This study examines the moderating effect of buyer-supplier trust on the relationship between outsourced formal contracts and supplier delivery performance in the domain of public sector procurement. In so doing, we extend the paradigm that formal contracts and relational governance mechanism function as complements rather than substitutes. Using a cross sectional data from a survey of 612 staf...

Reserve prices are commonly used in procurement auctions, and the logic is simple: They help the buyer avoid paying too much for the contract. The reserve price is set by the buyer before the auction based on the buyer’s knowledge about suppliers’ costs. In practice, buyers can refine their knowledge about suppliers’ costs through activities known in industry as cost modeling. In this paper we ...

Communication in Supplier Relationships: The Case of Finnish Sourcing in China Objective of the study The objective of the study was to research the supplier relationship management in a case company from the perspective of business communication. The case company was a Finnish buyer organization and its supplier was a Chinese company in the health food industry. The study evaluated their relat...

Supply networks rely increasingly on dynamic information flow between organisations. Providing intelligent automated collaboration requires learning capability i.e. an agent should be capable of adapting behaviour as conditions change. This paper proposes a scalable multi-agent system which uses case-based reasoning as a framework for part of its intelligence. Agents operate at two levels: an i...

We compare buyer-supplier links established by pairs of Japanese-owned automobile assemblers and component manufacturers operating in Japan and in North America during 198%90. Eight assemblers and more than I70 Japanese component manufacturers had established North American manufacturing facilities. In total, Japanese automobile assembly organizations operating in North America had recreated ab...

We consider a general Informed Principal Problem in the context of procurement. Both the potential suppliers and the buyer hold some private information: each supplier knows his cost of production, the buyer knows how much each supplier’s product …ts her technical requirements. We derive the optimal auction in this environment, and analyze the implementation problem with special emphasis on thr...

This paper studies market schemes in which auctions are used to coordinate the buyer and competing suppliers in a procurement setting. While auction is typically considered a price-determination mechanism, it could also serve as a coordination mechanism. Possible auction and market mechanisms and their expected payoffs are analyzed in a two-supplier, one-buyer system. The auction mechanism coul...

We develop a simple theoretical model of a long term buyer-supplier relationship with non-contractible buyer specific R&D investment, and derive predictions on the effects of trust and competition on suppliers’ investment and buyers’ procurement strategies. We address these issues empirically using unique survey data on individual buyer-supplier relationships in the German automotive industry. ...