8 Questions
How does a high level of trust and commitment in buyer-supplier relationships affect opportunism?
It reduces opportunism and encourages inter-organizational cooperation.
What is the role of commitment in buyer-supplier relationships?
It helps in creating a more sustainable business organization and interdependent relationships between buyers and suppliers.
What is the basis of frequency of communication between buyers and suppliers?
It is based on the benefits they perceive to gain from the relationship.
What does the duration of relationship reflect in buyer-supplier relationships?
It reflects the level of experience gained, developed behaviors and norms, and relationship specific-assets invested.
How does trust affect the duration of relationship between buyers and suppliers?
As trust increases, buyers and suppliers act collectively, investing in each other’s capabilities.
What is the role of reputation in buyer-supplier relationships?
It is a main selection criterion and characteristic of suppliers, and it can be referred to as the supplier’s intangible asset.
How does reputation affect the supplier’s relationship with its buyers?
The supplier’s reputation greatly affects his relationship with its buyers in supply chains.
What happens when buyers and suppliers have a longer and closer relationship?
They can share risks and rewards.
Study Notes
Trust and Commitment
- Higher degree of trust and commitment in buyer-supplier relationships reduces opportunism and promotes inter-organizational cooperation.
- Commitment leads to the creation of a more sustainable business organization and interdependent relationships between buyers and suppliers.
Supply Chain Performance
- Degree of commitment in buyer-supplier relationships affects supply chain performance.
- Commitment helps in achieving common goals and efforts between buyers and suppliers.
Frequency of Communication
- Frequency of communication refers to the degree of contact and interaction between buyers and suppliers.
- The frequency of communication is based on the benefits perceived by both parties in the relationship.
Relationship Duration
- Duration of relationship reflects the level of experience gained, developed behaviors and norms, and investment in relationship-specific assets.
- Trust is a key factor in determining the duration of the relationship between buyers and suppliers.
Consequences of Trust
- As trust increases, buyers and suppliers act collectively, investing in each other's capabilities.
- Trust leads to joint problem-solving, design of new products, and shared planning.
- Trust results in a longer and closer relationship, enabling parties to share risks and rewards.
Reputation
- Reputation is a main selection criterion and characteristic of suppliers in buyer-supplier relationships.
- Reputation is an intangible asset that reflects the extent to which suppliers are fair, honest, and concerned with their buyers.
- Positive reputation raises the degree of buyer's trust, increases willingness to lengthen the relationship duration, and enhances commitment to the relationship.
Interrelationship between Factors
- Reputation is interrelated with trust, commitment, and relationship duration.
- Positive reputation reinforces trust, commitment, and relationship duration.
This quiz assesses the importance of commitment in buyer-supplier relationships and its impact on supply chain performance. It explores the role of trust and communication in inter-organizational cooperation.
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