Performance measurement in strategic buyer-supplier relationships: the mediating role of socialization mechanisms

Paul D Cousins, Benn Lawson, Brian Squire

Research output: Contribution to journalArticle

  • 83 Citations

Abstract

Purpose – Close links between buyers and suppliers are increasingly cited as a critical differentiator of high and low performers in global supply chains. While the application of performance measures to manage supplier relationships has been well-identified and encouraged in the literature, comparatively little research exists on the inter-organizational socialization mechanisms that underlie the flow of learning and information within supply chains. The authors aim to develop a model positing that socialization mechanisms play an important role in mediating the relationship between supplier performance measures and performance outcomes.
Design/methodology/approach – A structural equation model, using a sample of 142 manufacturing and service firms based in the UK, tests this hypothesised model.
Findings – The theoretical framework was supported, with results indicating that socialization mechanisms fully mediate the effects of supplier performance measures (communication and operational-based) on firm performance.
Practical implications – This study provides additional insights for purchasing managers seeking to improve the management of their strategic supplier relationships. The authors find that monitoring supplier performance is not of itself sufficient, rather, it is the process of socializing the buyer and supplier that is critical to success.
Originality/value – As far as the authors are aware, no previous supply chain research has examined how supplier performance measurement systems, socialization mechanisms, and firm performance are related. The paper makes a significant contribution to this literature embedding an established theoretical construct (socialization) into the supply chain literature.
LanguageEnglish
Pages238-258
Number of pages21
JournalInternational Journal of Operations & Production Management
Volume28
Issue number3
DOIs
StatusPublished - 2008

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Supply chains
Purchasing
Managers
Buyer-supplier relationships
Socialization
Supplier performance
Performance measurement
Monitoring
Communication
Supply chain
Performance measures
Suppliers
Buyers
Firm performance
Supplier relationships

Cite this

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abstract = "Purpose – Close links between buyers and suppliers are increasingly cited as a critical differentiator of high and low performers in global supply chains. While the application of performance measures to manage supplier relationships has been well-identified and encouraged in the literature, comparatively little research exists on the inter-organizational socialization mechanisms that underlie the flow of learning and information within supply chains. The authors aim to develop a model positing that socialization mechanisms play an important role in mediating the relationship between supplier performance measures and performance outcomes. Design/methodology/approach – A structural equation model, using a sample of 142 manufacturing and service firms based in the UK, tests this hypothesised model. Findings – The theoretical framework was supported, with results indicating that socialization mechanisms fully mediate the effects of supplier performance measures (communication and operational-based) on firm performance. Practical implications – This study provides additional insights for purchasing managers seeking to improve the management of their strategic supplier relationships. The authors find that monitoring supplier performance is not of itself sufficient, rather, it is the process of socializing the buyer and supplier that is critical to success. Originality/value – As far as the authors are aware, no previous supply chain research has examined how supplier performance measurement systems, socialization mechanisms, and firm performance are related. The paper makes a significant contribution to this literature embedding an established theoretical construct (socialization) into the supply chain literature.",
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