THE EFFECT OF INTERNAL COST MANAGEMENT, INTEGRATION OF EXTERNAL AND INTERNAL INFORMATION SYSTEMS, AND FIBER CAPACITY ON INTER-ORGANIZATIONAL COST MANAGEMENT IN SUPPLY CHAINS (Empirical Studies in Manufacturing Companies in The Province of Banten)

Inter-organizational cost management is a strategic cost management approach to managing costs that span organizational boundaries in supply chains. Drawing on the resourcebased view of the firm, we develop a model to predict which inter-related resources might enable companies to manage inter-organizational costs. We test this model using a survey of managerial accountants whose organizations are part of a supply chain. Using structural equation modeling, we conclude that the resources of internal electronic integration, external electronic integration, internal cost management, and absorptive capacity play significant direct and indirect roles in the development of an inter-organizational cost management (IOCM) resource. We find that these resources are inter-related and together are useful in enabling companies to ultimately benefit from managing inter-organizational costs. We find in particular the importance of relational resources associated with absorptive capacity in the development of an IOCM resource. Our research contributes to theory and practice by explaining how specific resources can be combined in allowing companies to better manage inter-organizational costs. Data were analyzed using SEM with the aid SmartPLS software version 3.0

Electronic integration and capability widening for OEM suppliers

Purpose The purpose of this paper is to investigate the effect of original equipment manufacturing (OEM) suppliers’ electronic integration with global customers on their capability widening, following the literature on electronic integration, firm innovativeness, product modularity and dynamic capabilities. It also examines the moderating roles of supplier innovativeness and product modularity in the proposed relationship. Design/methodology/approach This study conducts empirical examination on a sample of OEM suppliers in Taiwan. It collects 201 self-reported responses via mailed surveys of 1,069 electronics companies listed in the 5000 Largest Firms in Taiwan, and the archival data are obtained from the Taiwan Economic Journal database. Findings The results show that electronic integration with global customers affects capability widening negatively, whereas supplier innovativeness affects capability widening positively. In addition, product modularity plays a moderating role in the relationship between electronic integration and capability widening. Research limitations/implications This study contributes to the electronic integration literature by providing empirical evidences on how OEM suppliers’ electronic integration affects their capability widening. This study also adds to the supply chain management literature by demonstrating the relationship between OEM suppliers’ innovativeness and their move into higher value-added activities, as well as how product modularity interplays with electronic integration between customers and suppliers on suppliers’ capability widening in global supplier‒customer relationships. Practical implications For OEM suppliers with a low level of product modularity, they may widen their capabilities by exploring other value-added activities (e.g. original design manufacturing or original brand manufacturing). For OEM suppliers with a high level of product modularity, the improvement of their manufacturing capabilities is a helpful approach to create competitive advantage. Originality/value This study is one of the first to examine the interplay between electronic integration and product modularity on capability widening of OEM suppliers from an emerging market. Meanwhile, this study provides support for the relationship between supplier innovativeness and innovative activities in the global supply chain context.