Network Complexity and Supply Chain Performance Measurement: A Comparative Case Study
Posted: 29 Apr 2020
Date Written: June 26, 2013
We investigate the emphasis that buyers place on each of five performance measurement dimensions (technology, quality, delivery, service, and cost) when they select suppliers and allocate orders among those suppliers. The results of a comparative case study of six large buyers in the electronics industry show that buyers employ different criteria for these two decisions and that Network complexity influences the degree of variation in those criteria. Buyers producing generic products employ observable, cost-related criteria in both supplier selection and order allocation, whereas their innovative product-producing counterparts rely on intangibles (e.g., technical superiority) for supplier selection, but tangible metrics (e.g., delivery) for order allocation. We also obtain evidence of post-contract monitoring practices.
Keywords: Supplier selection criteria, Non-financial performance measures; Supplier cost management; Subjective performance measurement
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