Assessing Transaction Cost to Describe Scope of the Firm in Emerging Farm Supply Chain in India: The Case of ITC E-Chaupal

2014 ◽  
Author(s):  
Rakesh Singh
Keyword(s):  
Supply Chain ◽  
Transaction Cost ◽  
Scope Of The Firm

Product Development Resources and the Scope of the Firm

2005 ◽  
Vol 69 (2) ◽  
pp. 15-23 ◽  
Author(s):  
Birger Wernerfelt
Keyword(s):  
Supply Chain ◽  
Product Development ◽  
Full Advantage ◽  
Theory Of The Firm ◽  
Adjustment Cost ◽  
Scope Of The Firm ◽  
The Relationship

This article examines the relationship between a firm's strength in product development and its optimal scope. Firms with product development strength have two options: They can leverage it in horizontally related markets, and they can reach into the supply chain to take full advantage of it. The question is how this should be done. One possibility is for the firm to expand its scope, and another is to manage the linkage through contracts. On the basis of the adjustment cost theory of the firm, the author argues that the former solution is more appropriate when product development is fast-paced. This study tests the argument in a sample of several thousand firms and reports four tests. For both types of expansion, the author examines the incidence and the productivity of increased scope. The author uses several measures and finds results that are consistent with the theory.

Strategic Management of International Subcontracting

2010 ◽  
pp. 1924-1934
Author(s):  
Yue Wang
Keyword(s):  
Supply Chain ◽  
Strategic Management ◽  
Transaction Cost ◽  
Empirical Research ◽  
International Business ◽  
Multinational Enterprises ◽  
Cost Model ◽  
Governance Structure ◽  
Complex Nature ◽  
Relational Contract

Research on international subcontracting has been policy-oriented and industry-focused. There is a lack of understanding of the phenomenon from strategic management and international business perspectives. This article conceptualizes international subcontracting as a type of relational contract formed by buyers and suppliers from different countries, aiming to facilitate the sourcing of products or components with buyer-specific requirements. It builds a transaction cost model for studying the strategic choice of international subcontracting as an intermediate governance structure, sitting between arm’s length outsourcing arrangement and vertically integrated multinational enterprises (MNEs). A set of propositions are developed to aid future empirical research and to provide managers with some guidelines for organizing supply chain across borders. The model also allows managers to examine the complex nature of a range of subcontracting relationships and identify the specific mechanisms that can be used to preserve and manage the dyadic principal-subcontractor exchanges.

scholarly journals Do Collaborative Relationships in Supply Chain Pay-Off?

2017 ◽  
Vol 7 (1) ◽  
pp. 36-46 ◽  
Author(s):  
Ik-Whan G. Kwon ◽  
Seock-Jin Hong ◽  
Sung-Ho Kim
Keyword(s):  
Supply Chain ◽  
Transaction Cost ◽  
Theoretical Framework ◽  
Future Research ◽  
Sustainable Supply Chain ◽  
Collaborative Relationship ◽  
Collaborative Relationships ◽  
Time To Market ◽  
Speed Up ◽  
Financial Gains

Collaborative relationship is said to foster sustainable supply chain operations. It is argued that relationship based supply chain produces financially tangible results in many areas of supply chain. The concept is based on transaction cost theory arguing that the final price is determined in the market by total cost. A collaborative relationship fosters trust that leads to lowering transaction cost and speed up time to market which creates “serial equity” rather than “spot equity”. Recent research on collaboration and supply chain performance seems to suggest tangible financial gains. Yet, no theoretical framework has been developed and empirical evidences have been lacking to support such hypothesis. A clearly defined theoretical framework and supportive empirical evidence between these two constructs are needed for future research in this area. This article attempts to articulate the theoretical foundation of collaborative relationship in supply chain and survey empirical results on financial gains reported in various research studies.

Managing transaction risks in interdependent supply chains: an extended transaction cost economics perspective

2012 ◽  
Vol 12 (3) ◽  
pp. 243-260 ◽  
Author(s):  
Mark Wever ◽  
Nel Wognum ◽  
Jacques Trienekens ◽  
Onno Omta
Keyword(s):  
Risk Management ◽  
Supply Chain ◽  
Supply Chains ◽  
Transaction Cost ◽  
Risk Sharing ◽  
Transaction Cost Economics ◽  
Management Strategies ◽  
Risk Minimization ◽  
Risk Management Strategies ◽  
Supply Chain Orientation

The present study examines the management of transaction risks in supply chains. Risk management studies often ignore the wider supply chain context in which individual transactions take place. However, risk management strategies which are suitable to use when only a single transaction is considered may be inappropriate when other transactions in the supply chain are taken into account. This study addresses this issue by examining: (1) how risks arise as a result of interdependencies between the various transactions making up the supply chain; and (2) what types of contractual-based strategies actors can use to manage their risk exposure. To realize these aims, the study applies an extended Transaction Cost Economics (TCE) framework with a supply chain orientation. The framework illustrates how different types of interdependencies - pooled, sequential and reciprocal - expose companies to different sources of risk. Three strategies companies can use when facing barriers to risk minimization in sequentially interdependent supply chains are analyzed: risk transferring, risk altering and risk sharing. Examples from the agri-food sector are discussed to demonstrate the functioning of these strategies.

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