Customization management in supplier performance

Abstract

Prior research on customized component transactions asserts that from a manufacturer’s perspective, customization costs can be reduced by creating collaborative relationships. However, there are few researches on the supplier’s perspective. In this paper, a survey of Japanese suppliers revealed that (a) supplier performance improves when there are more proposals both from and to customers, and that (b) supplier performance deteriorates when proposals only come from the customer. In other words, in case of the top-down relationship in (b), supplier performance deteriorates, but in the bidirectional relationship in (a), supplier performance improves.