TITLE:
Strategic Fast Supply Demand-Chains in a Network Context: Opportunistic Practices That Can Destroy Supply Chain Systems
AUTHORS:
José Crespo de Carvalho, Ana Lúcia Martins, Tânia Ramos, Eurico Brilhante Dias
KEYWORDS:
Strategic Fast Supply Chains; Network Chains; Opportunism; Collaboration
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.4 No.3,
March
20,
2014
ABSTRACT: This paper has a
conceptual character and explores an approach between transaction cost analysis
theory and network theory when applied to supply chains in a broader context:
industrial management research. This approach raises the assumptions that fast
supply chains, i.e., supply chains
made of short time relationships and multiple partners can contribute to
destroying trust and collaboration
between companies, ending up by stressing actual systems’ arrangements in somehow
stable supply chains/network chains. As a consequence, transforming them in
distrust arrangements and thus giving birth to new
(old) approaches based only on transaction cost analysis theory: opportunism
and limited rationality as the continuum for relationships between companies in
a globalized world with numerous potential agents/companies that can play
several roles. Too high levels of entropy can show this reality: the number of
potential players (suppliers, customers or complementors) with theoretically
equal probability of establishing partnerships with one focal company in a
supply chain or network arrangement is excessive in relation to the number of
current suppliers, customers and complementors, and for that reason, the
focal company is somehow dissipating energy in identifying several potential
players and in a state of giving one way or another equal importance to them
all, situation that can affect stable relations with current partners.
Theoretically, this will create what looks like strategic fast supply—demand chains or network
chains: fast because they are
rapidly settle down and fast as they are also rapidly dismantled. Those arrangements are
the ones responsible for several possible and fast relations (internalizing
resources from the environment and/or externalizing resources to the environment)
but, anyway, contributing to loose trust, credibility and running against
profitable games with partners already involved with focal companies in stable
supply chains.