Thomas Y. Choi, Professor of Supply Chain Management at Arizona State University, will lead our next Innovation Seminar. Tom will discuss the dramatic changes that
American manufacturing has undergone during the last two decades with re-engineering, downsizing, and restructuring. Outsourcing to external suppliers increased significantly, which in turn resulted in the increased importance of strategic sourcing and its economic implications. Strategic sourcing integrates the buying firm's strategic decisions with those of its key suppliers, thus promoting trust and decreasing transaction costs. However, a dark side of strategic sourcing has emerged. Some firms established long-term contracts with their suppliers, set up mutually dependent relationships, and then began to strangle suppliers with relentlessly short-term, cost-driven decisions. As a result, the buying firms and their suppliers have now become competitors in the same market.
Simply put, there is serious long-term risk associated with firms becoming strategically integrated with suppliers and then mistreating them for short-term gains.
This upcoming seminar is scheduled for Friday, April 20, 2007 from 2 to 4 pm. If you are interested in attending, please contact Jackie Grueser at Grueser.1@osu.edu
or call 614
292 1275.