Reasons for SMEs to engage in multi-tier supply chain management – a social capital perspective

Abstract

While large enterprises engage in multi-tier supply chain management (SCM), small and medium-sized enterprises (SMEs) tend to consider multi-tier SCM considerably less. To better understand how and why SMEs approach multi-tier SCM, the paper applies a social capital perspective. The paper builds upon 11 case studies with SMEs from bordering regions of Salzburg and Upper Austria (Austria) and Bavaria (Germany), presenting material from interviews with their executive personnel. All 11 SMEs emphasise the role of all three dimensions of social capital, shared vision, shared interaction, and trust for multi-tier SCM. Reliability, product and service quality, cost management, and sourcing are targets of pursuing all three dimensions of social capital regarding multi-tier SCM. In the case of trust, responsiveness is an additional target of pursuing social capital in multi-tier SCM. For shared vision, data and information availability are additional targets.