Supplier Relationship Performance Research Articles

The Chinese paradigm of global supplier relationships: Social control, formal interactions and the mediating role of culture

This paper reports the results of a study that examined how firms can establish successful business relationships with Chinese suppliers. Its aim is to explore salient characteristics of the nature of buyer supplier relationships with the emergence of China as a dominant economic power. Two surveys have been conducted that investigated several factors that inhibit and enable effective supplier relationship management (SRM) between organisations sourcing from China and Chinese suppliers, and explored the impact of cultural characteristics of Chinese management on the nature and performance of supplier relationships. The research highlights the importance of the social control aspect of governance structure of supplier relationships and stresses that both social and formal control mechanisms should be implemented for more effective relationships with Chinese suppliers. It also demonstrates the need for companies to recognise the importance of guanxi and several cultural characteristics of the Chinese style of management in SRM and advocates the need for the development of a hybrid Sino-Japanese and global supplier relationship management paradigm that incorporates elements from the existing SRM models. It generates insights into how the cultural context of emerging markets affects the nature of business relationships and generates a research agenda in the field of supply chain management that can explore the development of new paradigms in supplier relationships management. The main theoretical argument put forward centres on the need for the development of a new global supplier relationship management paradigm that will take into account the cultural elements of the Chinese society.

Beyond the “Mirroring” Hypothesis: Product Modularity and Interorganizational Relations in the Air Conditioning Industry

This study explores whether, to what extent, and under which conditions modular products are associated with modular organizations (the “mirroring” hypothesis). We analyze the product and organizational architectures of three firms in the air conditioning industry through an original data set of 100 components and supply relationships. Applying a variety of regression methods, we show that, under the condition of product architecture stability at the component level, supplier relations for loosely coupled components are characterized by less information sharing, which implies that the degree of coupling of product components varies directly with the degree of coupling of organizations (the “mirroring” hypothesis). Also, the performance of supply relationships depends on the amount of buyer–supplier information sharing but not on the degree of component modularity, which supports the relational view and confirms that product modularity does not have unambiguous effects on organizational performance. Moreover, the degree of component modularity negatively moderates the impact of buyer–supplier information sharing on supplier-relationship performance, which confirms that component modularity works as an ex ante, embedded substitute for high-powered interorganizational integration mechanisms. Finally, contingent on firms' strategies, organizational structures, and capabilities, we argue that at the firm level, higher product modularity may be associated either with less information sharing with suppliers, which implies that the mirroring effect might hold also at the firm level, or with more information sharing with suppliers, which implies that there may be increasing returns to modularity in design efforts because of interorganizational integration (the “complementarity” hypothesis).

The correlations among domain knowledge specificity, joint new product development and relationship performance

PurposeThis paper aims to provide suppliers with an important direction in customer relationship management to apply organizational resources to understanding patterns and rules particular to a specific context, since the expertise deployment leads to increasingly effective issue diagnosis and problem solving. And to provide suppliers with an important government mechanism that co‐development with buyers not only reduces transaction cost, but also enhances performance.Design/methodology/approachThe conceptual model is empirically tested using cross‐sectional survey data, based on the administering of mail questionnaires to key informants within a sample of 133 Taiwanese contract manufacturers of information products. A preliminary examination of the validity of these measures is conducted with a view to examining the item‐to‐item correlations for the set of items corresponding to each of the theoretical constructs. The hypotheses were tested by ordinary least‐square regression analysis.FindingsIt is found that the joint new product development (JNPD) activities are positively related to the supplier's relationship performance (RP). Moreover, the supplier's domain knowledge specificity (DKS) positively influences the degree of JNPD and RP. Besides, it is also found that the effect of DKS on RP is partially mediated by JNPD.Research limitations/implicationsThis research collected data from only one partner to deal with supplier‐buyer dyads. The causal arguments are made in this research and yet offer only a cross‐sectional test for these arguments. This study focused on limited variables only.Practical implicationsIt is essential for suppliers to apply organizational resources to understanding patterns and rules particular to a specific context, since the expertise deployment leads to increasingly effective issue diagnosis and problem solving. Suppliers may conduct co‐development with buyers not only to reduce transaction cost, but also to enhance performance.Originality/valueThis paper fulfils an identified information/resources need and offers practical help to suppliers implementing governance strategy.

Performance measurement of supplier relationships

PurposeThe purpose of this paper is to develop an analytical model for assessing the performance of supplier relationships (SRs). The majority of performance measurement models incorporate hard quantitative measures that are not appropriate for the soft features of business relationships. As they are usually designed by the customer organisation, they are imposed on suppliers, they do not take into account the relationship as a unit of analysis and therefore they carry a bias in their interpretation.Design/methodology/approachFor the development of the model, the nature of a SR is conceptualised in terms of two typologies: one based on the level of its analysis and one based on its genesis and development and the methodology of gap analysis is used.FindingsThe performance of SRs is assessed in terms of several disparities that exist between the participating parties' perceptions of the nature and their performance to the relationship as well as their perception of their partners' performance to the relationship. The proposed model can be utilised with qualitative (interviews) as well as quantitative (survey) data. The aim of any improvement strategy for the performance of SRs should be to minimise the gaps in partners' perceptions and pursuit the role that the parties play in the relationship and identify those factors that have greater importance to the relationship. Appropriate strategies should be then selected to minimise the gaps in the perceptions of the individuals against these factors.Research limitations/implicationsThe usefulness of the model in assessing SRs' performance lies in the fact that a holistic view of SRs is achieved by taking into account both soft and hard dimensions of SRs. Contrasting the model to other performance management models its major limitation is that it cannot be used as a “scientific” diagnostic tool for suggestion of best practices. Further research is required to identify the causes behind poor performance in a particular area and then devise appropriate strategies.Practical implicationsThe proposed model can be used in different context (manufacturing or services), does not require specialised knowledge or external consulting and provides scope for improvement of relationships between departments within an organisation.Originality/valueThis paper emphasises the importance of performance measurement of SRs and proposes an innovative for performance measurement model, which overcomes the limitations of existing tools and can be applied in several contexts.

An empirical examination of the role of joint new product development in industrial buyer seller relationship

From the theoretical perspective of transaction cost economics, cooperative relationships between firms reflect the increased use of non-market governance. In addition to transaction cost, transaction value is also important to governance decision-making. Governance mechanisms can advantageously incorporate features that both enhance transaction value and minimise transaction costs. The objective of this study is to examine the associations among supplier's assets specificity, Joint New Product Development (JNPD) and Relationship Performance (RP). The conceptual model is empirically tested using cross-sectional survey data, based on the administration of mail questionnaires to key informants within a sample of Taiwanese contract manufacturers of information products. It is found that the JNPD activities were positively related to the supplier's RP. The supplier's Domain Knowledge Specificity (DKS) and Site Specificity (SS) positively influence the degree of JNPD. Besides, RP is positively associated with supplier's DKS.

Effects of Firms’ Relationship-Oriented Behaviors on Financial Performance: A Case of the Restaurant Industry

The business-to-business and business-to-customer relationship marketing literature includes little effort to develop a conceptual framework for understanding both supplier and customer relationship-oriented behaviors. The purpose of this study is to investigate how a firm’s supplier and customer relationship-oriented behaviors affect its financial performance through three relationship performance outcomes: supplier relationship performance, product and service quality performance, and customer relationship performance. The authors critically revisit extant knowledge on the subject, develop a conceptual framework integrating supplier and customer relationship management practices, and test the framework in the independent restaurant industry context. Results support the usefulness of the framework and suggest that building relationships with suppliers and customers plays an important role in providing values to restaurant firms and stakeholders such as suppliers and customers, leading to high financial performance of the restaurant firms.