Explaining Supplier Behavior On Global Account Management

Explaining Supplier Behavior On Global Account Management

By David Bruce Montgomery, George S. Yip, Belen Villalonga
2002Working Paper No. 1767

Using globalization and contingency theory, this paper develops a supplier-based model of global account management (GAM). The model comprises the multinational suppliers industry globalization drivers, the multinational customers extent of globally coordinated buying, such customers demand for GAM services, the suppliers response in terms of using various aspects of GAM, and resulting possible improvement in the suppliers performance. The paper develops six hypotheses linking these variables. Data on various aspects of these variables were collected in a survey of 191 executives in multinational companies. Two related models are estimated from these data using a structural equations method. The results support the argument that the suppliers industry globalization drivers play a key role in affecting customers demand for GAM services, and that suppliers implementation of GAM leads to significant performance improvements