The case against purchasing partnerships.

INTRODUCTION

The idea of forming cooperative rather than adversarial relationships with suppliers made an appearance in the United Kingdom almost two decades ago.[1] There have been a number of re-launches since that time under a variety of names such as co-makership,[2] reverse marketing,[3] supplier alliances,[4] and most recently, partnership sourcing.[5] Over the same period, the idea has been extended from immediate suppliers to encompass the wider supply chain,[6] and has been coupled with ideas borrowed form Japanese automotive and lean production literature.[7] Variations on the cooperative theme have also begun to appear in the marketing sphere under the titles of relational or relationship marketing,[8] and in the strategic management field in the guise of strategic alliances.

Given the range and volume of publications devoted to partnerships and cooperative sourcing relationships, one might argue that if business fads can be said to have life-cycles, then the idea of cooperative supplier partnerships has reached the mature stage. If the fad had been preceded by a vigorous theoretical debate leading to conclusions that were subsequently rigorously tested with large-scale empirical research, there would be no need for concern. However, although glowing testimonials to the wonders of cooperation are available,[10] balanced assessments of the idea are in extremely short supply. With a few notable exceptions,[11] the majority of the academic profession and the accompanying literature appears to have leapt from an attack on the adversarial approach to supplier relationships[12] to the assumption that cooperation and partnerships are the sine qua non of successful supplier relationship management. The current conventional wisdom in this area is exemplified in the following quotation:

Every business looking for success in the 1990s requires world-class quality and flexibility as well as the ability to bring the best possible products or services to market in the shortest possible time. The Confederation of British Industry believes that the concept of partnership sourcing is critical in helping British industry to achieve world-class competitiveness.[13]

Again, this would be of little concern if the concept was unambiguously applicable to and beneficial for all companies.