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1 – 10 of over 4000
Article
Publication date: 5 July 2022

K. Chandra Shekar and Manikantha Nataraj

Subcontracting is a crucial cause behind the simultaneous existence of formal and informal entrepreneurship in India. This article aims to provide an over-time comparative…

Abstract

Purpose

Subcontracting is a crucial cause behind the simultaneous existence of formal and informal entrepreneurship in India. This article aims to provide an over-time comparative analysis between the subcontracted and the non-subcontracted enterprises within the informal sector. Further, it also brings to fore the contribution of subcontracting towards ensuring sustainability of the informal enterprises.

Design/methodology/approach

By constructing a panel data from two rounds of NSS Unincorporated Enterprise Survey Data (2010 and 2015), and employing a PSM-DID method, considering labour productivity and net retained earnings as two critical indicators of growth and development of the informal sector firms, this study has made some broad claims regarding the differences in immediate and long run performances between the subcontracted and non-subcontracted informal sector enterprises in India.

Findings

This study finds that subcontracted enterprises have not only been performing at a much lower level than the non-subcontracted enterprises, they are also growing much slowly than their counterparts. However, it has been observed that for the establishments, who are capital abundant and also have a larger production capacity, subcontracting is showing the prospect for deriving sustainable gains.

Originality/value

This article contributes to the existing literature in the following two ways. Firstly, it provides an over-time comparative analysis between the subcontracted and the non-subcontracted enterprises within the informal sector. Secondly, it brings to fore the contribution of subcontracting towards ensuring sustainability of the informal enterprises.

Details

Journal of Small Business and Enterprise Development, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 4 March 2022

Chenxi Shi, Yongqiang Chen, Yuanyuan Hua and Yinqiu Tang

Chinese construction projects commonly implement subcontracting, but organizational arrangements have received little attention. Some studies have debated the impact of…

Abstract

Purpose

Chinese construction projects commonly implement subcontracting, but organizational arrangements have received little attention. Some studies have debated the impact of firm capabilities on subcontracting. To address these issues, this study differentiates the general contractor’s technological capabilities and alliance management capabilities and investigates how capabilities affect the degree of subcontracting and subcontracting dispersion based on the resource-based view and transaction cost economics.

Design/methodology/approach

By conducting a survey, 219 valid questionnaires were collected from Chinese construction companies. Multiple regression analyses were conducted to test the influence of capabilities on subcontracting organizational arrangements and the moderating role of uncertainty.

Findings

The results show that technological capabilities decrease the degree of subcontracting, whereas alliance management capabilities increase the degree of subcontracting as well as subcontracting dispersion. The results also indicate that the positive effects of alliance management capabilities are weakened by project uncertainty.

Practical implications

This study provides a better understanding of the diversity of subcontracting organizational arrangements in China. In addition, the findings may help general contractors carry out a rational arrangement by considering their capabilities and transaction hazards.

Originality/value

This study contributes to a holistic understanding of how capabilities determine subcontracting by distinguishing technological capabilities and alliance management capabilities and refining the degree of subcontracting and subcontracting dispersion. Meanwhile, the findings highlight the complementarity of the resource-based view and transaction cost economics by examining the moderating effect of uncertainty.

Details

Engineering, Construction and Architectural Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0969-9988

Keywords

Open Access
Article
Publication date: 18 February 2022

Kimmo Keskiniva, Arto Saari and Juha-Matti Junnonen

This study aims to provide a foundation for the development of subcontracts that suit takt production in construction.

Abstract

Purpose

This study aims to provide a foundation for the development of subcontracts that suit takt production in construction.

Design/methodology/approach

This is a non-empiric conceptual study, which integrates takt production and general construction literature into new proposals for subcontract clauses suitable for takt production in construction. This study uses literature reviews, from which proposals regarding takt production viable subcontract clauses are conducted via logical reasoning.

Findings

A total of 13 proposals for takt production applicable subcontracts are provided in this study. The proposals emphasize detailed and collaborative planning, suitable payment methods and flexibility for takt plan modification.

Originality/value

Previous takt literature has not properly addressed the development of subcontracts for takt production, despite regular attempts to use subcontracting in takt production. This study aims to aid main contractors to create fair and suitable subcontracts, so that adhering to takt schedules could be more viable in practice. This study also acts as a foundation for further empirical studies regarding the subject.

Details

Construction Innovation , vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1471-4175

Keywords

Article
Publication date: 27 December 2021

Pyoungsoo Lee, Sohee Lim and Hyejin Cho

This study aims to focus on the subcontracting relationship between small and medium-sized enterprises (SMEs) and business group buyers and analyze the effect of the level…

Abstract

Purpose

This study aims to focus on the subcontracting relationship between small and medium-sized enterprises (SMEs) and business group buyers and analyze the effect of the level of buyer dependency on R&D intensity. The primary prediction is that buyer dependency and R&D intensity have a non-linear relationship, showing an inverted U-shaped relationship. Furthermore, the moderating effect of founder CEOs and internationalization is explored.

Design/methodology/approach

A sample of 546 firm-level survey responses were collected from Korean subcontracting SMEs provided by the Ministry of SMEs and Startups and the Korea Venture Business Association.

Findings

A lower level of dependency on business group buyers promotes R&D investment, while excessive dependence reduces R&D investment. Moreover, founder CEOs and internationalization decrease the effect of buyer dependency on R&D investment, implying that both firm characteristics are associated with a long-term focus and promote R&D investment.

Research limitations/implications

This research contributes to the literature on the special form of the buyer–supplier relationship, that is, subcontracting. Subcontracting has a contradictory effect on R&D investment based on large group buyer dependency, and this relationship is moderated by the founder CEO and internationalization.

Practical implications

This study provides insights to managers and practitioners governing SME subcontracting by showing that the level of buyer dependency is better managed in promoting innovation, and the long-term perspective allows SMEs to be less affected by buyer dependency.

Originality/value

This study extends the literature by focusing on the non-linear relationship between buyer dependency and R&D intensity of subcontracting SMEs. This approach addresses the contradicting results suggested by prior supply chain management literature and suggests that the level of buyer dependency should be considered when analyzing the subcontracting relationship.

Details

Management Decision, vol. 60 no. 8
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 17 January 2022

Temidayo Akenroye, Jonathan D. Owens, Adekunle Sabitu Oyegoke, Jamal Elbaz, H.M. Belal and Fedwa Jebli

This study aims to examine the causes of small and medium-sized enterprises (SMEs) disinclination towards subcontracting in public sector markets. Previous studies have…

Abstract

Purpose

This study aims to examine the causes of small and medium-sized enterprises (SMEs) disinclination towards subcontracting in public sector markets. Previous studies have revealed that UK SMEs are reluctant to do business with the public sector through the subcontracting route, but the reasons for this lack of enthusiasm have not been widely researched.

Design/methodology/approach

Drawing on semi-structured interviews with SMEs competing for public contracts in North West England, a qualitative study was performed, from which several themes emerged.

Findings

The findings were synthesised into a framework underpinned by attribution theory, to portray situationally and dispositionally caused factors that were used to interpret SMEs’ behaviour.

Social implications

The findings can guide policy development and government interventions in developed and developing countries, aimed at using public procurement as a policy tool to develop the small business sector.

Originality/value

This paper contributes in a unique way to an emerging discourse on how subcontracting can facilitate the access of SMEs to government procurement spending. It adds to knowledge regarding the explanatory power of attribution theory – from its base in social psychology.

Details

Journal of Public Procurement, vol. 22 no. 2
Type: Research Article
ISSN: 1535-0118

Keywords

Article
Publication date: 1 March 2013

Max V. Kidalov

U.S. and E.U. public and defense procurement rules require large prime contractors to promote subcontracts to small businesses, a.k.a. small and medium enterprises (SMEs)…

Abstract

U.S. and E.U. public and defense procurement rules require large prime contractors to promote subcontracts to small businesses, a.k.a. small and medium enterprises (SMEs). Under the U.S. Small Business Act, large firms encourage subcontracting through publicity, subcontracting plans, and “good faith” efforts to achieve subcontracting goals. However, processoriented measures failed to guarantee definitive results. In contrast, E.U. and member governments can hold large firms accountable to stricter subcontracting standards (often sweetened by incentives). With the Small Business Jobs Act of 2010, the U.S. is trying accountability measures now. Therefore, large contractors must plan for definitive subcontracting commitments in both markets.

Details

Journal of Public Procurement, vol. 13 no. 1
Type: Research Article
ISSN: 1535-0118

Article
Publication date: 1 September 1997

M. Webster, C. Alder and A.P. Muhlemann

Discusses issues associated with the subcontracting of manufacturing activity within the supply chain for electronics assembly products. The principal focus of the work is…

2422

Abstract

Discusses issues associated with the subcontracting of manufacturing activity within the supply chain for electronics assembly products. The principal focus of the work is the operational issues surrounding the organization, management and control of the subcontract process, but related issues and research streams are also considered. Some of the operational issues are placed within the context of current practice by presenting case studies of two small to medium‐sized manufacturing enterprises (SMMEs) in the electronics assembly sector which use subcontract manufacture. The approaches of the two companies to the management and control of the process are compared and contrasted, and mapped onto generic models. This work is considered timely because of the increasing importance of the subcontracting of manufacture within the supply chain, and because of the lack of supporting theoretical and practical work. It identifies key issues which need to be addressed by academic researchers and by industry practitioners in the pursuit of world class manufacturing ideals, as part of a process of concentrating on core competencies and expertise.

Details

International Journal of Operations & Production Management, vol. 17 no. 9
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 7 September 2015

Lars-Henrik Kvist Nielsen, Abiola Akanmu and Chimay J. Anumba

“Back-to-back” contracts are widely used in the engineering and construction industry and are recently spreading into the telecommunication industry. In back-to-back…

Abstract

Purpose

“Back-to-back” contracts are widely used in the engineering and construction industry and are recently spreading into the telecommunication industry. In back-to-back contracts, the principals require the main contractors to assume majority of the liability in delivering a project and in turn, the main contractors try to allocate most of that liability to their subcontractors. The successful delivery of the projects hinges on how the contracts are drafted and risks are allocated between the parties involved. The purpose of this paper is to undertake a comparative analysis of “back-to-back” subcontracts in the telecommunication and construction industries.

Design/methodology/approach

By examining contracting practices and texts from contract documents for the telecommunication and construction industries, this paper reveals how certain aspects of “back-to-back” contracts lose their meaning when seen out of context. Using comparative research method, this paper discusses reasons why the adoption of “back-to-back” contracts should be a matter of degree, based on the business strategy and relevance to the intended transactions rather than on the typical model of “back-to-back” contracts.

Findings

Good contracting practices should be such as to enable parties negotiate the contract terms to ensure clarity and common understanding before commencing the project. Construction universally adopts back-to-back even for minor straightforward works, an approach supported by readily available industry model contracts as well as the traditional tender process (design before construction). In telecoms, back-to-back is mainly desired where the subcontractor has a major part of the scope, whereas minor subcontractor scope is considered “leverage commodity” where suppliers are engaged using in-house contract templates, often in a frame contract arrangement, to satisfy corporate strategies for supplier management and pricing.

Originality/value

This paper provides value by presenting an insightful review of the nature of back-to-back contracting practices in the telecommunication and construction industries. The paper outlines advantages, disadvantages and opportunities for improving “back-to-back” contracting practices in the telecommunication and construction industries.

Details

Built Environment Project and Asset Management, vol. 5 no. 4
Type: Research Article
ISSN: 2044-124X

Keywords

Article
Publication date: 14 May 2020

Nouhayla Hafidi, Abdellah El Barkany, Abderrahman EL Mhamedi and Morad Mahmoudi

The purpose of this paper is to consider various possible constraints of the problem of production and maintenance planning control for a multi-machine under subcontracting

Abstract

Purpose

The purpose of this paper is to consider various possible constraints of the problem of production and maintenance planning control for a multi-machine under subcontracting constraint, in order to bring the manufacturer industry closer to real mode. In this paper, we present an efficient and feasible optimal solution, by comparing optimization procedures.

Design/methodology/approach

Our manufacturing system is composed of parallel machines producing a single product, to satisfy a random demand under a given service level. In fact, the demand is greater than the total capacity of the set of machines; hence there rises a necessity of subcontracting to complete the missing demand. In addition, we consider that the unit cost of subcontracting is a variable depending on the quantity subcontracted. As a result, we have developed a stochastic optimal control model. Then, to solve the problem we compared three optimization methods: (exact/approximate), the genetic algorithm (GA), the Pattern Search (PS) and finally fmincon. Thus, we validate our approach via a numerical example and a sensitivity analysis.

Findings

This paper defines an internal production plan, a subcontracting plan and an optimal maintenance strategy. The optimal solution presented in this paper significantly improves the ability of the decision maker to consider larger instances of the integrated model. In addition, the decision maker can answer the following question: Which is the most optimal subcontractor to choose?

Practical implications

The approach developed deals with the case of the real-mode manufacturing industry, taking into consideration different constraints and determining decision variables which allow it to expand the profits of the manufacturing industry in different domains such as automotive, aeronautics, textile and pharmacies.

Originality/value

This paper is one of the few documents dealing with the integrated maintenance in subcontracting constraint production which considers the complex aspect of the multi-machine manufacturing industry. We also dealt with the stochastic aspect of demand and failures. Then, we covered the impact of the unit cost variation of subcontracting on the total cost. Finally, we shed light on a comparison between three optimization methods in order to arrive at the most optimal solution.

Details

Journal of Quality in Maintenance Engineering, vol. 27 no. 1
Type: Research Article
ISSN: 1355-2511

Keywords

Article
Publication date: 11 January 2008

M.H. Bala Subrahmanya

This paper aims to trace the evolution of industrial subcontracting in Japan, over a period of time. Subsequently, the transition in the spread and depth of subcontracting

1381

Abstract

Purpose

This paper aims to trace the evolution of industrial subcontracting in Japan, over a period of time. Subsequently, the transition in the spread and depth of subcontracting along with relative performance of small and medium enterprises (SMEs) in Japanese industry over a period of time are to be analyzed.

Design/methodology/approach

First, a historical over view of the evolution of industrial subcontracting in Japan is discussed based on literature and discussion with experts. Secondly, based on secondary data, the industry‐wise trends of subcontracting and performance of small, medium and large enterprises are analyzed.

Findings

Japanese industrial subcontracting and structure evolved over the period, particularly after World War II, represents integration and mutual coordination among small, medium and large enterprises across industries. Along with the growth of multi‐layered subcontracting, labour productivities of SMEs have improved as that of large though value added/value of output has remained more or less at the same level. Overall, there is reason to argue that SMEs have benefited from the system of subcontracting in Japanese manufacturing towards its overall competitiveness.

Practical implications

It would be worthwhile to promote multi‐layered industrial subcontracting, particularly with locally based/newly entered TNCs at the helm of the pyramid, in industrializing countries like India, to enhance the competitiveness of local SMEs.

Originality/value

This paper provides the reader with an understanding of evolution of industrial subcontracting in Japan since World War I and its recent trends and throws light on how SMEs have improved their performance over a period of time.

Details

Journal of Management History, vol. 14 no. 1
Type: Research Article
ISSN: 1751-1348

Keywords

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