Management of Complex Industrial Supplier Relations - a Case of Customer Attractiveness

Companies are increasingly relying on suppliers when developing and manufacturing industrial products. Therefore the supplier relationships of the company need to be managed. This dissertation looks at existing theoretical approaches to supplier relationship management. By studying a number of supplier relationships of the company Danfoss Drives, an alternative understanding of the supplier relationship management task is proposed. The case study methodology forms the basis for the applied research design. The alternative understanding sees the management task as one of influencing suppliers, rather than dominating, controlling or safeguarding. This alternative model of supplier relationship management is furthermore inspired by various complementary theories, e.g. theories on strategic alliances and traditional intraorganisational management. Finally a motivational approach to supplier relationship management is proposed – the concept of Customer Attractiveness. Customer Attractiveness is founded on the revised understanding of the supplier relationship management task and focuses on influencing suppliers by being an attractive customer, hereby motivating the necessary commitment to long term value creation in the relation.