abstract: In this dissertation research, I expand the definition of the supply network to include the buying firm’s competitors. Just as one buyer-supplier relationship impacts all other relationships within the network, the presence of competitor-supplier relationships must also impact the focal buying firm. Therefore, the concept of a “competitive network” made up of a focal firm, its competitors and all of their combined suppliers is introduced. Utilizing a unique longitudinal dataset, this research explores how the organic structural changes within the new, many-to-many supply network impact firm performance. The investigation begins by studying the change in number of suppliers used by global auto manufacturers between 2004 and 2013. Following the Great Recession of 2008-09, firms have been growing the number of suppliers at more than twice the rate they had been reducing suppliers just a few years prior. The second phase of research explores the structural changes to the network resulting from this explosive growth in the number of suppliers. The final investigation explores a different flow – financial flow -- and evaluates its association with firm performance. Overall, this dissertation research demonstrates the value of aggregating individual supply networks into a macro-network defined as the competitive network. From this view, no one firm is able to control the structure of the network and the change in structure directly impacts firm performance. A new metric is introduced which addresses the subtle changes in buyer-supplier relationships and relates significantly to firm performance. The analyses expand the body of knowledge through the use of longitudinal datasets and uncovers otherwise overlooked dynamics existing within supply networks over the past decade. / Dissertation/Thesis / Doctoral Dissertation Business Administration 2016

Dynapac GmbH is a manufacturer of road construction equipment and has historically been acquired and merged with several companies, resulting in an expansion of their supplier base. Currently, they are experiencing a large supplier base within direct material causing a decrease in the effectiveness and efficiency in the management of the suppliers. Dynapac GmbH therefore wishes to lower the number of suppliers in order to obtain desired effects, such as cost savings, reduction of administrative workload, higher control, higher quality and improved communication with suppliers. The purpose of the study is therefore to develop a methodology that describes all the activities needed to successfully reduce the number of suppliers. At the moment, approximately 80 percent of the total purchasing budget is allocated to only 14 percent of the supplier base. The supplier base can therefore be assumed to consist of a high number of suppliers supplying only a few products with a low turnover. Based on this, it can be concluded that the supplier base includes several opportunities for supplier base reduction. The action of reducing the supplier base is perceived as being in line with the sourcing strategy as well as the business strategy and the needed support is therefore believed to be present in order to succeed with performing supplier base reduction. Based on existing research, a conceptual model for supplier base reduction was created. The current situation at Dynapac GmbH was thereafter analysed in order to enable a customization of the model. Interviews were held to obtain input regarding the model and the activities. The overall view on the model was positive and all activities were considered to be relevant to include. Possible customizations of the activities were discussed during the interviews, which resulted in a customized model consisting of activities with either two types of customizations: (1) defined variables or (2) developed processes. Lastly, the model was validated in a pilot test before it was reconfigured and handed over as a methodology. The finalized methodology included a thorough description on how to conduct supplier base reduction from beginning to end, consisting of 14 activities corresponding to five different phases. The first two phases intend to lay the basis for enabling a reduction of the supplier base and the third phase aims at implementing it in practice. The fourth phase consists of analysing the result of the implementation followed by the last phase with focus on continuous improvement of the supplier base.

Purchasing has gone from an administrative task to a strategic activity. As such, firms adopt purchasing as a corporate function to set up rules and processes in order to standardize how purchasing is to be carried out by business units. This has the benefit of consolidating spend towards a fewer number of suppliers to be used throughout the entire organization and achieve great cost savings on a corporate level. Not complying to these rules and processes, however, will offset the benefits associated with strategic purchasing. A consequence of non-compliance is a large supply base which should not be the case if established processes are followed. The purpose of this thesis is to investigate the procurement process of a Swedish multinational organization in a case study setting, which applies strategic purchasing whilst reporting a large supply base. Hence, the authors aim to identify the main challenge in the procurement process. Additionally, this thesis seeks to find an explanation to the challenge by identifying the underlying contributing factors. The main challenge was discovered to be Maverick Buying, a phenomenon limited in research. Maverick Buying is the off-contract purchasing of goods and services and therefore bypass established processes, rules, and selected suppliers. At the case company four forms of Maverick Buying was found where the underlying factors contributing to them were communication, structures, purchasing tools, involvement, control mechanisms, and lack of understanding the procurement process. This thesis contributes to a greater understanding of the phenomenon and what causes its existence. / Inköp har gått från att vara en administrativ uppgift till att vara en strategisk uppgift. Därför inkluderas numera inköp som en funktion på koncernnivå hos företag för att utveckla och implementera en standardiserad process för hur inköp skall utföras genom hela företaget. Standardisering av inköp medför fördelen av att inköpskostnader konsolideras mot ett få antal leverantörer och därmed leder till stora kostnadsbesparingar på koncernnivå. Däremot, om inköp sker utanför den standardiserade inköpsprocessen kan fördelarna med strategiskt inköp aldrig att realiseras. Konsekvenserna blir därmed en större bas av leverantörer, vilket är motsatsen till om den tänkta inköpsprocessen hade följts. Syftet med denna uppsats är att, genom en fallstudie, undersöka inköpsprocessen hos ett svenskt multinationellt företag som utövar strategiskt inköp men samtidigt redovisar en stor bas av leverantörer. Författarnas mål är därmed att identifiera det huvudsakliga problemet i inköpsprocessen. Uppsatsen försöker även att finna förklaringar för varför problemet existerar samt de underliggande anledningarna till dessa förklaringarna. Författarna fann att det största problemet med inköpsprocessen var Maverick Buying, ett fenomen med begränsad forskning. Maverick Buying innebär att inköp av varor och tjänster sker utanför förhandlade leverantörskontrakt och etablerade inköpsprocesser. Specifikt hittade författarna fyra olika former av Maverick Buying, där de underliggande anledningarna var kommunikation, kontrollmekanismer och bristande förståelse för inköpsprocessen. Uppsatsen adderar till samt utvecklar förståelsen av fenomenet Maverick Buying och vad som orsakar det.