Just-in-time purchasing: an empirical study of operational practices, supplier development and performance

This paper examines the role of supplier development in establishing and managing efficient buyer–supplier operational links. The paper develops and assesses a measurement instrument for “operational” and “supplier development” just-in-time purchasing practices, followed by an examination of the relationships between the two sets, and an investigation into whether the use of “operational” and “supplier development” practices has a bearing on higher plant performance. A plant-level survey was carried out on a sample of electronics and machinery plants. The study empirically:

• documents the close connection between the buyer–supplier operational link and the buyer’s practices for supplier development;

• demonstrates that recourse to supplier development programs and their nature depend on the kind of vendor–vendee operational connection;

• test whether different plant performance outcomes result from the implementing of different “operational” and “supplier development” practices. It demonstrates that better-performing plants exhibit more advanced design and logistic links with sources, more formalised vendor-rating and ranking procedures, greater use of organisational devices for supplier-organisational integration and place greater importance on supplier assistance and training.

Author Keywords: Just-in-time; Buyers; Suppliers; Empirical research