The Role of Buyer and Supplier Knowledge Stocks for Supplier-led Improvements in Logistics Outsourcing

Abstract

Abstract In service outsourcing, supplier-led relationship-specific improvements (RSIs) are vital to buyers, yet, often falls short of the buyer s expectations. One explanation for the lack of such RSIs are insufficient relationship-specific knowledge stocks. However, it is not understood how relationship-specific knowledge stocks facilitate RSIs. Our research addresses this gap by providing a nuanced view of knowledge stocks as relationship-specific resources in service outsourcing. This research is based on a multiple case study of ten logistics outsourcing dyads. The findings build on the Relational View of Dyer and Singh (1998) and extend the understanding of how different types of relationship-specific-knowledge stocks and their sub-dimensions affect proactive and reactive RSIs. In this respect, supplier knowledge of the specific value-creating processes (e.g., logistics processes) at the buyer form the foundational layer for RSIs, flowed by a second layer of supplier knowledge of the buyer company and its up- and downstream interconnections with the customers and other suppliers. The third knowledge-layer is formed by more generic relationships-related market knowledge. In addition, the buyer’s knowledge of the service supplier showed vital in facilitating RSIs by removing barriers that hamper the supplier’s improvement efforts.