Buyer‐focused operations as a supply chain strategy: Identifying the influence of business characteristics

Abstract

Purpose

Buyer‐focused operations aim at a high level of supply chain alignment by singling out resources for one buyer in order to serve this buyer optimally. The purpose of this paper is to identify what business characteristics make suppliers choose buyer‐focused operations as a supply chain strategy in their relationships with key buyers.

Design/methodology/approach

A broad range of qualitative and quantitative data was collected during interviews and plant visits in a multi‐case study research design. Nine units and 42 supply links with key buyers were investigated and analysed.

Findings

The suppliers choose buyer‐focused operations for different reasons. As expected, some of them choose buyer‐focused operations to fulfil the buyer's requirements in terms of flexibility (mix, volume, specification and timing). However, in other situations, buyer‐focus is used for other reasons: mostly to perform additional assembly operations. Suppliers rarely consider buyer‐focus of core production technology in relationships with buyers for which cost and speed are the main order‐winners.

Research limitations/implications

The study is based on a relatively small number of cases. Although the findings confirm the theoretical framework, more empirical work is needed to better understand different forms of buyer‐focus. Further research should also point out if and how mutual trust and risk dispersal influence decisions to invest in buyer‐focused resources.

Practical implications

The results of this paper help managers in choosing between different forms of buyer‐focus, based on the specific characteristics of a supply chain link.

Originality/value

The paper introduces focus into the domain of supply chain management and shows that striving for close cooperation in a supply relationship needs to be carefully considered and depends on the business characteristics. The paper contributes also to a better understanding of the concept of buyer‐focus and distinguishes different types.

Citation

van der Vaart, T. and Pieter van Donk, D. (2006), "Buyer‐focused operations as a supply chain strategy: Identifying the influence of business characteristics", International Journal of Operations & Production Management, Vol. 26 No. 1, pp. 8-23. https://doi.org/10.1108/01443570610636996