scholarly journals Mitigating the performance implications of buyer’s dependence on supplier: the role of absorptive capacity and long-term relationship

2020 ◽  
Vol 25 (6) ◽  
pp. 693-707
Author(s):  
Daniel Prajogo ◽  
Mesbahuddin Chowdhury ◽  
Anand Nair ◽  
T.C.E. Cheng
Keyword(s):  
Absorptive Capacity ◽  
Business Performance ◽  
Resource Dependence ◽  
Positive Outcome ◽  
Resource Dependence Theory ◽  
Joint Effect ◽  
Data Set ◽  
Content Type ◽  
And Performance

Purpose Buyer’s dependence on its key supplier for critical resources and capabilities is generally considered as creating a disadvantageous position for the buyer and undermining its business performance. This study aims to invoke arguments from resource dependence theory (RDT) to examine if this adverse effect of buyer’s dependence is moderated by the buyer’s absorptive capacity and a long-term relationship with the key supplier. Design/methodology/approach Using a data set drawn from 204 manufacturing firms in Australia, this study tested the proposed model using hierarchical moderated regression analysis. Findings The finding shows that buyer’s dependence on its key supplier by itself has no significant effect on the buyer’s business performance. However, the link between buyer’s dependence on its key supplier and performance is positively moderated by the level of the buyer’s absorptive capacity, as well as by the joint effect of buyer’s absorptive capacity and a long-term relationship with the key supplier. Practical implications As buyer’s dependence is often difficult to avoid, the finding of this study is instructive in showing managers how to strategically mitigate the effect of their firm’s dependence on a key supplier; indeed, turn it into a positive outcome. Originality/value This is the first study, which integrates the internal and external resources in mitigating the effect of buyer’s dependence on the supplier.

Do board interlocks support monitoring effectiveness?

2019 ◽  
Vol 42 (11) ◽  
pp. 1278-1296 ◽  
Author(s):  
Franziska Handschumacher ◽  
Maximilian Behrmann ◽  
Willi Ceschinski ◽  
Remmer Sassen
Keyword(s):  
Panel Data ◽  
Resource Dependence ◽  
Pay For Performance ◽  
Resource Dependence Theory ◽  
Risk Governance ◽  
Data Set ◽  
Content Type ◽  
Board Interlocks ◽  
Performance Sensitivity ◽  
The Impact

Purpose This paper aims to investigate the relationship between board interlocks and monitoring effectiveness for listed German companies in a context of risk governance. While agency-theory and resource-dependence-theory suggest a positive association between board interlocks and monitoring effectiveness, reasons such as limited temporal resources of busy board members may suggest a negative association. Design/methodology/approach By using panel data regression, the authors examined the association between board interlocks and monitoring effectiveness, which was approximated by excessive management compensation, pay-for-performance-sensitivity and CEO turnover-performance-sensitivity. The data set comprises 3,998 directorships for 132 listed German companies covering the period 2015-2017. Findings The authors find that board interlocks are associated with not only a more excessive management pay and less performance-sensitive turnover but also a higher pay-for-performance-sensitivity. Originality/value The study examines the impact of multiple directorships based on a German panel data set that includes both multiple appointments of members to national supervisory boards and all other appointments to national and international executive and supervisory bodies. The authors compile three measures to operationalize monitoring effectiveness.

Linkages between firm innovation strategy, suppliers, product innovation, and business performance

2017 ◽  
Vol 37 (8) ◽  
pp. 1054-1075 ◽  
Author(s):  
Muhammad Shakeel Sadiq Jajja ◽  
Vijay R. Kannan ◽  
Shaukat Ali Brah ◽  
Syed Zahoor Hassan
Keyword(s):  
Product Innovation ◽  
Business Performance ◽  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Innovation Strategy ◽  
Equation Modeling ◽  
Content Type ◽  
The Impact ◽  
Innovation Outcomes ◽  
Supplier Relationship

Purpose The purpose of this paper is to use resource dependence theory to hypothesize that a buyer’s innovation strategy enhances supplier innovation focus and a buyer-supplier relationship that supports product innovation. These in turn positively impact buyer product innovation outcomes and business performance. Moreover, it is argued that the buyer-supplier relationship positively moderates the impact of supplier innovation focus on product innovation. Design/methodology/approach Structural equation modeling and hierarchical linear regression are used to test hypotheses. Findings The results support all hypotheses and suggest that company (buyer) age and variables related to buyer engagement with international markets directly influence performance. The results also indicate that the buyer-supplier relationship does not moderate the relationship between innovation strategy and innovation performance. Research limitations/implications This study demonstrates that how a firm builds the conditions to effectively leverage the complementary resources and capabilities of suppliers directly influence innovation outcomes and business performance. Practical implications An important factor in firms achieving their product innovation goals is the selection and management of suppliers that are strategically aligned with regard to innovation. While managers need to develop internal innovation capabilities, partnering with like-minded organizations, and creating conditions for effective cooperation are key drivers of innovation outcomes. Originality/value In contrast to prior research that has examined operational issues, this study shows how the strategic alignment of buyers and suppliers with regard to innovation is an antecedent of product innovation outcomes. Moreover, it adds to a limited literature on supply chain management practices in emerging markets.

Trading places: innovation and performance go head-to-head

2014 ◽  
Vol 30 (6) ◽  
pp. 14-16
Keyword(s):  
Product Innovation ◽  
Business Performance ◽  
Innovation Performance ◽  
Data Set ◽  
Content Type ◽  
Technology Firms ◽  
Trade Offs ◽  
Pertinent Information ◽  
And Performance ◽  
Practical Implications

Purpose – This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies. Design/methodology/approach – This briefing is prepared by an independent writer who adds his own impartial comments and places the articles in context. Findings – This briefing examines the trade-offs that take place between product innovation performance and business performance. It leverages a data set of 99 medium-sized technology firms in Sweden and considers the variables that affect these trade-offs. The paper suggests that while product innovation performance is positively related to the sales of the firm, the links with profitability are rather less proven. Practical implications – The paper provides strategic insights and practical thinking that have influenced some of the world’s leading organizations. Originality/value – The briefing saves busy executives and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and an easy-to-digest format.

Paradoxes in supplier’s uptake of GSCM practices: institutional drivers and buyer dependency

2019 ◽  
Vol 31 (3) ◽  
pp. 479-500
Author(s):  
Sajad Fayezi ◽  
Rebecca Stekelorum ◽  
Jamal El Baz ◽  
Issam Laguir
Keyword(s):  
Resource Dependence ◽  
Institutional Environment ◽  
Resource Dependence Theory ◽  
Performance Outcomes ◽  
Equation Modeling ◽  
Content Type ◽  
And Performance ◽  
The Impact ◽  
Institutional Drivers

Purpose The purpose of this paper is to investigate the impact of institutional drivers and buyer dependency on green supply chain management (GSCM) practices and performance of suppliers. Design/methodology/approach The authors draw on institutional theory and resource dependence theory to construct a conceptual model than links institutional drivers, GSCM practices, buyer dependency and performance outcomes. The authors test the hypotheses using partial least squares structural equation modeling applied to a sample of suppliers in the Australian manufacturing sector. Findings The results confirm that suppliers develop GSCM practices of green sourcing and eco-design to enhance their performance in response to both coercive forces and voluntary behaviors of their institutional environment. However, buyer dependence of suppliers explains important paradoxes in their uptake of GSCM practices. For example, while the institutional drivers encourage greater adoption of green sourcing by suppliers, increase in buyer dependence in turn reduces the positive performance outcome of green sourcing. Practical implications The authors establish that understanding and assessment of the role of buyer dependency is critical for managers in charge of GSCM practices of their company. This enables practitioners to proactively manage paradoxes resulting from institutional drivers and buyer dependency through an informed decision on the type of GSCM practice to be adopted for effectuating performance improvement. Originality/value The authors provide empirical evidence on paradoxes that curtail performance associated with the uptake of GSCM practices by suppliers moving beyond institutional environment by considering the role of buyer dependency.

Managerial skills and performance in small businesses: the mediating role of organizational climate

2020 ◽  
Vol 14 (3) ◽  
pp. 361-377
Author(s):  
Gholamhossein Mehralian ◽  
Mohammad Peikanpour ◽  
Maryam Rangchian ◽  
Hamed Aghakhani
Keyword(s):  
Organizational Climate ◽  
Small Businesses ◽  
Structural Equation ◽  
Business Performance ◽  
Mediating Effect ◽  
Equation Modeling ◽  
Data Set ◽  
Content Type ◽  
Managerial Skills ◽  
And Performance

Purpose The purpose of this paper is to develop a conceptual model to determine whether organizational climate (OC) mediates the effect of managerial skills (MSs) on business performance in small businesses, such as pharmacies. Design/methodology/approach The model proposed in this research was tested using separate questionnaires specifically designed for managers, employees and clients. The data set consists of responses from 301 managers, 470 clients and 328 employees from community pharmacies in Tehran, capital of Iran, which were analyzed using structural equation modeling. Findings Although the results indicated no significant direct relationship between MSs and pharmacy performance (PP), they also confirmed that having a context-appropriate set of MSs can positively affect PP via the mediating effect of OC. Originality/value This is the first study investigating how MSs improve performance in retail pharmacies. Although this research focuses specifically on small businesses in the pharmaceutical industry, it nevertheless contributes to the literature by showing the importance of OC.

The link between independent directors and firm’s performance: the moderating role of corporate social responsibility

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hien Thi Tran
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Fixed Effects ◽  
Resource Dependence ◽  
Estimation Method ◽  
Resource Dependence Theory ◽  
Independent Directors ◽  
Data Set ◽  
Content Type ◽  
Corporate Social

Purpose This paper aims to examine how independent directors (IDs) affect a firm’s performance measured on profitability, with corporate social responsibility (CSR) interaction. Design/methodology/approach The study uses an international data set of 1,817 firm-year observations from 545 large companies in 20 countries across Asia, America and Europe, and the fixed-effects estimation method. Findings The direct effect of IDs alone on profitability is statistically insignificant; however, the synergic effect of IDs and CSR on profitability becomes significantly positive when firms disclose CSR information. Practical implications The profitability is partially sourced from the synergy of IDs and stakeholders through CSR. IDs may use CSR disclosure to win stakeholders’ goodwill. This goodwill will likely be transformed into profitability. The empirical results indicate that there should be more need for IDs’ engagement in CSR projects as the resources of IDs combined with external stakeholders can be of important value to firms. Originality/value This paper reveals the underlying mechanism that firm-idiosyncratic value is formed using a combination of ID resources and stakeholders through CSR. This research extends the literature of IDs’ efficiency and effectiveness and confirms the agency theory and resource dependence theory.

Is doing economically good enough to shape the MNE’s governmental relations? In contingency with contextual influences

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Chun-Ping Yeh ◽  
Hsueh-Liang Wu ◽  
Yi-Chi Hsiao
Keyword(s):  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Contextual Influences ◽  
Snowball Sampling ◽  
Institutional Perspective ◽  
Data Set ◽  
Content Type ◽  
Political Activities ◽  
Managerial Implications ◽  
Mne Subsidiaries

Purpose In response to the tilted emphasis on the corporate political activities and to the recent call for including the institutional perspective in the research of the MNE’s governmental relations (MGRs), this study aims to, departing from resource dependence theory, introduce the legitimacy formation as a bridging mechanism to MGRs to holistically examine the behavioral types of antecedents of MGRs in contingency with three critical contextual influences. Design/methodology/approach This study purposely chose a Taiwanese globalized logistic corporation that we have been acquainted with as the entry for collecting data. The study started the survey with the seven foreign subsidiaries of this logistic corporation and invited their customers through their personal referrals to join this survey. Following the snowball sampling, remarks were added in the questionnaire to request respondents’ assistance in inviting TMT members of different MNE subsidiaries in their personal networks to join the survey. Findings The findings from analyzing a survey data set of 155 MNE subsidiaries during 2016 show that the MNE’s economically-good behaviors are not so influential as Milton Friedman stated in 1962, and can only outperform socially-good and politically-good behaviors in shaping better MGRs under some specific contextual influences. Originality/value This study contributes to the international business literature by shedding new light on the sensitivity of behavioral antecedents of MGRs in contingency with contextual influences and provides managerial implications to MNE particularly when they expect to reduce external uncertainties or capturing opportunities by MGRs.

How do resources and diversification strategy explain the performance consequences of internationalization?

2014 ◽  
Vol 52 (5) ◽  
pp. 897-915 ◽  
Author(s):  
Yan Chen ◽  
Yiwei Jiang ◽  
Chengqi Wang ◽  
Wen Chung Hsu
Keyword(s):  
Emerging Market ◽  
Product Diversification ◽  
Firm Resources ◽  
Diversification Strategy ◽  
Data Set ◽  
Content Type ◽  
Listed Firms ◽  
Performance Consequences ◽  
Performance Effects ◽  
And Performance

Purpose – The purpose of this paper is to examine how firm resources and diversification strategy explain the performance consequences of internationalization of emerging market enterprises. Design/methodology/approach – The paper conducts a regression analysis by using a novel panel data set comprising of 685 listed Chinese firms over the period of 2008-2011. Findings – The results show that the relationship between internationalization and performance is inverse U-shaped. Further, marketing resources play a greater role in enhancing the performance effects of internationalization than technological resources do. Related product diversification enhances the performance effects, while unrelated product diversification does the contrary. Research limitations/implications – The study focusses on listed firms in one country, and as a result, the findings cannot be generalized to non-listed firms and firms in other countries. Practical implications – This paper offers guidelines for international managers to improve performance of internationalization by developing a particular type of resources and diversification strategy. Originality/value – This paper extends the literature on the functional form of the internationalization-performance relationship, and further suggests that the analysis of the performance consequences of internationalization should go beyond the nexus between internationalization and performance, and focusses on firm-specific resources and strategies that may facilitate or constrain the performance effects of internationalization.

Increasing revenue and attendance in Canadian Baptist churches

2015 ◽  
Vol 42 (12) ◽  
pp. 1071-1089
Author(s):  
Alan Chan ◽  
Bruce G. Fawcett ◽  
Shu-Kam Lee
Keyword(s):  
Church Health ◽  
Eastern Canada ◽  
Data Set ◽  
Content Type ◽  
Factors Affecting ◽  
Scarce Resources ◽  
Baptist Churches ◽  
And Performance ◽  
The Impact ◽  
Simulation Exercises

Purpose – Church giving and attendance are two important indicators of church health and performance. In the literature, they are usually understood to be simultaneously determined. The purpose of this paper is to estimate if there a sustainable church congregation size using Wintrobe’s (1998) dictatorship model. The authors want to examine the impact of youth and adult ministry as well. Design/methodology/approach – Using the data collected from among Canadian Baptist churches in Eastern Canada, this study investigates the factors affecting the level of the two indicators by the panel-instrumental variable technique. Applying Wintrobe’s (1998) political economy model on dictatorship, the equilibrium level of worship attendance and giving is predicted. Findings – Through various simulation exercises, the actual church congregation sizes is approximately 50 percent of the predicted value, implying inefficiency and misallocation of church resources. The paper concludes with insights on effective ways church leaders can allocate scarce resources to promote growth within churches. Originality/value – The authors are the only researchers getting the permission from the Atlantic Canada Baptist Convention to use their mega data set on church giving and congregation sizes as per the authors’ knowledge. The authors are also applying a theoretical model on dictatorship to religious/not for profits organizations.

The effect of supplier globalization on firm innovation: a resource dependence theory perspective

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Yibo Wang ◽  
Bai Liu
Keyword(s):  
Resource Dependence ◽  
Positive Impact ◽  
Market Competition ◽  
Effective Means ◽  
Resource Dependence Theory ◽  
Institutional Distance ◽  
Foreign Firms ◽  
Firm Innovation ◽  
Content Type ◽  
Dependence Theory

PurposeEither buying or making is predicted by the existing literature for firms to reduce dependence. However, firms in the rapid globalization are found to adopt a pattern of buying and making. Specially, they critically rely on foreign firms for needed materials and goods, and invest in innovation against the uncertainty of potential supply disruptions simultaneously. Therefore, this paper seeks to investigate how the depth and width of supplier globalization shape firm innovation together. Moreover, the moderating effects of institutional distance and market competition are also examined in the paper.Design/methodology/approachGrounded on the resource dependence theory, this paper develops a theoretical framework and tests the proposed hypotheses by Poisson model using secondary data from 502 Chinese listed firms with foreign suppliers.FindingsThe depth of supplier globalization has a positive impact on firm innovation, while the width of supplier globalization weakens firm innovation. The depth and width of supplier globalization further interact negatively to influence firm innovation. Moreover, this relationship is enhanced when firms establish relationships with foreign firms with greater institutional distance and is weakened when firms face fiercer product competition.Originality/valueThe authors contribute to the literature by evidencing that the existence of foreign suppliers results in firms' enhancement of innovation to secure their operations and showing that diversifying the country origins of foreign suppliers is an effective means to reduce firms' uncertainty about supply disruption. We also advance the understanding regarding the contextual factors in which firms are more likely or less likely to manage the uncertainty about supplier globalization.

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