A Case Study into Supplier Dominance in the Commercial Airline Industry

The current theoretical axiom is that an organisation’s supply chain system is synchronised and has a common goal. In this context, the constructs of dominance and power may identified through review of dyadic and static models of the supply chain. The extant literature points to the possibility of a single or central player within a given supply chain either dominating or controlling its behaviour and performance, through various means. However, the ownership of a supply chain in certain industries may not be attributed to a single organisation as it is not designed by any particular entity that makes up the supply chain. Moreover, supply chains evolve over time leading to unrecognised legacy issues that may impede the optimal performance and desired outcomes at the supply chain level. Even where opportunities arise to design supply chains from a ‘blank sheet of paper’, existing structures and constraints are typically incorporated. This study considered several theoretical perspectives, including resource dependency, transaction cost and supply chain management to understand and explain supplier dominance in the commercial airline industry. Informed by a comprehensive literature review, the study set out to identify the existence of supplier dominance in the commercial airline industry. To this end, a case study into the commercial airline supply system with particular focus on the Qantas-operated Kangaroo Route between Australia and the United Kingdom, was conducted. More specifically, this thesis addressed the research question “What evidence is there that a supplier can unduly influence the long term strategy of an organisation and own the supply chain?” by way of explaining the three propositions outlined below. The insights from this case study may be applied across a range of industries including land (e.g. rail) and marine transportation and similar industries where large scale and long term assets are involved