The effect of buyers’ socialization efforts on the culture of their key strategic supplier and its impact on supplier operational performance

Abstract

This paper investigates if inter-organizational socialization mechanisms initiated by a buyer organization towards a strategic supplier can influence the culture within that supplier organization to ultimately improve supplier performance to the buyer. Using a quantitative sample of 279 UK companies from across a variety of industry sectors, statistical techniques were utilized to examine the effect of informal and formal socialization mechanisms on the culture of a strategic supplier as measured by their organizational practices and the subsequent supplier performance outcomes. It was found that both informal and formal socialization efforts by a buyer organization have a significant influence on the culture of the supplier organization as measured by their organizational practices. Socialization efforts by the buyer organization influence the organizational practices of the supplier to be more result-oriented, employee-centred, open, pragmatic to customer needs and market focussed. These organizational practices were found to positively influence supplier operational performance in the eyes of the buyer organization as measured by on time delivery, conformance to product specifications, flexibility to respond to changing customer needs and cost reduction initiatives. Modelling the influence of informal and formal socialization efforts by a buyer on the organizational culture of a key supply chain partner provides new insights to academics. Firstly, this work makes a significant contribution to the extant research on socialization in the supply chain literature. Secondly, it raises the importance of understanding the influence of culture on supplier operational performance. Although the study used a dyadic method to validate the cultural insights, our study only took a snapshot of culture at one point in time. Organization culture as displayed through organizational practices is a complex construct that changes over time. Therefore, to further understand the intricacies of organization culture, a longitudinal study would be useful in the future. Secondly, future studies could develop into themes such as the green supply chain and sustainability issues. Finally, our study was undertaken in the UK. It would be useful to replicate this study in a different setting, including Eastern countries. Organizations should engage early with their key supply base from a socialization perspective. The importance of joint away days, cross function teams alongside effective communication and on site visits have been fund to have a significant influence on shaping a high performance culture along the supply chain. Therefore, a buyers’ early understanding of their key supplier’s culture via these mechanisms appear critical for long-term supply chain success. Measuring supplier culture at the visible level of organizational practices removes the ethereal qualities often attributed to culture as a concept; buyers can influence supplier culture. This paper presents an empirically tested model which includes informal socialization, formal socialization, deconstructed organizational culture and supplier operational performance in a supply chain setting.

Keywords:

• Supply chain
• culture
• organizational practices
• socialization
• performance
• inter-organizational supply chain relationships

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Trevor Cadden

Dr. Trevor Cadden is a Senior Lecturer in Operations Management at the University of Ulster. Trevor has considerable experience in Supply Chain Management and Operations Management. His experience working for many years in US multinationals in supply chain systems implementation, project management, inventory control and management, and performance measurement has provided a fundamental platform for his career in academia. Trevor is regularly involved in a range of consultancy projects across sectors based on his knowledge of supply chain and operations management. Trevor’s research has been published in journals such as Supply Chain Management: An International Journal, International Journal of Production Economics, International Journal of Information Management and Production Planning and Control.

Guangming Cao

Guangming Cao, PhD, previously held lecturing positions at the Northwestern Polytechnical University in China, the University of Ulster, and the University of Bedfordshire in the UK. He is Associate Professor of Data Analytics at Ajman University in the UAE. His research interests include the use of artificial intelligence and business analytics and its impact on organizational decision making, capabilities, innovation, and performance. He has published articles in journals such as European Journal of Operational Research, Industrial Marketing Management, IEEE Transactions on Engineering Management, Information Technology & People, International Journal of Management Review, Supply Chain Management, and Production Planning & Control.

Ying Yang

Dr. Ying Yang is a senior lecturer in Newcastle University Business School, Newcastle University, UK. She received her PhD in operations management from the University of Ulster, UK. Her research interests lie in operations strategy, supply chain management and business service. She has published in journals such as The International Journal of Production Research, Supply Chain Management: an International Journal, Production Planning and Control and International Journal of Logistics Management.

Alan McKittrick

Dr. Ronan McIvor is a Professor of Operations Management at the Ulster University. He has carried out extensive research in the areas of supply chain management. He is currently carrying out research in the area of supply chain management with a number of service and manufacturing organizations. He has authored a number of books including The Outsourcing Process and Global Services Outsourcing, both published by Cambridge University Press. He has over 20 years of experience of teaching and research in operations management and information technology. He has practical experience of supply chain management and applying information technology to management situations. He has led knowledge transfer partnerships (KTPs) and Fusion programmes in the areas of supply chain management and information technology in both manufacturing and service organizations.

Ronan McIvor

Dr. Alan McKittrick is a Senior Lecturer in Operations Management at the University of Ulster. Alan has extensive experience in Operations Management and Organizational Transformation. His experience working for many years in multinational manufacturing companies in operations strategy and management, business improvement, lean and agile projects, inventory control and management, and performance measurement has provided an important foundation for his academic career. Alan is regularly involved in a range of consultancy projects in both the private sector and healthcare sector applying his knowledge of operations management, operational improvement and transformation. Alan’s research has been published in journals such as International Journal of Operations and Production Management, Supply Chain Management: An International Journal, and Technology Analysis and Strategic Management.

George Onofrei

George Onofrei is a Senior Lecturer in Operations and Supply Chain Management, at the School of Business, Letterkenny Institute of Technology, Ireland. He has completed his PhD at UCD Smurfit Graduate Business School, Ireland in the area of Operations and Supply Chain Management. His research interests focus on supply chain practices and behavioural operations in manufacturing and service industries. He is Vice-President of the Global Manufacturing Research Group (GMRG) and serves on the Board of the European Operations Management Association (EurOMA).