Factors Influencing Companies’ Supply Chain Partnership: The Case Of Haier And GomeContents
TOC o “1-3” h z u HYPERLINK l “_Toc376179943” Factors Influencing Companies’ Supply Chain Partnership: The Case Of Haier And Gome PAGEREF _Toc376179943 h 1
HYPERLINK l “_Toc376179944” 1.0 CHAPTER 1: INTRODUCTION PAGEREF _Toc376179944 h 3
HYPERLINK l “_Toc376179945” 1.1 Background PAGEREF _Toc376179945 h 3
HYPERLINK l “_Toc376179946” 1.2 Research rationale PAGEREF _Toc376179946 h 4
HYPERLINK l “_Toc376179947” 1.3 Aim and Objectives PAGEREF _Toc376179947 h 5
HYPERLINK l “_Toc376179948” 1.4 Structure of the dissertation PAGEREF _Toc376179948 h 6
HYPERLINK l “_Toc376179949” CHAPTER 2 LITERATURE REVIEW PAGEREF _Toc376179949 h 7
HYPERLINK l “_Toc376179950” 2.1 Introduction PAGEREF _Toc376179950 h 7
HYPERLINK l “_Toc376179951” The concept of supply chain has different meanings in different times, while the understanding also varies from one research to another (Lemke et al., 2003). In relevant field, researchers illustrated supply chain from different perspectives. However, it is generally believed that formal researches on supply chain started at the 1960s. Stadtler (2005) pointed that Forrester (1961) first used system dynamics model to optimise the dynamic relationship between industrial upstream and downstream and put forward the term of supply chain, so that Forrester is recognised as the father of supply chain. Many modern supply chain design principles can track back to the production distribution system of Forrester. Since the 1990s, researches on the theories and application of supply chain management have attracted wide attention, while, with the continuous evolution of corporate development, there emerged many representative definitions of supply chain (Kopczak and Johnson, 2003; Kulp et al., 2004). Early researches defined supply chain as a network (Lee and Billington, 1992; Christopher, 1994; Ganeshan and Harrison, 1995). Lee and Billington (1992) pointed out that supply chain is a network in which an enterprise obtains raw materials, produces semi-finished products or finished products and then delivers the products to consumers through sales channels. Ganeshan and Harrison (1995) pointed out that supply chain is a logistics distribution selection network instrument, which enables enterprises to obtain raw materials, transform raw materials into semi-finished or finished products and then distribute the products to consumers. Later, researches defined supply chain as a dynamic process. Kalalota and Whinsto (1996) argued that supply chain is a series of independent steps and enterprises can meet customer needs if following these steps. Harrington (1997) pointed out that supply chain includes product flow, information flow, and capital flow, while supply chain is a two-way process which links all members from suppliers to consumers into a virtual aggregate, while supply chain also links procurement, manufacturing, and product/service distribution activities. At that time, supply chain took suppliers, manufacturers, and customers into account, while the entire supply chain was divided into different organically-linked processes. After 2000, the definition of supply chain emphasised that supply chain is a dynamic process and that the management plan needs to be continuously adjusted. Chopra and Meindl (2001) maintained that supply chain is a dynamic chain of information, product, and capital flow in various stages, while supply chain is made up of the mutual linkage between a series of upstream suppliers and downstream customers. PAGEREF _Toc376179951 h 7
HYPERLINK l “_Toc376179952” 2.3 Supply Chain Partnership PAGEREF _Toc376179952 h 10
HYPERLINK l “_Toc376179953” 2.3.1 Partnership PAGEREF _Toc376179953 h 10
HYPERLINK l “_Toc376179954” 2.3.2 Supply Chain Partnership PAGEREF _Toc376179954 h 11
HYPERLINK l “_Toc376179955” 2.4 Factors Influencing Supply Chain Partnership PAGEREF _Toc376179955 h 13
HYPERLINK l “_Toc376179956” 2.4.1 Enterprise-related Influencing Factors PAGEREF _Toc376179956 h 14
HYPERLINK l “_Toc376179957” (1) Factors Influencing Supplier Selection PAGEREF _Toc376179957 h 14
HYPERLINK l “_Toc376179958” (2) Factors Influencing Vendor Selection PAGEREF _Toc376179958 h 15
HYPERLINK l “_Toc376179959” 2.4.2 Partner-related Influencing Factors PAGEREF _Toc376179959 h 16
HYPERLINK l “_Toc376179960” 2.4.3 Influence of Major Factors on Supply Chain Partnership PAGEREF _Toc376179960 h 17
HYPERLINK l “_Toc376179961” 1) Influence of Organisational Structure on Supply Chain Partnership PAGEREF _Toc376179961 h 17
HYPERLINK l “_Toc376179962” 2) Influence of Organisational Culture on Supply Chain Partnership PAGEREF _Toc376179962 h 18
HYPERLINK l “_Toc376179963” 3) Influence of Organisational Reputation on Supply Chain Partnership PAGEREF _Toc376179963 h 20
HYPERLINK l “_Toc376179964” 2.5 Conclusion PAGEREF _Toc376179964 h 21
HYPERLINK l “_Toc376179965” 3.0 CHAPTER 3: METHODOLOGY PAGEREF _Toc376179965 h 22
HYPERLINK l “_Toc376179966” 3.1 Introduction PAGEREF _Toc376179966 h 22
HYPERLINK l “_Toc376179967” Research Philosophy PAGEREF _Toc376179967 h 22
HYPERLINK l “_Toc376179968” Research Approach PAGEREF _Toc376179968 h 23
HYPERLINK l “_Toc376179969” Research Strategy PAGEREF _Toc376179969 h 24
HYPERLINK l “_Toc376179970” 3.3.1 Case Study PAGEREF _Toc376179970 h 24
HYPERLINK l “_Toc376179971” 3.4.2 In-depth Interview PAGEREF _Toc376179971 h 25
HYPERLINK l “_Toc376179972” (1) Introduction of In-Depth Interview PAGEREF _Toc376179972 h 25
HYPERLINK l “_Toc376179973” (2) Interview Protocol PAGEREF _Toc376179973 h 26
HYPERLINK l “_Toc376179974” Research Method PAGEREF _Toc376179974 h 28
HYPERLINK l “_Toc376179975” Data collection and Analysis PAGEREF _Toc376179975 h 29
HYPERLINK l “_Toc376179976” Limitations of the Research PAGEREF _Toc376179976 h 30
HYPERLINK l “_Toc376179977” Ethics in Business Research PAGEREF _Toc376179977 h 30
HYPERLINK l “_Toc376179978” 3.2Conclusion PAGEREF _Toc376179978 h 31
HYPERLINK l “_Toc376179979” 4.0 CHAPTER 4: DATA ANALYSIS AND DISCUSSION PAGEREF _Toc376179979 h 31
HYPERLINK l “_Toc376179980” 4.1 Introduction PAGEREF _Toc376179980 h 31
HYPERLINK l “_Toc376179981” 4.2 Background of Case Companies PAGEREF _Toc376179981 h 32
HYPERLINK l “_Toc376179982” 4.3 The Current Supply Chain Partnership between Gome and Haier PAGEREF _Toc376179982 h 36
HYPERLINK l “_Toc376179983” 4.4 The Influence of Organisational Structure on Supply Chain Partnership PAGEREF _Toc376179983 h 39
HYPERLINK l “_Toc376179984” 4.5 The Influence of Organisational Culture on Supply Chain Partnership PAGEREF _Toc376179984 h 42
HYPERLINK l “_Toc376179985” 4.6 The Influence of Organisational Reputation on Supply Chain Partnership PAGEREF _Toc376179985 h 44
HYPERLINK l “_Toc376179986” 5.0 CHAPTER 5: CONCLUSIONS AND RECOMMENDATIONS PAGEREF _Toc376179986 h 48
HYPERLINK l “_Toc376179987” 5.1 Restatement of Study Aims and Objectives PAGEREF _Toc376179987 h 48
HYPERLINK l “_Toc376179988” 5.1 The Current Supply Chain Partnership between Gome and Haier PAGEREF _Toc376179988 h 48
HYPERLINK l “_Toc376179989” 5.2 The Influence of Organisational Structure on Supply Chain Partnership PAGEREF _Toc376179989 h 49
HYPERLINK l “_Toc376179990” 5.3 The Influence of Organisational Culture on Supply Chain Partnership PAGEREF _Toc376179990 h 50
HYPERLINK l “_Toc376179991” 5.4 The Influence of Organisational Reputation on Supply Chain Partnership PAGEREF _Toc376179991 h 51
HYPERLINK l “_Toc376179992” 5.2 Recommendations PAGEREF _Toc376179992 h 51
HYPERLINK l “_Toc376179993” 5.3 Research Limitations PAGEREF _Toc376179993 h 52
HYPERLINK l “_Toc376179994” 5.4 Future Research PAGEREF _Toc376179994 h 52
1.0 CHAPTER 1: INTRODUCTION1.1 BackgroundWith the increasingly fierce competition in global market, the growingly short product life cycle, and increasingly high customer expectation, the market demand also becomes growingly individualised. Changes in market frequently expose the disadvantages of traditional operation models, while the competition among upstream and downstream enterprises hinders enterprises in the way of development. Under such situation, more and more enterprises begin to attach importance to supply chain management. Chow et al. (2008) argued that, with the intensifying global market competition and the growing importance of supply chain partnership (SCP), the competition in the strength of supply chains becomes a mainstream tend in market competition nowadays.
In supply chain management, partnership between companies is a factor that determines whether the supply chain will succeed or not (Wisner et al., 2005). Supply chain partnership is a tailored business relationship based on mutual trust, openness, shared risk and shared rewards (Lambert et al., 2004). Survey of China Federation of Logistics & Purchasing (CFLP), however, found that the failure rate of Chinese companies’ supply chain partnership has reached 50%-60%, while it remains at a high level and there is a severe lack of stability and duration in supply chain partnership (China Logistics Development Report, 2010). Hence, it is always a focus of Chinese enterprises to find out the factors influencing supply chain partnership and thus establish stable supply chain partnership.
Although the failure rate of Chinese enterprises’ supply chain partnership is rather high, yet there are still lots of successful cases. In the early cooperation stage of Gome and Haier, Gome always adheres to low price, while Haier advocates value war rather than price war, thus the partnership between the two is always rigid. Since 2002, however, Haier has begun to change the strategies and comprehensively cooperated with Gome. With the upgrading of partnership, the cooperation field of the two keeps on expanding. Gome announced that it would no longer charge Haier of non-contractual fees and slotting allowances and gradually realise transparency of transaction between the two. Through logistics system integration, Gome and Haier realised the integration of B2B and B2C business and improved the supply chain efficiency (Haier, 2012). In addition, Gome no longer charged fees which are not stipulated in the contract or slotting allowance, and Gome and Haier has maintained a stable partnership in the past decade (Haier, 2012). The partnership between Gree (Gree Electric Appliances Inc. of Zhuhai) and Gome is a sharp contrast with the partnership between Haier and Gome. Gree is a most successful air-conditioner enterprise in China. Over years, Gree has been a leader in Chinese air-conditioner market and enjoyed good reputation among consumers. However, there are always some conflicts in the partnership between Gree and Gome. In February 2004, Gome (Chengdu) and Gree (Chengdu) had some disputes as Gome (Chengdu) greatly lowered the price of Gree air-conditioner without informing Gree (Chengdu). In March, the supply chain partnership between Gree and Gome further deteriorated due to disputes on price promotion, which resulted in the withdrawal of Gree from Gome. Neither Gree nor Gome made compromise, thus the supply chain partnership between Gree and Gome completely broke (cb.com, 2004). The partnership between Gome and Haier goes form failure to success, thus the influencing factors can be clearly perceived. Hence, this research takes Gome and Haier as the case to study the factors influencing supply chain partnership.
1.2 Research rationaleIn the researches on supply chain partnership, most researches focused on the development process, operation mechanism, and performance appraisal of the partnership (Sodhi and Son, 2009; Kim et al., 2010), while there are only a few researches on the factors influencing supply chain partnership. Bensaou (1999) summarised 6 factors influencing supply chain partnership, including organisational member and skills, market competitiveness, supplier, nature of cross-organisational work, relationship between organisational functions, and partnership benefits. Wilson (2001) pointed out some factors contributing to successful partnership, while partner-related factors include reputation, unrecoverable investment, and performance satisfaction. When studying the determinants of partnership, Sethuraman et al. (1998) pointed out that, from the perspective of manufacturer, the factors influencing partner advantage include: reputation, market penetrability (including skills, professional knowledge of market, inventory management, controllability, and financial capacity), which are the major factors influencing partner advantage. Hence, from the perspective of sociology and economics, this research adopts in-depth interview to discuss the factors influencing supply chain partnership, while this research can serve as an effective supplement to existing researches on supply chain partnership.
In addition, there are relatively rich research results on the relationship between organisational culture, organisational structure, and organisational performance, yet there are only a few researches on the relationship between organisational culture, organisational structure, and supply chain partnership (Bailey and Francis, 2007). This research studies the influence of organisational culture and organisational structure on supply chain partnership and expands the research object from a single enterprise to supply chain partnership, while relevant empirical results can further enrich the research results on organisational culture and organisational theories. At last, under the background of Chinese enterprises’ high supply chain partnership failure rate, this research can provide Chinese enterprises with some suggestions on establishing and maintaining stable supply chain partnership, so that this research is of some practical significance.
1.3 Aim and Objectives
This research aims to analyse the factors influencing supply chain partnership in current context by taking two Chinese enterprises, i.e. Gome and Haier as the case. And the research objectives include following ones:
To analyse the influence of Gome’s and Haier’s organisational structure on supply chain partnership (between Gome and Haier);
To analyse the influence of Gome’s and Haier’s organisational culture on supply chain partnership (between Gome and Haier);
To analyse the influence of Gome’s and Haier’s organisational reputation on supply chain partnership (between Gome and Haier);
Through case study, to provide Chinese enterprises with some suggestions on establishing and maintaining stable supply chain partnership.
1.4 Structure of the dissertationThis dissertation has five chapters. Chapter One is an introduction, which primarily elaborates the research background, rationale, research methods, research objectives, and structure of the dissertation. Chapter Two is literature review, which primarily elaborates the theoretical and empirical support of this research, including the factors influencing SCP from the perspective of manufacturers and the perspective of manufacturer-supplier relationship; while this chapter also analyses the influences of organisational reputation, organisational structure, and organisational culture on SCP. Chapter Three is methodology, which primarily elaborates the research philosophy, research approaches, research strategy, research method, in-depth interview, and data collection and analysis method. Chapter Four is empirical analyses, which primarily processes and analyses the interview data under the guidance of Chapters One-Three. Chapter Five is conclusion, which primarily analyses the research results based on literature review and empirical analysis in Chapter Four and then compares the research results with those of previous scholars, while this chapter also analyses the research limitation and presents some suggestions to future research.
CHAPTER 2 LITERATURE REVIEW2.1 IntroductionThis chapter is literature review and mainly introduces and reviews relevant theories and researches. First of all, this chapter introduces relevant theories of supply chain. Secondly, this chapter introduces relevant researches on supply chain partnership and the influencing factors. At last, this chapter discusses the relationship between organisational culture, organisational structure, and organisational reputation, and supply chain partnership.2.2 Supply Chain ManagementThe concept of supply chain has different meanings in different times, while the understanding also varies from one research to another (Lemke et al., 2003). In relevant field, researchers illustrated supply chain from different perspectives. However, it is generally believed that formal researches on supply chain started at the 1960s. Stadtler (2005) pointed that Forrester (1961) first used system dynamics model to optimise the dynamic relationship between industrial upstream and downstream and put forward the term of supply chain, so that Forrester is recognised as the father of supply chain. Many modern supply chain design principles can track back to the production distribution system of Forrester. Since the 1990s, researches on the theories and application of supply chain management have attracted wide attention, while, with the continuous evolution of corporate development, there emerged many representative definitions of supply chain (Kopczak and Johnson, 2003; Kulp et al., 2004). Early researches defined supply chain as a network (Lee and Billington, 1992; Christopher, 1994; Ganeshan and Harrison, 1995). Lee and Billington (1992) pointed out that supply chain is a network in which an enterprise obtains raw materials, produces semi-finished products or finished products and then delivers the products to consumers through sales channels. Ganeshan and Harrison (1995) pointed out that supply chain is a logistics distribution selection network instrument, which enables enterprises to obtain raw materials, transform raw materials into semi-finished or finished products and then distribute the products to consumers. Later, researches defined supply chain as a dynamic process. Kalalota and Whinsto (1996) argued that supply chain is a series of independent steps and enterprises can meet customer needs if following these steps. Harrington (1997) pointed out that supply chain includes product flow, information flow, and capital flow, while supply chain is a two-way process which links all members from suppliers to consumers into a virtual aggregate, while supply chain also links procurement, manufacturing, and product/service distribution activities. At that time, supply chain took suppliers, manufacturers, and customers into account, while the entire supply chain was divided into different organically-linked processes. After 2000, the definition of supply chain emphasised that supply chain is a dynamic process and that the management plan needs to be continuously adjusted. Chopra and Meindl (2001) maintained that supply chain is a dynamic chain of information, product, and capital flow in various stages, while supply chain is made up of the mutual linkage between a series of upstream suppliers and downstream customers.
Although researches posed different definitions of supply chain, yet the connotation of supply chain can be summed up out of these definitions: Firstly, participants are subjects of different behaviours and including enterprises as well as the departments in enterprises, such as raw material suppliers, manufacturers, retailers, and consumers, while supply chain is the interaction and correlation between these units as well as the cooperation between enterprises and inside the enterprise (Maheshwari et al., 2006). Secondly, specific elements circulate in supply chain, such as logistics, information flow, capital flow, and technology flow. The business flow and operation of supply chain can be analysed from four aspects: work flow (business flow), physical flow, information flow, and funds flow. Information flow in supply chain drives work flow, while work flow determines physical flow, and physical flow feeds back to funds flow (Qiao, 2009). Thirdly, supply chain has specific functions and provides certain products/services. The essence of supply chain is to provide customers with valuable products/services, while supply chain is the business process which links all forces from raw material supply to product/service delivery to terminal customers.
Supply chain is made up of different interest groups, which take actions to maximise their own interest, while supply chain is a typical complicated system. With the transformation of seller’s market to buyer’s market, global market competition becomes increasingly fierce, and new product life cycle growingly short, and customer expectation growingly short. In such context, supply chain management attracts the attention of more and more enterprises, which stimulates supply chain members to think over the operational practice from the perspective of overall supply chain interest, so that supply chain members began to establish strategic alliance with up- and down-stream enterprises or coordinate the operation strategies, so as to improve the competitiveness of the entire supply chain system and realise win-win or multi-win (Simch et al., 2007).
Supply chain management is also a hot topic in the management science field in the past two decades. Combining the actual problems in enterprises’ supply chain management, researchers conducted many researches and obtained lots of research findings, while many theoretical research findings are already used by enterprises and generate significant economic benefit. The major researches in the past two decades can be summed up into: supply chain coordination contract (Chen et al., 2006; Cai et al., 2010); supply chain risk management (Lian and Deshmuk, 2009; Gan et al., 2004); closed loop supply chain management (Li and Cai, 2007; Guide and Van, 2009); supply chain management in context of incomplete/asymmetric information (Azoury and Miyaoka, 2009); integration and optimisation of supply chain operation and other management functions (Caldentery and Haugh, 2009), and decision making behaviour in supply chain (Bolton and Katok, 2008; Shen and Su, 2007).
Although there are many different opinions in the researches on supply chain management, yet the focus is still put on how to stimulate supply chain members to think about the operational practice from the perspective of overall supply chain interest, establish strategic alliance with up- and down-stream enterprises, or coordinate the operation strategies to improve the competitiveness of the entire supply chain system, so as to realise win-win or multi-win, i.e. the focus is put on supply chain partnership. Therefore, this research takes the partnership between Gome and Haier as the case to study the factors influencing supply chain partnership.
In addition, supply chain can also be analysed from the perspective of a single enterprise or from the perspective of supply chain network, while supply chain can be divided into ultimate supply chain, extended supply chain, and basic supply chain. In this research, Haier and Gome share a partnership, which is an extended supply chain in the entire supply chain.
2.3 Supply Chain Partnership2.3.1 PartnershipThe definition of supply chain partnership is based on the definition of partnership (Christopher, 2005). So before defining supply chain partnership, this research firstly analyse the content of partnership. Lambert, Emmelhainz and Gardner (1996) argued that, from one-time exchange to multiple transactions, the relationship between enterprises can generally be divided into: arm’s length, partnership, joint venture, and vertical integration. (1) Arm’s length: The seller only provides the standard products/services needed by customers, and the relationship ends with the end of transaction. (2) Partnership: The buyer and the seller carry out transaction based on mutual trust, openness, risk sharing, and profit sharing and emphasis on long-term competitive advantage (Corsten and Kumar, 2005). (3) Joint venture: The seller and the buyer have some ownership of the other, while joint venture is a relatively long-term relationship (Kogut, 1988). (4) Vertical integration: It is closer than the interaction relationship in joint venture.
When defining partnership, most researches focused on information and benefit sharing between enterprises, establishment of common goal or trust, coordination and commitment, and risk sharing (Fynes et al., 2005). Lambert, Emmelhainz and Gardner (1996) pointed out that partnership is a relatively close relationship between two organisations which mutually support each other to attain certain objectives. As for buyers and suppliers, partnership is the promise and agreement formed in a relatively long time, of which the content includes information, and benefit, and risk sharing. That is to say, the concept of partnership must be based on cooperation and trust. Hutt et al. (2000) pointed out that partnership management includes four aspects: professional knowledge, good process, common goals and motivations, and the same views, while these conditions should be available both inside the organisation and between organisations. Trust is a key factor in successful alliance, while trust must be based on the communication and information processing flow between partners (Wong et al., 2005; Gulati and Sytch, 2007; Johnston et al., 2004). Herzog (2001) agreed with the view of Hutt et al. (2000) and pointed out that partnership refers to the strategic relationship of independent entities sharing common goals, working toward common interests, and highly and mutually depending on each other. However, Dwyer and Tanner (2002) emphasised the relationship characteristic in their definition of partnership and argued that partnership is a relationship characterised by mutual commitment, high trust, and common goals.
Summing up the above definitions on partnership, this research argues that partnership refers to a close cooperative relationship between two independent enterprises with common strategic goals, supplementary resources and capacities, compatible organisational culture, organisational structure, and management operation that work together to accomplish the tasks which they cannot accomplish on their own (Douma et al., 2000).
2.3.2 Supply Chain PartnershipSeuring and Muller (2008) pointed out that most traditional enterprises select suppliers based on price and continuously change suppliers to obtain lower price. However, with the competitive environment becoming increasingly fierce, to continuously improve the profit, increase market share, and enhance competitive advantages, enterprises begin to establish partnership with suppliers and gradually change the previous hostile relationship with upstream suppliers (Cousins et al., 2008). However, Saccani and Perona (2007) pointed that the distrust and information asymmetry between enterprises and suppliers has a long history, and enterprises, as buyers, keep on looking for suppliers offering lower price in the market, while suppliers gradually lose their loyalty to and trust in the buyers under exploit. In addition, apart from switching cost, enterprises will also face uncertainties such as time and quality if they want to switch to other suppliers, thus many enterprises find that the traditional transaction-based procurement is no longer efficient (Harrison and van Hoek, 2008). Hence, enterprises gradually cooperate with the major suppliers and begin to establish supply chain partnership (Christopher, 2005).
Supply chain partnership has many names, such as supply chain relationship, supplier-manufacturer or supplier-buyer relationship, supplier partnerships, supply chain alliance, strategic network, and inter-firm network, while most of these terms emerge with the development of supply chain and illustrate the concept from different perspectives (Lu and Yan, 2007).
Currently, existing researches’ definitions of supply chain partnership are based on the establishment of supply chain and partnership (Benton and Maloni, 2005). For instance, Speakman et al. (1998) held that supply chain partnership mainly refers to the relationship between two independent enterprises in the supply chain to achieve certain goals and profits, while these two enterprises are often suppliers and buyers/customers who agree to share information and risks in a certain period and improve financial or operating performance by reducing the cost and inventory. Different from the definition focus of Speakman et al. (1998), Baker (2002) mainly emphasised the durability of supply chain partnership and pointed out that supply chain partnership is a long-term close supplier relationship, in which the parties can negotiate and reach consensus in case of unexpected events. However, Lambert et al. (2004) held the same opinion with Speakman et al. (1998) and maintained that supply chain partnership is a special enterprise relationship based on mutual trust, openness, risk sharing, and benefit sharing.
This research mainly studies the factors influencing supply chain partnership by taking the partnership between Gome and Haier as the case. Hence, this research mainly refers to the definition of Speakman et al. (1998) when defining supply chain partnership: Supply chain partnership generally refers to a relationship between two independent enterprises aiming to attain certain goals and profits, while these two enterprises are often supply and buyer/customer who agree to share information and risk in a certain period and improve the financial or operating performance by lowering the cost and reducing the inventory.
2.4 Factors Influencing Supply Chain PartnershipSince the 1990s, researches have taken great interest in the factors influencing enterprises’ establishment and cultivation of relationship with external organisations, while many researchers have developed scales and conducted empirical researches (Lee et al., 2001). These researches can be divided into two groups: One group studies how environmental factors and enterprise factors affect the relationship by studying the correlation between dependent variables and independent variables and testing the hypotheses; while the other group mainly studies how personal relationship factors influence the relationship by summing up the possible influencing factors through interviews and questionnaire surveys with managerial personnel, while these researches did not put the influencing factors in the uniform theoretical framework not proved whether these factors are complete in logic. According to the research topic, this research mainly reviews the first group of researches.
According to systems theory, system output is the product of the common effects of system elements, element correlation, and external environment, thus the cooperation effects of supply chain system are affected by enterprise quality, node enterprises’ interaction, and external environment (Benton and Maloni, 2005). According to the source and nature of influencing factors, this research divides the factors influencing supply chain partnership into three categories: enterprise-related controllable factors; partner-related coordinate-able factors; and uncertain factors outside supply chain enterprises, such as environment and policy. The third category of factors is highly uncontrollable, thus this res
