Economizing on supply network development

This thesis deals with economizing on supply network development. The problematization in thisthesis builds on two starting points. First, the ever-increasing importance of purchasing as afunction and the role of suppliers as resource providers means that the supply side of firms hasbecome a spring of opportunities for various types of benefits. In business networks, the firms,individuals, what they do, and what they use are all related. Nothing happens in isolation andnothing in the business world stops changing. The interconnectedness and dynamism in businessnetworks reveals the importance of network developments for the firms involved. Consequently,it is important for firms to understand developments in their supply networks. The second startingpoint for this study is the concept of economic sense-making, which is used to define‘economizing’ as a concept with which to study the phenomenon of supply network development.The aim of the study is to develop a framework for analyzing how a firm economizes on supplynetwork developments, and to develop an understanding of supply network development from afirm’s perspective.This study centers on a single qualitative case of the development of a Swedish firm’s supplynetwork over a period of almost 13 years. The firm is an automated production flow solutionsprovider that has a wide network of suppliers spread around the world. Systematic combining hasbeen the underlying methodological approach throughout the study, adjusting and matching theresearcher’s selection of the theoretical and empirical worlds, resulting in the formulation of theconceptualization of the phenomenon.The frame of reference is based on the industrial networks approach. Supply networks are analyzedin terms of actors, resources, and activities, all of which are interrelated. Developing a supplynetwork involves developing those elements and their interconnectedness. The analysis uses thoseconcepts to analyze the focal firm’s developments in its supply network.The main result of the analysis is a framework that breaks down developments in a firm’s supplynetwork into changes that can be analyzed in terms of the following three dimensions: the focusof the change (that is, the change of relatedness among particular network elements); the directionof the change (that is, the improvements in the network elements, pursued by the change); and thescope of the change (that is, whether the change is of a relational character or concerns connectedrelationships). Based on these three dimensions, the framework suggests a way to explain how afirm economizes on supply network development in terms of economizing on scale and scope,integration, and innovation. The framework recognizes the dynamic features of economic sensemakingby discussing relativity in networks and the effects that a change in one part of the networkcan have on the others. That discussion is complemented by a set of managerial implications withregard to strategizing in supply network development, and positioning of the study in relation tothe streams of research on sense-making and opportunity development to raise researchimplications. The study ends by presenting three methodological reflections regarding theresearcher’s use of the systematic combining approach in case research