International Business Review

Transcription

1 International Business Review xxx (2012) xxx xxx Contents lists available at SciVerse ScienceDirect International Business Review journal homepage: Integrating global and local procurement for superior supplier working relations Sengun Yeniyurt a, *, John W. Henke Jr. b, Erin Cavusgil c a School of Business, Rutgers University, Piscataway, NJ 08854, USA b School of Business Administration, Oakland University, Rochester, MI 49309, USA c School of Management, University of Michigan Flint, Flint, MI 48502, USA ARTICLE INFO ABSTRACT Article history: Received 15 February 2011 Received in revised form 25 March 2012 Accepted 19 June 2012 Available online xxx Keywords: Global companies Global sourcing Local sourcing Procurement Supplier relationship management Globalization is forcing global organizations to focus on processes that will enable them to more effectively and efficiently integrate and coordinate their activities throughout their worldwide organization. As such, global sourcing is becoming a standard practice in many global organizations. Using a dataset of 1455 observations from the suppliers of a North American-based global manufacturer of high technology products, this research evaluates how a global company can utilize a globally integrated procurement organization to achieve global and local sourcing responsiveness and superior supplier working relations. The study found that if a global procurement organization aspires to achieve exceptional supplier working relations, it should be highly integrated across its geographic regions with knowledgeable global and local procurement personnel who effectively communicate with the firm s suppliers, while working closely together in a coordinated manner to achieve a globally responsive supply chain. ß 2012 Elsevier Ltd. All rights reserved. 1. Introduction While globalization is a trend present in many industries, its effect on company structure and strategies, as well as the tactics that are optimal in such an environment remain to be identified. Globalization is creating increasingly competitive markets, which in turn create the need for reduced lead times in innovation and production, both of which require global companies to manage their resources more proactively on a global basis (Kotabe & Mudambi, 2009). Today, increasingly competent local firms and fierce global competitors are challenging global companies to be globally competitive while maintaining an optimal level of responsiveness through the adaptation of the strategy to local market conditions (Townsend, Yeniyurt, Deligonul, & Cavusgil, 2004; Zou & Cavusgil, 2002). A successful global marketing strategy requires companies to configure their value chain activities optimally to exploit location specific advantages and coordinate these activities across national borders to achieve global efficiency (Zou & Cavusgil, 2002). In this way, global companies can to produce high quality products using components that are procured at the lowest total cost possible. Because of this, effective management of the sourcing (also referred to as procurement) function on a global and local basis is crucial to the success and long term viability of a global company. By exploiting the comparative and competitive advantages that can be realized by integrating various value-added activities from globally disparate locations, multinational companies are moving toward increased globalization (Kogut, * Corresponding author at: Department of SCM and Marketing Sciences, School of Business, Rutgers University, The Janice Levin Building, Room 230, 94 Rockafeller Road, Piscataway, NJ 08854, USA. Tel.: ; fax: address: yeniyurt@business.rutgers.edu (S. Yeniyurt) /$ see front matter ß 2012 Elsevier Ltd. All rights reserved.

2 2 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx 1985). Successful globalization, however, is not easily realized, as it requires the integration of processes, practices, and procedures across dispersed global organizations to achieve coordination of worldwide activities (Cavusgil, Yeniyurt, & Townsend, 2004). Needless to say, the implementation of a global corporate strategy is a major challenge for corporate leadership when trying to restructure a worldwide organization (Roth, Schweiger, & Morrison, 1991; Yip, 1992; Zou & Cavusgil, 2002). As global firms adapt their organizational structures and governance of their complex organizations to the needs of the marketplace, in keeping with Buckley s global factory concept (2009), they are confronted with significant challenges. The more significant of these challenges is the need for global integration of operational and functional activities (Buckley & Ghauri, 2004), which is changing the realities of conducting international business (Cavusgil, Knight, & Riesenberger, 2008). Organizations that aspire for globalization are required to employ radical changes in their processes and organizational structures (Cavusgil et al., 2004). Among these radical changes is the need to plan and allocate resources on a global basis to integrate and coordinate worldwide manufacturing facilities, an essential element of implementing a globally integrated strategy (Dunning, 1981; Porter, 1980). Manufacturing integration and coordination, in turn, requires global value chain coordination if a global market advantage is to established (Yeniyurt, Cavusgil, & Hult, 2005). A key element in integrating and coordinating global manufacturing facilities is the procurement activity (Kotabe & Murray, 2004). Fortunately, in contrast to other mechanisms necessary for global integration (e.g., global product platforms, global talent pools, and global HR systems), global procurement has been enthusiastically adopted by multinationals, primarily because the benefits of uniform sourcing are more apparent. Consequently, the global procurement function is a critical integrating mechanism that supports companies striving to create a rational, global organization. The need for increased speed to market has also caused many multinational companies to move toward increased global sourcing based on specialization and focus (Kotabe & Mudambi, 2009). The primary objective of a global sourcing approach is to enable the firm to combine its competencies and those of its suppliers with the comparative advantages of the firm s various country locations to create a competitive advantage (Mudambi, 2008). In achieving this end, many multinationals are leveraging their global sourcing benefits by moving toward hybrid purchasing organizations that encompass both global and local sourcing capabilities. A special challenge for these hybrid organizations is distinguishing between those sourced components that should be integrated globally across different locations and those components that should remain the responsibility of the local purchasing unit (Trautmann, Bals, & Hartmann, 2009). This is, of course, the classic globalization localization integration challenge (Bartlett & Ghoshal, 1987). Trautmann et al. (2009) added to the understanding of the principal structural drivers of global sourcing, particularly with regard to integration of global sourcing organizations, while concluding that more research is needed for further understanding of integration in the global sourcing context. This conclusion is consistent with the observation that global dynamism is forcing global organizations to focus on the processes that will enable them to more effectively and efficiently integrate and coordinate their global and local procurement activities. To contribute to an increased understanding of the role of procurement in the global company, this research explores the following questions: How can a global company utilize a globally integrated procurement organization to achieve global and local sourcing responsiveness? What is the effect of global and local sourcing practices, and global and local sourcing responsiveness on superior supplier working relations? What role does global and local knowledge play in facilitating global and local responsiveness? How important is communication with the firm s suppliers at both the global and the local level? This paper utilizes the global market advantage (GMA) framework (Yeniyurt et al., 2005) to develop a set of theoretically driven hypotheses associated with these research questions. Next, the hypotheses are tested empirically, using a dataset collected from the suppliers of a North American headquartered global manufacturer of high technology products. 2. Literature review and hypotheses 2.1. Theoretical background To better understand the use of global and local sourcing in a global company, and the effects global and local knowledge, communication, and responsiveness have on supplier working relations we used the global market advantage (GMA) framework (Yeniyurt et al., 2005). GMA is an overarching framework that explains the role of knowledge competencies in developing global market advantage and achieving superior marketing and financial performance. Since this study analyzes the role of sourcing in organizations, we focus on the global supply chain management and sourcing aspects of the GMA framework. According to GMA, the knowledge competence of the global company with respect to its suppliers is a driver of global responsiveness. Similarly, the ability to share information across a geographically dispersed value chain is an important antecedent of global company responsiveness. All these factors enable the company to develop global strategic partnerships with other supply chain members. Such strategic partnerships provide a global market advantage to the firm, having positive effects on its market performance.

3 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx 3 Multinational companies aspiring to become truly global companies concentrate their supply chain activities in certain locations around the world in such a way that the unique comparative advantages of different countries (Hill, 1996) are utilized on a global scale (Porter, 1986; Roth et al., 1991; Zou & Cavusgil, 1996, 2002). Such a strategy, which is consistent with the observation that global sourcing is an important antecedent of firm performance (Kotabe, Murray, & Javalgi, 1998), enables these companies to reduce redundancies and achieve synergies that would otherwise not be possible. In addition, these activities enable the organization to achieve global value-chain coordination, a critical competency that a global company must possess (Craig & Douglas, 2000; Kogut, 1985; Porter, 1986; Roth, 1992; Roth et al., 1991; Zou & Cavusgil, 2002). By coordinating the firm s value-adding activities across the globe, the global company is able to exploit countryspecific comparative advantages that achieve efficiency and effectiveness, not otherwise possible (Bartlett & Ghoshal, 1987; Craig & Douglas, 2000; Ghoshal, 1987; Kogut, 1989). Global value chain coordination enables the sharing of information, as well as the strategic integration of geographically dispersed subsidiaries and different units of the value chain in the process of creating customer value across geographical space. This constitutes a critical capability that global companies need to develop for increased efficiency and effectiveness. Among the value chain units that must be integrated and coordinated as the company attempts to maximize the comparative advantages available from various locations across the globe is the procurement activity. If the multinational, in its attempts to be a global company, is to be successful in the marketplace the achievement of meaningful comparative advantage begins with suppliers. Internally, it is the procurement organization at the global and local levels that communicates with and coordinates the activities of the firm s suppliers. It is, therefore, necessary for sourcing personnel to not only be responsive to supplier needs, but to also possess the necessary knowledge, skills, and capabilities that will enable them to work with suppliers in the most effective and efficient manner Sourcing responsiveness Deriving from the GMA framework (Yeniyurt et al., 2005), we posit responsiveness as an important factor in global sourcing and we define global sourcing responsiveness as the ability to react on a global basis to changes in supply chain conditions, threats, and opportunities as they arise. Consistent with the GMA framework, we also propose a new construct, local sourcing responsiveness, which is defined as the ability to react on a local basis to changes in supply chain conditions, threats, and opportunities as they arise. Regardless of the sourcing personnel s knowledge, skills, and capabilities, if they are not responsive to the needs of the suppliers with whom they work, their suppliers will not be as effective and efficient as they might otherwise be. Subsequently, global organizations should strive to achieve an optimum balance between central authority and responsiveness to local preferences (Bartlett & Ghoshal, 1988; Johansson & Yip, 1994; Roth et al., 1991). In doing so, multinationals aspiring to be a global company should employ modern information technology and communication systems to allow for free exchange of ideas, data, and best practices throughout the firm (Boudreau, Loch, Robey, & Straud, 1998). They also need coordination mechanisms including interconnectedness, i.e., linking electronically geographically dispersed components of the organization via intranets, extranets, etc. (Boudreau et al., 1998), and best practice repositories and lead centers of excellence (Frost, Birkinshaw, & Ensign, 2002). Only by utilizing formal and informal inter-functional coordination mechanisms are organizations able to achieve global responsiveness while balancing flexibility and efficiency (e.g., Bartlett & Ghoshal, 1987; Martinez & Jarillo, 1991). At the individual level, responsiveness is related to the ability of initiating actions based on knowledge generated and disseminated across the organization (Kohli, Jaworski, & Kumar, 1993). While global and local sourcing personnel may have available information and knowledge associated with their job and the suppliers with whom they work, it is the extent by which this information and knowledge is generated and retained by the global and local sourcing personnel, and the manner by which these personnel use the information and knowledge when responding to supplier issues and concerns, that is of critical importance. As such, the responsiveness of the global company to the global and local conditions as expected to have a positive effect on the partnership management process and the working relationships with global partners. In other words, global and local sourcing knowledge, as well as global and local sourcing communication are antecedents of global and local sourcing responsiveness. Further, it is expected that global sourcing responsiveness and local sourcing responsiveness will allow the global company to better address issues that arise with its suppliers, whether global or local. It is, therefore, hypothesized that: Hypothesis 1a. Global Sourcing Responsiveness has a positive effect on the Working Relations between the global company and the supplier. Hypothesis 1b. Local Sourcing Responsiveness has a positive effect on the Working Relations between the global company and the supplier Sourcing knowledge Sourcing personnel shape working relations with their suppliers through knowledge. The knowledge sourcing personnel possess enables them to competently carry out their responsibilities, as well as shape interactions with suppliers. The more

4 4 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx relevant knowledge sourcing personnel should possess includes general commercial knowledge, knowledge of the products for which they are responsible, knowledge of the manner in which the products are incorporated into their firm s end products, as well as, familiarity with supplier capabilities. This base of disparate knowledge contributes to the sourcing personnel s ability to acquire goods from a specific supplier in a manner that most closely meets the needs of their firm, while maintaining good working relations with the supplier. The extent of professional knowledge possessed by sourcing personnel is a strong indicator of the overall competence of the sourcing individual. A supplier s salesperson is more likely to develop trust in the sourcing personnel with whom they work to develop the commercial relations between their firms, when the sales person perceives the sourcing personnel as being competent and able to deliver on his/her promises (Doney & Cannon, 1997; Perrone, Zaheer, & McEvily, 2003). Professional knowledge also serves as a positive indication to the supplier that the sourcing personnel are more inclined to facilitate joint-goal achievement between them (Doney & Cannon, 1997). In addition, professional knowledge enables sourcing personnel to proactively shape the role they perform (Spekman, 1979). Internally, professional knowledge gives sourcing personnel higher professional status and allows them to exercise their expert power within the buying firm. Externally, suppliers perceive sourcing personnel expert power as an indication that they have decision-making autonomy within their organization, which makes the supplier more likely to trust the sourcing personnel (Perrone et al., 2003). Furthermore, when sourcing personnel are knowledgeable about a supplier s product and business, the buying firm and supplier share an essential common knowledge base. This common knowledge contributes to suppliers being more likely to feel understood and valued, because they perceive the sourcing personnel with whom they are working made an effort to learn about their product(s) and business. According to GMA, the global supplier knowledge base that a company possesses has a positive effect on the firm s responsiveness to its suppliers (Yeniyurt et al., 2005). In line with this reasoning it is hypothesized that: Hypothesis 2a. Global Sourcing Knowledge has a positive effect on Global Sourcing Responsiveness. Hypothesis 2b. Global Sourcing Knowledge has a positive effect on Local Sourcing Responsiveness. When operating in global markets, where significant differences exist among different regions, market-specific experiential knowledge is considered to be central to successfully running global operations (Cavusgil, 1980, 1984; Johansson & Vahlne, 1977, 1990). Subsequently, to achieve an appropriate level of responsiveness on both a global and local level, sourcing personnel in the firm s global and local sourcing units must possess significant knowledge regarding sourcing conditions. It is, therefore, hypothesized that: Hypothesis 3a. Local Sourcing Knowledge has a positive effect on Global Sourcing Responsiveness. Hypothesis 3b. Local Sourcing Knowledge has a positive effect on Local Sourcing Responsiveness Sourcing communication GMA recognizes that value chain coordination, i.e., information exchange across the geographically dispersed global value chain, is a critical capability that global companies need to develop (Yeniyurt et al., 2005), as information exchange is an important antecedent to responsiveness. Since this study focuses on sourcing responsiveness, the importance of open communication, i.e., information exchange between the supplier and the global company, and its effect on sourcing responsiveness, is incorporated in our framework. Within the context of communication, sourcing personnel are representatives of their firm s strategic intention and goals (Perrone et al., 2003). For example, when sourcing personnel discuss their firm s long-term vision with a supplier, it enables the supplier to determine how they may respond to the buying firm s future plans. Subsequently, the supplier can determine its internal investment priorities as they relate to supporting its customers. Furthermore, by sharing strategic information, sourcing personnel enable suppliers to determine how they can influence the buying firm s future purchase decisions. By sharing the firm s technology roadmap or more specifically addressing what innovations and new technologies the firm needs, sourcing personnel provide information that the supplier can use to determine how it may better meet the needs of the sourcing personnel s firm. Such communication involves long-term, strategic information that can be associated with each product/service supplied by a supplier (Kraljic, 1983). When sourcing personnel communicate with suppliers the strategic goals and intentions of their firm, they integrate their firm with its suppliers strategically (Ireland & Webb, 2007). Such integration helps to align the strategic goals of suppliers with the strategic goals of buying firms (Paulraj, Lado, & Chen, 2008), enabling shared norms and values to be established between buyer and supplier (Ireland & Webb, 2007). Furthermore, knowledge of the buying firm s strategic goals and objectives contribute to increasing a supplier s trust in the buying firm, because this strategy-related knowledge helps to mitigate risks and uncertainty associated with a supplier s long-term production and investment planning for the buying firm, while increasing the supplier s likelihood of winning future contracts from the buying firm (Zhang, Henke, & Griffith, 2009). Strategic communication content is determined by the firm the sourcing personnel represents (Perrone et al., 2003). As such, sourcing personnel carryout their role of communicating their firm s strategy-related information passively, as

5 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx 5 opposed to actively choosing the content of their strategic communication. Nonetheless, this activity causes suppliers to link sourcing personnel to their firm, as the sourcing personnel are perceived to be an unbiased conveyor of the buying firm s strategic information (Ireland & Webb, 2007). Since sourcing personnel tend not to exercise a significant amount of discretion when communicating their firm s strategic objectives and goals, a supplier associates responsibility for the information they receive to the buying firm and thus manifest trust toward the buying firm, rather than the sourcing personnel delivering the message (Perrone et al., 2003). This outcome is consistent with the observation that trust in the buying firm increases significantly as sourcing personnel carry out activities associated with the buying firm. Given the importance of communication in developing and maintaining good working relations with suppliers, it can be expected that increased communication with suppliers will allow the company to better address issues that arise with suppliers, whether global or local. It is, therefore, hypothesized that: Hypothesis 4a. Global Sourcing Communication has a positive effect on Global Sourcing Responsiveness. Hypothesis 4b. Global Sourcing Communication has a positive effect on Local Sourcing Responsiveness. Hypothesis 5a. Local Sourcing Communication has a positive effect on Global Sourcing Responsiveness. Hypothesis 5b. Local Sourcing Communication has a positive effect on Local Sourcing Responsiveness Global versus local suppliers A global company, in its quest to achieve a streamlined, flexible, and efficient supply chain, is expected to source components from a wide variety of suppliers located within and across various geographic regions (Cavusgil et al., 2008). While local suppliers would typically provide only a limited number of goods to a local/regional manufacturing sites of a global company, global suppliers would typically provide a single customer various goods at multiple manufacturing locations throughout different regions of the world (Trautmann et al., 2009; Trent & Monczka, 2003). In providing multiple goods to multiple sites, more capable global supplier also creates some challenges. The more global the supplier, the more geographic regions it will serve, and the greater will be the coordination task faced by the sourcing organization (Kotabe & Mudambi, 2009). Global suppliers need to be in contact with local sourcing personnel located in various countries, as well as with centrally located global sourcing personnel at the customer headquarters location. To successfully meet these challenges and overcome any issues that may arise when dealing with such a global partner, the global company requires considerable use and coordination of its knowledge and communication capabilities (Shi, Shaoming Zou, & Cavusgil, 2004; Yeniyurt et al., 2005). As a result, it is expected that global sourcing personnel will be involved frequently in addressing sourcing challenges and solving sourcing issues that arise between the global sourcing organization and local sourcing organizations, as well as addressing sourcing challenges and solving sourcing issues that arise among the local sourcing organizations. Furthermore, the relative importance of a global supplier and a local supplier to the global company are expected to vary in their relative value to the company. Subsequently, significant differences are expected between global and local suppliers in the effects of global and local sourcing knowledge and communication on global and local responsiveness, and of global and local responsiveness on supplier working relations. It is, therefore, hypothesized that: Hypothesis 6a. The effects of Global Sourcing Knowledge and Communication, and Local Sourcing Knowledge and Communication on global and local responsiveness differ between global suppliers and local suppliers. Hypothesis 6b. The effects of Global and Local Sourcing Responsiveness on the Working Relations differ between global suppliers and local suppliers. 3. Methods 3.1. Research setting To conduct our research we enlisted the support of a global manufacturer of B2B high technology products that is headquartered in North America. The global expansion of the company has occurred through a combination of organic growth and aggressive acquisition of local and regional manufacturers of complementary products. The company is organized in seven marketing regions: China, Asia/Pacific, India, Europe, Middle East/Africa, Latin America, and North America; and three sourcing regions: North America, Europe, and Asia/Pacific. Supporting the regional product development and manufacturing operations is a matrix procurement organization with each region having local sourcing personnel who are responsible for acquiring goods classified in a specific Commodity Family. The local sourcing personnel have responsibility for fulfillment and price issues. Each supplier also works with a Global Sourcing Director who is located in the company s North American headquarters. A few Global Sourcing Directors, however, are located elsewhere when the suppliers of the goods for which they are responsible are geographically concentrated. For example, because suppliers of electronics-related goods are located almost

6 6 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx exclusively in China, as are company s electronics manufacturing operations, the Global Sourcing Directors for the electronics goods Commodity Families are in China. Global sourcing personnel have responsibility for growing the working relations with their key suppliers, the cost of the goods supplied, negotiating contracts with the supplier, and determining the terms and conditions with which the company will conduct business with the supplier. Those larger and diversified suppliers who provide multiple goods to the company, i.e., multiple Commodity Families, are involved with multiple Global Sourcing Directors. The local sourcing personnel report to a Country Sourcing Manager and to the Global Sourcing Director who has responsibility for the supplier. When there are fulfillment issues or pricing issues with a supplier at a manufacturing site the Local Sourcing Buyer is responsible for resolving them. If the issues cannot be resolved locally, then the issue is escalated to the Global Sourcing Director. The Local Sourcing Buyer also has responsibility for local suppliers who provide goods only to manufacturing sites within the sourcing region Instrument design and data collection To identify potential measures associated with sourcing knowledge, communication, and responsiveness of a global company, we undertook a several-step process. Initially we conducted a literature review that identified a list of potential measures. We then interviewed 34 global and local sourcing personnel in the subject company who had been in their respective positions for at least five years to help determine the content validity of the potential measures, while identifying any new measures. A questionnaire was then developed and reviewed by several of the more experienced global and local sourcing personnel to ensure the appropriateness of the questions. Lastly we pre-tested the survey questionnaire with 14 suppliers, which resulted in additional modifications. A large scale internet-based survey of production suppliers was then implemented. The questionnaire was ed to 741 sales personnel responsible for sales to the company at 697 suppliers. The questionnaires, as with all messages, were in the native language (Chinese, English, French, Japanese, and Spanish) of the recipient of the message. One of the fundamental issues of developing adequate scales is ensuring the adequate translation of the questionnaire items in such a way that they are related to the latent factors similarly across cultures. Because the definition of certain phenomena may vary across cultures the back translation technique was used to ensure the equivalence of surveys in multiple languages (Mullen, 1995). Four weekly reminder s were directed to all potential respondents who had not completed their questionnaire in order to increase the response rate. A total of 423 individuals completed their questionnaires for a response rate of 57%. The job titles of the respondents included vice president of sales, division sales manager, and account representative. Nonresponse bias was evaluated by comparing the results of early and late response in terms of variables used in the study (Armstrong & Overton, 1977). No significant differences were found. The Harman one-factor test (Podsakoff & Organ, 1986) was utilized to test for common method bias. A principal component analysis of all the items included in the study was performed. Since no dominant factor emerged (the first factor explains only 26.2% of the total variance), we conclude that there is no evidence suggesting the presence of common method bias in the study Data The respondent was asked to answer the survey questions on the basis of supplying goods in a specific Commodity Family to a specific manufacturing site. Subsequently, each respondent provided information on several combinations of Commodity Families, and local and global sourcing personnel. The dataset contains 1455 such Commodity Family local and global sourcing observations. The items comprising each construct of our model are based on the literature review, as well as, what was learned in the interviews with the global and local sourcing personnel of the subject company and in the interviews of the suppliers during the survey instrument development activities. Global sourcing knowledge and local sourcing knowledge were measured using three items: commercial knowledge, product technical knowledge, and engineering/manufacturing process knowledge of the global and local sourcing personnel. The extent of communication between the global and local sourcing units, and the suppliers were measured using sets of eight items that capture communication: company sourcing policies, company technology roadmap, company strategic direction, company strategy for the parts and/or services supplied by the respondent s firm, supplier s role in the company s overall strategy, company purchase materials quality requirements, the importance of the supplier bringing innovation and new technologies to the company, and company contractual agreements. Responsiveness was captured using three items: responsiveness experienced with a particular sourcing unit (i.e., global or local), and timely resolution and effective resolution of issues by a sourcing unit. Respondents were asked to rate the knowledge, communication, and responsiveness of the global sourcing and local sourcing personnel with whom they worked on a five point Likert scale anchored poor to excellent. The quality of the working relationship between the company and its suppliers was captured using two items, one measuring the current overall working relations with the company, and another measuring the anticipated working relations with the company in the next months. These two items were rated on a seven point Likert scale from very poor to very good.

7 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx 7 To assess the differences between the global and local suppliers, the dataset was divided into two subsets. One subset consists of local suppliers and includes 1137 observations from companies that provide products and services to operations located in only one sourcing region (i.e., North America, Europe, or Asia/Pacific). The second subset constitutes the global suppliers and includes 318 observations from companies that provide products and services to company operations in more than one sourcing region. This definition is in line with extant research in company globalization (e.g., Rugman & Collinson, 2004; Townsend, Yeniyurt, & Berk Talay, 2009) Measurement reliability and validity A three-step approach, as outlined by Churchill (1979) and Anderson (1987) was employed to assess the validity and reliability of the measures. First, Cronbach s (1951) alpha coefficients were computed in order to assess the reliability of each scale. Coefficient alphas were evaluated relative to the minimum.70 level recommended by Nunnally (1978). The coefficient alphas meet the criteria set forth in the literature, with the lowest coefficient being.76 for local sourcing responsiveness, indicating adequate reliability for the measures employed in this study. Second, a confirmatory factor analysis (CFA) was carried out to investigate the convergent and discriminant validity of each construct. The measurement model including all constructs was fitted by the elliptical reweighted least squares (ERLS) procedure of the EQS program (Bentler, 1995, p. 47). The elliptical distributions are not constrained by the normality assumptions and their use is recommended when these assumptions are not met (Browne, 1984). ERLS performs as well as ML with normal data and better than ML with nonnormal data (Sharma, Durvasula, & Dillon, 1989). Hence, this estimation method, which has been previously used in the business literature (Townsend et al., 2004; Zou & Cavusgil, 2002), is recommended. The model provides an excellent fit with a chi-squared statistic of , statistically significant at.001 confidence level, with 384 degrees or freedom, NFI of.98, CFI of.99, and RMSEA of.05. All items loaded on their respective constructs and were statistically significant, with the smallest standardized coefficient of.711, indicating that the scales possess convergent validity. Further, all composite reliability coefficients are above.90, indicating adequate reliability. Table 1 describes the measures, the factor loadings, and the reliabilities of the constructs employed. Table 2 provides the inter-factor correlations. Third, the discriminant validity was assessed using the procedure recommended by Anderson (1987) and Bagozzi, Youjae, and Lynn (1991). This entails analyzing all possible pairs of constructs in a series of two-factor CFA models using EQS. Each pair of constructs was included in CFAs estimated by constraining the correlation between factors to one and then releasing this constraint. A chi-square difference test was then performed on the nested models to assess if the chi-square values were significantly lower for the unconstrained models. The critical value of 3.84 was exceeded in all cases, indicating the measures possess discriminant validity in the context of this study. To test for common method bias, Harman s one factor test was performed by estimating a single factor CFA and comparing it to the full CFA. The chi-squared difference between the models is 1626 with 21 degrees of freedom, which is statistically significant at.001 confidence level. Therefore, it can be concluded that common method bias is not a concern. Finally, considering that the respondents have different cultural backgrounds a series of multi-group CFAs were performed to assess the cross-cultural equivalence of the measurement model. The dataset was divided into two groups, English and non-english, based on the language of the survey questionnaire. A constrained two group CFA indicated that, according to the chi-squared difference statistic, there are no statistically significant differences in factor structure and item loadings across the two groups. Further, respondents were grouped based on their location, North America, Europe or Asia/ Pacific, and similarly, the constrained multi-group CFA reveled that there are no statistically significant differences between groups. 4. Results The hypotheses presented above were tested using a path model that was estimated using average factor scores as indicators for each construct with a constrained two group estimation and the ERLS procedure in EQS. The data was divided into two groups, according to whether the respondents are from a local supplier or a global supplier of the company. Next, the path coefficients were constrained equally across the two groups and the constraints that have a statistically significant chi-squared statistic were released. The unstandardized path coefficients and fit statistics resulting from fitting the path model are presented in Fig. 1. Overall, the model has a good fit to the data, with a chi-squared statistic of 48.39, with 17 degrees of freedom and statistically significant at.001 confidence level, NFI equal to.99, CFI of.99 and RMSEA of.04. For both local and global suppliers, global and local sourcing responsiveness have positive and statistically significant effects on supplier working relations (b =.157, p <.01 and b =.159, p <.01 respectively), providing support for Hypotheses 1a and 1b. The results provide support for Hypotheses 2a and 2b, with statistically significant and positive effects of global sourcing knowledge on global (b =.184, p <.01) and local sourcing responsiveness (b =.254, p <.01) respectively. The estimated effect of local sourcing knowledge on Global Sourcing Responsiveness is positive and statistically significant (b =.089, p <.05) providing support for Hypothesis 3a. While the effect of local sourcing knowledge on local sourcing responsiveness is positive and statistically significant for local suppliers (b local =.092, p <.01), it is positive and statistically insignificant for global suppliers (b global =.016, p >.05). As such, Hypothesis 3b is only partially supported.

8 8 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx Table 1 Confirmatory factor analysis results. Knowledge Global sourcing Local sourcing Alpha =.85 Composite reliability =.94 Ave. var. extracted =.85 Alpha =.87 Composite reliability =.96 Ave. var. extracted =.88 Std. loading t value Std. loading t value Commercial knowledge * * Product technical knowledge * * Engineering/manufacturing process knowledge * * Communication Global sourcing Local sourcing Alpha =.95 Composite reliability =.90 Ave. var. extracted =.77 Alpha =.95 Composite reliability =.97 Ave. var. extracted =.78 Std. loading t value Std. loading t value Communicate company s sourcing policies * * Communicate company s technology roadmap * * Communicate company s strategic direction * * Communicate company s strategy for the parts * * and/or services supplied by your firm Communicate your firm s role in company s overall strategy * * Communicate purchase materials quality requirements * * Communicate the importance of your firm bringing * * innovation and new technologies to the company Communicate contractual agreements * * Responsiveness Global sourcing Local sourcing Alpha =.77 Composite reliability =.90 Ave. var. extracted =.76 Alpha =.76 Composite reliability =.91 Ave. var. extracted =.78 Std. loading t value Std. loading t value Responsiveness received from global or local sourcing * * Timely resolution of issues * * Effective resolution of issues * * Supplier working relations Alpha =.92 Composite reliability =.92 Ave. var. extracted =.85 Std. loading t value Current overall working relations with the company * Anticipated overall working relations with the company in the next months * Fit statistics: chi square = ; d.f. = 384; p <.001; NFI =.98; CFI =.99; RMSEA =.05. * p <.001. The results also provide strong support for Hypothesis 4a, with a significant positive effect of Global Sourcing Communication on Global Sourcing Responsiveness (b =.632, p <.01). Yet, Hypothesis 4b is not supported, as the effect of Global Sourcing Communication on local sourcing responsiveness is small in magnitude and statistically insignificant for both local and global suppliers (b local =.046, p >.05; b global =.014, p >.05). The effect of local sourcing communication on Global Sourcing Responsiveness is positive and statistically insignificant (b =.034,p >.05), failing to provide support for Hypothesis 5a. On the other hand, its effect on local sourcing responsiveness is positive and statistically significant (b local =.539,p <<.01; b global =.548, p <.01), providing strong support for Hypothesis 5b. Table 2 Inter-factor correlations. * Global Sourcing Knowledge Local Sourcing Knowledge Global Sourcing Communication Local Sourcing Communication Global Sourcing Responsiveness Local Sourcing Responsiveness Supplier working relations * All correlations are statistically significant at.01 confidence level.

9 [(Fig._1)TD$FIG] S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx 9 Global Sourcing Knowledge.184** Global Sourcing Communication.254**.632** Global Sourcing Responsiveness.157** Local Sourcing Knowledge.046 / * Supplier Working Relations Local Sourcing Communication.092** / ** /.548** 1 Local Sourcing Responsiveness.159** ** p <.01; * p <.05 Chi Sq = (d.f. =17, p <.001); NFI =.99; CFI =.99; RMSEA =.04 Fig. 1. Estimated Path Coefficients. Paths with two coefficients denote statistically significant differences between local and global suppliers, where the first figure indicates local suppliers path coefficient and second figure indicates global suppliers path coefficient. All remaining path coefficients are statistically equal for local and global suppliers. Finally, to test Hypotheses 6a and 6b, all ten path coefficients of the model (see Fig. 1) have been constrained equal across the two groups consisting of local versus global suppliers. Then, the improvement in chi-squared fit statistic achieved from releasing each of the equality constraints was identified. According to the chi-squared difference statistic, only three of the ten constraints provide an improvement in chi-squared statistic that is larger than the 3.84 cut-off value that denotes significance at.05 confidence level for one degree of freedom. Therefore, while the remaining seven path coefficients are not statistically different among local and global suppliers, three path coefficients are statistically different. Specifically, there are significant differences among the two groups in the effects of Global Sourcing Communication on local sourcing responsiveness, local sourcing knowledge on local sourcing responsiveness, and local sourcing communication on local sourcing responsiveness. These results provide partial support for Hypothesis 6a and fail to support Hypothesis 6b. A summary of the findings is presented in Table Discussion This study develops and tests a theoretical framework that illustrates the effect of global and local sourcing on the supplier working relations of a global company. This study found that if a sourcing organization aspires to achieve exceptional supplier working relations it should be highly integrated across its geographic regions, with global and local sourcing personnel working closely together in a coordinated manner to achieve a globally responsive supply chain. The Table 3 Hypothesis support. Hypothesis Support 1a Global Sourcing Responsiveness has a positive effect on the Working Relations between the Supported global company and the supplier 1b Local Sourcing Responsiveness has a positive effect on the Working Relations between the Supported global company and the supplier 2a Global Sourcing Knowledge has a positive effect on Global Sourcing Responsiveness Supported 2b Global Sourcing Knowledge has a positive effect on Local Sourcing Responsiveness Supported 3a Local Sourcing Knowledge has a positive effect on Global Sourcing Responsiveness Supported 3b Local Sourcing Knowledge has a positive effect on Local Sourcing Responsiveness Partially supported 4a Global Sourcing Communication has a positive effect on Global Sourcing Responsiveness Supported 4b Global Sourcing Communication has a positive effect on Local Sourcing Responsiveness Not supported 5a Local Sourcing Communication has a positive effect on Global Sourcing Responsiveness Not supported 5b Local Sourcing Communication has a positive effect on Local Sourcing Responsiveness Supported 6a The effects of Global Sourcing Knowledge and Communication, and Local Sourcing Partially supported Knowledge and Communication on Global and Local Responsiveness differ between local suppliers and global suppliers 6b The effects of Global Sourcing and Local Sourcing Responsiveness on the Working Relations differ between local suppliers and global suppliers Not supported

10 10 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx greater knowledge and more complete communication of the global sourcing unit, contributes to greater global sourcing responsiveness. And, the greater the global sourcing responsiveness, the better are the working relations between the global company and its suppliers. Local sourcing knowledge and communication are also important drivers of global and local responsiveness. The impact of local knowledge and communication on both global and local responsiveness underscores the importance of local sourcing personnel having market-specific knowledge as local idiosyncrasies and significant differences among country markets continue to persist in the age of globalization. Clearly, the most important result of this study is the strong positive effects of global sourcing and local sourcing responsiveness on the working relations of the global company and its suppliers. Even though there are some differences in the impact of the knowledge and communication on the responsiveness of the global and local sourcing units, the theoretical framework generally holds for all the suppliers included in the dataset. Therefore, it can be concluded that for a global company, concurrent sourcing knowledge and communication at the global and local levels are important antecedents of sourcing responsiveness, and concurrent global and local sourcing responsiveness results in superior supplier working relations. The knowledge of each sourcing unit, i.e., global and local, has a positive impact on the responsiveness of the other unit, while the communication of each unit does not impact the responsiveness of the other sourcing unit. The implication is that for meaningful global and local responsiveness, both global and local sourcing knowledge and expertise are required. On the other hand, for local responsiveness only communication from the local sourcing unit is needed, while for global responsiveness only communication from the global sourcing unit is of importance. As such, to achieve global responsiveness a firm has to develop expertise in global and local sourcing, and must maintain good communication channels between the global sourcing unit and its suppliers. Similarly, local responsiveness can be achieved by having a strong sourcing knowledge base at both the global and local levels, and by maintaining good communication between the local sourcing unit and the supplier. The moderation test by global and local suppliers identified in terms of different manufacturing regions that each component is being supplied has indicated some differences in the path coefficients. Due to the research setting, the same supplier can supply a commodity globally while supplying other commodities locally. This may have been reflected in the dataset and the moderation test, blurring the differences between locally and globally sourced commodities. Nevertheless, the results show that the differences between suppliers are relatively minor and it can be concluded that the proposed theoretical framework and the tenets of the GMA theory hold regardless of the type of the supplier. It is clear from these findings that the global firm being studied has moved well beyond international purchasing, where the purchasing activities typically involve buying from a country to achieve lower piece prices, to global sourcing, which includes the integration and coordination of sourcing, operations, and design/development and/or internal customers in different countries (Monczka, Trent, & Peterson, 2006). Monczka et al. (2006) have identified seven factors that supply chain executives consider critical to successful global sourcing performance. Included among these factors are information availability, personnel with required worldwide knowledge and skills, knowledge of suppliers available worldwide, time to develop worldwide strategies, and availability of suppliers with worldwide capabilities. While the Monczka et al. (2006) study found a low level of maturity regarding integrated global sourcing among the firms studied, it is clear from our findings that the global firm of our study has achieved a high level of maturity in its global sourcing integration and coordination primarily because the seven critical factors mentioned earlier are inherent in its global and local sourcing operations. Our study further elucidates the resources and capabilities a global company has to develop in order to achieve a globally and locally responsive sourcing organization. Sourcing knowledge, communication and responsiveness at both global and local levels are shown to be important antecedents of developing and maintaining good working relations with suppliers. As with any important endeavor, the success of an effective and efficient globally integrated organization begins with having the full and active support and leadership of top management (e.g., Fawcett, Andraski, Fawcett, & Magnan, 2009). This study indicates the importance of global and local sourcing knowledge and communication, and managers should focus their efforts on developing a globally integrated sourcing organization that balances local and global sourcing responsiveness. In this way, superior supplier working relations can be established and a global market advantage can be engendered. This study also has significant managerial implications. Procurement managers in global companies need to understand the importance of local and global knowledge and train their sourcing personnel to improve the information they have in terms of product characteristics, technical specifications, commercial considerations and the engineering process related to the procurements of components. Further, managers should facilitate open and timely communication between their sourcing personnel and the suppliers in terms of sourcing factors such as company s sourcing policies, its strategic direction, and quality requirements. Improvement in knowledge and communication is expected to improve the company responsiveness to global and local events. Sourcing managers should also be aware of the importance of global and local sourcing responsiveness in building good working relations with the suppliers. Overall, knowledge acquisition, open communication, and responsiveness should be encouraged throughout the global sourcing organization. 6. Future research This study analyzed the sourcing practices of a large multi-national company. Future research is needed to understand the validity of these findings in other global organizations, different supply chain settings, and different industries. It has

11 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx 11 been indicated that good working relations have significant economic benefits (e.g., Monczka et al., 2006), including decreased sourcing costs (Henke, Yeniyurt, & Zhang, 2009). Therefore, it can be expected that developing and maintaining a globally coordinated and integrated sourcing organization has a significant positive impact on the bottom line of the global company. Hence, additional research is needed to identify the financial returns of global sourcing and effective management of supplier relations on a global basis. Close working relations with global suppliers are a significant source of competitive advantage, allowing the global company to extend its available resource base through the addition of complementary resources (Sarkar, Raj Echambadi, Cavusgil, & Aulakh, 2001). Future research on the integration and coordination of the sourcing organization in global companies should consider the additional benefits of globally and locally responsive sourcing organization, as well as the competitive advantages of an integrated and globally coordinated supply chain. Appendix A. Survey questions A.1. Global sourcing/local sourcing knowledge Please rate the global sourcing/local sourcing individuals with whom you have had the most contact over the past year in the following areas (poor = 1; excellent = 5): Commercial knowledge Product technical knowledge Engineering/manufacturing process knowledge A.2. Global sourcing/local sourcing communication Please rate how well the global sourcing/local sourcing individuals with whom you have had the most contact over the past year, communicate the following activities (poor = 1; excellent = 5): Company s sourcing policies Company s technology roadmap Company s strategic direction Company s strategy for the parts and/or services supplied by your firm Your firm s role in company s overall strategy Purchase materials quality requirements The importance of your firm bringing innovation and new technologies to the company Contractual agreements with your firm A.3. Global sourcing/local sourcing responsiveness Overall, how would you rate the responsiveness your firm receives from global sourcing/local sourcing (poor = 1; excellent = 5)? Please rate the Global Sourcing/Local Sourcing individuals with whom you have had the most contact over the past year (poor = 1; excellent = 5): Timely resolution of issues Effective resolution of issues A.4. Supplier working relations Please select the answer that best describes the state of your firm s current overall working relations with the company: (poor = 1; excellent = 7). Please select the answer that best describes the state of the overall working relations your firm anticipates it will have with the company in the next months: (poor = 1; excellent = 7). References Anderson, James C.. (1987). An approach for confirmatory measurement and structural equation modeling of organizational properties. Management Science, 33, Armstrong, J. S., & Overton, T. S. (1977). Estimating non-response bias in mail surveys. Journal Of Marketing Research, 14(3), Bagozzi, R. P., Youjae, Y., & Lynn, W. P. (1991). Assessing construct validity in organizational research. Administrative Science Quarterly, 36(3), Bartlett, C. A., & Ghoshal, S. (1987). Managing across borders: New strategic requirements. Sloan Management Review, 28(4), 7 17.

12 12 S. Yeniyurt et al. / International Business Review xxx (2012) xxx xxx Bartlett, C. A., & Ghoshal, S. (1988). Organizing for worldwide effectiveness: The transnational solution. California Management Review, 31(1), Bentler, Peter M. (1995). EQS structural equations program manual. Los Angeles, CA: Multivariate Software Inc. Boudreau, M.-C., Loch, D. K., Robey, D., & Straud, D. (1998). Going global: Using information technology to advance the competitiveness of the virtual transnational organization. Academy of Management Executive, 12(4), Browne, M. W. (1984). Asymptotically distribution-free methods for the analysis of covariance structures. British Journal of Mathematical and Statistical Psychology, 37, Buckley, P. J. (2009). Internalisation thinking: From the multinational enterprise to the global factory. International Business Review, 18(3), Buckley, P. J., & Ghauri, P. N. (2004). Globalisation economic geography and the strategy of multinational enterprises. Journal of International Business Studies, 35(2), Cavusgil, S. T. (1980). On the internationalization process of firms. European Research, 8, Cavusgil, S. T. (1984). Organizational characteristics associated with export activity. Journal of Management Studies, 21(1), Cavusgil, T. S., Knight, G., & Riesenberger, J. R. (2008). International business: Strategy, management, and the new realities. Upper Saddle River, NJ: Pearson Prentice Hall. Cavusgil, S. T., Yeniyurt, S., & Townsend, D. J. (2004). The framework of a global company: A conceptualization and preliminary validation. Industrial Marketing Management, 33(8), Churchill, G. A. (1979). A paradigm for developing better measures of marketing constructs. Journal of Marketing Research, 16, Craig, C. S., & Douglas, S. P. (2000). Configural advantage in global markets. Journal of International Marketing, 8(1), Cronbach, L. J. (1951). Coefficient alpha and the internal structure of tests. Psychometrica, 16(3), Doney, P. M., & Cannon, J. P. (1997). An examination of the nature of trust in buyer seller relationships. Journal of Marketing, 61(2), Dunning, J. H. (1981). Explaining international production. London: Unwin Hyman. Fawcett, S. E., Andraski, J. C., Fawcett, A. M., & Magnan, G. M. (2009). The art of supply change management. Supply Chain Management Review, 13(2), Frost, T. S., Birkinshaw, M. J., & Ensign, C. P. (2002). Centers of excellence in multinational corporations. Strategic Management Journal, 23(11), 997. Ghoshal, S. (1987). Global strategy: An organizing framework. Strategic Management Journal, 8(5), Henke, J. W., Jr., Yeniyurt, S., & Zhang, C. (2009). Supplier price concessions: A longitudinal empirical study. Marketing Letters, 20(1), Hill, C.W.L. (1996). International business: Competing in the global marketplace. Chicago: Richard D Irwin. Ireland, R. D., & Webb, J. W. (2007). A multi-theoretic perspective on trust and power in strategic supply chains. Journal of Operations Management, 25, Johansson, J., & Vahlne, J.-E. (1977). The internationalization process of the firm A model of knowledge development and increasing foreign market commitments. Journal of International Business Studies, 8(1), Johansson, J., & Vahlne, J.-E. (1990). The mechanism of internationalization. International Marketing Review, 7(4), Johansson, J. K., & Yip, S. G. (1994). Exploiting globalization potential: U.S. and Japanese strategies. Strategic Management Journal, 15(8), Kogut, B. (1985). Designing global strategies: Comparative and competitive value-added chains. Sloan Management Review, 26(Summer), Kogut, Bruce. (1989). A note on global strategies. Strategic Management Journal, 10(4), Kohli, A. K., Jaworski, B. J., & Kumar, A. (1993). MARKOR: A measure of market orientation. Journal Of Marketing Research, 30(4), Kotabe, M., & Mudambi, R. (2009). Global sourcing and value creation: Opportunities and challenges. Journal of International Management, 15, Kotabe, M., & Murray, J. Y. (2004). Global sourcing strategy and sustainable competitive advantage. Industrial Marketing Management, 33, Kotabe, M., Murray, J. Y., & Javalgi, R. G. (1998). Global sourcing of services and market performance: An empirical investigation. Journal of International Marketing, 6(4), Kraljic, P. (1983). Purchasing must become supply management. Harvard Business Review, 61, Martinez, J. I., & Jarillo, J. C. (1991). Coordination demands of international strategies. Journal of International Business Studies, 22(3), 429. Monczka, R. M., Trent, R. J., & Peterson, K. J. (2006). Effective global sourcing and supply for superior results. Tempe, AZ: CAPS Research. Mudambi, R. (2008). Location, control and innovation in knowledge-intensive industries. Journal of Economic Geography, 8(5), Mullen, M. R. (1995). Diagnosing measurement equivalence in cross-national research. Journal of International Business Studies, 26(3), Nunnally, J. C. (1978). Psychometric theory. New York: McGraw-Hill. Paulraj, A., Lado, A. A., & Chen, I. J. (2008). Inter-organizational communication as a relational competency: Antecedents and performance outcomes in collaborative buyer supplier relationships. Journal of Operations Management, 26(1), Perrone, V., Zaheer, A., & McEvily, B. (2003). Free to be trusted? Organizational constraints on trust in boundary spanners. Organization Science, 14(4), Podsakoff, P. M., & Organ, D. W. (1986). Self-reports in organizational research: Problems and prospects. Journal of Management, 12(4), Porter, M. E. (1980). Competitive strategy. New York: The Free Press. Porter, M. E. (1986). Changing patterns of international competition. California Management Review, 28(Winter), Roth, K. (1992). International configuration and coordination archetypes for medium-sized firms in global industries. Journal of International Business Studies, 23(3), Roth, K., Schweiger, D. M., & Morrison, A. J. (1991). Global strategy implementation at the business unit level: Operational capabilities and administrative mechanisms. Journal of International Business Studies, 22(3rd Quarter), Rugman, A. M., & Collinson, S. (2004). The regional nature of the world s automotive sector. European Management Journal, 22(5), Sarkar, M. B., Raj Echambadi, S., Cavusgil, T., & Aulakh, S. P. (2001). The influence of complementarity, compatibility, and relationship capital on alliance performance. Journal of Academy of Marketing Science, 29(4), Sharma, S., Durvasula, S., & Dillon, W. (1989). Some results on the behavior of alternate covariance structure estimation procedures in the presence of non-normal data. Journal of Marketing Research, 26(2), Shi, L. H., Shaoming Zou, S., & Cavusgil, T. (2004). A conceptual framework of global account management capabilities and firm performance. International Business Review, 13(5), Spekman, R. E. (1979). Influence and information: An exploratory investigation of the boundary role person s basis of power. Academy of Management Journal, 22, Townsend, J. D., Yeniyurt, S., & Berk Talay, M. (2009). Getting to global: An evolutionary perspective of brand expansion in international markets. Journal of International Business Studies, 40(4), Townsend, J. D., Yeniyurt, S., Deligonul, S. S., & Cavusgil, T. (2004). Exploring the Marketing Program Antecedents of Performance in a Global Company. Journal of International Marketing, 12(4), Trautmann, G., Bals, L., & Hartmann, E. (2009). Global sourcing in integrated network structures: The case of hybrid purchasing organizations. Journal of International Management, 15, Trent, R. J., & Monczka, R. M. (2003). International purchasing and global sourcing What are the differences? The Journal of Supply Chain Management, 39(4), Yeniyurt, S. S., Cavusgil, T. G., & Hult, M. T. (2005). A global market advantage framework: The role of global market knowledge competencies. International Business Review, 14(1), Yip, George S.. (1992). Total global strategy: Managing for worldwide competitive advantage. New Jersey: Prentice Hall. Zhang, C., Henke, J. W., Jr., & Griffith, D. A. (2009). Do buyer cooperative actions matter under relational stress? Evidence from Japanese and U.S. assemblers in the U.S. automotive industry. Journal of Operations Management, 27, Zou, S., & Cavusgil, S. T. (1996). Global strategy: A review and an integrated conceptual framework. European Journal of Marketing, 30(1), Zou, S. S., & Cavusgil, T. (2002). The GMS: A broad conceptualization of global marketing strategy and its effects on firm performance. Journal of Marketing, 66(4),