Normally, a company does not have one supplier; it has different suppliers for which a portfolio of relationships is needed. An enormous amount of scholars developed models and frameworks for such a purpose. For example Jubert presented 15 appraches, Day et al.
This advice comes as a natural reaction to the numerous empirical studies conducted during the past decade that compare Japanese production and supply practices with those of the rest of the world.
In the automobile sector, for example, all three U. Do Japanese firms manage primarily by partnerships? Empirical data on supplier relationships in the United States and Japan across a representative set of components and technologies show this common assumption to be unjustified.
While strategic partnerships create new value, they Bensaou model supplier relationships costly to develop, nurture, and maintain. In addition, they are risky, given the specialized investments they require.
As an alternative, in this article, I propose and empirically validate a framework for managing a portfolio of relationships. My purpose is to help senior managers answer two key questions.
First, which governance structure or relational design should a firm choose under different external contingencies? This is a strategic decision because it affects how a firm defines its boundaries and core activities. Second, what is the appropriate way to manage each different type of relationship?
This is an organizational question. Types of Relationships As part of a broader project on supplier relationships, I administered a survey questionnaire, in English and Japanese, to a total of managers in all three U.
As a result, I obtained comprehensive information about the external and internal aspects of each relationship: Unique to the study was the systematic control for, and selection of, a representative cross-section of products, so as to avoid a data set with mostly self-selected strategic partnerships.
Searching for naturally occurring patterns within the data, I found a set of management variables that tend to co-vary together and interact with one another in creating effective supplier relationships.
In particular, I discovered that the level of specific investments made by either partner to the relationship significantly correlates with practices commonly associated with strategic partnerships, such as long-term relationships, mutual trust, cooperation, and wide-scope relationships that include multiple components.
The mutual exchange of specific investments therefore appeared as an interesting and valid criterion to use to compare the relationships in the data set.
When I segmented the two national samples into four generic cells using this criterion, I was startled by the result see Figure 1. These are tangible investments in buildings, tooling, and equipment dedicated to the supplier or in products and processes customized to the components procured from the supplier.
Special tools and dies are built or lent specifically for the component delivered by the supplier. This customization can, in turn, lead to tailoring some of the design work to some key components such as air conditioning or wire harnessing: This is time and effort, of course, not spent developing new business opportunities with another supplier; the benefits of these initiatives accrue primarily to this single relationship.
Tangible investments include plant or warehouse location or layout and specialized facilities and dies. We want them to put their money where their mouth is.Bensaou M (), Portfolios of Buyer-Supplier Relationships, Sloan Management Review, Vol.
40, pp. adopted a similar approach based on product and market conditions to create a supplier portfolio of our different relationship profiles; captive buyer, strategic partnership, market exchange and .
Power and interdependence are generally considered to be important concepts for understanding buyer–supplier relationships. Yet, empirical research on power and interdependence in buyer–supplier relationships is still limited.
This gap is about how buyer–supplier relationships develop over time and about how, in particular, collaborative efforts can be facilitated and maintained to deliver supply improvement and innovation in the NHS.
Bensaou’s relationship portfolio model (adapted from Bensaou). Portfolio approaches to improving procurement and supply. A Purchasing Portfolio approach to Supplier Relationship Management at Volvo Car Group IT A Purchasing Portfolio approach to Supplier Relationship Management at Volvo Car Group IT Supplier relationships can have different characteristics as well as importance for a company.
Bensaou () categorizes supplier relationships in accordance with the levels of the buyer's and the supplier's specific investments. Olsen and Ellram () classify suppliers according to the strength of the relationship and the relative supplier attractiveness, while Kraljic () uses purchasing power and supply risk as their criteria.
a model of buyer-supplier relationships in a transnational company: the role of the business network context matevž rašković, phd candidate.