Relational factors that explain supply chain relationships

Purpose – The purpose of this paper is to gain a better understanding of the types of relationships that exist along the supply chain and the capabilities that are needed to manage them effectively. Design/methodology/approach – This is exploratory research as there has been little empirical research into this area. Quantitative data were gathered by using a self‐administered questionnaire, using the Australian road freight industry as the context. There were 132 usable responses. Inferential and descriptive analysis, including factor analysis, confirmatory factor and regression analysis was used to examine the predictive power of relational factors in inter‐firm relationships. Findings – Three factors were identified as having significant influence on relationships: sharing, power and interdependency. “Sharing” is the willingness of the organisation to share resources with other members of the supply chain. “Power” relates to exercising control based on experience, knowledge and position in the supply chain. “Interdependency” is the relative levels of dependency along the supply chain. Research limitations/implications – The research only looks at the Australian road freight industry; a wider sample including other industries would help to strengthen the generalisability of the findings. Practical implications – When these factors are correlated to the types of relationship, arm's length, cooperation, collaboration and alliances, managerial implications can be identified. The more road freight businesses place importance on power, the less they will cooperate. The greater the importance of sharing and interdependency, the greater is the likelihood of arm's length relationships. Originality/value – This paper makes a contribution by describing empirical work conducted in an under‐researched but important area – supply chain relationships in the Australian road freight industry.