Buyer and Supplier Collaboration Strategy for Development and Production in the Korean Auto Industry

Abstract

Purpose - This paper aims to articulate determinants of inter-organizational cooperation based on to the extent to which inter-organizational tasks are related to product development and production processes. Design/Methodology - This research conducted OLS regression analysis based on the data acquired from questionnaire survey in Korean auto industry. Findings - Our analysis has verified that complementary and compatible resources, as well as physical and human asset specificities, positively affect inter-organizational product development cooperation. Conversely, in the production process, only complementary resources positively affect interorganizational cooperation, whereas compatible resources and physical asset specificity have a negative influence. The changing characteristics of compatible resources (with IT innovations and AI), and physical asset specificity (influenced by a rising need to reduce production costs), cause interorganizational cooperation in production to decrease. Originality/value - This research attempts to expound upon these determining factors of interorganizational cooperation by considering both complementary-compatible resources and asset specificity in product development and production simultaneously. The reason why the impact of complementary-compatible resources and asset specificity on inter-organizational cooperation is critical in understanding the determinants of inter-organizational cooperation is that the attributes of complementary-compatible resources and asset specificity in production have changed drastically due to the continuing diffusion of IT innovations and AI (Artificial Intelligence).