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This research investigates the dynamic interplay of contractual and relational governance mechanisms in long-term supply arrangements. The thesis contributes to an emerging debate that examines the combination of contractual and relational governance in inter-organisational exchanges. Contractual and relational governance mechanisms have been positioned as precluding mechanisms, which may result in destructive effects if combined for governing inter-organisational relationships. Previous research studies have increasingly acknowledged that the use of contractual mechanisms does not exclude the use of relational mechanisms and vice-versa. However, the recent literature offers limited insights into the dynamic interaction of both inter-organisational governance mechanisms and their impact on overall performance. The analysis in this research utilises a conceptual framework and a number of theoretical lenses through which the dynamic interplay of contractual and relational governance mechanisms is explained. Based on empirical case analysis of six public-private supply arrangements across three sectors: healthcare, waste management and emergency services, the research explores the dynamic interplay of both governance mechanisms and their impact on overall performance. Retrospective case study data was collected deploying semi-structured interviews and the critical incident technique was used to investigate the governance interplay over time. The contribution to knowledge is a conceptual framework that refines contractual and relational governance components in supply relationships over time. The findings indicate the importance of the interplay between inter-personal and inter-organisational trust in combination with complex contracts and intermediate contractual agreements. From this the conclusion is drawn that organisations entering into long-term supply relationships need to deploy both contractual and relational governance mechanisms in combination in order to achieve better overall performance.

Network relationships play a significant role in the provision of servitized offerings. To date, little empirical research has been conducted to investigate the link between servitization and inter-organisational relationships. The objective of this doctoral thesis is to explore the implications of servitization on a manufacturer’s network. Particular emphasis is placed on the impact on the network structure and relationship attributes. An exploratory in-depth case study was conducted within the truck manufacturing industry using a multi-organisational perspective. An abductive research approach was adopted which was underlined by pragmatism. As part of this approach, 43 interviews were conducted in a total of 11 companies. The findings of the study suggest that managers need to be aware of the different customer needs, related offerings and resultant implications on the network structure and relationships. To this end, the findings show that as the offerings move towards advanced servitized offerings the network becomes more complex in terms of its structure and relationships. The research contributes to the literature by providing a more nuanced description of what actually occurs in a network when a manufacturer provides servitized offerings in conjunction with other product-based offerings. In particular, it identifies the relationship attributes that need to be managed in order to drive the right behaviour for the provision of each of these offerings. Moreover, it is the first known study to uncover triadic as well as tetradic network structures in a servitization context. Equally important, it provides a framework that captures the interplay between the different offerings and the resultant network structure and relationship attributes. In all of these capacities, this research is one of the first known studies to uncover some of the complexities surrounding the way in which inter-organisational relationships are enacted in a servitization context.

© Cranfield University 2013. All rights reserved. No part of this publication may be reproduced without the written permission of the copyright owner. / Network relationships play a significant role in the provision of servitized offerings. To date, little empirical research has been conducted to investigate the link between servitization and inter-organisational relationships. The objective of this doctoral thesis is to explore the implications of servitization on a manufacturer’s network. Particular emphasis is placed on the impact on the network structure and relationship attributes. An exploratory in-depth case study was conducted within the truck manufacturing industry using a multi-organisational perspective. An abductive research approach was adopted which was underlined by pragmatism. As part of this approach, 43 interviews were conducted in a total of 11 companies. The findings of the study suggest that managers need to be aware of the different customer needs, related offerings and resultant implications on the network structure and relationships. To this end, the findings show that as the offerings move towards advanced servitized offerings the network becomes more complex in terms of its structure and relationships. The research contributes to the literature by providing a more nuanced description of what actually occurs in a network when a manufacturer provides servitized offerings in conjunction with other product-based offerings. In particular, it identifies the relationship attributes that need to be managed in order to drive the right behaviour for the provision of each of these offerings. Moreover, it is the first known study to uncover triadic as well as tetradic network structures in a servitization context. Equally important, it provides a framework that captures the interplay between the different offerings and the resultant network structure and relationship attributes. In all of these capacities, this research is one of the first known studies to uncover some of the complexities surrounding the way in which inter-organisational relationships are enacted in a servitization context.

It is well-recognised that companies are under pressure to take responsibility for the environmental impact of their operations. Logistics service providers (LSPs), who through their transport and logistics operations have a large negative impact on the environment, are one type of supply chain actor that is under such pressure. However, in order for LSPs to be able to lower their environmental impact sufficiently, their customers, the shippers, also need to take responsibility. This thesis takes its starting point in the relationships between LSPs and shippers and argues that in order for LSPs’ environmental activities to reach their full potential, the shippers must be included in the activities. The purpose of this thesis is to describe and explain how supply chain actors, with a specific focus on logistics service providers and shippers, can include environmental activities in their relationships with each other. This comprises identifying those environmental activities that are relevant for relationships between LSPs and shippers, as well as describing the extent to which environmental activities are included in such relationships. By means of the theoretical perspective of power between supply chain actors, the thesis also sets out to further understand how power balances between LSPs and shippers can influence the extent to which they include environmental activities in their relationships with each other. Finally, the use of the theoretical perspective of coordination aims, through the analysis of coordination mechanisms, to shed light on how environmental activities are included in LSP-shipper relationships. The research in this thesis has mainly descriptive and explanatory aims, although due to the novelty of research into LSPshipper relationships in an environmental context, the research process as such is mainly exploratory. Following an abductive approach, the insights from literature are combined with empirical data from two cases studies, a homepage scan, a survey and a study of city logistics projects. Most of the applied research methods take a dual perspective of relationships between supply chain actors and thus include both LSPs and shippers. One conclusion from the research conducted for this thesis comprises the identification of environmental activities as well as a suggestion for a classification based on the activities’ role in the business between LSPs and shippers. With a starting point in the identified activities, a comparison of a market perspective and a relationship perspective of environmental activities in LSP-shipper relationships indicates that LSPs are able to fulfil the requirements set by shippers and that shippers’ requirement thus are met. The research does, however, point to a passiveness among LSPs in their relationships with shippers, who in turn would like the LSPs to be more proactive. Further, based on an analysis of power balances in LSP-shipper relationships, it is suggested that in an LSP-shipper relationship in which the shipper has a power advantage, the shipper’s environmental ambitions for logistics sets the agenda for the environmental activities in that relationship. An analysis of coordination of environmental activities in LSP-shipper relationships indicates that the mechanisms of direct supervision, which is when one actor tells the other actor in the relationship what to do, and mutual adjustment can be chosen to be used in order to include environmental activities in LSP-shipper relationships. While direct supervision is suggested to be a coordination mechanism that is easy for shippers to apply, mutual adjustment appears to hold greater potential for the development of environmental activities. Finally, these findings in combination are suggested to have implications for the coordination of environmental activities in LSP-shipper relationships. More specifically, this thesis offers a categorisation of different types of LSP-shipper relationships and the involved actors’ environmental ambition. Depending on whether the environmental ambition of the LSP and shipper in a specific relationship is high or low appears to have implications for the possibility to work towards greener supply chains for each type of relationship. / Många företag känner av pressen av agera för att minska sin miljöpåverkan. Flera företag har också insett att ett sådant agerande även har affärsmässiga fördelar. När det gäller miljöpåverkan så tillhör logistikföretagen, till stor del på grund av sina transporter, de företag som insett att något måste göras. Möjligheten för dessa företag att göra olika miljöåtgärder påverkas av varuägarna som köper logistikföretagens tjänster. Som en följd av detta blir länken mellan dessa företag – relationen – viktig för att möjliggöra förbättringar när det gäller påverkan från logistiken. Denna avhandling har som syfte att beskriva och förklara hur aktörer i försörjningskedjan, med ett speciellt fokus på relationer mellan logistikföretag och varuägare, kan inkludera miljöåtgärder i sina relationer med varandra. För att över huvud taget kunna diskutera miljöåtgärder i relationer mellan logistikföretag och varuägare så är det viktigt att veta vad för typer av miljöåtgärder detta kan röra sig om. Första forskningsfrågan i avhandlingen behandlar detta och i avhandlingen identifieras ett antal sådana åtgärder. Det kan röra sig om relativt tekniska åtgärder så som alternativa bränslen, olika typer av fordon och energieffektiv körning, till åtgärder som handlar om styrning av logistiken, så som design av logistiksystemen, till åtgärder som är väldigt relationsspecifika som exempelvis specifika projekt eller miljögrupper. Med avstamp i de identifierade åtgärderna analyseras sedan relationerna mellan logistikföretag och varuägare i några olika steg. En jämförelse mellan logistikföretagens och varuägarnas perspektiv på de miljöåtgärder som erbjuds, efterfrågas samt ingår i relationerna dem emellan visar att logistikföretagen ofta kan tillgodose sina kunders önskemål. Samtidigt som detta visar att varuägarnas önskemål verkar vara uppfyllda, så finns det en frustration från varuägarnas sida över att logistikföretagen inte är mer proaktiva. En av anledningarna till detta kan vara maktbalansen mellan logistikföretag och varuägare. Resultaten i avhandlingen pekar nämligen på att varuägarna oftast har makten över logistikföretagen, vilket verkar leda till att varuägarens ambitioner gällande miljö ofta är det som sätter agendan för vilka miljöåtgärder som inkluderas i relationen mellan dessa företag. Vidare så kan de miljöåtgärder som ingår i en relation mellan logistikföretag och varuägare koordineras på olika sätt och flera sådana tas upp i avhandlingen. Resultaten pekar även på att maktbalansen i relationerna påverkar i vilken grad miljöåtgärder inkluderas i relationer mellan logistikföretag och varuägare samt hur dessa koordineras. En matris, som bygger på logistikföretagets och varuägarens ambitioner gällande miljö för en specifik relation, sammanfattar resultaten i avhandlingen. Beroende på om denna ambition är hög eller låg för de båda aktörerna påverkar i sin tur möjligheten för varje typ av relation att arbeta mot gröna försörjningskedjor.

This research investigates the relationship between guanxi and Corporate Community Involvement (CCI) in the Chinese business environment. The thesis provides valuable insights into the motivation and management of CCI in China where the institutional and cultural context is radically different from the Western contexts. This thesis also places CCI in the context of guanxi and thus bridges the literatures on CCI and guanxi. Strategic motivation and management of CCI has been studied extensively in the context of Western countries. However, the extant literature offers limited insights into the motivation and management of CCI in the Chinese business environment. The Chinese business environment is characterised by a comparatively poor legal system and weak property rights. In such an environment guanxi – a system of personal connections that carry long-term social obligations – are held to play a significant role in business relationships in China. Earlier studies have found that guanxi is able to influence a variety of corporate behaviours. Nevertheless, no attempt has been made to investigate how CCI may have been influenced by guanxi in China. This research develops a conceptual model and six propositions, which explain how CCI is strategically tailored to initiate guanxi, and furthermore, facilitate inter-organisational relationship development through such guanxi in China. Based on an empirical case analysis of 148 CCI projects from three types of company; foreign, state-owned, and private, this research explores the relationship between CCI and guanxi and tests the conceptual model and propositions. The empirical data was collected deploying face-to-face, semi-structured interviews with 65 companies (30 foreign companies, 9 state-owned companies, and 26 private companies) in China. The findings indicate that foreign companies’ and private companies’ CCI are motivated by guanxi development. Their CCI behaviours are strategically tailored to initiate guanxi with key stakeholders, and in particular with stakeholders who possess strong governmental backgrounds; and Chinese state-owned companies’ CCI behaviours are subject to little influence of guanxi development. While foreign companies used guanxi to facilitate their inter-organisational relationship development, private companies used guanxi to obtain formal institutional supports. From the findings, the conclusion is drawn that guanxi plays a significant role in motivating CCI engagement and shaping CCI behaviours in China, and, through such guanxi, CCI can be employed to facilitate inter-organisational relationship building and obtain formal institutional support.

Background: Inter-organisational ways of working have become more and more common during the last decades. In order to attain efficiency and productivity, such inter-organisational relationships need to be governed and controlled. However, studies have shown that inadequate control is one of the main reasons for why inter-organisational relationships fail. One of the means that can be used for governing and controlling a business is management control. The use of management control in inter-organisational contexts is a quite unexplored area of research at the present time, which might seem somewhat surprising considering the fact that inadequate control is a common explanation for why inter-organisational relationships fail. Purpose: The purpose of this thesis is to describe management control in horizontal inter-organisational relationships, as well as to analyse the design of inter-organisational management control systems, using relation specific characteristics as a starting point. Delimitation: The possible influence that trust might have on inter- organisational management control will not be discussed in this thesis. Realisation: A case study of a network consisting of three companies that jointly develop a fuel cell air supply system for vehicle applications. The empirical data was gathered through visits at each of the three companies, including an interview with each company’s general manager. Conclusions: The character of inter-organisational relationships can change over time, which might make it necessary to change inter-organisational management control systems. Some aspects that should be kept in mind when designing an inter-organisational management control system are: the match between the relationship and the control system, the openness within the relationship, the balance between control and commitment, as well as the trade- off between the costs and the benefits of a certain system. The possible effect that external factors might have on inter-organisational management control is yet another aspect that should be considered.

<p>Background: Inter-organisational ways of working have become more and more common during the last decades. In order to attain efficiency and productivity, such inter-organisational relationships need to be governed and controlled. However, studies have shown that inadequate control is one of the main reasons for why inter-organisational relationships fail. One of the means that can be used for governing and controlling a business is management control. The use of management control in inter-organisational contexts is a quite unexplored area of research at the present time, which might seem somewhat surprising considering the fact that inadequate control is a common explanation for why inter-organisational relationships fail. </p><p>Purpose: The purpose of this thesis is to describe management control in horizontal inter-organisational relationships, as well as to analyse the design of inter-organisational management control systems, using relation specific characteristics as a starting point. </p><p>Delimitation: The possible influence that trust might have on inter- organisational management control will not be discussed in this thesis. </p><p>Realisation: A case study of a network consisting of three companies that jointly develop a fuel cell air supply system for vehicle applications. The empirical data was gathered through visits at each of the three companies, including an interview with each company’s general manager. </p><p>Conclusions: The character of inter-organisational relationships can change over time, which might make it necessary to change inter-organisational management control systems. Some aspects that should be kept in mind when designing an inter-organisational management control system are: the match between the relationship and the control system, the openness within the relationship, the balance between control and commitment, as well as the trade- off between the costs and the benefits of a certain system. The possible effect that external factors might have on inter-organisational management control is yet another aspect that should be considered.</p>

Title: Discovering the Dark Side: A Multiple Case Study of IOMC Instability in Triadic Relationships Authors: Adam Hargrave, Iqra Ashfaq Mian, and Jan Peter van der Zwet Background: Within IORs, knowledge, activities, and resources are increasing shared amongst organisation members to obtain some sort of strategic advantage. Typically, forming a triadic relationship. Therefore, IOMC practices are regularly used to shape, support and control activities across the triadic relationship, but conversely, literature has not explored the instability certain shared IOMC systems can bring to partners through its complexity, triadic complexity, and instability drivers. Therefore, the investigation of IOMC’s instability influence on triadic relationships is investigated to contribute to the academic literature and organisations studied.  Purpose: The purpose for the research conducted is to investigate the shared IOMC in triadic, inter-organisational relationships that influence instability in buyer-supplier triadic relationships. Methodology: A multiple case study has been conducted through semistructured interviews. A critical realism perspective, descriptive-exploratory, and abductive research methodology was enacted. Analysis and Discussion: The multiple cases show that complexities in the from of triadic complexity and IOMC design complexity may lead to the drivers that introduce IOMC instability in the triadic relationships. The literature discussed is linked to the empirical findings and a research model is proposed. Conclusion: The conclusion discusses the theoretical and managerial implications of the presented research and possible future research opportunities of IOMC instability in triadic relationships.

Can interorganisational relationships be managed for effective functioning? This is the problem investigated in this research. Organisations world-wide are adopting co-operative relationships with other organisations. These interorganisational relationships are viewed as a way to enhance their own business performance (Williamson 1985, 1991; Dyer 1997; Gulati 1998; Barringer & Harrison 2000; Das & Teng 2000; Quinn 2000; Stuart 2000; Johnson, Korsgaard & Sapienza 2002). Despite this, the success rate for interorganisational relationships is not high (Hutt, Stafford, Walker & Reingen 2000; Quinn 2000; Hitt, Ireland & Vaidyanath 2002) with many of them failing to achieve their objectives. Understanding how to manage these boundary-spanning arrangements is important to realising the objectives of the business strategy. The research setting is a large private hospital in Australia. It works with a network of external service organisations that provide the Hospital with a range of clinical and non-clinical support services including: Diagnostic Imaging, Pathology Pharmacy, Food Services, Environmental Services, and Human Resources support. This research explores how these different relationships were managed in their operating period: 1998 to 2002. It reveals the dynamic and often ad hoc way, in which managers made sense of the collaborative service context, and how managers influenced the process of interorganisational relationship formation. Extant research about interorganisational relationships comes from a variety of fields. For this research it is most relevant to draw from the research fields of organisational theory, organisation behaviour, sociology, psychology and management. These fields contribute findings that provide useful knowledge upon which to build further understanding about how managers contribute to construct interorganisational relationships functioning (Ring & Van de Ven 1992, 1994; Walsh 1995; Chikudate 1999a, 1999b; Boddy, Macbeth & Wagner 2000; Hutt, Stafford, Walker & Reingen 2000; Lasker, Weiss & Miller 2001). This research uses an interpretivist methodology that enables the researcher to explore the dynamic nature of the Manager's sense-making in the construction of six interorganisational relationships. For the purposes of this research, interorganisational relationships are defined as new structures that emerge through the social interaction of actors involved in shared service delivery. The collaborative context of interorganisational relationships stimulates managers' sense-making by challenging institutionalised ways of behaving. This sensemaking process builds new knowledge stores and contributes to emerging, new management routines. The process is transformative and enables the emergence of interorganisational relationships. It emerges from this research that managers take cues from their context. These cues are used to interpret and make assessments that enable decisions about those actions that they take to construct the interorganisational relationships. A manager's processing of contextual cues, through interpretive frames and dispositional sense-making filters, is an inter-subjective, socially constructive process. The 'self' is a dimensional influence in the managers' sense-making and management behaviours and is implicated through the notion of contextual interpretive frames and dispositional sense-making filters. A model of interorganisational relationship management as a transformational process is developed. The association between contextual influences and managers' behaviours will raise awareness for professional practitioners of the challenges involved in managing across organisational boundaries and in turn, may contribute to more successful implementation of interorganisational business relationships.