Subcontractors in a partnership environment: a study on changing manufacturing strategy

A clear transition towards long-term and commitment-based supplier-customer relationships is evident among Finnish subcontractors since 1989. This was gleaned from an examination of the development of the subcontracting system among Finnish subcontractors. Findings demonstrate that the development of a subcontracting system in Finland is remarkably similar to the Japanese experience. Changes in the supplier network and the purchasing policy are also shown to affect subcontractors' manufacturing strategy. The success of subcontractors is attributed to the ability to manage inbound logistics and to cooperate with other companies.