Conclusion

---

An examination of multiple empirical studies has revealed that sourcing has so far mainly been uni-regional orbi-regional and not as global as is commonly thought. Neither does the internal organization of sourcing conform well to the global model, which suggests a strong functional integration across borders. In fact, the more appropriate view is to see every sourcing strategy as a balancing act between the local and the global, which is strongly determined by differences between buyer and supplier in three categories: geography, relation and environment. How big the differences between buyer and supplier are, and how important these differences are to the product under consideration, will determine the feasibility of a particular strategy. IT is a useful way to decrease those inhibitors to internationalization of the supply base and functional integration that are related to geography or located within the buyer-suppler relation. However, IT will not influence environmental inhibitors to global sourcing, and especially not the institutional inhibitors in the environment. As the degree of international sourcing increases, firms will actually have to face these inhibitors more often. The case studies of Ikea and Ford confirmed all of these propositions. Learning how to deal with these environmental inhibitors when setting up global electronic sourcing is a key managerial capability. Future research should address how management can develop this capability.

Another issue that should be addressed in future research is how global information systems can be supported by an equally global management structure and culture that includes an integrated sourcing function. Management should not only focus on the opportunities that global integration provides, but be equally concerned about the consequences of local behavior. This may require firms to go further than simply instructing their own employees about desired behaviors. The Ikea case showed that firms that forget to manage beyond the first tier of suppliers are bound to run into trouble at some point. Since ethical and regulatory demands upon foreign firms are usually greater than upon local firms, and being multinational severely increases organizational complexity (Kostova & Zaheer, 1999), a wider range of tools has to be developed. From a research perspective it may be interesting to look at the interaction between global information systems and global management practices and how it develops over time.

Another interesting avenue for future research concerns the impact of the Internet on sourcing relations. Ford is working in new ways to improve the information exchange with its suppliers and reduce transaction costs. It participated in ANX, the Automotive Network Exchange, and is now collaborating with multiple competitors to build more advanced electronic marketplaces in the Covisint initiative. It is interesting to note that those efforts are still implemented on a region-by-region basis. Starting with the U.S. these systems are slowly expanding to Europe and Asia, often in an adapted form. The Internet era raises interesting research questions. Perhaps it is true that the Internet opens up the opportunity to look for the best possible sources in the world, but do firms subsequently use that opportunity? Or, alternatively, do they continue to expand on the basis of their existing social networks (Rangan, 2000)? Only empirical testing can resolve that debate but it seems unlikely that local networks will suddenly become unimportant. Thus the question is, in what situations will local networks remain of importance? This article has pointed at the importance of analyzing environmental pressures to answer that question. The local and the global continue their struggle.

---