Power assessment as a high-level partner selection criterion for new product development projects

Abstract

International audienceIn New Product Development (NPD) projects, various partners may be involved at different phases and their participation can lead to either success or failure of the project. Therefore, a company that launches a NPD project has to carefully select the most appropriate partners. Currently, partner selection in supply chains is often performed according to well-known criteria such as cost or delay. However, problems could emerge in such processes due to the unavoidable power disequilibrium of the parties involved. The strongest party will sooner or later force the weaker ones to accept challenging constraints. The use of power will lead to doubtless mistrust and frustration. Therefore, the awareness of the suppliers' power before any collaboration is of upmost importance and in realistic situations it should be used as a high-level selection criterion. This paper argues that the power of partners represents a significant issue for the achievement of a coherent supplier selection strategy. A method is suggested to assess the power of partners based on its performances. The joint use of a power-based selection approach and a performance-based selection approach is illustrated at the end of the paper showing how the power consideration can help decision-makers in selecting more relevant partners

An Analysis Framework of Power Imbalance in Supply Chains

“…Understanding the relative power towards a supplier is particularly important in cases when the supplier is new and the interaction is planned over an extended period of time. With established suppliers, power might become a means for leverage in contract or price negotiations [14].…”

“…Being able to apply pressure upon weaker actors means that the stronger partner has been able to understand its real source of power and was able to use it. However, if a company overestimates or underestimates its own power, its consequent actions could affect its ability to negotiate successful collaboration with the supplier or customer and reduce its agility [14]. The role of power is crucial to its interactions with other relationship structures; power can seriously affect the level of confidence and commitment between parties [15].…”

User development through proactive knowledge transfer

“…Moreover, all three case organizations were aware of the importance of having knowledgeable employees to conduct the user development initiative; but not all of them have a formal procedure for the selection process. Prior research has mainly focused on the importance of having supplier assessment in order to increase new product development projects (Zolghadri et al, 2012) and supply chain agility (Ngai et al, 2011). No studies were found in the literature concerning user development.…”

A Multi-Attribute Decision Support System for Allocation of Humanitarian Cluster Resources Based on Decision Makers’ Perspective

“…The most suitable option within MADM is AHP, which is used extensively in supplier selection [59,[120][121][122]. This method is a good method for our research because unlike the other MADM methods mentioned above, it accommodates the subjective values, including the decision maker's preferences.…”