infonet-economy

The article points out, that current rigid supply chains seem to struggle with the dynamic of the environment. Frequent changes of customer preferences and demand as well as dynamic political and economical conditions do pressurize companies to continuous adjustments. If a company is embedded into integrated supply relationships the impact of the adjustments at other supply partners have to be taken into account as well. Thus, more time is needed due to an extended decision-making process, which in turn reduces a companies' flexibility and may decrease its competitive capabilities. This trade-off between the opportunity to gain relational rents in integrated supplier-buyer relationships on the one side and decreased flexibility on the other side has to be taken into account by an evaluation of the outcome of close relationships. The undifferentiated "romantic" view on cooperation with suppliers neglects the possibility of flexibility reduction and performance weakness due to a lack of market pressure. However, if an integrated supplier-buyer relationship has to be changed, a professional and structured management approach is required in order to achieve a "smooth switch.