Safeguarding mechanisms in a supply chain network

Purpose – Building on the transaction cost theory and power structure literature, this paper aims to investigate the extent to which firms use two safeguarding mechanisms (supply chain relational investments and electronic collaboration) in different network dependency contexts in order to protect their portfolios of business relationships.Design/methodology/approach – Empirical evidence is gathered though a survey data conducted with 159 firms in the wireless communication sector. The paper tests the assumption that the two safeguarding mechanisms are used to a greater extent in interdependency‐intensive networks than in other supply chain contexts.Findings – This empirical study suggests that: in a network‐dependent context, relational investments allow firms to safeguard their portfolios of relationships; electronic collaboration seems to be a safeguarding mechanism for firms in downstream‐dependent network contexts; in general, firms appear to use both relational investments and electronic collaborati...

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