Success Factors in Strategic Supplier Alliances: The Buying Company Perspective*

Authors

  • Robert M. Monczka,

    1. The Eli Broad Graduate School of Management, Department of Marketing and Supply Chain Management, Michigan State University, East Lansing, MI 48824–1121
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      Robert M. Monczka is director of the Global Procurement and Supply Chain Benchmarking Initiative, Professor of Strategic Sourcing Management, and The National Association of Purchasing Management Professor at Michigan State University. His current research efforts are directed at procurementlsourcing and supply chain strategy. Outside of the academic arena, his career consists of consulting and research with more than 150 international organizations.

  • Kenneth J. Petersen,

    1. The Eli Broad Graduate School of Management, Department of Marketing and Supply Chain Management, Michigan State University, East Lansing, MI 48824–1121
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      Kenneth J. Petersen is a research associate for the Global Procurement and Supply Chain Benchmarking Initiative at Michigan State University, and is completing a PhD in operations and sourcing management from Michigan State University. He received an MBA from the University of Akron, and a BS in finance and economics from the University of Alabama. His research interests are in strategic alliances and the use of information technology throughout the supply chain.

  • Robert B. Handfield,

    1. The Eli Broad Graduate School of Management, Department of Marketing and Supply Chain Management, Michigan State University, East Lansing, MI 48824–1121
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      Robert B. Handfield is an associate professor of purchasing and operations management at Michigan State University, and a faculty research associate for the Global Procurement and Supply Chain Benchmarking Initiative. He received a PhD in operations management from the University of North Carolina at Chapel Hill. His research combines qualitative and structural modeling approaches to the study of time-based competition, quality management and strategic sourcing. He has presented a number of seminars on these topics to materials managers, and also serves on the editorial review board of the Journal of Operations Management and Decision Sciences.

  • Gary L. Ragatz

    1. The Eli Broad Graduate School of Management, Department of Marketing and Supply Chain Management, Michigan State University, East Lansing, MI 48824–1121
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      Gary L. Ragatz is an associate professor of operations management at Michigan State University, and a faculty research associate for the Global Procurement and Supply Chain Benchmarking Initiative. He received a PhD in operations management from Indiana University, and is secretary of the Decision Sciences Institute and past president of the Midwest Region of the Decision Sciences Institute. Dr. Ragatz serves on the editorial review board of the Journal of Operations Management. His current research focuses on industry best practices in integrated supply chain management and short-term schedulingkapacity planning systems.


  • *

    Research support provided by the Global Procurement and Supply Chain Benchmarking Initiative at Michigan State University.

ABSTRACT

The emerging area of supply chain alliances has received considerable attention in the academic and managerial press, yet there are many unanswered questions regarding the dynamics of such relationships. A number of such fundamental issues drive this research initiative, including how alliances are developed, their key success factors, and the specific benefits to be achieved. The study begins by establishing a definition of strategic supplier alliances, based on a comparison of both theoretical and managerial descriptions. The critical antecedents associated with the success of strategic supplier alliances are next developed, and the magnitude of the effect of these factors on partnership success is assessed. The analysis employs both qualitative and quantitative data, collected through an electronic network of over 200 companies, as part of an ongoing benchmarking initiative in supply chain management.

From the perspective of the buying company in the alliance, the following attributes of supplier alliances were found to be significantly related to partnership success: trust and coordination, interdependence, information quality and participation, information sharing, joint problem solving, avoiding the use of severe conflict resolution tactics, and the existence of a formal supplier/commodity alliance selection process. Resource commitment and smoothing over problems were found to be poor predictors of alliance success. The implications of these results for managerial decision making in supplier alliance development are discussed.

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