The structure and management of Asian supply networks: A comparative study of Scandinavian apparel firms’ strategies

Lars Øvrebø

Student thesis: Master thesis

Abstract

In this thesis I have through interviews with four Scandinavian apparel firms gained insights in how these firms structure and manage their Asian supply network in order to overcome cultural and geographical barriers and ensure appropriate performance on the criteria of price, quality, flexibility, lead-times, reliability and CSR in their supply chain. The firms in the sample were selected on the basis on a replication logic – they are all of Scandinavian of origin and are selling high-quality technical clothing, but differ in size and years of experience in Asia. My ambition was to conduct a comparative analysis of the case findings, in order to reveal possible patterns in firm strategies that either could be traced back to the shared or the diverging firm characteristics, in order to come with ideas and questions for further exploration and testing. These are the most interesting findings of my analysis as topics of further investigation: ->All the firms in the study emphasize importance close suppliers relationships, characterized by a mutual trust and a harmonic atmosphere in order to succeed in Asia. At the same time they have developed extensive mechanisms for control and inspection to check the same suppliers’ behaviour. The co-existence of these two conflicting modes of management within the same relationships seem a bit paradoxical, and would thus be interesting to further explore. ->The Firm in the sample with least experience in Asian sourcing (6-7 years) was the only one that did not have an Asian office. Nor did they work through an intermediary. This might suggest that the Asian and European business cultures today have approached each other to such an extent that Asian supplier relationships can be successfully established and managed by simpler means, without having to invest in an Asian office or us an agent to bridge the differences. ->There was a clear distinction between how the two larger firms and the two smaller firms, strategically positioned themselves as a response to the increasing production costs in China. Whereas the larger ones actively searched for new locations for production by working with their existing suppliers, the smaller ones felt that going into a new location as one of the first firms, was too risky in regard to the quality in production. This shows how size can offer you more room for manoeuvre strategically, and is something worth to further investigate in relation to the on-going developments in China.

EducationsMSc in International Business and Politics, (Graduate Programme) Final Thesis
LanguageEnglish
Publication date2013
Number of pages104