Operationalizing Supply Chain vs. Supply Chain Competion

Competition is an immensely important area of study in economic theory, business and strategy. It is known to be vital in meeting consumers’ growing expectations, stimulating increase in the size of the market, pushing innovation, reducing cost and consequently generating better value for end users, among other things. Having said that, it is important to recognize that supply chains, as we know it, has changed the way companies deal with each other both in confrontational or conciliatory terms. As such, with the rise of global markets and outsourcing destinations, increased technological development in transportation, communication and telecommunications has meant that geographical barriers of distance with regards to competition are a thing of the past in an increasingly flat world. Even though the dominant articulation of competition within management and business literature rests mostly within economic competition theory, this thesis draws attention to the implicit shift in the recognition of other forms of competition in today’s business environment, especially those involving supply chain structures. Thus, there is popular agreement within a broad business arena that competition between companies is set to take place along their supply chains. Hence, management’s attention has been focused on how supply chains could become more aggressive making each firm in its supply chain more efficient. However, there is much disagreement on the mechanism through which such competition pitching supply chain against supply chain will take place. The purpose of this thesis therefore, is to develop and conceptualize the notion of supply chain vs. supply chain competition, within the discipline of supply chain management. The thesis proposes that competition between supply chains may be carried forward via the use of competition theories that emphasize interaction and dimensionality, hence, encountering friction from a number of sources in their search for critical resources and services. The thesis demonstrates how supply chain vs. supply chain competition may be carried out theoretically, using generated data for illustration, and practically using logistics centers as a way to provide a link between theory and corresponding practice of this evolving competition mode. The thesis concludes that supply chain vs. supply chain competition, no matter the conceptualization taken, is complex, novel and can be very easily distorted and abused. It therefore calls for the joint development of regulatory measures by practitioners and policymakers alike, to guide this developing mode of competition.

Understanding the organic chain : The framework of the interaction between the actors in organic chains in relation to ecological modernisation of food production

The sustainability of food production has increasingly attracted the attention of consumers, farmers, food and retailing companies, and politicians. One manifestation of such attention is the growing interest in organic foods. Organic agriculture has the potential to enhance the ecological modernisation of food production by implementing the organic method as a preventative innovation that simultaneously produces environmental and economic benefits. However, in addition to the challenges to organic farming, the small market share of organic products in many countries today and Finland in particular risks undermining the achievement of such benefits. The problems identified as hindrances to the increased consumption of organic food are the poor availability, limited variety and high prices of organic products, the complicated buying decisions and the difficulties in delivering the intangible value of organic foods. Small volumes and sporadic markets, high costs, lack of market information, as well as poor supply reliability are obstacles to increasing the volume of organic production and processing. These problems shift the focus from a single actor to the entire supply chain and require solutions that involve more interaction among the actors within the organic chain. As an entity, the organic food chain has received very little scholarly attention. Researchers have mainly approached the organic chain from the perspective of a single actor, or they have described its structure rather than the interaction between the actors. Consequently, interaction among the primary actors in organic chains, i.e. farmers, manufacturers, retailers and consumers, has largely gone unexamined. The purpose of this study is to shed light on the interaction of the primary actors within a whole organic chain in relation to the ecological modernisation of food production. This information is organised into a conceptual framework to help illuminate this complex field. This thesis integrates the theories and concepts of three approaches: food system studies, supply chain management and ecological modernisation. Through a case study, a conceptual system framework will be developed and applied to a real life-situation. The thesis is supported by research published in four articles. All examine the same organic chains through case studies, but each approaches the problem from a different, complementary perspective. The findings indicated that regardless of the coherent values emphasising responsibility, the organic chains were loosely integrated to operate as a system. The focus was on product flow, leaving other aspects of value creation largely aside. Communication with consumers was rare, and none of the actors had taken a leading role in enhancing the market for organic products. Such a situation presents unsuitable conditions for ecological modernisation of food production through organic food and calls for contributions from stakeholders other than those directly involved in the product chain. The findings inspired a revision of the original conceptual framework. The revised framework, the three-layer framework , distinguishes the different layers of interaction. By gradually enlarging the chain orientation the different but interrelated layers become visible. A framework is thus provided for further research and for understanding practical implications of the performance of organic food chains. The revised framework provides both an ideal model for organic chains in relation to ecological modernisation and demonstrates a situation consistent with the empirical evidence.

Collective Network Capability in International Project Business Networks - A Case Study of the Business Network for the Ashanti Electrification Project in Ghana

Despite thirty years of research in interorganizational networks and project business within the industrial networks approach and relationship marketing, collective capability of networks of business and other interorganizational actors has not been explicitly conceptualized and studied within the above-named approaches. This is despite the fact that the two approaches maintain that networking is one of the core strategies for the long-term survival of market actors. Recently, many scholars within the above-named approaches have emphasized that the survival of market actors is based on the strength of their networks and that inter-firm competition is being replaced by inter-network competition. Furthermore, project business is characterized by the building of goal-oriented, temporary networks whose aims, structures, and procedures are clarified and that are governed by processes of interaction as well as recurrent contracts. This study develops frameworks for studying and analysing collective network capability, i.e. collective capability created for the network of firms. The concept is first justified and positioned within the industrial networks, project business, and relationship marketing schools. An eclectic source of conceptual input is based on four major approaches to interorganizational business relationships. The study uses qualitative research and analysis, and the case report analyses the empirical phenomenon using a large number of qualitative techniques: tables, diagrams, network models, matrices etc. The study shows the high level of uniqueness and complexity of international project business. While perceived psychic distance between the parties may be small due to previous project experiences and the benefit of existing relationships, a varied number of critical events develop due to the economic and local context of the recipient country as well as the coordination demands of the large number of involved actors. The study shows that the successful creation of collective network capability led to the success of the network for the studied project. The processes and structures for creating collective network capability are encapsulated in a model of governance factors for interorganizational networks. The theoretical and management implications are summarized in seven propositions. The core implication is that project business success in unique and complex environments is achieved by accessing the capabilities of a network of actors, and project management in such environments should be built on both contractual and cooperative procedures with local recipient country parties.

Tiering Effects in Third-party Logistics: A First-tier Buyer Perspective

This doctoral dissertation takes a buy side perspective to third-party logistics (3PL) providers’ service tiering by applying a linear serial dyadic view to transactions. It takes its point of departure not only from the unalterable focus on the dyad levels as units of analysis and how to manage them, but also the characteristics both creating and determining purposeful conditions for a longer duration. A conceptual framework is proposed and evaluated on its ability to capture logistics service buyers’ perceptions of service tiering. The problem discussed is in the theoretical context of logistics and reflects value appropriation, power dependencies, visibility in linear serial dyads, a movement towards the more market governed modes of transactions (i.e. service tiering) and buyers’ risk perception of broader utilisation of the logistics services market. Service tiering, in a supply chain setting, with the lack of multilateral agreements between supply chain members, is new. The deductive research approach applied, in which theoretically based propositions are empirically tested with quantitative and qualitative data, provides new insight into (contractual) transactions in 3PL. The study findings imply that the understanding of power dependencies and supply chain dynamics in a 3PL context is still in its infancy. The issues found include separation of service responsibilities, supply chain visibility, price-making behaviour and supply chain strategies under changing circumstances or influence of non-immediate supply chain actors. Understanding (or failing to understand) these issues may mean remarkable implications for the industry. Thus, the contingencies may trigger more open-book policies, larger liability scope of 3PL service providers or insourcing of critical logistics activities from the first-tier buyer core business and customer service perspectives. In addition, a sufficient understanding of the issues surrounding service tiering enables proactive responses to devise appropriate supply chain strategies. The author concludes that qualitative research designs, facilitating data collection on multiple supply chain actors, may capture and increase understanding of the impact of broader supply chain strategies. This would enable pattern-matching through an examination of two or more sides of exchange transactions to measure relational symmetries across linear serial dyads. Indeed, the performance of the firm depends not only on how efficiently it cooperates with its partners, but also on how well exchange partners cooperate with an organisation’s own business.

Corporate Environmental Responsibility in Demand Networks (summary section only)

Research on corporate responsibility has traditionally focused on the responsibilities of companies within their corporate boundaries only. Yet this view is challenged today as more and more companies face the situation in which the environmental and social performance of their suppliers, distributors, industry or other associated partners impacts on their sales performance and brand equity. Simultaneously, policy-makers have taken up the discussion on corporate responsibility from the perspective of globalisation, in particular of global supply chains. The category of selecting and evaluating suppliers has also entered the field of environmental reporting. Companies thus need to tackle their responsibility in collaboration with different partners. The aim of the thesis is to further the understanding of collaboration and corporate environmental responsibility beyond corporate boundaries. Drawing on the fields of supply chain management and industrial ecology, the thesis sets out to investigate inter-firm collaboration on three different levels, between the company and its stakeholders, in the supply chain, and in the demand network of a company. The thesis is comprised of four papers: Paper A discusses the use of different research approaches in logistics and supply chain management. Paper B introduces the study on collaboration and corporate environmental responsibility from a focal company perspective, looking at the collaboration of companies with their stakeholders, and the salience of these stakeholders. Paper C widens this perspective to an analysis on the supply chain level. The focus here is not only beyond corporate boundaries, but also beyond direct supplier and customer interfaces in the supply chain. Paper D then extends the analysis to the demand network level, taking into account the input-output, competitive and regulatory environments, in which a company operates. The results of the study broaden the view of corporate responsibility. By applying this broader view, different types of inter-firm collaboration can be highlighted. Results also show how environmental demand is extended in the supply chain regardless of the industry background of the company.

Sensemaking in the Third Space - Essays on French-Finnish Bicultural Experiences in Organizations and Their Narratives (summary section only)

Research on cross-cultural and intercultural aspects in organizations has been traditionally conducted from an objectivist, functionalist perspective, with culture treated as an independent variable, and often the key explanatory factor. In order to do justice to the ontological relativity of the phenomena studied, more subjectivist research on intercultural interactions, and especially on their relationships with the dynamics of cultural identity construction, is needed. The present research seeks to address this gap by focusing on bicultural interactions in organizations, as they are experienced by the involved individuals. It is argued that such bicultural situations see the emergence of a space of hybridity, which is here called a ‘third space’, and which can be understood as providing ‘occasions for sensemaking’: it is this individual sensemaking that is of particular interest in the empirical narrative study. A first overall aim of the study is to reach an understanding of the dynamics of bicultural interactions in organizations; an understanding not only of the potential for learning and emancipatory sensemaking, but also of the possibility of conflict and alienatory ordering (this is mainly addressed in the theoretical essays 1 and 2). Further, a second overall aim of the study is to analyze the reflexive identity construction of four young French expatriates involved in such bicultural interactions in organizations in Finland, in order to examine the extent to which their expatriation experiences have allowed for an emancipatory opportunity in their cases (in essays 3 and 4). The primary theoretical contribution in this study lies in its new articulation of the dynamics of bicultural interactions in organizations. The ways in which the empirical material is analyzed bring about methodological contributions: since the expatriates’ accounts are bound to be some kind of construction, the analysis is made from angles that point to how the self-narratives construct reality. There are two such angles here: a ‘performative’ one and a ‘spatial’ one. The most important empirical contributions lie in the analysis of, on the one hand, the alternative uses that the young expatriates made of the notion of ‘national culture’ in their self-narratives, and, on the other hand, their ‘narrative practices of the third space’: their politics of escape or stabilization, their exploration of space or search for place, their emancipation from their origin or return to home as only horizon.

Social dynamics for sustainable food systems. Actors’ orientations towards sustainability in primary production and public consumption

Abstract The modern food system and sustainable development form a conceptual combination that suggests sustainability deficits in the ways we deal with food consumption and production - in terms of economic relations, environmental impacts and nutritional status of western population. This study explores actors’ orientations towards sustainability by taking into account actors’ embedded positions within structures of the food system, actors’ economic relations and views about sustainability as well as their possibilities for progressive activities. The study looks particularly at social dynamics for sustainability within primary production and public consumption. If actors within these two worlds were to express converging orientations for sustainability, the system dynamics of the market would enable more sustainable growth in terms of production dictated by consumption. The study is based on a constructivist research approach with qualitative text analyses. The data consisted of three text corpora, the ‘local food corpus’, the ‘catering corpus’ and the ‘mixed corpus’. The local food actors were interviewed about their economic exchange relations. The caterers’ interviews dealt with their professional identity for sustainability. Finally, the mixed corpus assembled a dialogue as a participatory research approach, which was applied in order to enable researcher and caterer learning about the use of organic milk in public catering. The data were analysed for theoretically conceptualised relations, expressing behavioural patterns in actors’ everyday work as interpreted by the researcher. The findings were corroborated by the internal and external communities of food system actors. The interpretations have some validity, although they only present abstractions of everyday life and its rich, even opaque, fabric of meanings and aims. The key findings included primary producers’ social skilfulness, which enabled networking with other actors in very different paths of life, learning in order to promote one’s trade, and trusting reflectively in partners in order to extend business. These activities expanded the supply chain in a spiral fashion by horizontal and vertical forward integration, until large retailers were met for negotiations on a more equal or ‘other regarding’ basis. This kind of chain level coordination, typically building around the core of social and partnership relations, was coined as a socially overlaid network. It supported market access of local farmers, rooted in their farms, who were able to draw on local capital and labour in promotion of competitive business; the growth was endogenous. These kinds of chains – one conventional and one organic – were different from the strategic chain, which was more profit based and while highly competitive, presented exogenous growth as it depended on imported capital and local employees. However, the strategic chain offered learning opportunities and support for the local economy. The caterers exhibited more or less committed professional identity for sustainability within their reach. The facilitating and balanced approaches for professional identities dealt successfully with local and organic food in addition to domestic food, and also imported food. The co-operation with supply chains created innovative solutions and savings for the business parties to be shared. The rule-abiding approach for sustainability only made choices among organic supply chains without extending into co-operation with actors. There were also more complicated and troubled identities as juggling, critical and delimited approaches for sustainability, with less productive efforts due to restrictions such as absence of organisational sustainability strategy, weak presence of local and organic suppliers, limited understanding about sustainability and no organisational resources to develop changes towards a sustainable food system. Learning in the workplace about food system reality in terms of supply chain co-operation may prove to be a change engine that leads to advanced network operations and a more sustainable food system. The convergence between primary producers and caterers existed to an extent allowing suggestion that increased clarity about sustainable consumption and production by actors could be approached using advanced tools. The study looks for introduction of more profound environmental and socio-economic knowledge through participatory research with supply chain actors in order to promote more sustainable food systems. Summary of original publications and the authors’ contribution I Mikkola, M. & Seppänen, L. 2006. Farmers’ new participation in food chains: making horizontal and vertical progress by networking. In: Langeveld, H. & Röling N. (Eds.). Changing European farming systems for a better future. New visions for rural areas. Wageningen, The Netherlands. Wageningen Academic Publishers: 267–271. II Mikkola, M. 2008. Coordinative structures and development of food supply chains. British Food Journal 110 (2): 189–205. III Mikkola, M. 2009. Shaping professional identity for sustainability. Evidence in Finnish public catering. Appetite 53 (1): 56–65. IV Mikkola, M. 2009. Catering for sustainability: building a dialogue on organic milk. Agronomy Research 7 (Special issue 2): 668–676. Minna Mikkola has been responsible for developing the generic research frame, particular research questions, the planning and collection of the data, their qualitative analysis and writing the articles I, II, III and IV. Dr Laura Seppänen has contributed to the development of the generic research frame and article I by introducing the author to the basic concepts of economic sociology and by supporting the writing of article II with her critical comments. Articles are printed with permission from the publishers.

Designing Creativity Through Clusters - A periodisation of cluster discourse

The thesis focuses on one of the most dominant articulations of the relation between geographical place and development, clusters - internationally competing place-bound economic system of production in related industries. The dominant articulation of cluster discourse represents the subnational region as a system of production, and as a means for competitiveness for Western countries. Its reproduction in theories has become one of the most prolific exports of economic geography to other disciplines and for policymaking. By analysing cluster discourse the thesis traces how the languages and processes of globalization have over time altered the understandings of the relation between geographical place and the economy. It shows how in its latest incarnation of the cluster discourse, the language of mainstream economics is combined with ‘softer’ elements (e.g. community, learning, creativity) in the economic geographic discourse. This is typical for the idea of soft capitalism, wherein it is assumed that economic success emanates from soft characteristics, such as knowledge, learning and creativity, rather than straightforward technological or cost advantages. A reoccurring critique against the dominant understanding of the relationship between competitiveness and regions, as articulated in cluster discourse, has pinpointed the perspective’s inability to reconcile the respective and reciprocal roles of local standard of living with firm competitiveness. The thesis traces how such critique is increasingly appropriated through the fusion of the economic, social and cultural landscape into the language of capitalism. It shows how cluster discourse has appropriated its critique, by focusing on creativity, with its strong associations to arts, individual artists and the cultural sphere in general, while predominantly creating its meaning in relation to competitiveness. The thesis consists of six essays that each outlines the development of the cluster discourse. The essays show how meaning systems and strategies are created, accepted and naturalized in cluster discourse, how this affects individuals, the economic landscape and society at large, as well as showing which understandings are marginalized in the process. The thesis argues that clusters are a) inseparable from ideology and politics and b) they are the result of purposeful social practice. It calls for increased reflexivity within corporate and economic geographic research on clusters, and underlines the importance of placing issues of power at the centre of analysis.