0.124 0.035 0.020 0.061 0.074 0.100 1
13. Industry_ 0.170** 0.159* 0.009 0.123 0.341*** 0.0660 0.065 0.136 0.252*** 0.380*** 0.464*** 0.146* 1
Size
mean 0.010 0.261 0.307 0.572 0.864 11941.213 646.037 3.046 0.058 21.596 1.141 0.239 27.219
SD 0.037 0.159 0.171 0.474 0.110 11868.064 3707.500 2.587 0.052 1.320 1.320 0.407 1.460
Note(s): *p < 0.1, **p < 0.05, ***p < 0.01
Blockchain and
value
shareholder
Correlation matrix
Table 4.
IJOPM The VIFs of all models presented in Table 5 are less than 3.0, indicating that there is no
multicollinearity. Model 1 contains only control variables, and we add explanatory and
control variables in Models 2–5. Business diversification is significantly positively related to
the dependent variable, suggesting that the stock returns of blockchain implementation are
more positive for companies with higher business diversification. Thus, H2 is supported. The
results indicated that the customer concentration is significantly negative at the 1% level,
indicating that the stock market reaction to blockchain implemented by companies with
lower customer concentration is more positive than that of companies with higher customer
concentration. Thus, H3a is supported. Supplier concentration is positive but not
significantly different from zero. Therefore, H3b is not supported. Environmental
complexity is significantly negative to ARs, suggesting that the stock market reaction to
blockchain implementation is more positive for companies with lower environmental
Model 1 Model 2 Model 3 Model 4 Model 5 Model 6 Model 7
CC_ 0.055 **
0.060**
0.505**
Concentration (2.09) (2.26) (2.19)
SC_ 0.013 0.020 0.137
Concentration (0.54) (0.89) (0.57)
BD_ 0.017** 0.017** 0.070
Diversification (2.23) (2.24) (0.74)
EC_Complexity 0.101** 0.125*** 0.376**
(2.20) (2.77) (2.43)
EC*CC 0.503*
(1.94)
EC*SC 0.178
(0.67)
EC*BD 0.096
(0.91)
Bitcoin 0.000 0.000 0.000 0.000 0.000 0.000 0.000
(1.22) (1.20) (1.21) (1.29) (1.19) (1.24) (1.19)
Inventory 0.000 0.000 0.000 0.000 0.000 0.000 0.000
(0.08) (0.73) (0.07) (0.32) (0.02) (0.73) (0.56)
MTB_ratio 0.004** 0.005*** 0.004** 0.003** 0.004** 0.005*** 0.005***
(2.23) (2.79) (2.24) (2.19) (2.29) (2.92) (2.96)
RD 0.210** 0.235** 0.198** 0.186** 0.213** 0.200** 0.195**
(2.26) (2.55) (2.06) (2.03) (2.34) (2.18) (2.13)
Firm_size 0.011*** 0.015*** 0.010** 0.009** 0.012*** 0.014*** 0.014***
(2.65) (3.36) (2.57) (2.13) (2.90) (3.12) (3.07)
Leverage 0.002 0.001 0.003 0.003 0.002 0.003 0.005
(0.49) (0.28) (0.58) (0.61) (0.52) (0.61) (1.14)
Growth 0.001 0.001 0.001 0.002 0.001 0.001 0.000
(0.09) (0.13) (0.16) (0.23) (0.10) (0.10) (0.01)
Industry_Size 0.003 0.005 0.003 0.002 0.008* 0.009** 0.012***
(0.99) (1.39) (1.00) (0.65) (1.97) (2.34) (2.95)
Year dummies Included Included Included Included Included Included Included
Industry Included Included Included Included Included Included Included
dummies
_cons 0.264* 0.340** 0.260* 0.229 0.257* 0.297** 0.428**
(1.80) (2.28) (1.76) (1.58) (1.78) (2.05) (2.50)
N 138 138 138 138 138 138 138
R2 0.076 0.104 0.070 0.108 0.107 0.177 0.188
F 1.435 1.587* 1.384 1.615** 1.610** 1.983*** 1.962***
Table 5. Note(s): *p < 0.1, **p < 0.05, ***p < 0.01
Regression analysis Source(s): Authors own creation
complexity. Thus, H4 is supported. We add customer concentration, supplier concentration, Blockchain and
business diversification and environmental complexity in Model 6, the results are the same as shareholder
those in Model 2–5. In model 7, the results indicated the stock market reaction to blockchain
implementation is more positive for companies with lower customer concentration in a lower
value
complex environment. Thus, H5b is supported.
5.3 Robust check

5.3.1 Alternative expected return models. To ensure that the results do not have model
selection bias, we also used three other models such as the market model, the market-adjusted
model, and the Fama-French model to estimate abnormal returns (Jacobs and Singhal, 2020;
Xia et al., 2016).
The market-adjusted model:
Rit ¼ Rmt þ εit (19)
ARit ¼ Rit Rmt (20)
The Fama-factor model:

Rit ¼ αi þ Rft þ βi1ðRmt Rft Þ þ βi2 SMBt þβi3 HMLt þ εit (21)

ARit ¼ Rit ðαi þ Rft þ βi1ðRmt Rft Þ þ βi2 SMBt þ βi3 HMLt (22)
Results are consistent with those reported using the four-factor model. As presented in Panel
A in Table 6, the mean (median) of the ARs on day 0 is 1.44% (1.01%), significantly greater
Date Day–1 Day0 Day1 Day[1,0] Day[0,1] Day[1,1]
n 138 138 138 138 138 138

Panel A: Market model
Mean abnormal return 0.24% 1.44% 0.60% 1.68% 2.04% 2.28%
t-statistic 1.06 6.25*** 2.66*** 5.20*** 6.26*** 5.74***
Median abnormal return 0.20% 1.01% 0.07% 1.16% 1.20% 1.52%
Wilcoxon signed-rank Z-statistic 1.11 4.12*** 0.62 3.74*** 3.36*** 3.36***
Abnormal returns positive 54.35% 62.32% 49.28% 62.32% 66.67% 61.59%
generalized sign test(Cowan) 2.14** 3.85*** 0.78 3.85*** 4.88*** 3.68***
Panel B: Market-adjusted model
t-statistic 0.98 6.05*** 2.31** 5.01*** 5.88*** 5.39***
Wilcoxon signed-rank Z-statistic 1.14 3.89*** 0.41 3.59*** 3.04*** 3.11***
Abnormal returns positive 54.35% 62.32% 50.72% 62.32% 64.49% 60.87%
generalized sign test(Cowan) 2.27** 3.98*** 1.25 3.98*** 4.50*** 3.64***
Panel C: Fama-French model
t-statistic 0.84 4.47*** 0.45 2.60** 3.47*** 2.38**
Table 6.
Wilcoxon signed-rank Z-statistic 1.22 2.24** 1.19 0.81 0.73 0.10 Robust check of
Abnormal returns positive 44.20% 55.80% 38.41% 51.45% 52.90% 49.28% abnormal returns for
generalized sign test(Cowan) 2.72*** 5.41*** 1.10 4.34*** 4.70*** 3.80*** blockchain
Note(s): *p < 0.1, **p < 0.05, ***p < 0.01 implementation
Source(s): Authors own creation announcements
IJOPM than 0 at the 1% level. The results of the market-adjusted model and Fama-factor model are
reported in panels B and C in Table 6; the mean (median) ARs are 1.40% (0.70%) and 0.99%
(0.46%) for day 0 respectively. The positive percentage of ARs in the market model is 62.32%,
62.32% for the market-adjusted model and 55.80% for the Fama-French model, which are
significantly different from 50% at the 1%.
To ensure the robustness of the results, we use different expected return models as
the dependent variable to re-verify the proposed hypothesis. As presented in Table 7, all the
results are consistent with the previous results, which proves the robustness of the
research model.
Model 1 Model 2 Model 5 Model 6

Fama- Fama- Model 3 Model 4 Market- Market-
French French Market Market adjusted adjusted
model model model mode model model
CC_ 0.061** 0.489** 0.066** 0.494** 0.065** 0.512**

Concentration (2.30) (2.11) (2.41) (2.05) (2.35) (2.10)
SC_ 0.021 0.163 0.018 0.102 0.020 0.101
Concentration (0.90) (0.68) (0.77) (0.41) (0.84) (0.40)
BD_ 0.018** 0.077 0.018** 0.087 0.018** 0.094
Diversification (2.39) (0.81) (2.37) (0.87) (2.26) (0.93)
EC_ 0.131*** 0.391** 0.146*** 0.381** 0.149*** 0.393**
Complexity (2.91) (2.52) (3.11) (2.36) (3.13) (2.41)
EC*CC 0.483* 0.483* 0.505*
(1.86) (1.79) (1.85)
EC*SC 0.207 0.135 0.136
(0.78) (0.48) (0.48)
EC*BD 0.104 0.117 0.124
(0.99) (1.06) (1.11)
Bitcoin 0.000 0.000 0.000 0.000 0.000 0.000
(1.29) (1.24) (0.87) (0.80) (0.87) (0.81)
Inventory 0.000 0.000 0.000 0.000 0.000 0.000
(0.67) (0.49) (0.82) (0.70) (0.55) (0.42)
MTB_ratio 0.005*** 0.005*** 0.005*** 0.005*** 0.004*** 0.004***
(2.96) (3.01) (2.85) (2.85) (2.64) (2.64)
RD 0.192** 0.188** 0.186* 0.185* 0.187* 0.186*
(2.10) (2.05) (1.95) (1.93) (1.94) (1.93)
Firm_size 0.014*** 0.014*** 0.014*** 0.014*** 0.014*** 0.014***
(3.04) (3.00) (3.06) (3.02) (2.96) (2.93)
Leverage 0.003 0.005 0.002 0.004 0.002 0.004
(0.61) (1.13) (0.43) (0.90) (0.43) (0.91)
Growth 0.001 0.000 0.001 0.001 0.001 0.001
(0.09) (0.05) (0.14) (0.09) (0.15) (0.10)
Industry_Size 0.009** 0.012*** 0.009** 0.012*** 0.008** 0.012***
(2.28) (2.90) (2.20) (2.73) (2.10) (2.66)
Year dummies Included Included Included Included Included Included
Industry Included Included Included Included Included Included
dummies
_cons 0.301** 0.439** 0.338** 0.464** 0.334** 0.465**
(2.08) (2.57) (2.24) (2.60) (2.19) (2.58)
N 138 138 138 138 138 138
R2 0.181 0.191 0.176 0.182 0.173 0.181
Table 7. F 2.007*** 1.979*** 1.979*** 1.925*** 1.955*** 1.915***
Robust check of Note(s): *p < 0.1, **p < 0.05, ***p < 0.01
regression analysis Source(s): Authors own creation
5.3.2 Sample-selection bias. Since the sample we selected has self-selection to implement Blockchain and
blockchain, this could lead to omitted-variable bias, which means that our results may be shareholder
biased. We use the Heckman two-step procedure to account for self-selection bias
(Heckman, 1979).
value
In the first step, we select a set of control groups that do not announce any blockchain. For
each company announcing blockchain implementation, we matched the control company
that operates in the same two-digital SIC code and is closest in the market value of equity at
the end of the fiscal year (Arora et al., 2020; Klockner et al., 2022). In this step, through a one-to-
one matching method, we selected 276 companies, including 138 companies that implemented
blockchain and 138 companies that did not. To estimate the likelihood of a firm implementing
blockchain, we selected a range of control variables, including firm_size, Growth, RD, MTB_
ratio, FL, Inventory and Indus. We also control the time (Year) effect and industry (two-digit
CSRC code). Our dependent variables are dummy variables (the probability that company i
makes a blockchain announcement is represented by 1, otherwise 0). Thus, the first-stage
selection model is:
Pr ðBlockchain ¼ 1Þ
¼ Φðβ0 þ β1 Bitcoini þ β2 Inventoryi þ β3 MTBi þ β4 RDi þ β5 Firm sizei
þ β6 Growthi þ β7 leveragei þ β8 Indus sizei þ β9 Indi þ β10 Year i þ εiÞ
(17)
In the second-stage regression stage, we add IMRi as an explanatory variable in the model
(17) (Heckman, 1979). Thus, the second-stage regression model is:
ARi ¼ β0 þ β1 BD Diversificationi þ β2 CC Concentrationi þ β3 SC Concentrationi
þ β4 EC Complexityi þ β5 Bitcoini þ β6 Inventoryi þ β7 MTBi þ β8 RDi
þ β9 Firm sizei þ β10 Growthi þ β11 leveragei þ β12 Indus sizei þ β13 IMR þ β14 Ind i
þ β15 3 Year i þ εi
(18)
where β1−15 are obtained by the maximum likelihood estimation method. Show the results of
the second-stage regression estimations model. As a robustness test, we also use the
Heckman two-step procedure to test the results of different expected return models as the
dependent variable. The results presented in Table 8 were the same as Table 5 and Table 7
which did not include IMR. The IMR coefficients were not significant, indicating that our
sample was not biased by self-selection.
5.3.3 Alternative moderator variables. We conducted additional analysis to examine the
effect of business diversification, SC concentration and environmental complexity on
blockchain implementation and market reaction. The robust check is presented in Panel A
of Table 9. In Models 1 and 2, we use the Herfindahl index to measure major customers’ and
suppliers’ importance to companies’ annual sales. The results of Models 1–2 are similar to those
of Models 2–3 in Table 5, indicating that the results are robust. In model 3, we use the Herfindahl
index to measure business diversification. Contrary to the entropy method, the higher the index,
the lower the diversification level. The stock returns of blockchain implementation are more
positive for companies with higher business diversification, further indicating the robustness of
the results. In model 4, we use the mean environmental complexity in the most recent fiscal year
as a robustness test. The result is similar to Table 5, indicating that the results are robust.
Table 8.
IJOPM
model results
Heckman two-step
(1) (2) (3) (4) (5) (6) (7) (8) (9)
Blockchain Fama- Fama- Market- Market-
announcement Four-factor Four-factor French French Market Market adjusted adjusted
decision model model model model model model model model
First stage Second stage
Probit (1) Random effects (2)
CC_ 0.059** 0.508** 0.059** 0.493** 0.065** 0.498** 0.064** 0.516**

Concentration (2.21) (2.20) (2.24) (2.13) (2.35) (2.06) (2.29) (2.12)
SC_ 0.017 0.149 0.016 0.179 0.014 0.117 0.015 0.118
Concentration (0.72) (0.62) (0.70) (0.75) (0.57) (0.47) (0.62) (0.47)
BD_ 0.016** 0.061 0.017** 0.066 0.018** 0.076 0.017** 0.081
Diversification (2.18) (0.64) (2.32) (0.68) (2.30) (0.76) (2.18) (0.81)
EC_Complexity 0.122*** 0.374** 0.127*** 0.389** 0.142*** 0.379** 0.143*** 0.390**
(2.67) (2.41) (2.79) (2.51) (2.99) (2.34) (3.00) (2.39)
EC*CC 0.507* 0.489* 0.489* 0.511*
(1.96) (1.88) (1.81) (1.87)
EC*SC 0.188 0.221 0.148 0.151
(0.70) (0.82) (0.53) (0.53)
EC*BD 0.086 0.091 0.104 0.109
(0.80) (0.86) (0.93) (0.98)
Control Included Included Included Included Included Included Included Included Included
Variables
IMR 0.568 0.652 0.734 0.819 0.776 0.804 0.881 0.907
(0.68) (0.77) (0.88) (0.97) (0.89) (0.91) (1.00) (1.02)
_cons 1.797 0.761 0.788 1.066 1.089 1.108 1.036 1.307 1.226
(0.54) (0.49) (0.50) (0.68) (0.69) (0.68) (0.63) (0.79) (0.73)
N 276 138 138 138 138 138 138 138 138
R2 0.173 0.185 0.179 0.190 0.175 0.181 0.173 0.181
F 1.924*** 1.914*** 1.963*** 1.947*** 1.937*** 1.889*** 1.924*** 1.890***
Note(s): *p < 0.1, **p < 0.05, ***p < 0.01
Panel A Panel B Panel C
With alternative moderator variables With manufacturing industry With the pre-COVID-only sample
Model 1 Model 2 Model 3 Model 4 Model 1 Model 2 Model 3 Model 4 Model 1 Model 2 Model 3 Model 4
CC_Concentration 0.102** 0.090**

(2.39) (2.42)
SC_Concentration 0.002 0.013
(0.03) (0.39)
BD_Diversification 0.027* 0.029**
(1.87) (2.61)
EC_Complexity 0.133 0.135*
(1.30) (1.91)
CHHI_ 0.180**
Concentration (2.02)
SHHI_ 0.081
Concentration (1.28)
BCHHI_ 0.036***
Diversification (2.66)
EC_Complexity 0.075*
(1.84)
Control Included Included Included Included Included Included Included Included Included Included Included Included
_cons 0.304** 0.261* 0.263* 0.257* 0.459** 0.314 0.221 0.275 0.268 0.173 0.102 0.226
(2.08) (1.78) (1.84) (1.76) (2.23) (1.50) (1.07) (1.32) (1.50) (0.94) (0.58) (1.26)
N 138 138 138 138 63 63 63 63 91 91 91 91
R2 0.101 0.081 0.124 0.096 0.197 0.099 0.162 0.131 0.101 0.025 0.113 0.073
F 1.572* 1.450* 1.720** 1.537* 2.014** 1.455 1.797* 1.621 1.440 1.100 1.497 1.310
*
Note(s): p < 0.1, **p < 0.05, ***p < 0.01
Blockchain and
value
Regression analysis for

shareholder
Table 9.
the robust test

IJOPM 5.3.4 Manufacturing industry announcements. Manufacturers tend to focus on the transfer of
physical goods whereas service industries typically focus on the transfer of data and
information. Tokenizing physical goods to be tracked on a blockchain application creates
many more challenges than simply putting data into a blockchain application. Considering
the SC differences between the manufacturing industry and the service industry, we
conducted a robustness check with only manufacturing companies. The results presented in
Panel B of Table 9 are consistent with the total sample.
5.3.5 Robustness check with the pre-COVID-only sample. Due to the global economic impact
caused by the COVID-19 pandemic, we further explored whether the impact of blockchain
implementation on company performance is affected by COVID-19. We conducted a
robustness check with the pre-COVID-only sample, and the results presented in Panel C of
Table 9 are consistent with the total sample.
6. Post hoc analysis

To further investigate the long-term impact of blockchain implementation, we carried out a
set of post-hoc analyses. Specifically, return on assets (ROA) measured by operating income/
book value of total assets, return on sales (ROS) measured by operating income/sales and
sales over assets (SOA) measured by sales/total assets are chosen to represent operational
performance. In addition, we also consider net operating working capital (NET), which
reflects the ability to manage capital flows in the SC (Shou et al., 2021). NET is measured by
(current assets – current liabilities)/total assets.
We estimate the performance impact over a total of four years before and after the
blockchain implementation. Specifically, we regard the fiscal year of the blockchain
implementation as Year 0. The last two years (the next two years) are Year 2 (Year 2).
We follow the method outlined by Hendricks and Singhal (2008) to obtain abnormal
operational performance by comparing the sample company with the benchmark company.
In the process of matching the benchmark company, the covariates we use include previous
performance (ROA), firm size (total assets) and industry (two-digit SIC code). To handle the
tradeoff between the three annotations, we matched the benchmark company in three ways,
including Performance-industry-matched, Performance-industry-size-matched and
Performance-size-matched.
Panel A of Table 9 presented the results of the impact of blockchain implementation on
operational performance from Year 2 to Year 0. For all operational indicators, there is no
significant difference between the overall median of ROA, ROS and SOA and zero, and the
binomial sign test of these performance indicators is not significant. Therefore, there is no
evidence that these companies have significant abnormal operational performance before the
implementation of the blockchain. Panel B in Table 9 shows that the operational performance
of the sample companies after blockchain implementation is poor compared with the
benchmark. The mean (median) change of NET is 5.65% (4.44%), significantly different
from 0 at the 1% level. The median change of ROA is 0.96%, significantly different form
0 at the 10% level. In addition, considering the global economic impact caused by the
COVID-19 pandemic, we further explored whether the impact of blockchain implementation
on company performance is affected by COVID-19 within Year 1 to Year 1. The results
presented in Panels C and D of Table 10 are consistent with the total sample.
The result can be explained from the following two aspects. First, blockchain is a tamper-
resistant and decentralized ledger storing transactions (Beck et al., 2018), rather than
acquiring data (e.g. radio-frequency identification, RFID) or utilizing data (e.g. artificial
intelligence, AI) (Babich and Hilary, 2020). Therefore, additional technologies (e.g. RFID, AI)
are needed in the operationalization of blockchain to ensure the accuracy and
synchronization of information (Chanson et al., 2019). However, because a variety of
Panel A: From year 2 to year 0 Panel B: From year 0 to year 2 Panel C: From year 1 to year 0 Panel D: From year 0 to year 1
Obs Mean Median % POS Obs Mean Median % NEG Obs Mean Median % POS Obs Mean Median % NEG
Performance-industry-matched
Change 102 0.03% 1.52% 52.94% 62 5.65% 4.44% 64.53% 30 1.54% 2.68% 57.67% 30 5.02% 5.11% 63.33%
in the 0.017 0.269 0.495 3.111*** 2.766*** 2.159** 0.760 0.751 0.548 2.768** 2.808*** 2.739***
level of
NET
Change 102 0.24% 0.12% 51.96% 62 0.62% 0.96% 66.13% 30 0.11% 0.44% 46.67% 30 0.48% 1.09% 66.13%
in the 0.529 0.526 0.297 0.8965 1.812* 2.413** 0.159 0.195 0.183 0.466 1.306 1.278
level of
ROA
Change 101 1.68% 0.14% 50.50% 62 2.70% 1.06% 61.29% 29 0.68% 0.14% 43.33% 29 2.74% 1.06% 60.00%
in the 0.829 0.069 0.000 1.4413 1.553 1.651* 0.639 0.812 0.548 1.262 1.059 0.913
level of
ROS
Change 102 3.24% 0.30% 51.96% 62 1.55% 0.82% 54.84% 30 1.12% 1.26% 40.00% 30 1.47% 0.27% 50.00%
in the 0.772 1.213 0.297 0.4692 0.137 0.635 0.237 0.710 0.913 0.268 0.483 0.000
level of
SOA
Performance-industry-size-matched
Change 100 0.31% 0.36% 51.00% 61 4.38% 3.22% 57.38% 28 0.39% 1.27% 53.57% 29 4.52% 2.94% 70.00%
in the 0.1357 0.75 0.100 2.371** 2.187** 1.024 0.187 0.228 0.189 2.768** 2.714** 0.371
level of
NET
Change 100 0.06% 0.42% 54.00% 61 0.29% 0.75% 62.29% 28 0.34% 0.51% 39.29% 29 0.15% 1.01% 55.17%
in the 0.1171 0.591 0.700 0.411 1.110 1.793* 0.496 0.182 0.945 0.142 0.703 1.793*
level of
ROA
Change 100 0.97% 0.21% 51.00% 61 2.43% 1.11% 59.02% 27 1.37% 0.21% 39.29% 28 2.72% 1.11% 55.17%
in the 0.4649 0.23 0.100 1.2967 1.433 1.280 1.141 1.116 0.945 1.228 1.114 0.371
level of
ROS
(continued )
Blockchain and
value
shareholder
different periods
performance in
Table 10.
Operational
IJOPM
Table 10.
Panel A: From year 2 to year 0 Panel B: From year 0 to year 2 Panel C: From year 1 to year 0 Panel D: From year 0 to year 1
Obs Mean Median % POS Obs Mean Median % NEG Obs Mean Median % POS Obs Mean Median % NEG
Change 100 6.14% 0.02% 50.00% 61 2.90% 2.03% 44.26% 28 1.42% 0.56% 46.43% 29 3.32% 1.93% 37.93%
in the 2.229** 1.021 0.000 0.8678 0.822 0.768 0.285 0.250 0.189 0.590 1.222 1.114
level of
SOA
Performance-size-matched
Change 94 1.16% 0.08% 48.94% 59 4.78% 3.08% 62.71% 28 0.32% 0.82% 53.57% 29 5.18% 3.60% 65.52%
in the 0.735 0.387 0.103 2.502** 2.295** 1.823* 0.151 0.159 0.189 2.780** 2.541** 1.486
level of
NET
Change 94 0.26% 0.03% 50.00% 59 0.28% 0.28% 55.93% 28 0.76% 0.43% 53.57% 29 0.29% 1.13% 62.07%
in the 0.587 0.526 0.000 0.398 1.102 0.781 1.134 1.002 0.189 0.262 1.178 1.114
level of
ROA
Change 94 0.94% 0.09% 50.00% 59 3.31% 1.23% 57.63% 27 0.51% 0.09% 42.86% 28 2.26% 1.23% 55.17%
in the 1.006 0.481 0.000 1.813* 1.766* 1.042 0.421 0.023 0.567 0.929 0.897 0.371
level of
ROS
Change 94 4.24% 0.64% 55.32% 59 1.99% 2.10% 42.37% 28 2.82% 0.97% 39.29% 29 0.72% 1.33% 44.83%
in the 1.826* 1.099 0.928 0.6477 1.011 1.042 0.569 0.342 0.945 0.116 0.508 0.371
level of
SOA
Note(s): *p < 0.1, **p < 0.05, ***p < 0.01
technologies are competing, their interoperability has not yet been fully established, which Blockchain and
may increase the complexity of the technology system. Second, given the novelty of shareholder
blockchain technology, special trust mechanisms of the technology need to be established.
Although blockchain can sometimes address the issue of trust, it is still based on
value
technological concepts such as distributed systems and trust protocols, rather than specific
individuals, organizations and societies (Babich and Hilary, 2020). Companies may need to
implement protection mechanisms, which will incur additional operating costs (Klockner
et al., 2022).
We further explore how business diversification, SC concentration and environmental
complexity affect the relationship between blockchain implementation and operational
performance. The results presented in Table 11 indicated that the negative effect of
blockchain implementation on operational performance is more negative for companies with
higher customer concentration. Contrary to the short-term stock price, customer
concentration has a negative moderating effect on long-term operating performance. The
coefficient of business diversification and environmental complexity is insignificant,
indicating that the operational performance of blockchain implementation is not affected
by business diversification and environmental complexity.
Model 1 Model 2 Model 3 Model 4 Model 5 Model 6
CC_Concentration 0.315** 0.334**

(2.28) (2.24)
SC_Concentration 0.137 0.083
(1.21) (0.73)
BD_Diversification 0.020 0.046
(0.48) (1.09)
EC_Complexity 0.095 0.122
(0.35) (0.47)
Bitcoin 0.000 0.000 0.000 0.000 0.000 0.000
(0.26) (0.12) (0.12) (0.18) (0.23) (0.19)
Inventory 0.006* 0.006 0.006* 0.006 0.006 0.005
(1.78) (1.66) (1.79) (1.66) (1.59) (1.23)
MTB_ratio 0.032** 0.036** 0.033** 0.032** 0.033** 0.037**
(2.11) (2.46) (2.18) (2.08) (2.11) (2.49)
RD_Sales 0.199 0.110 0.002 0.181 0.186 0.073
(0.45) (0.26) (0.00) (0.40) (0.42) (0.16)
Firm_size 0.042* 0.062** 0.046* 0.043* 0.040 0.066**
(1.84) (2.65) (2.01) (1.87) (1.68) (2.66)
Leverage 0.004 0.012 0.010 0.005 0.004 0.018
(0.19) (0.55) (0.44) (0.22) (0.18) (0.78)
Growth 0.009 0.021 0.022 0.010 0.010 0.034
(0.23) (0.56) (0.54) (0.25) (0.26) (0.84)
Industry_Size 0.027 0.023 0.025 0.028 0.032 0.029
(1.20) (1.05) (1.13) (1.21) (1.18) (1.12)
Year dummies Included Included Included Included Included Included
Industry dummies Included Included Included Included Included Included
_cons 1.594* 1.962** 1.688** 1.647* 1.609* 2.179**
(1.97) (2.49) (2.09) (2.00) (1.96) (2.67)
N 61 61 61 61 61 61
R2 0.214 0.286 0.222 0.198 0.196 0.267
F 1.857** 2.203** 1.857** 1.742* 1.733* 1.951** Table 11.
Note(s): t statistics in parentheses Regression analysis
*
p < 0.1, **p < 0.05, ***p < 0.01 with operational
Source(s): Authors own creation performance
IJOPM 7. Discussion, implications and future research
This study provides an empirical assessment of how blockchain implementation can improve
the market value of companies varying from business diversification, SC concentration and
environmental complexity based on a CASs perspective. Based on 138 blockchain
implementation announcements of listed companies on the Chinese stock market, we use
event study methodology to evaluate the impact of blockchain implementation on
shareholder value. The results show that blockchain implementation has a positive impact
on shareholder value. For the announcing day, the mean (median) ARs are 0.97% (0.47%). For
the two-day event period, the mean (median) CARs are 1.06% (0.25%). We identify how
complexity factors, including business diversification, SC concentration and environmental
complexity influence the stock market reaction. Specifically, companies with higher business
diversification can bring more significant stock returns to blockchain implementation.
Interestingly, customer concentration and supplier concentration have different moderating
effects on blockchain implementation and stock market reaction. Companies with lower
customer concentration will gain more benefits from blockchain implementation. However,
the stock market reaction to blockchain implementation is not affected by supplier
concentration. In addition, from the perspective of environmental support, the
implementation of blockchain in a low-complex environment has a higher impact on stock
returns. In addition, the implementation of blockchain in a low-complex environment will
have a higher positive impact on stock returns. However, in the post hoc analysis, two of
operational performance measures, ROA and NET, showed that blockchain implementation
is negative to operational performance compared to benchmark companies within Year 0 to
Year 2. In addition, we find that contrary to short-term stock prices, customer concentration
has a positive moderating effect on blockchain implementation and operational performance.
7.1 Implications for research

First, our research finds that the impact of blockchain implementation on stock market
reaction varies from business diversification, SC concentration and environmental
complexity based on a CASs perspective. Specifically, companies with higher business
diversification have brought more significant stock returns to blockchain implementation.
An explanation is that business diversification increases the complexity of the tasks involved
in operations and the need for information processing capabilities (Gomez et al., 2016), so
companies are more likely to implement blockchain to handle the information processing and
coordination of complex tasks. Interestingly, customer concentration and supplier
concentration have different moderating effects on blockchain implementation and stock
market reaction. The stock market reaction to blockchain implementation is more positive for
companies with lower customer concentration. This finding can be explained by SC
information-sharing literature (Crawford et al., 2020; Wang et al., 2021). For companies with
higher customer complexity, the information sharing between them and their customers is
complicated, and the decentralization and traceability functions of the blockchain can better
exert its value, reduce the cost of information acquisition and improve information-sharing
efficiency (Wang et al., 2021). However, the stock market reaction to blockchain
implementation is not affected by supplier concentration. An explanation is that
blockchain implementation can reduce operating costs through information sharing
(Ak and Patatoukas, 2016). Our research shows that relying on a few major customers is
completely different from relying on a few suppliers. The research results may help to solve
the dilemma of blockchain implementation in the upstream and downstream of the SC and
guide the follow-up research. However, the implementation of blockchain in a low-complex
environment has a higher positive impact on stock returns. Although the blockchain can also
create new business models (Lumineau et al., 2021) and competitive advantages (Babich and
Hilary, 2020), the lack of sufficient resources in the highly competitive environment may Blockchain and
affect the effectiveness of blockchain implementation. shareholder
Second, this paper provides evidence of the different impacts of blockchain
implementation on short and long-term performance. Blockchain has been considered as
value
one of the most promising applications in SC management scenarios in recent years (Babich
and Hilary, 2020). However, whether blockchain can improve company performance is still
controversial (Cole et al., 2019; Hastig and Sodhi, 2020). Our research gives further evidence
that blockchain implementation can lead to positive stock returns in the short term but hurts
long-term operational performance. The short-term market response can capture the early
response of investors to blockchain implementation. When companies adopt blockchain for a
long time, the value of blockchain implementation may change (Bose and Leung, 2019). This
view will be reflected in the long-term market reaction. In the post hoc analysis, we also
complement the understanding of the moderating effect of SC concentration between
blockchain implementation and long-term operational performance. This paper provides
initial evidence that the moderator effect of customer concentration on long-term operating
performance is opposite to that of the short-term stock price. This finding seems to be
particularly important for blockchain implementation in complex SC networks and provides
preliminary evidence for follow-up research.
Third, our research gives a more comprehensive explanation of the mechanisms of
blockchain implementation from the CASs perspective. Although previous research has
regard SC networks as CASs (Choi et al., 2001; Yeoman and Santos, 2019; Zhao et al., 2019), it
received limited attention in technology-based SC. On the one hand, this research contributes
to the theory by adding a blockchain technology component to CASs. The results find that the
decentralized blockchain can support the dispersed distributed SC partners (Babich and
Hilary, 2020), improve the autonomy and spontaneity of the agents (Lumineau et al., 2021) and
promote the complex SC’s self-organizing behavior (Swierczek, 2023). On the other hand, this
study explores the complexity characteristics of SC networks based on CASs perspective,
verifies how complexity characteristics affect the effectiveness of blockchain implementation
and expands the theoretical basis of blockchain usage in complex scenarios. The theoretical
findings help to explain how companies implement blockchain to gain competitive
advantages by simultaneously considering internal operational complexity and external
environmental complexity.
7.2 Implications for practice

Although blockchain is expected to provide solutions to dilemmas in operations and SC
management, it has not become pervasive and implemented in the majority of companies
(Babich and Hilary, 2020). This phenomenon may be caused by practitioners’ uncertainty
about the impact of blockchain implementation (Babich and Hilary, 2020; Kurpjuweit et al.,
2021). Our research provides objective verification of the positive impact brought by
blockchain implementation, which will help encourage companies to implement blockchain to
obtain financial benefits. The finding can also help managers persuade shareholders or
investors to support blockchain implementation.
Our findings suggest that managers implement blockchain technology when their
businesses and SCs are complex but external environmental are not complex. First, the
decentralized and shareable characteristics of blockchain help to transfer information and
share resources among diversified business models and reduce internal coordination costs.
Therefore, we urge companies with higher business complexity to obtain more benefits from
blockchain implementation. Second, in the case of many customers, the decentralization and
traceability of the blockchain can better solve the complex information between companies
and their customers, better exert its value and improve the efficiency of information sharing.
IJOPM We suggest practitioners implement blockchain in SCs with high customer complexity.
However, due to the high competition in the complex environment, it is difficult for companies
to obtain sufficient resources to support blockchain implementation. This discovery provides
research implications for policy makers. The government can provide more financial support
to promote companies to gain competitive advantage through blockchain implementation.
The post-hoc analysis results reveal that blockchain implementation hurts operational
performance from Year 0 to Year 2. In addition, a more concentrated SC can alleviate the
negative impact of blockchain implementation on long-term operational performance.
Blockchain implementation is a complex process, and companies need to overcome various
obstacles (such as additional costs arising from the black-box effect of blockchain technology,
and special trust mechanism establishments) to successfully implement blockchain (Cole
et al., 2019; Hastig and Sodhi, 2020). Therefore, managers should be patient with the long-term
value of blockchain technology, and at the same time overcome technological obstacles
actively.
7.3 Limitation and future research

Our study has some limitations which can provide suggestions for future research. First,
considering the availability of stock price data, we limit the sample to A-share listed
companies. Therefore, we encourage future studies to verify the conclusions using private
companies, especially small and medium-sized companies. Furthermore, this study considers
the moderating effect of business diversification, SC concentration and environmental
complexity, but there may be other factors (such as the support of blockchain from previous
technical experience, technology maturity of blockchain, etc.) that may affect the relationship
between emerging technologies and stock prices (Lam et al., 2019; Nishant et al., 2017).
Therefore, future research can explore the moderating factors from the perspective of
technology and others. Finally, although we provide initial evidence that the blockchain
implementation hurts operational performance from Year 0 to Year 2, we are not clear about
the mechanisms of this negative impact. Future research can further explore the mechanisms
from different aspects to obtain more detailed insights.
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Corresponding author
Minhao Gu can be contacted at: minhaogu@tju.edu.cn
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Blockchain implementation and Blockchain and

adaptive systems perspective

2.2 Contingency factors

3.2 The moderating effect of business diversification and SC concentration

Customer Supplier Business

4. Sample and methodology

Mean Median SD Max Min

Panel A: Characteristics of BC implementation announcing companies

Year Number Percentage

Panel B: Distribution year for announcements

Industry Number Percentage

Panel C: Sample industry description (Industry two-digit CSRC code)

where N is the number of sample companies on day t.

The test statistic TS t is estimated as:

5.2 Moderation effect tests

Date Day–1 Day0 Day1 Day[1,0] Day[0,1] Day[1,1]

n 138 138 138 138 138 138

Business Diversification (BD_ Diversification). We use business diversification to measure

Herfindahl Index (BDHHI_ Diversification).

Environmental Complexity (EC_Complexity). We use the mean industry competition of the

Table 4 presents the correlations of variables used in this study.

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6 Model 7

5.3 Robust check

The Fama-factor model:

Date Day–1 Day0 Day1 Day[1,0] Day[0,1] Day[1,1]

n 138 138 138 138 138 138

Model 1 Model 2 Model 5 Model 6

CC_ 0.061** 0.489** 0.066** 0.494** 0.065** 0.512**

CC_ 0.059** 0.508** 0.059** 0.493** 0.065** 0.498** 0.064** 0.516**

CC_Concentration 0.102** 0.090**

Regression analysis for

the robust test

6. Post hoc analysis

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6

CC_Concentration 0.315** 0.334**

7.1 Implications for research

7.2 Implications for practice

7.3 Limitation and future research

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CC_ 0.061 0.489 0.066 0.494 0.065 0.512

CC_ 0.059 0.508 0.059 0.493 0.065 0.498 0.064 0.516

CC_Concentration 0.102 0.090

CC_Concentration 0.315 0.334