The Impact of Electronic Commerce on Buyer-Supplier Relationships in the Korean Electronics Industry

Buyer-supplier relationships are said to be developing toward more collaborative forms based on hierarchical cooperation and away from adversarial forms based on market competition. However, proponents of transaction cost economics (TCE) have predicted that e-commerce would lead to more competitive relationships because e-commerce reduces transaction costs.
Several theories have been employed in formulating the research framework for this study to explain these seemingly contradictory positions. The main underpinning for the conceptual framework of the research is based on the rationale of TCE, the dichotomy between market and hierarchy; while other theories, relational exchange theory (RET) and resource dependence theory (RD F) are used to complement TCE. This integrative view that combines TCE, RET and RDT proposes the research hypothesis that utilization of e-commerce will facilitate a collaborative relationship between buyer and supplier both directly and via the mediating roles of assets specificity, trust and dependence.
A questionnaire-based survey has been carried out into the Korean electronics industry since electronics industries of Korea are well developed, and the business culture of Korean industry is similar to that of other Asian countries. Exploratory factor analysis has been conducted on the data collected by the survey to discover the underlying structure for the questionnaire items. Structural equation modelling using AMOS Graphic 4.0 has been employed to test the research hypothesis.
Focusing on buyers (suppliers) and their key suppliers (buyers) in the electronics industry, this empirical study provides a support for the view that utilization of e-commerce is reconciled with growing tendency toward collaboration as an interaction strategy in an industrial market. This study claims that e-commerce contributes to building a long-term collaborative relationship rather than a transactional exchange for short-term economic gain. In addition, depersonalization caused by e-commerce has not happened yet, and electronic interconnection consolidates assets specificity, trust and dependence and collaborative relationship between trading partners either direct or indirect way.