Inter-organizational communication as a relational competency: Antecedents and performance outcomes in collaborative buyer–supplier relationships

Inter-organizational communication has been documented as a critical factor in promoting strategic collaboration among firms. In this paper, we seek to extend the stream of research in supply chain management by systematically investigating the antecedents and performance outcomes of inter-organizational communication. Specifically, inter-organizational communication is proposed as a relational competency that may yield strategic advantages for supply chain partners. Using structural equation modeling, we empirically test a number of hypothesized relationships based on a sample of over 200 United States firms. Our results provide strong support for the notion of inter-organizational communication as a relational competency that enhances buyers’ and suppliers’ performance. Implications for future research and practice are offered.     

How does justice matter in achieving buyer–supplier relationship performance?

This study presents an analysis exploring how four types of justice (distributive, procedural, interpersonal, and informational) influence dyadic relationship performance in the buyer–supplier context. Underpinned by loose coupling theory, we build a mediating framework in which we propose that a high level of justice (or fairness) as mutually perceived by both parties drives buyer–supplier relationship performance through bolstered coupling links in mutual knowledge sharing, continuous commitment, and relationship investment. Our survey of 216 paired manufacturers (suppliers) and distributors (buyers) in China generally supports this argument, leading to a conclusion that justice is not a direct determinant of buyer–supplier performance but a critical conduit that nourishes mid-range coupling behaviors, which in turn promotes a successful relationship. Based on findings from this study, firms are encouraged to endorse all four kinds of justice in managing supply chain relationships. However, when constrained by resources, the recommendation for managers is to focus on achieving a high level of perceptual convergence on procedural justice and informational justice with the exchange partner, because mutual perceptions of procedural and informational justice have the strongest effects on coupling behaviors and buyer–supplier relationship performance.     

Formal control and social control in domestic and international buyer–supplier relationships

Focusing on long-term buyer–supplier relationships, this article addresses two questions: (1) What are the antecedents that lead to the adoption of formal control, social control, or both? (2) What is the nature of the relationship between formal control and social control - are they substitutes or complements? We develop a model to investigate the impact of the length of cooperation and institutionalization on the use of control mechanisms. Further, we argue that in China, formal control and social control may be substitutes in domestic buyer–supplier relationships, but they may be complements in international relationships. Survey data collected nationwide with executives in 380 domestic and 200 international buyer–supplier relationships in China are used to test our hypotheses.     

Systematic review of sourcing and 3D printing: make-or-buy decisions in industrial buyer–supplier relationships

Management Review Quarterly - Additive manufacturing (AM) is regarded as a technology that has transformative and disruptive potential in nearly all industries. However, AM is not only about new...     

The interaction effect of relational norms and agent cooperativeness on opportunism in buyer–supplier relationships

In this study, we examined the effect of relational norms and agent cooperativeness on opportunism in buyer–supplier relationships. Drawing from the theoretical grounding of transaction cost economics, personality trait theory, and contingency theory, we proposed three distinct perspectives on opportunism mitigation in buyer–supplier relationships: (1) organizationalist, (2) individualist, and (3) interactionist, where relational norms, agent cooperativeness, and the interaction between them, respectively, serve as the key predictors in these three perspectives. The results of replicated experiments indicated that relational norms and agent cooperativeness interact with each other in mitigating opportunism and that the interactionist perspective yielded the highest explained variance in opportunism. This suggests that the interactionist perspective, a multi-level theoretical lens encompassing the dynamic interplay between organization-level and individual-level factors, was a more complete model in explaining opportunism than either the organizationalist or individualist perspectives. The consensus which emerged from post-experimental interviews of purchasing professionals is that agent personalities play an important role in buyer–supplier relationships. Some purchasing professionals had observed that uncooperative agents or personnel turnover in the boundary-spanning functions can substantially undermine even established relational exchanges. These qualitative findings are in line with our theoretical arguments and experimental outcomes.     

Examining supply chain relationships: Do buyer and supplier perspectives on collaborative relationships differ?

Firms are building collaborative relationships with their supply chain partners in order to achieve efficiencies, flexibility, and sustainable competitive advantage. However, it is unclear if collaborative relationships provide benefits that compensate for the additional expense associated with such relationships. Further, it is unclear what factors promote successful collaborations. This research examines collaborative relationships in two separate studies using structural equation modeling: one study examines buyers’ perceptions and the second study examines suppliers’ perceptions. The two studies are then compared using invariance testing in order to determine economic and relational factors that drive satisfaction and performance from each party's perspective. Results show that collaborative activities, such as information sharing, joint relationship effort, and dedicated investments lead to trust and commitment. Trust and commitment, in turn, lead to improved satisfaction and performance. Results from the two independent studies exhibit similarities and differences; while the conceptual model is highly similar, certain paths vary in their significance and/or their importance across buyer and supplier firms such that buyers focus more on relationship outcomes while suppliers look to safeguard their transaction specific investments through information sharing and joint relationship effort. Managerial and theoretical implications of the findings are discussed.     

The impact of cultural differences on buyer–supplier negotiations: An experimental study

In today's global economy, an ever-increasing number of companies are dealing with international partners, instigating a need to understand the impact of cultural differences on business interactions. Using Hall's distinction of high- and low-context culture, this study investigates the direct and moderating effects of cultural differences in dyadic buyer–supplier negotiations. Theory is developed regarding the impact of culture on joint profits, juxtaposing Transaction Cost Economics and the Relational View. The theory is tested with a negotiation experiment. Participants, classified by their country of origin, negotiate prices and quality levels for three products. This study finds that cultural differences within the negotiation dyad reduce joint profits when compared to dyads of participants with similar cultural backgrounds. Cultural differences also moderate the impact of trust and bargaining strategy on joint profits. Overall, this study concludes that cultural differences, as encountered in day-to-day business interactions in global supply chains, significantly impact negotiation outcomes.     

The influence of relational experience and contractual governance on the negotiation strategy in buyer–supplier disputes

This paper theoretically refines and empirically extends the debate on the type of interplay between relational experience and contractual governance in an under-researched area: supply chain disputes. We define relational experience as either cooperative or competitive; distinguish between control and coordination functions of contractual governance; and assess their interplay on the negotiation strategy used in disputes. Using a unique data set of buyer–supplier disputes, we find, in particular that increasing contractual control governance weakens the positive effect of cooperative relational experience on cooperative negotiation strategy. However, increasing contractual control governance for a buyer–supplier dyad with competitive relational experience will increase cooperative negotiation strategy. Contractual coordination governance reinforces the positive effect of cooperative relational experience. Through this study, we reach a better understanding of how and when contractual and relational governance dimensions interact; rather than whether they act as substitutes or complements as has been studied in prior research. We discuss the implications of these findings for the field of supply chain management.     

The effect of unethical behavior on trust in a buyer–supplier relationship: The mediating role of psychological contract violation

Research on trust in buyer–supplier relationships has tended to focus on the performance outcomes of a trusting relationship, as well as the processes that serve to build trust. Largely absent from the buyer–supplier literature is an in-depth examination of activities that break down trust, and the resulting effect on supplier trust in the buyer. The authors propose and test a model that evaluates psychological contract violations between a buyer and a supplier as a mediating variable of the effect of unethical activities on trust within a partnership. Survey data was collected from 110 tier one suppliers of major corporations in the state of Ohio. Our results show how a supplier's perception of a violation of the psychological contract either partially mediates or fully mediates the relationship between the buyers unethical activity and the suppliers trust in that buyer. We discuss how suppliers may demonstrate bounded ethicality when they overlook perceived unethical behaviors by the buyer.     

Implications of limited investor attention to customer–supplier information transfers

This study focuses on the market reaction to information transfers from economically linked customers. I examine whether investors have limited attention with respect to the information contained in customer earnings announcements for suppliers. Using 1083 unique customer–supplier relationships for the period 1983–2011, I find that the cumulative abnormal returns of a supplier surrounding and following linked customers’ earnings announcements are positively related to the earnings information of the customers, suggesting that customer earnings announcements convey information to suppliers. I also find that the post-earnings announcement drift in customers contributes to the cross-firm reaction, and the predictability of customer earnings surprises for suppliers’ future returns is not entirely due to limited investor attention.     

Pattern of information technology use: The impact on buyer–suppler coordination and performance

The use of information technologies between supply chain organizations has been shown to promote organizational coordination and have a positive impact on performance. Drawing from organizational theories of learning, we build on this research by proposing a model that relates the pattern of supplier use of IT to specific types of supply chain coordination activities and a comprehensive set of organizational benefits. Specifically, we evaluate how two patterns of IT use by suppliers (exploitation and exploration) relate to two specific types of coordination activities with their buyers (operational and strategic coordination), which in turn are posited to promote specific organizational benefits. Using data from 241 first-tier OEM suppliers in the computer industry, our findings show that each pattern of IT use directly promotes a specific type of coordination activity. Although both types of coordination activities are needed to achieve both strategic and operational benefits, we find each coordination activity to be uniquely promoted by a specific pattern of IT use. IT use for exploitation is found to be an antecedent to operational coordination; IT use for exploration is found to be an antecedent to strategic coordination. No crossover between pattern of use and coordination activities is found. Our findings show that to achieve a complete set of benefits, suppliers must ultimately use IT for both exploration and exploitation. These findings provide a deeper understanding of the mechanism of how the pattern of IT use can result in a comprehensive set of organizational benefits for supplier firms.     

Are relational ties always good for knowledge acquisition? Buyer–supplier exchanges in China

Relational ties between manufacturers and their suppliers serve as an important strategic resource for value creation and realization. However, conflicting evidence exists regarding their role in the acquisition of specific knowledge. This study proposes that relational ties have a nonlinear effect on specific knowledge acquisition and that this nonlinear relationship is conditional on contract specificity and competitive intensity. Results from a sample of 385 manufacturer–supplier exchanges in China demonstrate that a buyer's relational ties with its major supplier have an inverted U-shaped effect on specific knowledge acquisition from this supplier; this inverted U-shaped relationship is stronger (steeper) when contract specificity is high and competition is more intense. These findings suggest that managers should understand the benefits and downsides of relational ties in acquiring specific knowledge and avoid building highly embedded ties when they draft detailed contracts or competition is highly intensive.     

Model-based approach for importance–performance analysis

The importance that users or customers attach to various services and products is an essential part of customer satisfaction surveys. Some proposals for linking satisfaction and importance can be found in available literature. The objective is to identify and understand the dimensions with high importance but low perceived quality. These dimensions are primary candidates for focused improvement initiatives. In this study, we propose to apply a class of statistical models, denoted as CUB models, generally used to estimate the feeling and the uncertainty, to measure the importance of items on observed overall satisfaction. A questionnaire with explicit variables of importance for each dimension is considered to compare the obtained ranks with the observed ones. Then the estimated importance and the perceived quality, both obtained with the CUB models, will be jointly analyzed in different datasets coming from various fields. This approach will be compared with some others reported in the literature.     

Developing measures for performance excellence: is the Baldrige criteria sufficient for performance excellence in higher education?

The implementation of the education criteria for performance excellence (ECPE)—the education version of the Baldrige criteria—is driven by the growing need for performance excellence in higher education. Ironically the criteria meant for performance excellence have no theoretical underpinning and are based on normative performance improvement requirements. The lack of content and internal validity is reflected in some critical weaknesses in the criteria. Based on a critical review, this paper highlights potential improvements in the areas of aligning processes with the organisational mission, operations focus, customer focus, workforce focus, and performance measurement. To help enhance the ECPE, the paper develops performance measures for systematic implementation of the criteria. This is discussed in terms of defining desired outcomes, developing key measures, identifying specific indicators to track performance, and choosing methods to assess performance. The discussions provide a basis for future revisions to the ECPE.     

Task-specific abilities in multi-task principal–agent relationships

This paper analyzes a multi-task agency framework where the agent exhibits task-specific abilities. It illustrates how incentive contracts account for the agent's task-specific abilities if contractible performance measures do not reflect the agent's multidimensional contribution to firm value. This paper further sheds light on potential ranking criteria for performance measures in multi-task principal–agent relationships. It demonstrates that performance measures in multi-task agencies cannot necessarily be compared by their respective signal-to-noise ratio as in single-task agency relationships. In fact, it is indispensable to take the induced effort distortion and the measure-cost efficiency into consideration—both determined by the agent's task-specific abilities.     

An application of an integrated ANP–QFD framework for sustainable supplier selection

This study provides a novel integrated multi-criteria decision-making approach to sustainable supplier selection problems. Despite the large supply chain management literature on green performance measurement, the need for a systematic analysis of how specific sustainable variables develop and affect each other remains mostly overlooked. The proposed integrated framework allows for such an analysis. By combining analytic network process and quality function deployment, our model identifies a clear hierarchical structure for all the relevant sustainable factors and sub-factors while weighting the decision criteria based on the importance given to customer requirements. Finally, suppliers are ranked using a multi-objective optimisation procedure based on ratio analysis and weighted aggregated sum product assessment. The proposed framework is used to analyse a case study of a dairy company, but it can be easily implemented for supplier selection by any other company with similar features.     

Chain liability in multitier supply chains? Responsibility attributions for unsustainable supplier behavior

When it becomes publicly known that products are associated with suppliers that engage in unsustainable behaviors, consumers protest, as Nestlé, Zara, and Kimberly Clark, among others, have learned. The phenomenon by which consumers hold firms responsible for the unsustainable behavior of their upstream partners suggests the notion of “chain liability.” This study aims to generate insights into the antecedents and consequences of such consumer responsibility attributions. Using data from four vignette-based survey experiments, the authors find that the chain liability effect increases if an environmental degradation incident (1) results from supplier behavior rather than force majeure, (2) results from a company decision rather than the decision of an individual employee, and (3) is more severe. Responsibility attributions do not differ with varying organizational distance from the supplier, firm size, strategic importance of the supplied product, or the existence of environmental management systems. The chain liability effect also creates strong risks for the focal firm; higher responsibility attributions increase consumers’ anger and propensity to boycott. Therefore, firms should work to ensure sustainable behavior throughout the supply chain, to protect them from chain liability.     

Searching for a balance: work–family practices,work–team design,and organizational performance

The crucial impact of work–family issues on employee's well-being has been recognized and responded with a variety of research in field of organizational behavior. However, few studies examine the impact of how work–family practices affect productivity at firm-level. Following the research stream of strategic human resource management, we proposed that work–family may form the norm of reciprocity, which is a more sophisticated and more critical, internal social-structure component to enable organizational performance. We also examine the contingent effect, work–team structure – on the extent to which the work–family practices are appreciated by employees – and then create complementarities. We conduct a longitudinal study and utilize a data set of 204 Taiwanese public-traded firms to test our hypotheses. The results show that, contrary to our prediction, utilizing work–family practices does not have a significant positive impact on organizational productivity. However, the most important finding of this study is that there are synergies between work–family practices and work–team design on organizational productivity. Work–team design is an important situation in which the returns of work–family practices can be enhanced.     

The HR function in purchaser–provider relationships: insights from the UK voluntary sector

This article explores how inter-organisational relations with the state impact on the status of human resource (HR) professionals in voluntary organisations. It reveals a constrained and under-resourced HR function in voluntary organisations, implementing few strategic interventions. Explanations centre on the dynamics of power relations, institutional forces, the exercise of strategic choice and management of risk between purchasers and providers and their interaction with competencies among individual actors, attitudes of senior managers and the focus by voluntary sector managers on organisational mission. It warns that these external and internal factors will produce similar outcomes in sectors and economies characterised by arm's-length contractual relations.