Vol. 50, No. 2
The Role of Ego Networks in Manufacturing Joint Venture Formations
This article develops a network theory-based framework of manufacturing joint venture formations and provides an empirical test in the context of the automotive industry. Hypotheses are developed regarding the implications of the network structure for a firm's partner selection in manufacturing joint ventures. The roles of network theory constructs such as ego network size, ego network density, and ego network betweenness centrality on new manufacturing joint venture formations are explored using a dynamic framework. A comprehensive time series panel dataset with 3,247,124 observations containing the joint venture information of 1,158 automotive firms collectively engaging in 589 manufacturing joint ventures over 19 years is utilized to test the hypotheses. Results provide strong empirical support for the role of network structure in equity-based partnership formation. Specifically, ego network size and ego network betweennes centrality of both the focal manufacturer and potential partner(s) have significant effects on new manufacturing joint venture formations. Findings regarding the role of ego network density are mixed.
Steven Carnovale is a Ph.D. candidate in the Department of Supply Chain Management and Marketing Science in the Rutgers Business School at Rutgers University in Newark, New Jersey;
Sengun Yeniyurt, Ph.D., is an associate professor and Vice-Chair of the Department of Supply Chain Management and Marketing Science in the Rutgers Business School at Rutgers University in Newark, New Jersey.
Absorptive Capacity in Buyer-Supplier Relationships: Empirical Evidence of its Mediating Role
Companies increasingly depend upon the knowledge of supply chain partners to deliver superior value to customers with ever-shifting preferences. This transference requires absorptive capacity (AC), which allows an organization to identify external knowledge and convert it into value for the firm. Based on an approach of dynamic capabilities, AC encompasses three related learning processes: Exploration, assimilation and exploitation. Within the particular context of buyer-supplier relationships (BSR), the aim of this research is to examine AC; one of its most relevant antecedents, organizational compatibility; and its outcomes. Two samples of 153 and 199 companies, operating as key suppliers of two focal buyers, a European multinational retail chain and an American multinational spare parts distributor, respectively, constitute the empirical base of the study. Results derived from structural equation modeling — more precisely, multi-group confirmatory factor analysis — and a formal test of mediation, strongly indicate for both samples that AC mediates between organizational compatibility on the one hand, and innovation and efficiency performance on the other hand. Results also indicate that the mediating effect of AC related to innovation increases with demand uncertainty. This paper thus suggests that managers must be aware that the selection of supply chain partners based on their compatibility alone is not enough. AC is necessary to achieve sustainable performance improvement.
María Jesús Sáenz, Ph.D., is a professor and Ph.D. program director in the MIT-Zaragoza International Logistics Program in Zaragoza, Spain,
Elena Revilla, Ph.D., is a professor of operations management at the IE Business School in Madrid, Spain;
Desirée Knoppen, Ph.D., is a professor and the Department Head of Operations Management and Information Systems in te EADA Business School in Barcelona, Spain.
The Interplay of Relational Governance and Formal Control in Horizontal Alliances: A Social Contract Perspective
Governance is critical to an alliance relationship, as it aids in curbing opportunism and thus in achieving higher performance. While research suggests relational governance, as well as formal control mechanisms, as viable means to reduce opportunistic behavior in an alliance relationship, the effectiveness of the interplay of these governance forms remains an important issue. This research addresses this challenge by applying social contract theory to resolve the uncertainties surrounding whether relational governance, exercised by joint actions in the performance measurement process (PMP) can be complemented effectively by the formal control mechanisms of output and process controls. Based on a survey of 197 horizontal alliances of German logistics service providers, and using structural equation modeling, we find that if formal control mechanisms are legitimized by underlying agreements, which are established through relational governance (i.e., joint actions), the two governance forms indeed complement each other. However, if no such legitimization through social contracts is present, the complementation is counterproductive. Furthermore, it is shown that opportunism in the setting of horizontal alliances also is detrimental to alliance success.
Carl Marcus Wallenburg, Ph.D., is a professor of logistics and the Kühne Foundation Chair of Logistics and Services Management, at the WHU-Otto Beisheim School of Management in Vallendar, Germany;
Thorsten Schäffler, MBA, is a research fellow at the WHU-Otto Beisheim School of Management in Vallendar, Germany.
Buyer-Supplier Collaboration Quality in New Product Development Projects
Previous research has found that buyer-supplier collaboration in new product development can contribute to project success. Empirical evidence is mixed, however, and the concept of buyer-supplier collaboration is under-developed. This work develops a new construct, buyer-supplier collaboration quality, defined as the extent to which a buyer and supplier exploit shared resources while minimizing waste through interacting during project planning and execution. We use resource dependence theory to formulate inter-firm and project-level antecedents of buyer-supplier collaboration quality, and argue how it affects new product development project outcomes. Data from an empirical survey of 214 buying organizations validate the measurement structure of the new construct and support its positive associations with design quality and project efficiency. We also find that goal congruence, complementary capabilities and inter-firm coordination efforts increase buyer-supplier collaboration quality, while inter-firm relationship-specific investment reduces it.
Tingting Yan, Ph.D., is an assistant professor in the Department of Marketing and Supply Chain Management at Wayne State University in Detroit, Michigan;
Kevin Dooley, Ph.D., is a professor of supply chain management in the W. P. Carey School of Business at Arizona State University in Tempe, Arizona.
Understanding the Role of Government and Buyers in Supplier Energy Efficiency Initiatives
In environmental management, companies must respond to myriad needs and pressures from stakeholders such as buyers, regulators, communities and NGOs. While researchers recognize that these stakeholder entities have different saliency and influences over a focal firm, the influences from multiple stakeholders often are aggregated as a single factor, overlooking differences among them. Stakeholders may have competing demands. A buyer may consider only potential environment cost trade-offs, while the government balances the environment, increased cost-competitive manufacturing and job creation. Such demands compete for the same resources within the suppliers' organization, forcing suppliers to satisfice and compromise. This study qualitatively examines Chinese suppliers' responses to requests to adopt energy efficiency (EE) initiatives in their production plants by two of their most critical stakeholders: buyers and the government. We identify three categories of EE initiatives implemented by the suppliers and find that their implementations are contingent on their ownership characteristics and value alignment with these two stakeholders. Further, we find that suppliers interpret buyers' motives regarding EE in the context of buyer-supplier relationships and the environmental positioning of the buyers' products. These findings are articulated in a set of propositions that are introduced based upon our analysis of these case study data.
Zhaohui Wu, Ph.D., is an associate professor in the College of Business at Oregon State University in Corvallis, Oregon,
Lisa M. Ellram, Ph.D., is the Rees Distinguished Professor of Supply Chain Management in the Department of Marketing at the Farmer School of Business at Miami University in Oxford, Ohio;
Ryan Schuhard, MBA, is a manager at Business for Social Responsibility (BSR), a non-profit organization that works with business to create a just and sustainable world.