Academic journal article International Journal of Management

Supply Chain Relationships and Design Quality: The Moderating Effect of Organization Culture

Academic journal article International Journal of Management

Supply Chain Relationships and Design Quality: The Moderating Effect of Organization Culture

Article excerpt

Chinese automobile manufacturers become more competitive in global market. One critical success factor in the industry has proven to be effective supply chain relationships (SCR). The purpose of this study is to investigate the moderating effect of organization culture on relationship between SCR and design quality. The survey targeted on the automotive manufacturing firms which were chosen from the Directory of Chinese Manufacturing firms published by the Chinese Ministry of Trade and Industry. The survey questionnaires were distributed to 356 companies. A total of 278 respondents received the questionnaires and there were 78 unusable responses. The results reveal that the organization culture has influence the relationship between buyer-supplier communication and design quality in China automotive industry.

Introduction

The term relationship covers a lot of grounds in supply chain management. These include strategic relationships, tactical relationships, transactional relationships, internal relationships, and possibly more. The popularity of SCR has been stimulated from many directions including the quality revolution (Dale, Lascelles & Lloyd 1994). In fact, the development of supply chain management has emerged from the same roots of quality management. Many researchers have recently indicated that quality is a key strategic element that should be managed not only within a single firm but also among supply chain partners (Choi & Rungtusanatham, 1999). Thus, ensuring quality at every stage of supply chains is becoming quiet essential for successful supply chain management. While there is a considerable body of empirical research which has focused on supply chain management towards quality issues, vers few7 has paid attention to quality performance from supply chain relationship perspective (Choi & Rungtusanatham 1999).

The creation and enhancement of a long-term cooperative supply chain relationship is a significant quality practice which has been prescribed as an indispensable part of any organization (Lascelles & Dale, 1990; Lambert et al, 1996). In addition, organization can gain an invisible form of competitive advantage by making the most effective use of suppliers' capabilities. So they should identify suppliers as partners and build long-term relationships so that suppliers are motivated and able to provide the components needed to their ultimate goal (Derose, 1987; Harrison & St John, 1996). However, it is quite challenging to develop this kind of relationships in china. Since effective supply chain relationship demand manufacturing company to treat their suppliers as ongoing business partners, which is necessary to change in belief and a shift from traditional adversarial relationship to close partnership, then manufacturers and suppliers believe they can rely on each other to be honest and helpful (Harrison and St John, 1996).

However, in the current study the design quality has been conceptualized as part of quality performance. Brian and Sean (2005) proved that design is not only a major cost driver, but also recognized as major determinant of quality because quality is designed into the product, and good design can improve quality and enhance the company's ability to compete in marketplace, there are also potential benefits with partnerships. The design quality is an issue in china automotive industry, especially once the industry targeting a global market. In academic literature, the exact nature of these relationships and how they can improve design quality remain unexplored. However, the objective of this study is to examine whether organization culture play very important role in relationship between SCR and design quality on China automotive industry.

Automotive Industry in China

Since China implemented major economic reforms to create an open-door policy in 1978, its economic development has been impressive. The Chinese National Bureau of Statistics (NBS) (2008) reported that GDP has showed growth of 11. …

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