Improving Performance in Supplier Relationship Management with Lower-Tier Supplier Visibility and Management

December 3, 2016 Posted by admin

Xiaoming Li, Festus Olorunniwo, Chunxing Fana and Joel Jolayemi
Department of Business Administration, Tennessee State University
330 10th Avenue North, Nashville, TN 37203, USA

Abstract
In this study, we investigate how a company can employ lower-tier supplier visibility and management to achieve better performance for itself. After we identified important performance criteria and practices in engendering lower-tier supplier visibility and management through literature review and focus group interview, we designed a questionnaire – based on the identified criteria – to survey organizations on supplier performances with respect to the different LTSM practices they use for engendering lower-tier supplier visibility and enhancing lower-tier supplier management. Using our survey data, we are able to show that lower-tier supplier management can positively affect all SRM performance at three levels: the immediate purchasing level, the corporate level, and the intercorporate level. Our findings provide a justification for the industry to invest their efforts in seeking and monitoring the performance of their lower-tier suppliers along some key performance dimensions. We provide direct evidence that seeking knowledge of and monitoring certain activities of lower-tier suppliers can result in better performance in SRM.

Keywords: supplier relationships, lower-tier visibility, survey, lower-tier supplier management, supplier performance.

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