Together we share? Competitive and collaborative supplier interests in product development

While supplier involvement in product development projects can contribute with valuable knowledge and expertise, such involvement also poses organizational and managerial challenges, particularly if several rival suppliers are involved. This paper explores these challenges in the wind turbine industry, based on two interrelated Danish case studies. The analysis results in three propositions regarding how supplier rivalry and technological specialization influences roles, coordination patterns and communication between actors in distributed product development projects.     

Does supplier development lead to supplier satisfaction and relationship continuation?

The primary purpose of this study is to find out if supplier development can serve as a means for buying firms to actively increase supplier satisfaction and eventually predict relationship continuity. Supplier relationships provide an essential means for buying firms to access and leverage supplier resources. One way in which buying firms influence the supply management process is through supplier development. The findings show that supplier development is an important means by which buying firms can increase supplier satisfaction. Supplier development significantly predicts the future of business relationships. Further analysis based on polynomial regressions provides evidence to show how congruence or discrepancy between economic and non-economic satisfaction impact continuance.     

Partnering in the construction industry—Problems and opportunities

During recent years partnering has been on the top of the management agenda in the construction industry. Despite this attention there is limited and partly contradicting evidence of the impact of these efforts. The objective of this literature-based paper is to explore why it has been difficult to realise potential partnering benefits on the strategic level, while partnering in individual projects has improved construction performance. The analysis builds on a comparison of the features of business relationships in construction with the characteristics of so called ‘high-involvement relationships’ based on close cooperation. It is concluded that prevailing supply arrangements established to handle the particular conditions in the construction industry makes it unlikely for partnering to reach outside the individual project. Taking the step to strategic partnerships would require modification of some of the basic assumptions and norms of industry efficiency. On the basis of this analysis we explore potential consequences of modifications of current behaviour with respect to decentralisation and competitive tendering. The paper is finalised with a suggestion for a differentiated approach to partnering.     

Bring your suppliers into your projects—Managing the design of work packages in product development

Early supplier involvement and integration is important in product development on strategic as well as on operational, project and team levels. Saab Aerospace intended to achieve early supplier involvement and high level of integration on all levels in the redesign of the aircraft JAS 39 Gripen. The research underlying this article shows that the intended strategy was only achieved on the strategic level and not on the operational project and team levels. One major reason for this was that the design of the work breakdown structure (WBS) and work packages (WP) in the product development followed the functional and departmental logic within each company resulting in incompatible structures and preventing communication and information exchange. This article intends to explore how prevailing functionally designed WBS and WP structures created barriers and to demonstrate how supplier integration can be improved by designing collaborative WBS and integrated WP. The Dependence Structure Matrix (DSM) is introduced in order to analyze, visualize and manage interdependencies and information exchange between Saab Aerospace and its supplier on different levels of the WBS and in different phases of the development process, following the logic of interdependencies and information flow, in order to support a strategy focusing on integration of suppliers on the project and team level.     

Do dependent suppliers benefit from buying firms’ sustainability practices?

In view of the limited understanding and research on the effect of sustainable supplier development practices on supplier performance, this study examines the impact that the implementation of assessment and collaboration practices have on supplier performance outcomes. In addition, we investigate the role that supplier dependence has on the performance outcomes of assessment on and collaboration with suppliers. Based on a sample of 129 Chinese manufacturing firms, we run a series of OLS regressions to test our theoretical models. The findings suggest that collaboration improves supplier performance, while assessment causes a deterioration. In addition, supplier dependence could be leveraged for suppliers to gain performance improvements through collaborative practices.     

Antecedents and consequences of social capital on buyer performance improvement

The ability to leverage social capital within strategic buyer–supplier relationships is increasingly cited as a key driver of value creation. Despite the importance of strategic partnerships, the process by which social capital accumulates within buyer–supplier relationships and contributes to buyer performance improvements is not well understood. Drawing on social capital theory, we develop a model linking positive relational capital, and its antecedents, supplier integration and supplier closeness, to buyer performance improvements. Further, we hypothesize that structural capital, as reflected in managerial communication and technical exchanges, is also positively related to buyer performance improvements. Using data provided by 111 procurement executives from the United Kingdom, we find support for our hypotheses. The study extends the supply chain management and social capital literature and suggests important implications for both research and practice.     

Supplier's involvement and success of radical new product development in new ventures

Supplier involvement is essential to a new venture seeking to develop a radical innovation. Despite this, prior literature has not adequately addressed supplier involvement in radical innovation, nor what the antecedents to increased supplier involvement are. We build and test a conceptual model of the antecedents and new product performance outcomes of supplier involvement in the development of radical innovation by new ventures. Antecedent variables (supplier's specific investments and the new venture's qualification of the supplier's abilities) are drawn from the transaction cost analysis literature. We include new venture's relative power and new venture's level of commitment to the supplier as contingency conditions. We develop a set of hypotheses relating supplier involvement to radical innovation performance, relating the antecedent variables to supplier involvement, and also testing the interaction effects of the two contingency conditions. We gather data from both new ventures and their major suppliers for 173 recent radical innovation projects, and use hierarchical regression analysis to test our hypotheses. We find that the contingency conditions moderate achieved levels of supplier involvement, and also find a direct relationship between achieved level of involvement and performance. We conclude with theoretical contributions and managerial implications.     

Analysis of the effect of risk management practices on the performance of new product development programs

Risk management is receiving much attention, as it is seen as a method to improve cost, schedule, and technical performance of new product development programs. However, there is a lack of empirical research that investigates the effective integration of specific risk management practices proposed by various standards with new product development programs and their association with various dimensions of risk management success. Based on a survey of 291 product development programs, this paper investigates the association of risk management practices with five categories of product development program performance: (A) Quality Decision Making; (B) High Program Stability; (C) Open, problem solving organization; (D) Overall new product development project success; and (E) overall product success. The results show that six categories of risk management practices are most effective: (1) Develop risk management skills and resources; (2) Tailor risk management to and integrate it with new product development; (3) Quantify impacts of risks on your main objectives; (4) Support all critical decisions with risk management results; (5) Monitor and review your risks, risk mitigation actions, and risk management process; and (6) Create transparency regarding new product development risks. The data shows that the risk management practices are directly associated with outcome measures in the first three categories (improved decision making, program stability and problem solving). There is also evidence that the risk management practices indirectly associate with the remaining two categories of outcome measures (project and product success). Additional research is needed to describe the exact mechanisms through which risk management practices influence NPD program success.     

供应商参与产品创新的供应链协调研究

考虑供应商对产品创新的投入会影响未来需求,分析了初始需求为确定型和随机型两种情况下,供应商的最优创新投入策略和制造商的最优订货策略,给出了实现供应链协调的条件。研究表明,在确定初始需求下,要实现供应链的协调,只需要制造商给予创新失败的供应商一定的创新补贴;而在随机初始需求下,创新补贴与其他机制同时使用才能实现供应链协调。     

A providers’ perspective on supplier relationships in performance-based contracting

As companies are concentrating on core competencies, they increasingly require their suppliers to provide full solutions rather than individual offerings. Many of these solutions, a specific one being “performance-based contracting” (PBC), require a systems integration approach from the providers, who strongly depend on their sub-suppliers’ contributions. Yet, while research on PBC is increasing and some implications for the customer–provider relationship have been identified, no study has been undertaken to analyse the implications of PBC on the upstream suppliers, specifically how the relationship is impacted by results-oriented concepts such as PBC, how suppliers are aligned to the PBC outcome and how they participate in the performance-based compensation. This paper seeks to address this gap, combining a theoretical approach and an empirical approach. The challenges resulting from PBC on the supplier relationships of PBC providers are first analysed from an information economics perspective. Then, a case study approach with insights from typical PBC industries such as defence or aerospace was used to validate and enhance the study. The findings show that despite opposing assumptions in previous literature, PBC suppliers are not involved into the concept’s specifics in a dedicated way, giving away the potentials of a proper alignment. Based on this, a governance portfolio model for the PBC providers’ supplier relationships is developed. The paper is concluded with managerial and theoretical implications.     

The ‘T-Shaped Buyer’: A transactional perspective on supply chain relationships

This paper challenges the normative view of interdependent buyer-seller relationships and provides a more holistic perspective of the contextual reality that shapes buyer behaviour. By proposing an innovative qualitative methodology, which focusses on boundary-spanning, pre-sales interactions, the research penetrates complex and commercially sensitive buyer-seller relationships. The longitudinal research design uses web-based diaries and follow-up interviews to explore conditions of power based interdependence between buyers and sellers. The ensuing data is mapped using qualitative content analysis and the results are aggregated graphically for assessment. Using this approach the study develops a nuanced view of the dominant patterns of buyer behaviour, and challenges the opinion that a search for competitive advantage will strengthen cooperative relationships in conditions of power based interdependence. The paper introduces the metaphor of the 'T-Shaped Buyer' to explain the empirical findings and, while acknowledging the contextual limits of the study, suggests that this metaphor may cause both academics and practitioners to reflect on normative thinking.     

New product development in foreign customer relationships: a study of international SMEs

Abstract

This study identifies a gap in research concerning how small and medium-sized enterprises (SMEs) can benefit from pursuing locally (rather than globally) oriented internationalization strategies. Becoming overly dependent on one single foreign market could potentially reduce the inflow and diversity of new knowledge that can serve as input for new product development. This study discusses how this risk can be minimized. In this endeavour we create a theoretical model that investigates how the local sales concentration and relationship-specific commitment of SMEs relates to new product development. To do this we draw on the behavioural internationalization process framework. The theoretical model is tested on an effective sample of 188 Swedish SMEs. The results show that relationship-specific commitment mediates the effect of local sales concentration on new product development. The implication is that investments which enable collaboration in important business relationships are crucial requisites for keeping firms innovative and in pace with market fluctuations. The findings thus contribute to international business literature by showing that a local market scope of operations combined with a relationship orientation are beneficial for new product development in international SMEs.     

A contingent theory of supplier management initiatives: Effects of competitive intensity and product life cycle

Direct investments in supplier development and close relationship building are the two major collaborative supplier management strategies for developing and accessing superior supplier capability. The impact of these two strategies, however, has not been uniform across firms, calling for a deeper examination of their relative effectiveness. Utilizing multiple theoretical frameworks, this study examines the relevance and effectiveness of the two collaborative strategies across the growth and maturity stages of the product life cycle (PLC). Specifically, the study analyzes the influence of competitive intensity as an antecedent to supplier development and relational initiatives, and the role of product life cycle as a moderator of the inter-relationships among competitive intensity, supplier development, relational initiatives, and supplier capability. Based on primary survey data, and discussion with practicing managers, the study finds that the individual and integrative effectiveness of supplier development investments (SDI) and relational orientation (RO) can be influenced differently by competitive intensity and PLC stage. In particular, RO can have a foundational role in motivating SDI for superior supplier capability, as also in safeguarding against supplier opportunism in the standardized product market context of the maturity stage. The managerial and theoretical implications of varied emphasis on the two collaborative supplier management strategies across the PLC stages are discussed.