Aligning competitive priorities in the supply chain: The role of interactions with suppliers

Abstract

Purpose - Over the last decade, competition in the manufacturing sector has increased as globalization and customer requirements have evolved. Now, organizations are competing not only with their internal capabilities but also on their abilities to leverage capabilities in the supply chain. Recent studies suggest that strategic alignment in the supply chain, assessed by the degree of matching between supply management and market requirements, is critical for the success of organizations in the global marketplace. The purpose of this paper is to examine the possible linkage between strategic alignment (or lack of) in the supply chain, based on the traditional competitive priorities (i.e. cost, quality, flexibility and delivery), and the type of interactions with suppliers. Design/methodology/approach - Strategic alignment in the supply chain was measured by the difference between customer's requirements and the emphasis that the organization puts on these same requirements in dealing with its suppliers. The types of interactions were assessed by six items, three of them to measure the degree of arm's length practices and the other three to assess the degree of cooperation with suppliers. The empirical analysis used data from 512 manufacturing companies in Canada surveyed in 2003 and 2005. Linear regressions were conducted to test a series of four hypotheses linking alignment in the supply chain and the type of interactions with suppliers. Findings - Interactions with suppliers that are increasingly based on cooperation were found to be linked with a better alignment of competitive priorities that are characteristic of responsive supply chains. An unexpected result was the positive link between arm's length interactions and delivery, a dimension that is also associated with responsive supply chains. Research limitations/ implications - The choice of interactions with suppliers can be critical in the alignment of competitive priorities in the supply chain. A limitation is that the empirical analysis rests on data collected from one respondent per organization. Originality/value - This paper contributes to research by providing empirical evidence of the link between the type of interactions with suppliers and the alignment of competitive priorities in the supply chain. © 2009 Emerald Group Publishing Limited. All rights reserved.