Concurrent sourcing, governance mechanisms, and performance outcomes in industrial value chains

We examine transaction governance in the context of concurrent sourcing, where a manufacturer relies on sourcing from external suppliers and in-house production simultaneously. Our focus is on (1) a buyer's use of particular safeguards or governance mechanisms vis-à-vis an external supplier and...

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Bibliographic Details
Published in:Strategic management journal 2014-08, Vol.35 (8), p.1164-1185
Main Authors: Heide, Jan B., Kumar, Alok, Wathne, Kenneth H.
Format: Article
Language:English
Subjects:
Clothing industry
concurrent sourcing
Corporate governance
Corporate strategies
Economic analysis
Economic theory
Governance
Government relations
Manufacturing
monitoring
Multisourcing
norms
opportunism
Opportunistic behavior
Outsourcing
relationship governance
Retail stores
Solidarity
Strategic management
Studies
Transaction costs
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Description
Summary:We examine transaction governance in the context of concurrent sourcing, where a manufacturer relies on sourcing from external suppliers and in-house production simultaneously. Our focus is on (1) a buyer's use of particular safeguards or governance mechanisms vis-à-vis an external supplier and (2) how the effects of these mechanisms on various performance outcomes are influenced by the joint presence of an internal manufacturing branch. We conduct two studies in the apparel industry and show that performance outcomes are a joint function of (1) the individual governance mechanisms that are deployed in a particular relationship and (2) the larger sourcing context (concurrent or singular).
ISSN:0143-2095
1097-0266
DOI:10.1002/smj.2145