The purpose of this paper is to focus on the ambiguous relationship of information and communication technologies (ICT) in the relationship between small suppliers and their multinational enterprise (MNE) customers.
This is a literature review paper which develops a conceptual model of IT‐mediated relationships between small suppliers and large MNE customers. The framework integrates transaction cost economics (TCE) and resource based theory (RBV) perspectives and argues that ICT integration both facilitates coordination and monitoring but also impacts on partner opportunism. It is argued that ICT integration can enhance supplier performance given certain circumstances.
The paper clarifies the ambiguous nature of the power‐dependence relationship between small suppliers and their multinational customers.
ICT both facilitates the governance relationship, balances the power between these key players but also heightens ability to exert control, which is a paradoxical effect.
