An Analysis Framework of Power Imbalance in Supply Chains

Abstract

Is a huge multinational company always powerful, and is a small company always weak? What actually makes a company stronger than another one? These are two typical questions students, researchers and practitioners encounter when they study or practice management. Decision-makers in companies have to be able to account for power in their daily tasks because of the potential partners’ reactions to wrong decisions. Major papers studying power do agree that power and its direct consequence, i.e., decision imbalance, could have direct impacts on how soundly a supply chain operates. Even though power has been analyzed for a long time in various fields, to the best of our knowledge, there is a lack of scientific literature examining and modeling power imbalance and its consequences in supply chains. An important challenge regarding this issue is analyzing power in networks of partners. This chapter contributes to the development of a power analysis framework by presenting a set of concepts and properties to model and examine various aspects of power and the interactive process that leads to its use or does not. This framework will use data collected from a set of interviews conducted with main decision-makers to analyze a real case of four companies from the high-tech sector. The chapter does not address strategies or techniques to cope with power exertion but helps to elucidate the process of power evolution.