Abstract
<p>Strategic cost management in supply chains is not a new concept. Coordinated actions between companies of the same chain, in order to reduce costs and end consumer price, offer opportunities for improved results. Interorganizational Cost Management (IOCM) is a structured approach with a broad vision, beyond the borders of the organization, which aims to reduce costs at the internal and external levels. Indeed, cost management is a complex issue that permeates all areas of the organization and may pose a number of difficulties to be implemented and sustained. Thus, this work has the overall goal of identifying, in the literature, the factors and conditions that inhibit the applicability of the Interorganizational Cost Management approach. To achieve these goals, an analysis was made of 35 academic research studies available in the literature that reported the difficulties faced by companies in cooperative cost management. The analysis of the studies showed the perceptions of different companies, and described the difficulties they face; therefore, the present research is qualitative and exploratory. Factors that inhibit IOMC were grouped into: (i) corporate strategy; (ii) integration of companies; (iii) people; (iv) intra- and interorganizational processes; (v) corporate training and education; (vi) disputes between companies; and (vii) lack of trust between companies.</p>
Highlights
The evolution of markets and the increasing complexity in supply chains led to the emergence of new management techniques and new information exchange systems between companies, going through the internal environment and achieving interorganizational relations (Kulmala, Paranko, & Uusi-Rauva, 2002)
Wincent (2008) stated that interorganizational networks emerged as an alternative to the needs of companies, and inter-relationship is the future trend
Companies can gain competitive advantage by Interorganizational Cost Management (IOCM), whose goal is to find solutions that have lower costs when compared to the sum of costs of companies acting individually (Kulmala et al, 2002)
Summary
The evolution of markets and the increasing complexity in supply chains led to the emergence of new management techniques and new information exchange systems between companies, going through the internal environment and achieving interorganizational relations (Kulmala, Paranko, & Uusi-Rauva, 2002). Wincent (2008) stated that interorganizational networks emerged as an alternative to the needs of companies, and inter-relationship is the future trend. The evolution of markets and the increasing complexity in supply chains led to the emergence of new management techniques and new information exchange systems between companies, going through the internal environment and achieving interorganizational relations (Kulmala, Paranko, & Uusi-Rauva, 2002). Cooper and Slagmulder (1999) explained that Interorganizational Cost Management is a structured approach to coordinate companies’ activities in a supply chain, in order to reduce total network costs. Studies about inter-relationship claim that this approach is a tool for companies to grow in the market where they operate, generating benefits for all parties involved (Borin & Farris, 1990; Ellram, 1994; Ellram & Siferd, 1998; Cooper & Slagmulder, 1999; Ferrin & Plank, 2002; Lalonde, 2003). From an empirical point of view, there are a number of companies which fail to participate in cooperative processes, and many networks are unable to consolidate their structures and management models (Pereira, Alves, & Silva, 2010)
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
