Levels of Interactions in Supply Chain Relations

Licentiate thesis, 2007

To be able to retain the manufacturing industry durably, in Europe in general and in Sweden in specific, manufacturing companies have to be competitive also on the global market. One way for companies to realize this ambition is to interact with suppliers and customers in different kinds of supply chains. In the dyadic relation between two companies, three different levels of interaction have been identified. To be able to enhance the competitiveness instead of requiring excess workload, the level of interaction has to be adequate for the specific company and their market conditions. The aim of this thesis is to clarify the characteristics of supply chain interaction, both in terms of different levels of interaction and concerning the factors affecting the appropriate level of interaction. A basic prerequisite to enable companies to select an appropriate level of interaction within their supply chain is also to clarify the present use of terminology. This research is conducted through theoretical studies. The theoretical findings are synthesized in order to fulfill the research objective. Characteristics of supply chain interaction in terms of affecting categories and factors are identified. The factors are sorted according to the category they support. An interaction framework that can be used to gain an overview over the categories and factors affecting the level of interaction in a specific situation is developed. The resulting interaction framework is aiming at industry applicability but is based only on theoretical studies (which in turn are based on empirical data). The aim is to support the interaction level decision for, primarily, small and medium sized manufacturing companies in order to increase their competitiveness. Despite the amount of research within the supply chain area, the question how companies should select the way to interact within their supply chain has so far been left unanswered. In this thesis, a number of categories and factors that affects the appropriate level of interaction are identified and listed.