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Keywords:

  • outsourcing;
  • suppliers;
  • OEM;
  • innovation;
  • learning

Outsourcing in many industries has advanced beyond simple component supply to encompass manufacturing of entire products, often by suppliers in emerging economies. Understanding the evolving role and capabilities of suppliers in global supply chains is thus a pressing strategic issue for suppliers and customers alike. We analyze a novel panel dataset of supply relationships in the mobile telecommunications industry to answer the following questions: What factors contribute to a supplier's ability to build technological and market capabilities? Does it matter to whom the firm supplies? Is involvement in product design important, or is manufacturing the key to learning? Do the same types of relationships that support technological innovation also facilitate successful introduction of own-brand products, or does this require a different “locus” of learning? Copyright © 2013 John Wiley & Sons, Ltd.