Article: Re-examining the structure of supplier stratification matrix: a focus on differential value and relationship Journal: International Journal of Procurement Management (IJPM) 2014 Vol.7 No.2 pp.219 - 237 Abstract: This paper explores current empirical practice in supplier stratification management, focusing on how suppliers are stratified and how to manage these supplier segments differentially by using common evaluation criteria. Using information gathered through interviews of senior managers of supplier relationship management from 15 companies and extensive literature search, this paper proposes a new framework on supplier stratification that addresses the weakness in existing stratification conceptualisation. A survey was also conducted to evaluate the relative importance placed on different evaluation criteria when evaluating different supplier segments. Factor analysis reveals that all these evaluation criteria are indeed determined by two factors: purchasing value and relationship. Our analyses further show that, for purchasing value: strategic suppliers have the highest value, followed in decreasing order by custom, collaborative, and finally commodity suppliers. For relationship: strategic suppliers are distinctly the most important segment, followed by collaborative and custom suppliers, and finally commodity suppliers. Inderscience Publishers - linking academia, business and industry through research

Title: Re-examining the structure of supplier stratification matrix: a focus on differential value and relationship

Authors: Xiaoming Li; Festus Olorunniwo; Joel Jolayemi; Chunxing Fan

Addresses: Department of Business Administration, Tennessee State University, 330 10th Ave. N., Nashville, TN 37203, USA ' Department of Business Administration, Tennessee State University, 330 10th Ave. N., Nashville, TN 37203, USA ' Department of Business Administration, Tennessee State University, 330 10th Ave. N., Nashville, TN 37203, USA ' Department of Business Administration, Tennessee State University, 330 10th Ave. N., Nashville, TN 37203, USA

Abstract: This paper explores current empirical practice in supplier stratification management, focusing on how suppliers are stratified and how to manage these supplier segments differentially by using common evaluation criteria. Using information gathered through interviews of senior managers of supplier relationship management from 15 companies and extensive literature search, this paper proposes a new framework on supplier stratification that addresses the weakness in existing stratification conceptualisation. A survey was also conducted to evaluate the relative importance placed on different evaluation criteria when evaluating different supplier segments. Factor analysis reveals that all these evaluation criteria are indeed determined by two factors: purchasing value and relationship. Our analyses further show that, for purchasing value: strategic suppliers have the highest value, followed in decreasing order by custom, collaborative, and finally commodity suppliers. For relationship: strategic suppliers are distinctly the most important segment, followed by collaborative and custom suppliers, and finally commodity suppliers.

Keywords: supplier segmentation; supplier stratification; supplier relationships; procurement; supply chain management; SCM; purchasing value; relationships; interview; survey-based research; factor analysis; supplier relationship management.

DOI: 10.1504/IJPM.2014.059558

International Journal of Procurement Management, 2014 Vol.7 No.2, pp.219 - 237

Published online: 30 May 2014 *

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Title: Re-examining the structure of supplier stratification matrix: a focus on differential value and relationship

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