The Incentives, Benefits and Challenges of Increased Collaboration in Supply Chain Relationships

Pernille Reitz Højgaard

Student thesis: Master thesis

Abstract

The global business environment is far more competitive today, than just a few decades ago, and the quest for sustainable competitive advantages in the market therefor requires the development of dynamic capabilities, such as collaboration and coordination in the supply chain, which go beyond the individual company’s inherent resources. In order to be competitive in the global market, companies should increasingly be able to act as supply chain networks, instead of single entities competing against each other. There has been a tendency to focus primarily on the internal environment of companies, while the focus on building strong relationships between focal companies and suppliers have been neglected. However, this has received increasing attention in recent years. This thesis sets out to examine the benefits that arise when increasing the intensity of strategic collaboration in the supply chain, but also to shed light on the challenges that companies meet when attempting to exercise this task. It also examines the measures of collaboration that companies should implement in order to improve collaboration in the supply chain, and whether increased collaboration between focal companies and suppliers lead to dynamic capabilities that improves the competitive advantages of the companies.
The topic in question is analyzed primarily using Alexander’s theory of inter-organizational collaboration and coordination, Barney’s resource-based theory and the theory of dynamic capabilities as presented by Teece. Additionally, the ideas and frameworks of a range of scholars who have researched the topic previously, support these theories. The analysis is based on qualitative data, in the form interviews with managers of focal companies and supplier companies and a set of speeches held at a conference on the topic. The companies who have been interviewed are all production companies, and are part of an initiative by Danish Industry called ‘Stram Kæden’, which has set out to improve the collaborative efforts of Danish companies. A conceptual framework is created and applied in order to analyze the qualitative data that have been collected.
The thesis ends up proposing a revised conceptual framework, adding measures and challenges of collaboration that have not been addressed to a large extent in previous research. In this it is found that managers of supply chains should be especially focused on trust building, top management support, the internal culture of the companies and supplier ownership and autonomy, for supply chain collaboration to be effective and thereby lead to superior performance in the market by the entire network of companies.

EducationsMSc in International Business, (Graduate Programme) Final Thesis
LanguageEnglish
Publication date2016
Number of pages156
SupervisorsNicolai Pogrebnyakov