| Build-to-order Supply Chain (BOSC) is viewed by many researchers as an effective way to achieve high customer value because BOSC can fulfill an individual or a group of customers' orders while maintaining low cost, cutting inventory cost, eliminating waste, and achieving short response time through flexible manufacturing and integrated logistics. BOSC is needed to support mass customization, which is the ability to make high variety and low cost products and deliver them quickly to meet the diverging needs of customers. Mass customization can be achieved by implementing modularity-based manufacturing practices, postponing production steps that determine product features and performances, and applying IT to coordinate actions and speed up final production and delivery. BOSC also emphasizes the importance of partnership with suppliers and customers, web-based technologies, and rapid transport and delivery.;This research proposes that BOSC capability (i.e., cost effectiveness, volume effectiveness, and timely delivery) can be achieved through three dimensions of supply chain practices: modularity, postponement, and partnership.;This study applies social dilemma theory and resource dependency theory to build a model to explore the mechanism of inducing these three dimensions of supply chain practices. Social dilemma theory states that members in an alliance have a higher tendency to defect (e.g., withhold information or not fully participate) rather than to cooperate because members may achieve higher short-term profits through defecting (Dawes, 1980). These defects will cause long-term failure of an alliance, and members will loose their profits in the long run. Resource dependency theory indicates that members in a supply chain should depend and cooperate to move out of the dilemma of defecting to gain higher profits in the long-run instead of competing with one another. The literature suggests two types of solutions to change the views of members in an alliance from a short-term view to a long-term view: structural solutions, which focus on strategy, responsibility and profit allocation, and motivational solutions, which focus on changing partners' perceptions of group identity and self efficacy. This research applies social dilemma theory and resource dependency theory in buyer-supplier links in the supply chain context. A buyer's structural solutions (i.e., supplier alignment) perceived by the supplier and the supplier's motivational solutions (i.e., supplier empowerment) can increase the frequency and range of partnership practices, modularity practices, and postponement practices.;Partnership strategy (i.e., trust, commitment, and shared vision between the buyer and the supplier) established in the supply chain induces supplier alignment and supplier empowerment. Partner relationship has positive influences upon supplier alignment and supplier empowerment.;The data used in this study were collected from tier 1 and tier 2 suppliers in North America and China. Structural Equation Model is used to analyze those data. Of eleven hypotheses, seven are significant.;This research has three significant contributions to supply chain management literature. First, it has developed several valid and reliable measures (e.g., supplier alignment, supplier empowerment, and supplier partnership practices) for supply chain management research. Second, it has verified valuable practices (i.e., modularity supply chain practices and supplier partnership practices) for achieving BOSC capability. Third, it has also identified strategy (i.e., partner relationship) and drivers (i.e., supplier alignment and supplier empowerment) for the supply chain practices. |
