Power, shared goals and supplier flexibility: a study of the HUB-and-spoke supply chain

PurposeSupplier flexibility reflects a supplier's operations-related decisions in responsively providing the necessary inputs to the focal firm. Drawing on resource-dependency theory and transaction cost economics, this study develops a conceptual framework to explain the differential effects of a focal firm's power over supplier flexibility in the context of the hub-and-spoke supply chain (SC). This study also considers the goals shared between the focal firm and its suppliers as an important contingency factor within the framework.Design/methodology/approachThis study tests the proposed conceptual framework using dyadic survey data from a hub-and-spoke SC consisting of a large construction contractor and its 100 suppliers in Indonesia.FindingsThe findings show that coercive power has an inverted U-shaped effect on supplier flexibility, while legal-legitimate power has a U-shaped effect. Furthermore, shared goals positively moderate the U-shaped effect between legal-legitimate power and supplier flexibility.Originality/valueThis study differentiates between the impacts of coercive power and legal-legitimate power on supplier flexibility in the hub-and-spoke SC. It also demonstrates that shared goals play a moderating role in affecting the impacts of legal-legitimate power on supplier flexibility. These findings also have important implications with regard to integrating resource-dependency theory and transaction cost economics to explain these associations.

The unfolding rationales surrounding management accounting innovations: a balanced scorecard case

PurposeThe Balanced Scorecard (BSC) possesses an inherent duality, as it has been described as a carrier of institutions (i.e. the BSC is a “management ideology” or “mode of thinking”) and a flexibly interpretive boundary object at the same time. This study examines how this inherent duality of the BSC may influence the unfolding rationales surrounding its implementation and use.Design/methodology/approachEmpirical support for this investigation is gathered from an in-depth field study. The focal firm is a Brazilian electricity distribution company that transitioned from state to private ownership under hyper-regulation, and whose holding company experienced strategic and structural changes.FindingsThe study identified a misalignment between the characteristics of the firm (e.g. organizational logics) and the perceived BSC features. This misalignment initially produced tensions and institutional logics complexity for the organization forcing the BSC implementers to rationalize it to provide meaning regarding its implementation in the firm. The findings also show why and how the promoters of the BSC conducted its “strategy of translation” in order to disentangle and reassemble both the material and symbolic components of the BSC to facilitate its implementation and use. It was found that promoters of the BSC engaged in contextualization work, which featured two main actions: a combination of coupling and selective decoupling and a change of meaning.Originality/valueThis paper advances current understanding of the process of the unfolding rationales surrounding management accounting innovations (e.g. the BSC). The study shows that the BSC unfolds in more complex, time-related and simultaneous ways than has previously been reported in the literature. Moreover, the paper contributes by explaining how the management's rationales, relating to their historical understanding, perception of legitimation needs and social skills, contributed to the continuous unfolding of the BSC. In addition, four potentially interesting areas for further research were identified.

International business opportunity recognition and development

PurposeUnderstanding how international business opportunities (IBOs) are recognized and developed is critical to the study of international entrepreneurship.Design/methodology/approachWe draw on entrepreneurial cognition research broadly and the entrepreneurial judgment perspective specifically to develop a model of the recognition and development of IBOs by considering three theoretically important sets of drivers – social networks, international experience and a proactive mindset. We use a sample of 92 small- and medium-sized enterprises (SMEs) to test the model empirically.FindingsWe find robust support. Entrepreneurial judgment surrounding IBOs and uncertain international business environments entails tapping social networks, international experience and a proactive mindset to both recognize third-person opportunities for someone as well as to act upon and develop IBOs as first-person opportunities from which a focal firm can profit.Originality/valueConceptually and empirically, we peer inside the black box of IBO entrepreneurial judgment processes by jointly evaluating the abstract recognition of third-person opportunities as well as the concrete actions and interactions that develop the IBOs into first-person opportunities.

Performing openness: how the interplay between knowledge sharing and digital infrastructure creates multiple accountabilities

PurposeThe present study aims to address the emergence of platform-organized open innovation (OI). The research has the two main aims: the first is to increase the understanding of the performance of OI by investigating how the achievements of OI are measured in situated practices from a performative and strategic knowledge management (SKM) orientation. The methodological disadvantages of not pre-given case selection are partially counterbalanced by the second aim of the research, which is to extend existing SKM theory and examine how platforms create knowledge as they include actors and digital devices, thereby potentially redistributing relations of accountability.Design/methodology/approachBuilding on performativity theory, the paper studies how the achievements and knowledge created in OI are managed and evaluated in practice. The case description draws on different sources from a spiral case study, as openness is performed by platform, firm, crowd and innovation intermediaries.FindingsThe paper illustrates how a strategy of digitally enabled openness brings its own issues as platforms enable knowledge sharing and perform a redistribution of accountability. In the heterarchies studied through this research endeavor, managers and their team members were accountable not only to multiple units, or teams, across the organization, but also to the crowd. The case material demonstrates that the ecology of devices and their performative struggles create lateral accountability.Research limitations/implicationsWhile recent streams of research suggest that the context of OI (i.e. distributed sources of knowledge for innovation) shifts the unit of analysis of organization design from the individual firm to networks of actors organized on platforms, the authors find that the focal firm still remains a key conceptual parameter in SKM research, which, in turn, makes it difficult to capture the suggested radicality of OI.Practical implicationsThe authors show, that in practice, the firm has to take into account the performance of the external crowd and at times put resources into its training and education. In heterarchy, distributed authority is assumed to be facilitated through lateral accountability, whereby the traditional principles of vertical authority no longer hold, but rather, managers and their team members can be accountable to multiple units, or teams, across the organization.Originality/valueThe paper develops a performative theory of openness. OI is a model, strategy and socio-material practice whereby digital designs create an ecology of devices that can enact all kinds of openness. Ultimately, the current paper proposes that SKM and OI theory need to consider how platforms perform relations of accountability beyond the boundaries of the single organization.

The boundary-spanning role of first-tier suppliers in sustainability-oriented supplier development initiatives

PurposeThis study aims to study how first-tier suppliers (FTs) operate as boundary-spanners between the focal firm and second-tier suppliers (STs) in extending sustainability-oriented supplier development (SSD) initiatives up the supply chain.Design/methodology/approachAn exploratory multi-case study approach in the apparel industry is adopted, comprised of four cases focused on occupational health and safety issues. The paper uses primary semi-structured interviews and observation data and secondary documents, and it is informed by the boundary-spanning and social capital theory.FindingsThe influence of downstream social capital on the upstream boundary-spanning actions of FTs is highlighted. More specifically, it is found that the cognitive and relational capital that exists in the downstream relationship between an FT and the focal firm affects whether the FT adopts compliance- or improvement-oriented boundary-spanning actions in their upstream relationships with STs. Particularly important aspects of cognitive and relational capital are highlighted while the phenomenon of FTs adding their own personal interpretation to sustainability requirements when fulfilling their boundary-spanning role is identified.Research limitations/implicationsA distinction is made between compliance- and improvement-oriented boundary-spanning actions. A deeper insight into the boundary-spanning role of FTs in extending SSD initiatives up the supply chain to STs is provided along with a deeper understanding of how this role is impacted by social capital.Practical implicationsFocal firms should seek to build adequate cognitive and relational capital with their FTs before deploying SSD initiatives to extend their reach further upstream in the supply chain. In doing so, it is also important to be cognisant of the social capital that exists between FTs and STs.Originality/valueThe paper contributes to the SSD literature by going beyond the buyer–FT dyad to examine the FT's boundary-spanning role in the wider buyer–FT–ST chain relationship. The study theoretically and empirically draws out the importance of relation-specific assets through the social capital lens.

A framework of firms' business sustainability endeavours with internal and external stakeholders through time across oriental and occidental business contexts

PurposeThe purpose of the paper is to test and compare a framework of firms' business sustainability endeavours with internal and external stakeholders in an oriental business context and to verify the validity and reliability of a stakeholder framework through time and across oriental and occidental business contexts.Design/methodology/approachQuantitative approach based on a questionnaire survey in corporate Taiwan with a response rate of 68.5%. Multivariate analysis is undertaken to uncover the measurement properties of a stakeholder framework.FindingsA framework of firms' business sustainability endeavours with internal and external stakeholders appears valid and reliable through time and across occidental and oriental business contexts.Research limitations/implicationsThis study verifies and fortifies a stakeholder framework through time and across business contexts consisting of five stakeholder groups: upstream, the focal firm, downstream, market and societal.Practical implicationsThe framework of firms' business sustainability endeavours provides guidance to firms in their endeavours of business sustainability with internal and external stakeholders.Originality/valueThis study contributes to existing theory and previous studies by validating a stakeholder framework of business sustainability with internal and external stakeholders beyond occidental business context to be also valid and reliable in oriental ones.

In Search of Optimal Distinctiveness: Balancing Conformity and Differentiation via Organizational Learning

ABSTRACT Firms in a nascent industry need to search across various technological trajectories and market opportunities with limited prior knowledge. While inter-firm learning (e.g., imitation) helps the focal firm adapt in the process of conformity, intra-firm learning (e.g., independent experimentation) helps a firm stand out from rivals in the process of differentiation, both of which can gain competitive advantages. This study investigates how the conformity-differentiation balance can be achieved from the cross-level learning perspective. Adopting a mixed-method design, we first conduct a case study on the Chinese photovoltaic industry. The case suggests that firms are inclined to conform in upstream and bottleneck technological domains but differentiate in the downstream market applications. We then extend the case findings through a computational simulation based on March's learning model. When experimentation and imitation are possible, the balance between conformity and differentiation can be reframed as the classical balance between exploitation and exploration across the firm and industry levels: while experimentation is often exploitative at the firm level but exploratory at the industry level, imitation is often exploratory at the firm level but exploitative at the industry level. The study makes a new attempt to bridge the optimal distinctiveness literature with the organizational learning literature.

Information technology systems implementation and processes of integration and disintegration: case study evidence from Air Greenland

Purpose This paper aims to analyze the impact of information technology (IT) system implementation on the integration of data and information between sales and accounting departments, and how data integration affects relations with supplier and customers. Design/methodology/approach The change between three different reservation and distribution systems in an airline company was assessed over 20 years based on qualitative data collected while events unfolded and interviews that traced events retrospectively. Findings This study finds that data integration challenges affect the capacity to use revenue and sales data for control purposes and integrating with suppliers and customers. The systems either facilitated the ability to integrate sales and accounting data or enabled integration in wider supplier and customer networks. The implementation of different reservation and distribution systems resulted in a trade-off between integration within the firm and into wider customer and supplier networks. Research limitations/implications Data were mainly obtained from the focal firm, Air Greenland. The protracted study period meant that the data were not as concentrated as they would have been had the analysis been performed over a shorter duration or had the focus been on one implementation process. Originality/value Extant research suggests that integration challenges when implementing IT systems are caused by differences in information needs between groups with different logics. The authors illustrate how data integration is also a crucial challenge when implementing IT systems.

The interaction between supply networks and internal networks: performance implications

PurposeThe importance of the supply network to firm performance is well documented. Until now, the firm and its suppliers have been conceptualized as single entities. Yet, multinational corporations (MNCs) are composed of a complex, geographically dispersed internal network of subsidiaries. The supply and internal networks are inherently linked. The purpose of this study is to investigate the impact of the interaction of these networks on firm-level financial performance.Design/methodology/approachBuilding on supply network, internal network and dual embeddedness research, the authors investigate the interaction of these networks using supply network data from FactSet and internal network data from Orbis. We assess the impact at the MNC level, using measures of firm-level financial performance, physical proximity between the two networks and geographic dispersion of the internal network.FindingsThe results show that the performance effect of physical proximity of the firm with its supply network is negatively moderated by the geographic dispersion of the firm's internal network. This effect can be traced back to the diminishing marginal profitability of a firm's assets. Moreover, the benefits of dual embeddedness to the individual subsidiary come at a cost at the firm-level due to the operational challenges of managing a complex subsidiary network.Research limitations/implicationsThis study is the first to investigate the supply and internal networks of MNCs simultaneously.Originality/valueThe paper extends supply network literature by considering the internal network of the focal firm and its suppliers. This paper is one of the first studies that offer an understanding of the interaction between supply and internal networks of a focal firm and the effect on financial performance.

Product Complexity and Strategic Alliance on Drug Approval

Management of the business-government relationship is critical for firm performance in regulated industries. In this paper, we predict a U-shaped relationship between product complexity and the time to approval by the US Food and Drug Administration (FDA). Moreover, we argue that this association is contingent on the types of strategic alliances (i.e., R&D alliance, Marketing alliance) of the focal firm in that those alliances help FDA and pharmaceutical companies achieve harmony. Using the approved drugs by FDA from 1999 to 2016 as the sample, our hypotheses are supported by the empirical analysis on US pharmaceutical firms. The findings have important implications to achieving harmony between pharmaceutical firms and regulatory agencies.