Search results

In performance-based contracting (PBC), the provider is paid according to outcomes for its customer, and therefore assumes responsibility for customer risks. Previous studies have revealed that risk exposure is a fundamental influencing factor. Thus, the purpose of this paper is to analyze how previous experience with PBC influences the perception of risks.

This research is based on a cross-industry study. Factor analysis and discriminant analysis are used to reveal to what extent experience influences PBC risk factors.

It is confirmed that risk perception differs significantly according to previous PBC experience. Thus, significant learning effects are identified in the PBC context.

Experiential learning in PBC can explain entry barriers to PBC faced by new buyers with low levels of experience. Although the internal validity of the sample is high, as all analyzed cases represent PBC buying companies, there are limitations related to external validity.

To manage risks this study provides a structure (12 risks, 3 aggregated factors), which could be used for risk evaluation and strategic and operative risk management. Other implications recommend, e.g., to collaborate with a PBC “veteran” when entering into PBC, as this boosts the level of PBC-related experience.

The findings of this study contribute to identifying PBC risks through the explorative statistical assessment of these PBC risk factors.

One of the major methods to promote small- and medium-sized enterprises (SMEs) in public procurement is to split tenders into lots. The basic assumption is that SMEs have better chances of awarding smaller or more specialized contracts. This paper aims to investigate whether this widely accepted assumption is correct.

This article examines four hypotheses about the factors that influence SME success in public procurement. The empirical analysis uses real data from 380 contract award files and logistic regression to test the hypotheses.

The results show that a higher number of lots in a tender does not significantly increase the success rate of SMEs, and other factors, including the type of public procurement procedure, the number of participating companies and the overall tender volume, significantly influence SME success.

There are several implications for theory and practice, including the need to further strengthen the academic evaluation of public procurement policies, the suggestion to implement SME support instruments in public legislation with the utmost caution in practice and the managerial indication that SME competitiveness is more relevant to their success in public bidding than public support policies.

The findings stand in fundamental contrast to the legal regulations, which postulate that lots are the driving force for SME promotion in public procurement. This is also in contrast to public procurement policies that, for many years, have recommended splitting contracts into smaller lots to become SME-friendly.

The military of today depends on the availability and readiness of high-technology weapon systems. As the military often has to focus on core tasks (the usage of systems), logistics and support tasks are outsourced to industry, which means that industrial suppliers gain importance for making weapon systems available and mission ready. However, companies are profit-maximizing and invest their best resources in the most promising business areas, which might be clients other than the (domestic) military customer. This raises the question of how the military can ensure that the defense industry provides the best performance: preferential treatment for the military. The purpose of this study is to investigate preferential treatment in the specific context of defense.

This paper reports on the examination of factors influencing preferential treatment for the military. The analysis uses structural equation modeling and data from a sample of German defense suppliers.

The results show that the perceived customer attractiveness has a strong effect on preferential customer treatment. Attractiveness is influenced by trust, commitment and a comparison with other customers.

There are several implications for defense theory and practice, including the need for further consideration of relational in contrast to transactional practices in military–industrial supply collaboration, as these seem highly relevant for getting the best resources for producing and maintaining weapon systems. In addition, increasing customer attractiveness, in particular if the military lacks a domestic defense industry base, is proposed.

The findings are based on a focus sample of only defense suppliers. This paper transfers the industrial discussion about the buyer–supplier relationships and preferential customer treatment to the defense logistics research context.

The purpose of this paper is to examine how communication with suppliers influences performance during production ramp-up. Often, time, cost or quality targets are missed in production ramp-ups while the number and frequency of ramp-ups is further increasing. The goal of this paper is thus to contribute a better understanding if and to which extend communication content or communication relationship is affecting ramp-up performance.

The research uses data from a dyadic survey (N = 160) in the German automotive industry. The data set comprises responses from buyers and suppliers. Constructs, namely, information and relationship quality, as well as communication satisfaction, are measured. The effect of communication is evaluated referring to cost, quality and time dimensions of performance. The analysis is applied with structural equation modeling methodology. This research is complemented by a multigroup analysis (MGA) especially comparing buyer and supplier respondent groups.

The results indicate that communication satisfaction positively influences ramp-up performance and that information quality is of higher relevance than relationship quality. Briefly, information exchange (what information to transfer) is more important than relationship management (how to transfer information). This finding contrasts previous literature focusing on relationship factors in communication settings. Furthermore, findings from MGA sustain the findings, because effects are also analyzed from a supplier’s or buyer’s viewpoint. Overall, the findings imply that supplier communication in production ramp-up must of course provide a high level of information quality. However, to optimize ramp-up performance also a high level of relationship quality is required.

This study featured data from the German automotive industry from buyer’s and supplier’s perspective. This limits its generalizability, yet provides opportunities to test the findings through longitudinal studies, potentially gathering data from other sectors.

This research recommends managers deliver high information quality to improve communication satisfaction. Hence, this survey provides support for business communication o enhance ramp-up performance to achieve success in buyer–supplier relations.

Besides the original dyadic database, this research addresses production ramp-up as a very dynamic process. Plans and forecasts change often, thus supplier communication takes place in a stress situation. Then, communicators might overstate information quality and lose sight of relationship quality. The study contributes to this field of research and postulates that (automatic, autonomous) data exchange requires behavioral and relational support. The findings are useful for companies in stress situation (e.g. also a pandemic supply crisis) and will avoid that the optimization of information exchange disregards the relationship aspect.