Jimma University College of Business and Economics Department of Management MA of Logistics and Supply Chain Management
Jimma University College of Business and Economics Department of Management MA of Logistics and Supply Chain Management
Department of Management
January 2021
Jimma, Ethiopia
Crook, T. and Combs, J., 2006, ‘Sources and consequences of bargaining power in
supply chains’, Journal of Operations Management, 25(2), pp.546-555.
Introduction
In the article Crook, T. and Combs J. tries to discuss the Sources and consequences
of bargaining power in supply chains by theory drawn from resource dependence
theory
The study has tried to reveal Sources and consequences of bargaining power in
supply chains and contribute to the literature by: predicting when stronger firms
use their power; describing the performance implications of bargaining power use
for both strong and weak members. And also, describe pooled, sequential, and
reciprocal task interdependence. Supply chain profits can be thought of as having
two major components: the sum of individual members’ profits, plus; some added
profits generated by effective SCM. Authors forwarded their idea as increase in
the firm’s dependence on the chain wherein the relative need to acquire resources
shapes each member’s power.
Overall, supply chain members offering high magnitude or critical resources who
participate in highly concentrated industries are stronger. Weaker members, on the
other hand, lack such resources. Whereas it is an important first step to understand
how resources shape dependencies and hence bargaining power, it raises the
question of when and to what degree stronger members use their power. Generally
the authors argue that as appropriate use of bargaining power help both the
stronger and weaker firms alike improve their performance over the long run.
The main objective was to predict the use of bargaining power in supply chains
and draw a more realistic picture of SCM benefits for most members and to
describe the benefits, when they exist, of SCM for both stronger and weaker
members. Authors argue the following:
Contributions
The article mostly built up on ‘Resource-based view’, a model that sees resources
as key to superior firm performance. It assists companies to develop agility,
adaptability, and alignment regarding SCM.
General Critique
For the future researcher the authors’ forwarded recommendation as dealing with
further exploration of the relationship between task interdependence and available
gains from SCM might be beneficial.
Additional Reference
Baron, O., Berman, O. and Wu, D. (2016), “Bargaining within the supply chain
and its implications in an industry”, Decision Sciences, Vol. 47 No. 2, pp. 193-218.
I prefer the article to in order to understand bargaining in supply chain and its
implication