Abstract
With increasing numbers of nodes and links in supply network relationships, understanding partnership management and the required level of collaboration is important for sustainable supply network alignment. This study explores the impact of partnership orientation on partnership commitment and firm performance using a model based on social capital theory and resource dependence theory. It aims to understand the appropriate partnership orientation for the desired level of commitment and firm performance, including innovation, operational, and financial performance. Using a survey of 423 respondents representing three different partnership structure types (supplier, buyer, and parallel-aligned firms’ perspectives), the relationship between partnership orientation and commitment in enhancing firm performance is investigated using structural equation modeling. Additional analysis identifies the moderating role of commitment and investment exchange on performance. The findings show that positive relationships between both investment and contractual-based partnership orientation positively contribute to partnership commitment, but the direct association between partnership commitment and firm performance type varies by partnership structure. Furthermore, (i) investment exchange level moderates the relationship between commitment and innovation and operational performance regardless of partnership structure type, (ii) negative investment exchange signals higher firm performance from the buyer firm’s perspective, and (iii) positive investment exchange is absolutely necessary for financial performance from the supplier firm’s perspective.
Highlights
With increasing numbers of nodes and links in supply network relationships, understanding partnership management and the required level of collaboration is important for sustainable supply network alignment [1,2]
Based on social capital theory, which emphasizes the importance of relational resources, such as relational capital, cognitive capital, and structural capital, social capital was emphasized as the relational glue that contributes to a collaborative behavioral outcome [11]
We are interested in the structural capital part of social capital, which can turn into a positive behavioral outcome, such as sustainable commitment through appropriate partnership
Summary
With increasing numbers of nodes and links in supply network relationships, understanding partnership management and the required level of collaboration is important for sustainable supply network alignment [1,2]. Based on the direct associations between the presence and depth of partnership and the three types of firm performance (innovation, operational, and financial), this study further investigates partnership structure type (parallel-aligned, supplier, or buyer firms) to obtain a better understanding of various firms’ perspectives. To offer a more complete view of strategic partnership management and its impact on firm performance for SCM sustainability, different levels of social capital must be examined across the relationship. This study aims to fill this gap in the literature This approach offers an important implication, as it explores the differential effect of partnership orientation and commitment on firm performance. Based on a theoretically driven model, the research aimed to help both researchers and business practitioners to gain a deeper understanding of appropriate partnership orientation for the desired level of commitment and firm performance, including innovation, operational, and financial performance. Using a survey of 423 respondents representing various partnership structure types, the research aimed to develop reliable and valid instruments, and to perform structural equation modeling for the empirical findings
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