Supplier Quality Management: Investment, Inspection, and Incentives
成果类型：
Article
署名作者：
Lee, Hsiao-Hui; Li, Cuihong
署名单位：
University of Hong Kong; University of Connecticut
刊物名称：
PRODUCTION AND OPERATIONS MANAGEMENT
ISSN/ISSBN：
1059-1478
DOI：
10.1111/poms.12802
发表日期：
2018
页码：
304-322
关键词：
quality
incentives
Inspection
buyer direct investment
supplier management
摘要：
Buyers can manage product quality sourced from suppliers in three ways: they can improve the quality incoming from suppliers directly by investing in suppliers to improve a process/product, they can improve the incoming quality indirectly by incentivizing supplier quality-improvement efforts, and/or they can control the quality outgoing to subsequent processes by inspecting incoming units. In this study, we study a buyer's use of these three instrumentsinvestment, incentives, and inspectionto manage the sourced quality. To do so, we consider a general relationship between the buyer's direct investment effort and supplier's quality-improvement effort, allowing them to be complementary, substitutable, or additive in their quality-improvement effects. For situations in which the buyer and the supplier decide their efforts simultaneously with contractible internal-failure events, we identify three types of strategies: the investment-based strategy (focusing on the buyer's investment effort) for strongly substitutable efforts, the inspection-based strategy (focusing on inspection) for strongly complementary efforts, and the integrative strategy (emphasizing all three instruments) for additive efforts. If buyer-investment commitment is possible, then the inspection-based strategy in which both parties defect in their efforts will be replaced by a collaboration-based strategy in which both parties exert high efforts to improve quality. Contracting upon external failures (in addition to internal failures) does not change this strategy pattern; however, when combined with buyer-effort commitment, such a contract achieves the first-best result.