Enablers and Consequences of Interfirm Co-Production

As contemporary firms increase their reliance on information technology (IT) and are increasingly turning their attention to jointly creating value with their primary stakeholders, there is a growing need to understand what enablers promote from interfirm value co-creation from co-production in supply chains, how the co-production can be realized and what value can be created through the co-production. We integrate systems theory and the relational view perspectives to develop an explanatory model to explain how co-production mediates the impacts of enablers on the reciprocal benefits created in the global supply chain context. Drawing upon systems theory, we identify three constructs: platform compatibility (i.e., compatibility), co-production (i.e., synergy), and collaborative governance (i.e., integration effort). We draw on the relational view to identify two activities: process alignment and resource sharing for co-production, conceptualize three basic types of reciprocal benefits: market, innovation and anshin value, and theorize co-production—the synergy of process alignment and resource sharing activities—as key to the realization of synergy, thereby contributing to the reciprocal benefits in the context of interfirm supply chain. Based on survey data collected from 464 senior management representatives from 230 high-tech manufacturing firms from within Taiwan and China, we found 1) collaborative governance has a positive effect on platform compatibility, 2) both collaborative governance and platform compatibility promote co-production, 3) guanxi has a positive effect on collaborative governance and has a positive moderating effect on collaborative governance and co-production, and 4) co-production positively affects reciprocal benefits. Our findings highlight 1) the important role of co-production in mediating the platform compatibility and collaborative governance effects on reciprocal benefits, and 2) the complementary role of guanxi in strengthening the collaborative governance effect on co-production. These results provide insights into how firms can co-create value through enhanced interfirm co-production

Leveraging Open-standard Interorganizational Information Systems for Process Adaptability and Alignment: An Empirical Analysis

PurposeThe purpose of this paper is to understand the value creation mechanisms of open-standard inter-organizational information system (OSIOS), which is a key technology to achieve Industry 4.0. Specifically, this study investigates how the internal assimilation and external diffusion of OSIOS help manufactures facilitate process adaptability and alignment in supply chain network.Design/methodology/approachA survey instrument was designed and administrated to collect data for this research. Using three-stage least squares estimation, the authors empirically tested a number of hypothesized relationships based on a sample of 308 manufacturing firms in China.FindingsThe results of the study show that OSIOS can perform as value creation mechanisms to enable process adaptability and alignment. In addition, the impact of OSIOS internal assimilation is inversely U-shaped where the positive effect on process adaptability will become negative after an extremum point is reached.Originality/valueThis study contributes to the existing literature by providing insights on how OSIOS can improve supply chain integration and thus promote the achievement of industry 4.0. By revealing a U-shaped relationship between OSIOS assimilation and process adaptability, this study fills previous research gap by advancing the understanding on the value creation mechanisms of information systems deployment

Collaborative improvement as an inspiration for supply chain collaboration

The battlefield of competition is today moving from the level of\ud individual firms to the one of the extended enterprises, that is, networks of customers and their suppliers. This paper discusses how learning and continuous improvement today take place in processes based on daily collaboration at intercompany level, i.e. Extended Manufacturing Enterprises (EMEs). The purpose of the paper is to present a preliminary theory on Collaborative Improvement (CoI), i.e. continuous improvement at the EME level. Based on a literature review on Supply Networks, and Continuous Improvement and on evidence from two explorative case studies, the paper proposes a model for Collaborative Improvement in EMEs and discusses a research approach based on Action Research and Action Learning to further develop preliminary theory and actionable knowledge on how to foster and sustain CoI in EMEs

The Effect of Electronic Commerce in Business Value and Supply Chain Process: Evidence from Iran

This paper aims to develop and test a model to analyze the relationships between three aspects of technical electronic commerce (EC)-based information system (IS) resources and, the supply chain process integration, and business value. The paper is consistent with the perspective on IS-enabled organizational capabilities and resource based view of the firm. A questionnaire-based survey was conducted to collect data from 204 supply chain, logistics, or procurement/ purchasing managers of manufacturing firms. Findings show that supply chain process integration, a key EC-enabled organizational capability, can enhance business value. Additionally, the capability serve as a catalyst in transforming technical EC-based IS resources (technical quality of EC applications, EC advancements, EC alignment and E-branding) into higher value for a firm. Our results suggest that supply chain process integration is an important intermediate organizational capability through which value of EC-based IS resources can be materialized. However, the technical aspects of EC-based IS resources needs to developed to effectively form supply chain capabilities.Key words: Supply chain integration; Business value; Electronic commerce; Business performance; Resource-based view; Information system; E-brandin

Authority in the Age of Modularity

This paper builds upon on-going research into the organisational implications of 'modularity'. Advocates of modularity argue that the Invisible Hand of markets is reaching activities previously controlled through the Visible Hand of hierarchies. This paper argues that there are cognitive limits to the extent of division of labour: what kinds of problems firms solve, and how they solve them, set limits to the extent of division of labour, irrespective of the extent of the market. This paper analyses the cognitive limits to the division of labour relying on an in-depth case study of engineering design activities. On this basis, this paper explains why co-ordinating increasingly specialised bodies of knowledge, and increasingly distributed learning processes, requires the presence of knowledge integrating firms even in the presence of modular products. Such firms, relying on their wide in-house scientific and technological capabilities, have the 'authority' to identify, propose, and implement solutions to complex problems. In so doing, they co-ordinate networks of suppliers of both components and specialised competencies.modularity, division of labour limits, knowledge integrating firms

Co-creation in networks of SMEs: a conceptual model of the co-creation process

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Interfirm Strategic Information Flows in Logistics Supply Chain Relationships

This paper focuses on strategic information flows between buyers and suppliers within logistics supply chain relationships and on subsequent relationship-specific performance outcomes. Our analysis of dyadic data collected from 91 buyer–supplier logistics relationships finds that buyer and supplier strategic information flows positively impact the relationship-specific performance of both sharing and receiving parties. Specifically, each party gains financially from improved management of assets, reduced costs of operations, and enhanced productivity. Moreover, each benefits operationally from improved planning, control, and flexibility of resources. Buyer dependence on the supplier increases buyer strategic information flows to the supplier. Additionally, buyer IT customization and both buyer and sup plier trusting beliefs in the receiving party positively impact strategic information sharing with partners. This study suggests that partnerships for supply chain services engage in cooperative initiatives to generate relational rents and are an alternative to conventional “arms length” transactional exchanges. These partnerships need to be motivated to go beyond the sharing of order-related information (which must occur in transactional exchanges) and to share strategic information (which has the potential for both additional rent generation and risks of misappropriation)

How to develop suppliers within an Extended Enterprise towards a Digital Enterprise

Complex supply chains span the world connecting a heterogeneous network of firms. Digitisation offers them the opportunity to improve by leveraging, for example: leaner interfirm workflows, swifter data sharing, smarter analytics and knowledge management, greater automation, and empowered decision-making. However, an onerous organisational development and change programme is required to adopt such innovations and move towards a digital enterprise. Research into organisational change tends to be set within the confines of a single firm. Occasionally, it includes clusters of collaborating firms, but rarely does it cover the whole of an extended enterprise supply network. An exception is the supplier development process; yet, studies into its use for digitisation are very shallow. Moreover, research into the adoption and diffusion of enterprise-wide digital technologies has, to date, mostly had to consider them as piecemeal appendages. Suppliers will have choice and may be supportive, ambivalent, or outright hostile to the extent or pace of digital transformation. They may adopt different strategies in response to the investment, capability development, open access, and other such demands placed upon them by the focal firm. This 3-year longitudinal research programme studies Rolls-Royce and a tiered cross-section of 24 of its suppliers, in the aerospace sector, as they confront and embark upon the journey towards a digital enterprise. Literature is synthesised to create a 9 step process, with 28 implementation guidelines, which is given the descriptive title of supplier development for digital transformation (SD/DT). The SD/DT process begins with a strategic review and ends by embedding practices into routine business. The guidelines are used to initiate action research cycles which coalesce around 21 workshops held at various international locations. A theoretical framework is established using a combination of institutional and organisational learning theories. Close to 100 interviews are conducted with buyers and suppliers. Furthermore, supplier scorecards capture quantitative data on a quarterly basis across the supply base. Data is triangulated between supplier outcomes and their relative absorptive capacity. Digital minimum standards are created which provide a shared vision, common vocabulary, and framework for heterogeneous change management. Two interim waypoints are set on the journey towards a digital enterprise and progress is measured for the 24 suppliers in the cohort. Overall, an encouraging success rate is achieved. Also, the use of supplier scorecards to operationalise and measure relative absorptive capacity shows promise. There are only 3 suppliers for whom the results do not triangulate. Transferability is explored together with recommendations for further work.This research was funded by Rolls-Royce. The thesis has been cleared by Rolls-Royce for release on an open-access basis