A Theory of the Nexus Supplier : A Critical Supplier from a Network Perspective

We introduce a new type of critical supplier — the nexus supplier — that becomes evident when we consider suppliers from a network perspective. The extant literature focuses on the importance of strategic suppliers and identifies strategic suppliers as critical due to their significant impact on a buying firm’s profit and risk position. These strategic suppliers are considered one-at-a-time and tend to be top-tier suppliers. In contrast, a nexus supplier can come from anywhere in a multi-tier supply network and is critical due to its network positions and the resultant portfolio of inter-organizational ties. In this study, we offer a theory of the nexus supplier by integrating the supply management and social network literature. The theory is presented in the form of typologies, which articulate three ideal types of nexus suppliers and how they distinctively influence a focal buying firm’s operational performance. We use real-world examples to build our arguments. We discuss implications of the nexus supplier for both theory and practice