Understanding supplier selection practices: Differences between u.s. And korean executives

Over the past decades, U.S. firms have increasingly explored strategic supply chain partnerships with Asian firms. Although shaken by the financial crises in 1997, Asian firms also continue to make significant investment in the U.S. and develop strategic supply chain partnership with U.S. firms. These trends have prompted academic researchers to start focusing on global supply chain management prac‐tices. One important domain of supply chain management is the selection of sup‐pliers. This research examines the differences in supplier selection practices between U.S. and Asian (in particular, Korean) executives. The results provide important implications for both U.S. and Korean firms to successfully manage global supply chain management. ? 2001 John Wiley & Sons, Inc.     

Strategic and Operational Determinants of Relationship Outcomes With New Venture Suppliers

While the vast majority of the supplier selection and development literature has focused on relationships between mature, established firms, significantly less attention has been paid to relationships between established firms and new, entrepreneurial ventures. This study addresses this important topic and, using an interdisciplinary lens, investigates the question of how established buying firms can work with new ventures to achieve desired relationship outcomes. Drawing on the literature from the disciplines of entrepreneurship and supply chain management, we propose a theoretical model that links buying firms' strategic orientation in supplier selection (innovation and cost in strategic supplier selection) and operational approach in supplier development (direct and indirect development of new venture suppliers) with new venture‐specific relationship outcomes (purchasing volume and realized innovations). The model's predictions are tested on cross‐sectional survey data from 136 buying firms. Our results contribute to the emerging research stream at the supply chain management–entrepreneurship interface and enhance the understanding of relationships between established firms and new ventures.     

A typology of small- and medium-sized supplier approaches to social responsibility

Research on socially responsible supply chains has tended to define suppliers over-simplistically as either responsible or irresponsible. This paper illuminates the varied roles of broadly socially responsible small and medium sized enterprises by seeking to discern the differences and highlight the heterogeneity of the approaches taken. Distinguishing our approach from extant corporate social responsibility categorisations, a typology is outlined, drawing on Jungian Theory of Extraversion and the strategic capability of smaller firms. The analysis suggests four groupings of socially responsible small and medium enterprise supplier: strategic engager; strategic contemplator; active connector and active reflector. Overall, the paper seeks to inject nuance into discussions regarding supplier social responsibility practices, adding to the small business social responsibility literature, as well as unifying a number of strands of research relating to supply chain responsibility. The proposed typology offers firm foundations for further empirical and conceptual research in the area.     

Impacts of supplier–buyer relationships on modularization in new product development

Globalization of markets and new business practices are prompting high-tech firms to reconsider their strategic thinking, especially in supply chain and R&D management. This paper examines the effects of supplier–buyer relationships on modularization by evaluating the opportunities of modularization and corresponding interface constraints of a product at four different levels: component, module, sub-system, and system. The scope of modularization sensitivity is assessed in terms of the product's architecture, interface compatibility effects, component customization, value inputs, and supplier–buyer interdependence. The example of windshield wipers controller for Chrysler Jeeps illustrates that, higher opportunities for modularization can be attained through a more collaborative form of supplier–buyer partnership.     

The Roles of Business Ethics in Conflict Management in Small Retailer–Supplier Business Relationships

Any ongoing relationship involves conflict. While facing conflict can be a serious matter for small firms with limited resources and capabilities, little is known about conflict management or the role of an ethical foundation, or business ethics, for small businesses. This study examines some influential factors regarding conflict management and the role of business ethics in satisfactory business relationship building in the context of small retailer–supplier relationships. The proposed model identifies (1) the relative importance of business ethics and role performance as antecedents and (2) two dimensions of satisfaction (social and economic) as consequences. The data, collected from small apparel retailers in the United States, clearly demonstrate the powerful role of business ethics. The positive perceptions of small retailers regarding supplier business ethics significantly reduces retailer–supplier conflict and increases retailer–supplier social satisfaction. Supplier role performance does not contribute to a reduction in retailer–supplier conflict as perceived by small retailers, but it does enhance the economic satisfaction of retailers, which further increases their social satisfaction. The functional benefits of conflict provide interesting insight. Providing several meaningful implications, this study demonstrates the unique aspects of conflict management within small retailer–supplier relationships.     

PARTNER CONGRUENCE IN ELECTRONIC DATA INTERCHANGE (EDI)‐ENABLED RELATIONSHIPS

Business partnerships are a prerequisite for an effective supply chain. EDI‐enabled business partnerships are crucial in linking suppliers and customers. This paper develops congruence factors for customer‐supplier EDI partnerships. Data were collected from sixty‐four customer‐supplier dyads of firms using a questionnaire instrument. By factor analyzing thirty‐one items, six congruence factors were identified: top‐level strategic commitment, trading partner flexibility, joint partnering for EDI, readiness for high‐level EDI implementation, EDI infrastructure, and partner communication. Additional analysis revealed that customer firms placed significantly more emphasis on congruence factors than supplier firms except for “joint partnering for EDI.” These findings have implications for assessing business partnerships in the networked economy.     

Organization Context and Human Resource Management in the Small Firm

This paper examines the relationship between organization contextual variables and human resource management (HRM) practices in small firms. The proposed model is based on an integration of theoretical perspectives, including the resource-based approach, institutional theory, transaction cost economics (TCE), and concepts from strategic management. The model is explored empirically, with qualitative and quantitative analyses of data collected from a sample of sixteen small Dutch firms. Specific contextual variables examined include company size, the presence of a collective labor agreement, having a large firm associate, either as supplier, purchasing group or franchiser, and the company's strategic orientation toward growth (growth strategy). An important finding is the significance of having a large firm associate. Companies with a large firm associate are more likely to report having employer-based training programs. As predicted, company size is associated with more formal HRM practices, including greater regularity of performance appraisal and greater likelihood of employer-based training. A weak relationship is found between a more growth-oriented strategy and greater formality of these two HRM practices. Predictions based on collective labor agreements are not supported. The paper concludes that the findings warrant further research on the relationship between organization contextual variables and the formalization of HRM practices, although a clearer definition of the latter variable is needed in future research.     

THE BENEFITS OF USING E‐BUSINESS TECHNOLOGY: THE SUPPLIER PERSPECTIVE

The use of e‐business technologies between supply chain organizations has primarily been examined from the viewpoint of buying firms or retailers, with little attention given to the benefits accrued to suppliers. Further, previous studies have been limited to either financial or marketing performance measures, or a narrow range of operational measures. This study builds on research in this area by testing a model of the relationship between supplier use of e‐business technologies in communication with their primary buyer, degree of buyer‐supplier coordination, and a complete set of benefits that include strategic and operational performance measures. Using data from 241 first‐tier OEM suppliers in the computer industry, the findings show that supplier use of e‐business technologies positively impacts organizational benefits both directly and indirectly by promoting buyer‐supplier coordination.     

Crossing the borderline in strategic corporate philanthropy: Dangote and the construction of cement roads in Nigeria

Using the case of Nigeria's Dangote Group and an exploratory research technique, we critique CSR practices in a developing country context based on a three‐pillar model—traditional CSR, strategic CSR and strategic business engagements. Our paper makes a unique contribution by revealing how a company can transform its strategic CSR into strategic business engagements that permit it to circumvent public procurement laws and secure public contracts at non‐competitive terms. We show how, in weak institutional and regulatory contexts, strategic CSR could be turned to a tool for rent extraction and profit maximization. We advocate for regulatory measures that impose ex ante and ex post limits on the extent to which firms can go in integrating CSR into their normal business operations. Based on the outcomes from this important African case study, we illustrate and propose the strategic business engagement model as a new framework for analysing the social benefits of strategic CSR practices in developing countries.     

Social Sustainability in Selecting Emerging Economy Suppliers

Despite the growing public awareness of social sustainability issues, little is known about what drives firms to emphasize social criteria in their supplier management practices and what the precise benefits of such efforts are. This is especially true for relationships with international suppliers from the world’s emerging economies in Asia, Latin America, and Eastern Europe. Building on stakeholder theory, we address the issue by examining how pressures from customers, the government, and employees as primary constituencies of the firm determine the extent to which firms consider social aspects in the selection of emerging economy suppliers. Further, we analyze how such socially sustainable supplier selection relates to the capabilities of the firm’s suppliers, its market reputation, and the learning in its supply management organization. We test the developed research framework empirically using data from 244 U.S. and German corporations. Our findings, consistent with our hypothesized model, suggest that middle-level supply managers as internal stakeholders play a major driving role for firms’ socially sustainable supplier selection, and that strong positive links exist between that selection and the investigated outcomes.     

Strategic Goals and Practices of Innovative Family Businesses

A profile of 231 Washington state family businesses is presented. This article focuses on the business strategies of these firms, analyzing the relationship between strategy, performance, and business practices. Firms categorized as Prospector firms reported more gains in their current market position than all other strategic types. These firms were more likely to value an effective management and employee team and to develop new quality products and services and career development plans for non-family employees. Implications for family businesses are discussed.     

The Dark Side of Buyer Power: Supplier Exploitation and the Role of Ethical Climates

Media increasingly accuse firms of exploiting suppliers, and these allegations often result in lurid headlines that threaten the reputations and therefore business successes of these firms. Neither has the phenomenon of supplier exploitation been investigated from a rigorous, ethical standpoint, nor have answers been provided regarding why some firms pursue exploitative approaches. By systemically contrasting economic liberalism and just prices as two divergent perspectives on supplier exploitation, we introduce a distinction of common business practice and unethical supplier exploitation. Since supplier exploitation is based on power, we elucidate several levels of power as antecedents and investigate the role of ethical climate as a moderator. This study extends Victor and Cullen’s (1988) ethical climate matrix according to a supply chain dimension and is summarized in an integrated, conceptual model of five propositions for future theory testing. Results provide a frame of reference for executives and scholars, who can now delineate unethical exploitation and understand important antecedents of the phenomenon better.     

Competing with Marketing Channels and Logistics in Africa's Booming Markets: An Investigation of Emerging Supply Chain Management Practices in Ghana

Using Ghana as the African context for testing the applicability of supply chain management, this study reveals that firms there place less emphasis on logistics and channels management practices relative to product and pricing marketing mix elements. However, this situation is changing in response to the perceived positive impact of the regulatory and technological environment on market-share competitive performance. Those firms that emphasize integration of both logistics and channels management practices exhibited the strongest competitive market-share and financial performance; firms whose practices placed moderate emphasis on both logistics and channels management integration reported moderate levels of market-share and financial performance. These results suggest that firms in Ghana compete along a continuum of supply chain integration primarily on the basis of the increasingly market-oriented business environment.     

Strategic and Business Planning Practices of Fast Growth Family Firms

Fast-growth family firms were surveyed about their business and strategic planning practices. Of the 65 fast-growth family firms surveyed, the majority prepare written formal plans. The business plans are in sufficient detail to enable the business to tie planning to actual performance and to adjust management compensation accordingly. The majority of the firms regularly share information with employees regarding comparisons between actual company performance results and goals or planned performance. Further, the majority of the firms describe their business strategy as a high quality producer strategy rather than as a low-cost or time-based strategy. Further, when bringing new products to market, these fast-growth family firms adopt a first mover or early follower strategy. Implications of these findings for growth-oriented family firms are presented.     

Toward a Model of Understanding Strategic Decision‐Making in Micro‐Firms: Exploring the Australian Information Technology Sector

This study explores strategic decision‐making (SDM) in micro‐firms, an economically significant business subsector. As extant large‐ and small‐firm literature currently proffers an incomplete characterization of SDM in very small enterprises, a multiple‐case methodology was used to investigate how these firms make strategic decisions. Eleven Australian Information Technology service micro‐firms participated in the study. Using an information‐processing lens, the study uncovered patterns of SDM in micro‐firms and derived a theoretical micro‐firm SDM model. This research also identifies several implications for micro‐firm management and directions for future research, contributing to the understanding of micro‐firm SDM in both theory and practice.     

Strategic Options in the Digital Era

The collapse of the dot-com euphoria coupled with the downturn in the business cycle is driving many firms to abandon their high-growth strategies in favor of current earnings. This article argues that, whilst hedging against adverse future conditions, firms must retain an ability to seize up-side business benefits by framing IT investments as strategic options. The authors use three illustrative examples to develop a strategic management process that they term the "Strategic Options Navigator". They conclude by drawing implications for CEOs, CIOs and CFOs.     

Seeking knowledge or gaining legitimacy? Role of social networks on new practice adoption by OEM suppliers

This study tests two competing views (namely, institutional theory and organizational learning theory) regarding the role of social networks on firms' new practice adoption from 1999 to 2008 in Taiwanese high-tech sector firms that operate under the Original Equipment Manufacturer (OEM) supplier model. Empirical data analysis shows that the sampled suppliers adopt customer relationship management (CRM) systems mostly to gain legitimacy, while they adopt supply chain management (SCM) systems with joint desires of gaining legitimacy and seeking knowledge in the OEM network. The findings indicate that social networks provide firms with a dedicated mechanism for assessing the logic of adopting new practices.     

Human resource management: Challenges for graduate education

Despite a recent paradigm shift in many firms from an employee advocate model to a strategic business partner model, human resource (HR) management is still seen by some as not adding value to organizations. This article briefly summarizes a few of the challenges for HR graduate education at both the master's and doctoral degree levels. Emphasis is placed on the ever-increasing need to produce human resource professionals and managers, in general, who recognize and appreciate the value and relevance of HR's contributions to the attainment of strategic organizational outcomes as a strategic business contributor.     

Enrolling in global networks and contingencies for China's solar PV industry

This study tests the contention in the Asian business systems literature that interacting with global managers and increasing experience via international education are ways by which Asian firms enroll in global networks, thus potentially leading to changes in their broader network contingencies. Chinese solar PV firms are examined given the competitiveness of Chinese products in the global marketplace and the importance being placed on solar energy domestically as China confronts increasing pressure to protect its environment and control pollution while meeting mounting energy needs. Results indicate an emphasis on extra-firm institutional network relationships both within and outside of China for all firms, characteristic of a bourgeoning energy sector. A unique result is that buyer–supplier networks are spatially influenced by extra-local managerial education. Enrolling in wider networks also matters as firms with internationally educated managers have more non-mainland Chinese managers, which mitigates traditional management practices at home.     

Wal-Mart: Supplier performance and market power

This research seeks to further the understanding of the relationship between Wal-Mart and its suppliers. 1988-1994 demonstrates Wal-Mart's market power in relation to manufacturers [Bloom PN, Perry, VG. Retailer power and supplier welfare: the case of Wal-Mart. Journal of Retailing 2001; 77( 3): 379-396.]. Wal-Mart suppliers for that period had lower profits than non-suppliers, which indicate a dependency model of market power when suppliers give concessions to a stronger retailer in order to obtain or maintain the relationship. Wal-Mart's dramatic growth and increasing marketing power since the 1988-1994 period offer an opportunity to retest previous findings and further the understanding of a major retailer's strategy for managing suppliers through the use of the strategic profit model. Initial results indicate that gross margin is significantly less for Wal-Mart suppliers than non-suppliers indicating pricing concessions and a dependency model of market power. However, a fixed-effects model controlling for unobservable firm characteristics such as strategic choice suggest that Wal-Mart suppliers are self-selecting or are implicitly pre-screened such that Wal-Mart suppliers have a low-cost strategy and choose lower returns as a market strategy. Findings indicate that small firms do experience a dependency model in that they have lower gross margin, lower operating income, and higher turnover. However, considering fixed-effects for these firms, small manufacturers experience only higher turnover as a result of doing business with Wal-Mart, thus indicating more of a partner-type model of market power.