Product recalls: The effects of industry, recall strategy and hazard, on shareholder wealth

The purpose of this paper is to provide insights into the effects of product recalls on shareholder wealth of manufacturing firms in different supply chains. Previous research examining this phenomenon is largely uni-sectorial and/or does not consider the interplay of hazard, recall strategy and sector. By utilizing the event study method, this study examines investors\u27 reactions to key product recall characteristics: industry, recall strategy and hazard level, on a cross-industry sample of 296 product recall announcements. The results show a significant negative reaction of share values to product recalls and significant differences between industry type and hazard levels. More regulated and stringent supply chains, such as the automotive and pharmaceutical, showed statistically significant losses in share price. The results show that industry sector and level of hazard associated with defective products are significant factors impacting the shareholder wealth of manufacturing firms. Contrary to some studies, the impact of recall strategy was not confirmed, although proactive recall strategies led, in some cases, to an increase in share price. Further research would benefit from more detailed investigation of recall strategies on the value of companies in specific sectors, particularly ones which are susceptible to frequent and costly product recalls

Multi-principal collaboration and supplier’s compliance with codes-of-conduct

Purpose The purpose of this paper is to articulate propositions on how collaborating multi-national corporations (MNCs) can manage their supplier base in order to reduce the risk of suppliers’ non-compliance with shared codes-of-conduct. Design/methodology/approach The study utilises a conceptual theory development approach. In doing so, it utilises key tenets of agency theory that are applied in a multi-principal–supplier relationship context and synthesised in a series of propositions. Findings The study shows that MNCs have a variety of mechanisms for reducing the risk of suppliers’ non-compliance by decreasing information asymmetry, increasing their bargaining power and simultaneously use of both rewards/sanctions, and reputation-based safeguards. Research limitations/implications This is a conceptual theory development study, offering testable propositions, which have then to be empirically validated. Practical implications The study showcases that managers of MNCs who find themselves in relationships with non-compliant suppliers have at their disposal a variety of mechanisms to reduce the risk of suppliers’ non-compliance. Originality/value This is one of the first studies that explore suppliers’ non-compliance with codes-of-conduct at the level of a relationship, rather than a single firm. In this way it proposes a theoretical framework grounded in agency theory on managing relationships between multi-principal collaborators and their suppliers

A mid-range theory of control and coordination in service triads

The increased frequency of the adoption of service-based business models by manufacturers, such as solution provision, has given rise to service triads. While there is consensus that actors in service triads are relationally and performatively interdependent, less is understood about how service triads are controlled and coordinated. In this study, we use an inductive case-based approach to build an understanding about the roles, approaches, and contextual factors that influence how service triads are controlled and coordinated. We collected and analyzed data from nine companies forming three service triads, each comprising a customer, a manufacturer of an asset, and a service supplier. We synthesized our findings in a theoretical framework, where we show that; first, both, control and coordination are present in service triads rather than just control as previously posited. Second, controlling and coordinating service triads is not a single actor’s responsibility but rather a collective effort shared by two or three actors. Third, we uncovered four contingent factors that influence the dynamics of how service triads are controlled and coordinated: the customer’s risk exposure due to the offering’s failure, the substitutability of the offering, the contractual safeguards, and the relationship closeness

Manufacturer-supplier relationships and service performance in service triads

Purpose - The purpose of this paper is to explore the role of the manufacturer-supplier relationship in service performance within service triads.  Design/methodology/approach - An abductive case-research approach was adopted, using three embedded cases and 26 interviews in complex, multilevel manufacturer-supplier relationships within the same service network. Cannon and Perreault's (1999) multidimensional relationship framework was deployed to achieve granular and nuanced insight.  Findings - This study corroborates the idea that relational relationships within service triads and servitization improve performance. The role of each relationship dimension in service performance is discerned and their interplay is captured in an analytic model. Information exchange, supplier relationship-specific adaptations, and the degree of formalization of the relationship directly influence performance, while cooperative norms and operational linkages are further back in the causal ordering. The study also highlights the importance of contingent factors (the size of the service site, the proportion of its revenues coming from service contract activities) and how they affect the relationship dimensions.  Research limitations/implications - The work was conducted in one network and the findings were generalized to theory rather than additional empirical settings.  Originality/value - This study is the first to derive a contextualized causal ordering of the Cannon and Perreault (1999) framework of relationship connectors and link it with service performance

Supply networks for extreme uncertainty: a resource orchestration perspective

Purpose: Disasters are growing in frequency and scale, unmasking the systemic vulnerabilities of modern supply chains and highlighting the need to understand how to respond to such events. In the context of an extreme event such as the Covid-19 pandemic, this research focuses on how networks of organizations leverage their combined resources and capabilities to develop, manufacture, and deliver new products outside their traditional markets. Design/methodology/approach: Following a theory elaboration process, we build on resource orchestration theory to develop data collection and analysis protocols to support a multi-case study research design. This research investigates four cases of newly formed networks that emerged in four different countries – Colombia, Italy, the United States, and the United Kingdom – in response to the Covid-19 pandemic. Findings: These four networks in our investigation share common characteristics in terms of motivation and approach, creating patterns from which theoretical generalizations are developed into a series of propositions regarding the process of network-level resource orchestration under extreme uncertainty. Originality: This research contributes to theory by extending the resource orchestration model to a network level and showing how extreme uncertainty can lead to the emergence of networks and alter the motivations and goals of the member organizations, allowing them to be more responsive. Practical implications: The research shows how networks and the organizations within them can streamline processes, swiftly build new relationships, and develop a balanced risk management approach to extreme uncertainty

Treat me well and I may leave you kindly: A configurational approach to a buyer’s relationship exit strategy

Research shows that the choice of relationship exit strategy by the instigator of exit can have significant negative consequences for the party that is being dropped. In this study we focus on what we coin as kind exit, where the risk of harm to the supplier as a result of the buyer’s relationship termination is low. In line with current research, which is suggesting that the characteristics of a buyer-supplier relationship play a critical role in the instigator’s choice of exit strategy, we examine the link between the buyer’s perception of its relationship with the supplier and the manner in which the buyer-supplier relationship ends. We posit that this phenomenon is causally complex and context dependent, and as such, there will be multiple types of buyer-supplier relationships that will lead to a kind exit. To uncover these types, we examine 315 terminated buyer-supplier relationships in manufacturing and service sectors in the UK, employing fuzzy set qualitative comparative analysis (fsQCA). Our results show that contrary to extant literature, there is not one relationship type that leads to a kind exit; instead, we uncover four alternative equifinal configurations of relationship dimensions and two exogenous factors

An exploration of managers' openess and relationship transparency in a buyer-supplier relationship

The problem explored in this thesis falls under a broad topic of information sharing in a buyer-supplier relationship. Responding to the empirically underexplored state of extant literature on information sharing, this study aims to gain a better understanding of the factors that influence managers to engage in information sharing as an activity, as well as the factors influencing information sharing as an outcome and its consequences in a buyer-supplier relationship. In this way, this study acknowledges a conceptual separation between information sharing as an activity (i.e. a manager’s openness) and information sharing as an outcome (i.e. relationship transparency), and treats a manager as embedded in an external, wider interaction environment (e.g. buyer-supplier relationship). The study adopts a qualitative, exploratory approach, utilising a case-based research strategy. The empirical study is based on a pilot and two main cases. The main interviews were carried out on the suppliers’ side of two buyer-supplier dyads. In total, the empirical work consisted of 45 semi-structured interviews with 32 managers. Based on the empirical work, the thesis develops two models: the contingencies model, which captures the influencing factors of a manager’s openness and relationship transparency, and the consequences model, which captures the consequences of relationship transparency. In so doing, the thesis makes three primary theoretical contributions. First, captured in the contingencies model, it shows that a manager’s openness is influenced by the interplay of a number of individual-level factors, where managers’ trust and risk taking behaviours play a central role as well as through an external interaction environment. Second, the same model suggests that information quality alone is not enough to foster relationship transparency and that other factors, such as trustworthiness of information source and a recipient’s knowledge, should also be considered. Third, the thesis also identifies a number of consequences of relationship transparency, which are captured in the consequences model, and highlights the role of the external context an understanding of those consequences. In this way, the study marks a step forward towards increasing the understanding of information sharing as an activity and as an outcome, while considering an individual manager as part of a wider interaction environment

Strategic responses to power dominance in buyer-supplier relationships: a weaker actor's perspective

Purpose – This paper identifies the strategic options available to a weaker actor to counteract the dominance of a stronger actor in a buyer-supplier relationship, and identifies those factors that influence the choice of individual options. Design/methodology/approach – Following a systematic literature review methodology, a five-phase approach of planning, searching, screening, extraction and synthesis was rigorously employed. 48 studies were used to draw conclusions about the phenomena of interest. Findings – Captured in an integrated conceptual framework, this study identified five strategic options available to the weaker actor in order to counteract a power dominance of a stronger player, which were underpinned by seven influencing factors. Research limitations/implications – The proposed conceptual framework requires first qualitative empirical validation using an abductive multi-case strategy, followed by a theory testing phase, employing a configurational approach. Practical implications – The proposed framework suggested that the weaker actor in a buyer-supplier relationship has five options to address power dominance. These options were available within as well as beyond a focal dyadic relationship. For the stronger actor, we showed that power dominance is a temporary state rather than permanent. Originality/value – This study marks one of the first attempts to present a coherent set of strategic options and underpinning factors to counteract power dominance in a buyer-supplier relationship from the perspective of a weaker actor. Given the underexplored nature of the topic, the study also provides guidelines for further research. Keywords: Buyer-supplier relationships, power, weaker actor, strategic choices, systematic literature review Paper type: Literature Revie

Inter-organisational costing approaches: the inhibiting factors

Purpose - The purpose of this paper is to highlight the limitations of current accounting practices in an inter-organisational context; introduce contemporary costing approaches used in inter-organisational costing (IOC) programmes; and identify the inhibitors of successful implementation of IOC programmes. Design/ methodology/approach - The paper uses a structured review of empirical and theoretical literature. Findings - Traditional accounting practices do not adequately fulfil their role in the inter-organisational context. Contemporary accounting practices overcome only some limitations of traditional accounting practices. The paper uncovers part of the complexity surrounding the implementation of IOC programmes and suggests that we are dealing with a broad inter-disciplinary phenomenon. Research limitations/implications - Conclusions are drawn on a conceptual level and further empirical investigation is encouraged. Practical implications - The paper raises the awareness of the complexity surrounding the implementation of IOC programmes. The broad set of inhibiting factors could be effectively used by managers to assess the readiness of organisations involved in implementation of IOC programmes. Originality/value - This research is the first that systematically addresses the problem of inhibitors in the implementation of IOC programmes. The broad scope of the paper sets the foundations for more focused research into specific inhibiting factors

A Mid‐range theory of control and coordination in service triads

The increased frequency of the adoption of service‐based business models by manufacturers, such as solution provision, has given rise to service triads. While there is consensus that actors in service triads are relationally and performatively interdependent, less is understood about how service triads are controlled and coordinated. In this study, we use an inductive case‐based approach to build an understanding about the roles, approaches, and contextual factors that influence how service triads are controlled and coordinated. We collected and analyzed data from nine companies forming three service triads, each comprising a customer, a manufacturer of an asset, and a service supplier. We synthesized our findings in a theoretical framework, where we show that; first, both, control and coordination are present in service triads rather than just control as previously posited. Second, controlling and coordinating service triads is not a single actor's responsibility but rather a collective effort shared by two or three actors. Third, we uncovered four contingent factors that influence the dynamics of how service triads are controlled and coordinated: the customer's risk exposure due to the offering's failure, the substitutability of the offering, the contractual safeguards, and the relationship closeness.Peer reviewe