Boundary choices in the pulp and paper industry

Jantunen, Ari; Sandström, Jaana; Kuittinen, Hanna

doi:10.1108/17410380910936774

Cited by 5 publications

(5 citation statements)

References 33 publications

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“…Future research might also explore the influence of outsourcing on specific production activities, such as assembly, fabrication, and packaging. Additionally, future research should jointly address value-maximizing and cost-minimizing considerations in specific outsourcing settings, as in Jantunen et al (2009). This study generated additional interesting results pertaining to supplier integration and to IT investments.…”

mentioning

confidence: 87%

The effects of production outsourcing on factory cost performance: an empirical study

Meixell

Kenyon

Westfall

2014

Journal of Manufacturing Technology Management

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Access to this document was granted through an Emerald subscription provided by 353605 [] For AuthorsIf you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. AbstractPurpose -The purpose of this paper is to investigate the performance implications associated with production outsourcing. Specifically, the paper analyzes the cost of goods sold for firms who outsource core manufacturing processes, using empirical data from a variety of industries. The paper seeks to better understand the influence of outsourcing on factory cost by looking at these in the context of related strategies, such as supplier integration, information technology (IT) implementation, and manufacturing process decisions. Design/methodology/approach -The paper draws on transaction cost economics, manufacturing strategy, and supply chain management literature to aid in predicting the performance to be expected when outsourcing production activities. Furthermore, the paper investigates the moderating effects of manufacturing strategies, supplier integration, and IT expenditures on outsourcing. The primary model is a two-way panel model for the cross-sectional and longitudinal data drawn from the MPI Census of Manufacturers Survey of US manufacturing plants.Findings -The analysis indicates that production outsourcing tends to shift costs among cost of goods sold (COGS) categories, but does not consistently reduce them as measured by overall COGS. The effects of production outsourcing on both the cost of labor and the cost of materials are strong, tending to decrease labor, and increase materials. Additionally, this study shows that a high level of supplier integration has a notable moderating influence on overall COGS, but that process strategies do not. Finally, this analysis indicates that IT expenditures were not influential as a moderator variable when outsourcing, but did have a marked influence on overall COGS, as well as on labor and materials costs. Originality/value -This research investigates the effects of outsourcing on the components of COGS, a level of analysis that is typically not looked at relative to outsourcing. This research also provides methodological contributions with the development of a nested random effects structural model for use with a secondary ...

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confidence: 87%

The effects of production outsourcing on factory cost performance: an empirical study

Meixell

Kenyon

Westfall

2014

Journal of Manufacturing Technology Management

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“…This controversial discussion is very current and relevant for future research. Therefore, we highlight some key findings below: Jantunen et al (2009) conclude their paper by arguing that the TCE statements are not fully sufficient to explain a firm's organization but that the type and strategic relevance of the considered activity also represent an important part of the decision. Cho (2009) finds that distributors attempt to avoid backward integration in the case of high‐quantity fluctuations, country‐specific risk and high‐asset specificity.…”

Section: Resultsmentioning

confidence: 98%

“…Possible governance choices are the extremes of market and hierarchy, or any hybrid form between these boundaries. Typical research questions that TCE explains or analyzes are therefore vertical integration questions (Caves and Bradburd, 1988), make‐or‐buy decisions (Hodgkin et al , 1997), questions on contract choice (Kalnins and Mayer, 2004), firm boundary choice questions (Jantunen et al , 2009), governance choice questions (Pangarkar and Klein, 2002; Klein and Saidenberg, 1997) or more general questions on buyer‐supplier relationships (Liker et al , 1996). Transaction costs themselves are dependent on the so‐called transaction dimensions.…”

Section: Transaction Cost Economicsmentioning

confidence: 99%

Transaction costs detailed: single‐industry studies and operationalization

Müller

Aust²

2011

Industrial Management &Amp; Data Systems

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PurposeThis paper aims to present an in‐depth review on the latest state of empirical research in transaction cost economics (TCE), focusing on single‐industry studies. The intensely discussed subject of operationalization of transaction costs is critically assessed, and a concept of how to increase the quality of findings in empirical studies is presented.Design/methodology/approachThe sample was obtained by a literature research and review in high‐class media and submitted to in‐depth quantitative and qualitative analysis such as content analysis.FindingsThe findings are in part unexpected and substantially contribute to research: applicability of TCE to a broad range of industries is found, the majority being large industries with important markets. Most studies support TCE statements, some suggesting theory extension by complementary aspects. Operationalization of transaction costs remains a field requiring further research.Research limitations/implicationsFirst, this article is condensed and therefore limited to single‐industry studies within TCE, understanding “industry” as a specialized field of activity. The question of industry boundaries may be a base for future research. Second, the subject of operationalization of transaction costs still requires further research.Practical implicationsDecision makers can continue to use TCE for various applications such as strategic alliance, vertical integration, governance choice, make‐or‐buy or contract choice questions. A shortcoming in most articles reviewed is the presentation of the industry's characteristics. Authors need to consider them in order to increase the qualitative level of single‐industry studies.Originality/valueThis paper provides significant insight into the field of single‐industry TCE studies. As a result of penetrating research in high‐class media and in‐depth analysis, the paper provides highly structured and intensely examined statements on existing literature and related findings, which support TCE statements and will lead current disputes in the literature to a further stage.

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“…Attempts to improve profitability by a traditional cost minimisation strategy and by exploiting the large economies of scale-based consolidations have not affected significantly. Thus, the sources of competitive advantage must be searched elsewhere and this requires transforming the companies' strategic orientations and operating under so-called 'green economy' (e.g., Jantunen et al, 2009;Jönsson and Berntsson, 2012;Panwar et al, 2012).…”

Section: The Ppi In Briefmentioning

confidence: 99%

Diversification strategies in the global pulp and paper industry - empirical analysis from years 1996 and 2006

Valtonen

Pätäri

Jantunen

et al. 2015

IJBIR

Self Cite

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Strategic change through diversification is seen to offer potential sources for competitive advantage. On the other hand, there are also many advantages associated to focusing on core capabilities instead of diversification. This article studies how pulp and paper industry (PPI) companies have managed to adjust their diversification strategies in reaction to the changes that have reshaped their operational environment. We will differentiate between related and unrelated diversification, and analyse, how the potential strategic reorientation has affected the profitability of the companies. The sample includes 108 PPI companies and the years to be studied are 1996 and 2006. The results indicate that the PPI companies really have reduced the degree of unrelated and related diversification. Although the strategic change is clear, the profitability effects of diversification were not so explicit. . His current primary areas of research interest are in the resource-based theory, dynamic capability view of the firm and innovation management. He has published about 30 refereed articles, some book chapters and about 50 conference papers.

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Boundary choices in the pulp and paper industry

Cited by 5 publications

References 33 publications

The effects of production outsourcing on factory cost performance: an empirical study

The effects of production outsourcing on factory cost performance: an empirical study

Transaction costs detailed: single‐industry studies and operationalization

Diversification strategies in the global pulp and paper industry - empirical analysis from years 1996 and 2006

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