Purchased business services influence downstream supply chain members

Abstract

Purpose

Supply chain management and business networks have gained increased attention in services settings. The purpose of this research is to investigate the impact of external purchased services by a service provider on the satisfaction of downstream supply chain members, i.e. end‐users. The focus is on transaction‐specific satisfaction as it provides in‐depth information on specific satisfaction elements.

Design/methodology/approach

To test the propositions, one business service provider purchasing a service from an external supplier is selected. Data are collected by sending a web survey to the business service provider's customers. partial least squares (PLS) is used to analyze the data as transaction‐specific satisfaction is considered as a formative construct.

Findings

PLS analyses indicate that the elements determining satisfaction with the external supplier and those determining satisfaction with the business service provider differ. Moreover, transaction‐specific satisfaction of end‐users with the external supplier's service is positively related to transaction‐specific satisfaction of end‐users with the service provider's service. Furthermore, the strength of that relationship is influenced by the importance attached to the external supplier's service by the end‐users.

Research limitations/implications

First, the position of the customer in the supply chain influences how the service delivery is evaluated. Second, the relevance of service supply chains and business networks are confirmed. The relationship between supplier and provider and between provider and end‐user are interconnected. The strength of that relationship interconnectedness is influenced by importance attached to the purchased service. Future research is needed to extend the findings of this study to other services settings.

Originality/value

The results of the paper indicate that service providers should pay more attention to services purchased from external suppliers and to those suppliers' selection and evaluation, even when these services are considered less strategically valuable.

Citation

Vandaele, D. and Gemmel, P. (2007), "Purchased business services influence downstream supply chain members", International Journal of Service Industry Management, Vol. 18 No. 3, pp. 307-321. https://doi.org/10.1108/09564230710751505