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    Managing contract manufacturing relationships A design science approach to buyer-applied management practices
    (Universität St. Gallen, 2023-02-20)
    Contract manufacturing has established itself as a cornerstone of global supply chains across industries since the first wave of production outsourcing. Since then, brand-leading companies have focused on customer centricity and geared their supply chains towards the end consumer. In turn, contract manufacturers have closed the emerging knowledge gap and surpassed the brand leaders in many areas on the value chain's supply side, such as production, logistics, and materials science. As a result, clients no longer enter into contract manufacturing relationships to outsource manufacturing activities but to implement their product designs with the state-of-the-art capabilities of contract manufacturers. The increasing integration of the contract manufacturer up to the product development phase means an enormous strategic and operational dependency for the client, as the client's products are manufactured externally by the contract manufacturer's supply network. Consequently, relationship management must enable the coordination of manufacturing across company boundaries and against the backdrop of relationship dynamics and compensate for limited client influence. This dissertation addresses the relationship management of contract manufacturing relationships through the client's use of management practices. It adopts the theoretical lenses of transaction cost economics and the relationship velocity perspective. To this end, the dissertation examines contract manufacturing relationships, first for applied management practices, second for management needs assessment, third for management-relevant relationship dynamics, and fourth for the purposeful application and adjustment of management practices. The research findings indicate the need for systematic alignment of client companies and contract manufacturers at commercial and social relationship levels to enable effective coordination. Furthermore, the dynamics of contract manufacturing relationships require a regular reassessment of the commercial and social fit. To this end, the relationship should be temporally partitioned to ensure targeted goal achievement. The findings contribute to the understanding of contract manufacturing relationship management by addressing the research gap in the literature. Furthermore, the dissertation derives artifacts from the findings designed for application in practice.
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