Supplier and Buyer Networks

Abstract Many discussions of “Japanese business practices” center around the complex and (by Western standards) unusual manner in which Japanese manufacturers are thought to deal with their suppliers. Many anecdotal accounts of Japanese practice paint a picture of a tightly woven web characterized by elevated levels of service, innovation, and efficiency. These impressive results of Japanese buyer-supplier transactions are usually achieved with little of the well-publicized rancor that often characterizes the ever-changing lineup of players in many conventional supplier-buyer transactions. It is tempting to conclude that Japanese buyer-supplier relationships operate as smoothly as though everyone involved worked for the same company. However, that conclusion is tempered by the observation that such results are not often achieved even when it really is all one company. Obviously, not all Japanese supplier-buyer relationships are as successful as the growing mythology of Japanese management prowess would have it. Yet so many Japanese buyer-supplier relationships achieve such impressive results that the thoughtful manager must ask how they do it.