BUS606: Operations and Supply Chain Management

Network Resource and Strategic Intent

Many sociologists traditionally viewed the emergence of social networks as the outcome of spontaneous and informal face-to-face conversations among non-predetermined individuals. On the other hand, a stream of strategic alliance literature has adopted a different view in which firms utilize strategic alliances to access partners' knowledge or skills to hedge their performance risk, or to enter a certain foreign market within interfirm dyad settings. This view has been anchored in the network resource theory (also known as social resource theory), one of the most popular theories in social network research. The theory, mainly developed by Lin et al., argued that interpersonal contacts enable better access to, and mobilization of, resources embedded within and outside one's social network, such as valuable information and prestigious connections. However, relatively little is known about what specific motives drive interfirm network actors to interact with one another and attempt to form a specific network architecture.

The concept of strategic intent initially suggested by Hamel and Prahalad has been useful throughout various business disciplines in accounting for managerial motives behind the strategic alliance or joint venture formulation. While a vision is commonly developed and held by top management teams, strategic intent is more than just a vision or ambitious target of top management in that it is shared and implemented at multiple levels of the organization. For instance, Koza and Lewin proposed a framework emphasizing that a firm's strategic partnership structure varied by its strategic intent (exploitation or exploration). DiRomualdo and Gurbaxani also highlighted the importance of alignment between the strategic intent and supplier relationships to achieve outsourcing success. Ryall more recently espoused this view in his argument that an OEM should utilize different strategic intents (competitive or persuasive) in garnering the resources and capabilities possessed by non-immediate members of its value network. Extending the aforementioned conceptual arguments to the SCM domain, the OEM's strategic intents may serve as pivotal reference points for managing its supplying partners across multiple tiers, which result in different architectural properties of the formed supply network. Very little empirical research, however, has been done to test this conjecture. This study investigates the strategic antecedents of different supply network architectures by incorporating Fisher's supply chain design considerations (i.e., cost leadership and market responsiveness) as shown in Figure 1, and as a result, aims to provide a strategic supply network perspective.

Figure 1. Strategic intents and corresponding supply network types.