Management control of supplier relationships in manufacturing: a case study in the automotive industry.

This paper studies management control design of supplier relationships in manufacturing, a supply chain phase currently under-explored. Compared to supplier relations during procurement and R&D, which research found to be governed by a combination of formal and informal controls, supplier relations in manufacturing are more formal, so that they could be governed by more formal and less informal controls. To refine the management control system and influencing contingencies, we propose a theoretical framework specifically adapted for the manufacturing stage. This framework is investigated by an in depth case study of the supplier management control of a Volvo Cars production facility. We identify three types of suppliers visualizing the associations in the framework and illustrating the framework’s explicative power in (automotive) manufacturing. Furthermore, the case contradicts that supplier relations in the manufacturing phase are governed by little informal control, because the automaker highly values the role of trust building and social pressure. Most notably, a structured supplier team functions as a clan and establishes informal control among participating suppliers, which strengthens the automaker’s control on dyadic supplier relations.management control; supplier relationships; manufacturing; contingency theory; case research;

OUTSOURCING STRATEGIES. HOW TO FORMALIZE AND NEGOTIATE THE OUTSOURCING CONTRACT.

In the globalized economy multinational firms have given rise to local firms able to produce at a low cost and at acceptable quality levels. A growing number of firms have outsourced production and manufacturing activities of all types to these firms, not only to reduce production costs but also to make their organizational structures more streamlined and flexible. Outsourcing decisions, which originally were limited to production which had a modest technological content and was of marginal importance for the business in question, is increasingly adopted for activities which, requiring core competencies or belonging to the core business, were considered inseparable from the organization and thus not outsourceable. Gradually an outsourcing strategy has developed which has found it convenient to outsource even core competencies and functions, such as specialized manufacturing, which require a particular technology, marketing, product design, and the search for know-how (Prahalad and Hamel 1990: 79-91).\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\r\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\nSuch an outsourcing strategy has a number of advantages, among which quality improvement, a greater focus on managing other core competencies, a greater flexibility and leverage regarding resources, along with the possibility of entering new markets, even ones with a high rate of development.\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\r\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\nThis article analyzes the fundamental stages for an outsourcing strategy. It will demonstrate how, in order to achieve an outsourcing strategy, it is necessary to include outsourcing in the general strategy, gather suitable information for choosing the outsourcer, negotiate the contract with the supplier, choose the type of relationship to have with the supplier, and, finally, plan the transfer of activities and functions from the outsourcee to one or more outsourcers or providers.\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\r\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\noutsourcing, outourcing decision, strategic perspective, outsourcing contract, contract negotiation, outside information, organizational culture

Outsourcing and acquisition models comparison related to IT supplier selection decision analysis

This paper presents a comparison of acquisition models related to decision analysis of IT supplier selection. The main standards are: Capability Maturity Model Integration for Acquisition (CMMI-ACQ), ISO / IEC 12207 Information Technology / Software Life Cycle Processes, IEEE 1062 Recommended Practice for Software Acquisition, the IT Infrastructure Library (ITIL) and the Project Management Body of Knowledge (PMBOK) guide. The objective of this paper is to compare the previous models to find the advantages and disadvantages of them for the future development of a decision model for IT supplier selection

An axiomatic design framework to design interoperable buyer–supplier dyads

Cooperation arrangements in the form of buyer–supplier dyads are a way that companies have found to deal with the current competitive environment. Despite the contributions in the interoperability literature, a cohesive framework is lacking that would allow the systematization of solutions for interoperable problems in such cooperation. Therefore, we propose a framework for systematically detail interoperability issues and to provide solutions that fit business conditions.Through a case study conducted on an automotive dyad, it is possible to achieve a better interoperable scenario, by systematically addressing the issues and providing solutions that comply with the AD independence axiom.authorsversionpublishe

A contribution to supply chain design under uncertainty

Dans le contexte actuel des chaînes logistiques, des processus d'affaires complexes et des partenaires étendus, plusieurs facteurs peuvent augmenter les chances de perturbations dans les chaînes logistiques, telles que les pertes de clients en raison de l'intensification de la concurrence, la pénurie de l'offre en raison de l'incertitude des approvisionnements, la gestion d'un grand nombre de partenaires, les défaillances et les pannes imprévisibles, etc. Prévoir et répondre aux changements qui touchent les chaînes logistiques exigent parfois de composer avec des incertitudes et des informations incomplètes. Chaque entité de la chaîne doit être choisie de façon efficace afin de réduire autant que possible les facteurs de perturbations. Configurer des chaînes logistiques efficientes peut garantir la continuité des activités de la chaîne en dépit de la présence d'événements perturbateurs. L'objectif principal de cette thèse est la conception de chaînes logistiques qui résistent aux perturbations par le biais de modèles de sélection d'acteurs fiables. Les modèles proposés permettent de réduire la vulnérabilité aux perturbations qui peuvent aV, oir un impact sur la continuité des opérations des entités de la chaîne, soient les fournisseurs, les sites de production et les sites de distribution. Le manuscrit de cette thèse s'articule autour de trois principaux chapitres: 1 - Construction d'un modèle multi-objectifs de sélection d'acteurs fiables pour la conception de chaînes logistiques en mesure de résister aux perturbations. 2 - Examen des différents concepts et des types de risques liés aux chaînes logistiques ainsi qu'une présentation d'une approche pour quantifier le risque. 3 - Développement d'un modèle d'optimisation de la fiabilité afin de réduire la vulnérabilité aux perturbations des chaînes logistiques sous l'incertitude de la sollicitation et de l'offre

Selecting the right method for the right project

The development of information systems is constantly changing. As a background of the change, there is almost a traditional problem about the high failure rates of information systems development (ISD) projects, but it is no longer the only change-driving force. The role of information systems and their strategic significance has increased considerably due digitalization. This has happened also in the areas of business, which have not been traditionally thought as IT-oriented. Furthermore, the new agile development methods have forced ISD clients to take more responsibility for ISD than before. In practice, this means that completely outsourcing ISD is not as sensible nor as simple as before. ISD clients who acquire information systems must be aware of the different ISD methods and be able to compare and choose the most suitable for the business situation and the objectives in question. ISD method selection is rarely studied, and the majority of publications concentrate on different selection criteria relating to the ISD method choice without a clear selection model. Only a few ISD method selection models were found in the literature. Furthermore, the earlier ISD method selection models are restricted by two factors: firstly, the recommendations behind the prior ISD selection models do not correspond to today’s thoughts about the ISD methods; secondly, prior ISD selection models concentrate only on the properties of the ISD pro-jects, and attention is not really given to the business environment or the business to be developed. In a situation like this, it was considered necessary to develop and study an ISD selection framework which takes the business development and business environment into account as well. Furthermore, it was seen as necessary to study both the customer and supplier practices related to the ISD method choice. The objective was to understand the present situation and estimate how the developed ISD selection framework could be utilized in the future. The study was carried out in several stages. Firstly, two unsuccessful ISD projects were studied in the case study, and it was found that the ISD method used in the projects did not correspond to the properties of the business environment in either case. After that, a contingency theory–motivated ISD selection framework was developed, and a systematic literature review was conducted to study earlier ISD method selection criteria and compare them with the developed ISD method selection framework. In the next stage, expert interviews were done. Altogether, 31 ISD experts working on the borderline between the IS sup-plier and client were interviewed and asked their opinions on existing ISD method selection practices by both the client and the supplier. Furthermore, the experts were asked for their opinions on the recommendations of earlier ISD method selection models and on the developed ISD method selection framework. As a result of the study, it can be stated that the developed ISD method framework covers both the previous ISD method selection criteria, which mainly concentrates on ISD project factors, and the business environment factors. Whereas the majority of the interviewed experts considered the developed ISD method selection framework useful, the recommendations of earlier ISD method selection models were regarded as outdated. Furthermore, it was noticed that in IS client organizations, there was almost no discussion about the ISD methods, and in the supplier organizations, the discussion was very rare. Any systematic projectspecific ISD method selection practice had not been perceived in either organizations. Supplier organizations can justify their reasons for favouring a certain ISD method with the bounded rationality, whereas the operation of customer companies doing (or not doing) the ISD method selection seems to be filling the features of functional stupidity. In the future, it is important to study how to plant the ISD method selection as part of the starting stage of the ISD project. In addition, the developed ISD method selection framework should be tested in the practice.Tietojärjestelmien kehittäminen on jatkuvassa murroksessa. Muutoksen taustalla on jo perinteiseksi muodostunut ongelma tietojärjestelmäprojektien epäonnistumisesta, mutta se ei ole enää ainoa syy. Digitalisaation myötä tietojärjestelmien rooli ja strateginen merkitys on kasvanut huomattavasti myös sellaisilla liiketoiminta-alueilla, joita ei ole ajateltu IT-orientoituneina. Lisäksi uudet ketterät tietojärjestelmien kehittämismenetelmät osallistavat tietojärjestelmäprojektien asiakkaat, jotka joutuvat entistä vastuullisempaan asemaan. Käytännössä tämä kaikki merkitsee sitä, että tietojärjestelmien kehittämisen täydellinen ulkoistaminen ei enää ole yhtä mielekästä, eikä myös yhtä yksinkertaista kuin ennen. Tässä tilanteessa myös tietojärjestelmiä hankkivan asiakkaan pitää tietää erilaisista kehittämismenetelmistä ja kyetä vertailemaan ja valitsemaan kyseiseen liiketoimintatilanteeseen ja tavoitteisiin parhaiten sopiva kehittämismenetelmä. Tietojärjestelmien kehittämismenetelmien valintaa on tutkittu vähän ja suurin osa löydetyistä julkaisuista keskittyy listaamaan erilaisia menetelmävalintaan liittyviä kriteerejä. Varsinaisia tietojärjestelmien kehitysmenetelmien valintamalleja on esitetty vain muutamia. Aiempien valintamallien käyttökelpoisuutta rajoittaa kaksi tekijää: ensinnäkin mallien taustalla olevat olettamukset eivät välttämättä täsmää tämän päivän ajatuksiin kehittämismenetelmistä, ja toisekseen valintamallit keskittyvät tietojärjestelmien kehittämisprojektien ominaisuuksiin, kehitettävää liiketoimintaa tai liiketoimintaympäristöä ei aikaisemmissa valintamalleissa juurikaan huomioida. Tilanteen ollessa tämä kehitimme ja tutkimme tietojärjestelmän kehittämismenetelmien valintamallia, joka ottaa huomioon myös samaan aikaan tapahtuvan liiketoiminnan kehittämisen ja liiketoimintaympäristön. Lisäksi tutkimme tietojärjestelmän kehittämismenetelmien valintaan liittyviä käytäntöjä sekä asiakkaan että toimittajan näkökulmasta. Tavoitteena oli ymmärtää menetelmävalinnan nykytilannetta ja arvioida miten valintamallia voisi jatkossa hyödyntää. Tutkimus toteutettiin useammassa vaiheessa. Ensimmäiseksi tapaustutkimuksin tutkittiin kahta epäonnistunutta tietojärjestelmäkehitysprojektia, ja havaittiin että kummassakaan tapauksessa valittu tietojärjestelmän kehittämismalli ei vastannut liiketoimintaympäristön tarpeita. Sen jälkeen kehitimme kontingenssiteoreettisen tietojärjestelmän kehitysmenetelmän valintamallin, jota verrattiin systemaattisella kirjallisuuskatsauksella löydettyihin aikeisempiin valintasuosituksiin. Vertailun jälkeen haastateltiin 31 asiantuntijaa. Haastatteluilla selvitettiin nykyisiä tietojärjestelmän kehitysmenetelmien valintaan liittyviä käytäntöjä, niin tietojärjestelmäasiakkaan kuin toimittajan näkökulmasta. Lisäksi asiantuntijoilta kysyttiin heidän mielipidettään aiempien valintamallien taustalla olevista väittämistä sekä nyt kehitetystä valintamallista. Tulos on, että ehdottamamme kontingessimalli kattaa sekä aiemmat, projektinominaisuuksiin keskittyvät valintakriteerit, että myös liiketoimintaympäristön epävarmuuteen liittyvät tekijät. Suurin osa haastatelluista asiantuntijoista (23 vastaajaa 31 haastatellusta) piti ehdotettua valintamallia käyttökelpoisena. Aiempien valintamallien taustalla olevat väittämät koettiin ajastaan jälkeen jääneiksi. Lisäksi havaittiin, että asiakasyrityksissä keskustelua tietojärjestelmän kehittämismenetelmistä ei käytännössä ollut juuri lainkaan, eikä myöskään suurimmassa osassa toimittajayrityksiä. Mitään säännöllistä projektikohtaista valintakäytäntöä ei kummissakaan yrityksissä oltu havaittu. Haastateltujen asiantuntijoiden mukaan kehittämisprojekteissa kuitenkin pääsääntöisesti käytetään jotain tietojärjestelmän kehittämismenetelmää, ja syyt menetelmän käyttöön vaihtelevat. Toimittajayritysten syyt tietyn menetelmän suosimiseen ovat pääosin perusteltavissa rajoitetulla rationaalisuudella (bounded rationality), kun taas asiakasyritysten toiminta menetelmän valinnassa näyttää täyttävän toiminnallisen typeryyden (functional stupidity) tunnuspiirteet. Jotta kehitetystä mallista tulee asiakasyrityksille hyödyllinen käytännön työkalu, on seuraavaksi syytä tutkia miten tietojärjestelmän kehittämismenetelmän valinta saadaan osaksi projektin käynnistämisvaiheen tehtäviä. Tärkeää on myös testata nyt esitetyn kontingenssimallin toimivuutta käytännön tilanteissa

The impact of inter-organizational management control systems on performance: a longitudinal case study of a supplier relation in automotive.

This study investigates whether appropriate management control design of supplier relations is associated with better performance. Although management control systems (MCSs) are found to be contingent on situational characteristics, it remains unclear whether this contingency fit contributes to performance. In order to illustrate the existence and refine the dynamics of the fit-performance association, we perform a longitudinal case study of an exemplary automotive manufacturer-supplier relation that was subject to considerable change and severe performance difficulties in the course of time. As proposed, case findings show that if the supplier is incapable of dealing with changed contingencies, a MCS contingency misfit is associated with poor operational performance. However, this misfit is only temporal, as the manufacturer adapts the MCS to fit the changed supplier relation and regain operational performance. In addition, the longitudinal study suggests that trust and basic formal control (control continuously exercised under all circumstances) are complements, while trust substitutes for extra formal control (control set up on top of basic formal control). Finally, the data indicate a timing difference in the substitutive relation: the building up of extra formal control proceeds gradually, while the lowering happens almost immediately.management control; trust; performance; supplier relationships; manufacturing; contingency theory; case research; automotive;

Transboundary supply chain risk management: A consolidation of transboundary and supply chain risk management

Supply chains are becoming increasingly vulnerable to disruptions and face greater exposure from the dynamics of global interconnectivity. The growing complexities of modern societies have prompted renewed focus towards supply chain risk management (SCRM) research over the last decade. However, research related to transboundary risk issues has yet to be given substantial attention in recent years. Contributing to the developments in the field of SCRM, this thesis proposes an approach for managing global supply chain risk which modifies current SCRM processes to account for the dynamic nature of transboundary risks. This work extends current literary contributions and aims to compensate for the lack of transboundary risk focus in SCRM. Introducing the taxonomy of transboundary supply chain risk management (TSCRM), the present paper conceptualises a holistic integrative framework that incorporates resilience principles to adaptively manage the transboundary risk environment of global supply chains. In line with this framework, additional templates, tables, and a TSCRM planning process are proposed to facilitate the navigation through the TSCRM process, in particular the risk identification, and risk response selection and implementation phases

Supplier selection under disaster uncertainty with joint procurement

Master of ScienceDepartment of Industrial & Manufacturing Systems EngineeringJessica L. Heier StammHealth care organizations must have enough supplies and equipment on hand to adequately respond to events such as terrorist attacks, infectious disease outbreaks, and natural disasters. This is achieved through a robust supply chain system. Nationwide, states are assessing their current supply chains to identify gaps that may present issues during disaster preparedness and response. During an assessment of the Kansas health care supply chain, a number of vulnerabilities were identified, one of which being supplier consolidation. Through mergers and acquisitions, the number of suppliers within the health care field has been decreasing over the years. This can pose problems during disaster response when there is a surge in demand and multiple organizations are relying on the same suppliers to provide equipment and supplies. This thesis explores the potential for joint procurement agreements to encourage supplier diversity by splitting purchasing among multiple suppliers. In joint procurement, two or more customers combine their purchases into one large order so that they can receive quantity discounts from a supplier. This research makes three important contributions to supplier selection under disaster uncertainty. The first of these is the development of a scenario-based supplier selection model under uncertainty with joint procurement. This optimization model can be used to observe customer purchasing decisions in various scenarios while considering the probability of disaster occurrence. Second, the model is applied to a set of experiments to analyze the results when supplier diversity is increased and when joint procurement is introduced. This leads to the third and final contribution: a set of recommendations for health care organization decision makers regarding ways to increase supplier diversity and decrease the risk of disruption associated with disaster occurrence

Disruptive Risk Management: What makes supply chains resilient to low probability/ high impact disruptions to the inbound and outbound aspects of the supply chain? A Systematic Literature Review

The business community has found itself in the predicament of first understanding and then knowing how to deal with the risk and disruptions to which it is exposed. Risk management is a well informed field in other disciplines. Supply chain risk management however, still needs to be understood and adequately practised, but seemingly, of even more urgency is disruption risk management, which as a new hot topic, is still evolving in both the academic and the practical fields. To compound the problem is the fact that not all practitioners believe that this risk actually exists and that they need to plan for it. If they believe that it exists, they still are unsure as to how to prepare for it and many still need to be convinced that money needs to be put aside to plan for and to mitigate against disruptive events. Disruptive events such as acts of nature, accidents, terrorist and non-terrorist activities can cause a breakdown in the supply chain and thus very quickly cripple the supply chain, possibly causing disruptions to the transportation, communication and information technology systems. This is indeed a critical situation given the fact that many companies have chosen efficiency over effectiveness by employing such strategies of JIT, outsourcing and single sourcing strategies (Norrman, Jansson, 2004; CLSCM 2003, Christopher 2005, Tang 2006). In effect what they have done is exposed their supply chains making them very vulnerable to disruptive events. This report then, seeks to answer what makes a resilient supply chain. To this end the author has used the systematic review process in an attempt to use evidence-based methods of scientific research (Tranfield et al., 2003) to identify, select and critically appraise relevant research. The process is so designed that the information, once discovered and developed can then be discussed and synthesized. The broad fields of literature will include Supply Chain Risk, Vulnerability, Resilience, Risk Management and Disruption Risk Management. Findings thus far indicate that resilient supply chains have seemed to evolve from business continuity planning and supply chain risk management. Additionally, they are hinged on creating a flexible and agile supply chain, having enhanced communication within the network and establishing the right company culture. Firstly, the report seeks to situate the research in the current body of knowledge. It then describes in detail the methodology employed for the research and analysis of the information. The descriptive and thematic findings are presented, followed by their synthesis, discussion and conclusion. One of the main purposes and benefits of the systematic review is that it sets the stage to allow an issue to evolve, which can then be used to frame a PhD question. To this end, the conclusion includes PhD questions that the author has found of interest and considers as good, sound and feasible for further research and analysis