AbstractIndustrialMarketingManagement32(2003)365–374StrategiccostmanagementacrossboundariesoffirmsAnnaDubois*DepartmentofIndustrialMarketing,ChalmersUniversityofTechnology,GothenburgS-41296,SwedenInrecentyears,increasingattentionhasbeenplacedonhowpurchasingstrategiesmaycontributetotheefficiencyoffirms.Inthispaper,acasestudyillustrateshowonefirmimplementedasupplierbasereductiontoenableahighinvolvementstrategyinrelationtoappointedkeysuppliers.Theeffectsofthischangeinpurchasingstrategywereextensivecostrationalisations.Themainchangeinthisprocesswasaredefinitionoftheunitofanalysisfromindividualtransactionstobuyer–supplierrelationships.However,thecostsintherelationshiparedrivennotonlybyinternalfactorsonthetwosidesoftherelationshipbutalsobyhowthefocalrelationshiprelatestootherrelationships.Therefore,thewaysinwhichthecostsareaffectedbyotherparties,suchasthesupplier’ssupplier,thesupplier’sothercustomers,thecustomer’sothersuppliers,andthecustomer’scustomers,needtobeincludedintheanalysis.D2003ElsevierScienceInc.Allrightsreserved.Keywords:Purchasing;MRO;Totalcost1.IntroductionThesupplysideofcompanieshasbecomeincreasinglyimportantoverthelastfewdecades.Onereasonisthatthecostsofpurchasedgoodsandservicesrepresentthemajorityoftotalcostsformostcompanies.Thishighshareisattributabletotheambitionofcompaniestoconcentratemoreoftheireffortsonalimitedpartofthetotalactivitystructureofthebusinessnetworksinwhichtheyareinvolved.Byoutsourcingactivitiestosuppliers,firmsareabletospecialisetheirownoperations.Itisnotonlytheincreasingfinancialimpactthatmakesthesupplysidesignificant.Anothermoreimportantreasonisthechangingnatureofthecontentofbuyer–supplierexchange.Overtime,outsourcingofmanufacturingactiv-itieshasbeenfollowedbyoutsourcingofdesignanddevelopmentwork.Toanincreasingextent,suppliersarecontributingtothetechnicaldevelopmentofacompany.Thischangehasbeenaccentuatedbecauseofincreasesinthenumberofdifferenttechnologiesacompanynowneedsinordertobeabletooperateandbecauseofthehighercostofdevelopingeachsubsequentgenerationoftechnology.Com-paniestodayaredependentonknowledgedevelopedandsuppliedbyotherfirms.*Tel.:+46-31-772-1196;fax:+46-31-772-3783.E-mailaddress:anndub@mot.chalmers.se(A.Dubois).Athirdreasonforwhichthesupplysidehascomemoreintofocusistheenhancedsignificanceofinterfaceswithotherfirms(Araujo,Dubois,&Gadde,1999).Interfaceswithsuppliersarecrucialnotonlywhenitcomestotechnicaldevelopment,butmanagementconceptsandtechniquessuchasjust-in-time(JIT),totalqualitymanagement(TQM),and‘‘zero-defectprinciple’’alsohavesubstantialimpactsonthewayfirmsoperate.Applyingthesetechniquesrequirestheactiveinvolvementofsuppliersandaffectsthecostsandbenefitsofbothbuyerandsupplier.Theenhancedsignificanceofthesupplysidehasmadepurchasingastrategicfunction.Thecontributionsfrompurchasingtothestrategicdevelopmentofacompanymaybesummarisedintwostrategicroles:rationalisationanddevelopment(Axelsson&Ha˚kansson,1984).Thedevel-opmentroleconcernsthepurchasingfunction’scontributiontothetechnicaldevelopmentofthefirmthroughorganisingandmanagingrelationshipswithsuppliers.Asregardstherationalisationrole,GaddeandHa˚kansson(2001)distin-guishthreemaintypesofroles.Thefirstisrelatedtodiscoveringwhatneedstobepurchased.Thesecondisrelatedtorationalisationoflogisticsactivitiesandthethirdtorationalisationofadministrativeroutines.Toenablethe...
