Aligning cooperative supply chain relationships with firm strategy: a cross-disciplinary analysis

Abstract

Purpose This study aims to investigate the conflicting views in supply chain and strategic management literature regarding cooperative supply chain relationships (CSCR) and firm performance. Supply chain literature suggests a universally positive impact of CSCR on performance, irrespective of a firm’s strategy. In contrast, strategic management literature contends that the effectiveness of CSCR depends on their alignment with the firm’s competitive strategy. The research aims to clarify this disparity, offering insights into the strategic use of CSCR for enhancing firm performance. Design/methodology/approach This paper theorizes the integration of perspectives for the impact of CSCR on firm performance by examining the relationships considering the alignment of cost leadership and product differentiation strategies with supplier and customer relationships. Plant-level survey data is analyzed using regression techniques to test four hypotheses. Findings All four main relationships (cost leadership, product differentiation, supplier relationship and customer relationship) on firm performance are statistically significant. However, cost leadership firms are better aligned to their chosen strategy when they have strong relationships with suppliers, whereas similar relationships with customers create misalignment, negatively influencing firm performance. In contrast, product differentiators benefit by investing in relationships with customers rather than with suppliers. Practical implications A firm’s performance does not solely depend on its CSCR efforts but on aligning them with the firm’s overall strategy. Therefore, managers need to be cognizant of the firm’s competitive strategy when investing in CSCR. Failing to do so could negatively impact firm performance and, eventually, its ability to compete in the marketplace. Originality/value Scholars have advocated for the importance of examining competing perspectives of phenomena, both within and across various bodies of literature, as cross-disciplinary analysis often brings enhanced focus and depth, leading to improved understanding. This research is one of the initial efforts to empirically analyze the varying perspectives on CSCR in supply chain and strategic management literature. This cross-disciplinary approach can yield a more integrated perspective.