An investigation into supplier development activities and their influence on performance in the Chinese electronics industry

Many companies now recognise the importance of supply chain management activities in determining overall performance. A key area for concern is strategic supplier development. A survey was conducted of companies in the Hong Kong electronics industry examining the role of supplier development activities in the context of buyer-supplier performance (BSP). Results from statistical analysis highlight five factors, which proved to be significantly related to BSP improvement; effective communication, direct supplier involvement and trust proved to be directly related, whereas supplier evaluation and supplier strategic objectives proved significant when mediated via direct supplier involvement. The results should be of interest to Western companies when considering the establishment of a Far Eastern presence, particularly those involved in outsourcing. In addition, a framework for academics researching supplier development and BSP improvement is provided. Finally, practitioners will gain an insight into how specific supplier development efforts can result in improved performance outcomes.