Introduction
Competitive forces are putting firms under pressure to improve quality, delivery
performance, and responsiveness while simultaneously reducing costs. In response,
firms are increasingly exploring ways to leverage their supply chains, and in
particular, to systematically evaluating the role of suppliers in their activities. One
result has been the increased outsourcing of activities not considered to represent core
competencies (Prahalad and Hamel, 1990). This enables firms to better utilize their
resources, increasing the value added attributable to them. It also allows them to be
more flexible and responsive to changing needs. Moreover, outsourcing allows firms to
exploit the capabilities, expertise, technologies, and efficiencies of their suppliers.
Increased outsourcing, however, implies greater reliance on suppliers and a
commensurate need to manage the supplier base. This has for some companies