Building global logistics competence with Chinese OEM suppliers

In today's global economy, Chinese manufacturer networks serve as an important manufacturing base for many goods. Leading companies in those industries inevitably cooperate with Chinese manufacturers to build their global logistics capability to serve increasingly demanding customers worldwide. Many scholars have noted that guanxi (connections) relationships are a key practice of doing business with the Chinese. This paper presents a theoretical framework and empirical evidence on how to enhance global logistics competence by leveraging guanxi relationships with Chinese suppliers. Relationship development or network building between organizations is critical for corporate success in all parts of the world, not just in Chinese society. Results suggest that resource integration, manufacturing flexibility, and IT infrastructure capacities are positively associated with global logistics competence. The impacts of information sharing and asset specificity on global logistics competence are not significant. It is interesting that we found that guanxi serves as a moderating influence and it interacts with information sharing, resource integration, and manufacturing flexibility. Managerial implications are also discussed.