Interfirm Organizations: A New Perspective for Cost Management

24 Pages Posted: 12 Sep 2007

See all articles by Diego Maria Macrì

Diego Maria Macrì

Università degli studi di Modena e Reggio Emilia (UNIMORE)

Riccardo Silvi

University of Bologna - Department of Management

Andrea Zanoni

University of Bologna - School of Economics, Management, and Statistics

Date Written: April 24, 2001

Abstract

Interfirm organisations are receiving increasing attention in the management literature owing to their superior performance in terms of fast growth, increased flexibility and efficiency. Effective design of these organisations depends on the choice of which activities to perform internally and which to outsource, and also on how to manage relationships within the network. Building on the emerging field of strategic cost management studies, this paper presents a general framework that supports the rationale underpinning the cost structure and effectiveness of interfirm organisations. Specifically, it focuses on three important cost drivers relating to: a) how transactions with partners are settled; b) how technological interfaces with partners are managed; c) how activities are distributed among partners. The model is then applied to an Italian firm operating in the electronics industry. This work is to be considered as a work-in-progress, but nevertheless it provides two major contributions. At a theoretical level, while the traditional transactional approach focuses on the nature and on the object of the relationships, this paper extends its attention on the technological structure and managerial process that make transactions with the external environment possible. At a methodological level, our aim is to operationalise the data collection process in order to analyse the effects on the firm's cost structure of different ways of interacting with the actors of the value chain.

Keywords: Cost Management, Strategic Cost Management, Network, Activity Cost, Transaction Cost

JEL Classification: M40, D23, L14

Suggested Citation

Macrì, Diego Maria and Silvi, Riccardo and Zanoni, Andrea, Interfirm Organizations: A New Perspective for Cost Management (April 24, 2001). Available at SSRN: https://ssrn.com/abstract=1012634 or http://dx.doi.org/10.2139/ssrn.1012634

Diego Maria Macrì

Università degli studi di Modena e Reggio Emilia (UNIMORE) ( email )

Viale A. Allegri 9
Modena, Modena 42121
Italy

Riccardo Silvi (Contact Author)

University of Bologna - Department of Management ( email )

P.le della Vittoria, 15
Forli', Bologna 47100
Italy

Andrea Zanoni

University of Bologna - School of Economics, Management, and Statistics ( email )

Piazza Scaravilli 1
40126 Bologna, fc 47100
Italy

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