The impact of suppliers’ empowerment on innovative co-designs and the role of market intelligence: analysis case study of beverage production companies in Iran

Introduction: Nowadays, the business environment has become a complex and competitive environment and has caused managers to face many operational challenges such as access to global resources, long supply chains and the need for customized production of products. Thus, communication with suppliers has become a strategic asset for the survival of organizations. Firms strive to build partnerships with suppliers in order to gain operational efficiency and effectiveness in the supply chain. The empowerment of suppliers is a business process for managing all the communication between organizations and suppliers. According to many researchers, the empowerment of suppliers can help to design, develop or re-engineer a product or process. In fact, when suppliers are involved in product designing, their sense of ownership is enhanced and they are more likely to add value to their interaction with the company. Therefore, empowering and involving suppliers when designing a product is one of the most important strategies of innovative companies in today's business environment.
Methodology: The present research is applied in terms of purpose and descriptive-correlative in terms of data collection. In this study, 468 managers and experts at the central offices of beverage companies based in Tehran were selected as the statistical population, of whom 214 were selected as a random class according to Morgan table. In addition, library studies and field methods including the use of questionnaires served to collect the data. In order to measure the Supplier Empowerment variable, Lee and Koo questionnaire (2016), Falconnier innovative co-design questionnaire (2017) and Heppes & Toit market intelligence questionnaire (2009) were used. The data analysis was performed by the SPSS and Smart Pls software programs and structural equations.
Results and Discussion: In this study, four hypotheses were proposed to examine the relationships among the variables. Since the value of the t-statistics for the first hypothesis (5.301) was more than 1.96 and the significance level (0.001) was less than 0.05, the suppliers empowerment with a coefficient of 0.211 had a positive and significant effect on the innovative co-design. In other words, sharing knowledge and information, partnership in product designs, signing long-term contracts and creating an atmosphere of mutual trust and confidence can synergize innovative efforts to design new products and increase the competitiveness of companies.
The second hypothesis was confirmed because the value of the t-statistic (10.262) was more than 1.96 and the significance level (0.000) was less than 0.05. It can be concluded that supplier empowerment with a coefficient of 0.506 has a positive and significant effect on market intelligence. In other words, participation in product designing, sharing knowledge and information and consulting for the selection of raw materials lead to the continuous monitoring of the business environment and the awareness of market trends and brings more market intelligence to the company.
The third hypothesis was also confirmed with the t-statistic of 9.479 which was more than 1.96 and the significance level of 0.000 which was less than 0.05. It can, thus, be concluded that market intelligence with a coefficient of 0.525 has a positive and significant effect on innovative co-design. In other words, variables such as awareness of customers’ tastes, competitors' strategies and government policies in the field of business lead to the increased market intelligence of organizations and the convergence of efforts to design new products and services.
The fourth hypothesis, which examined the mediating role of market intelligence in suppliers’ empowerment and innovative co-design, was confirmed in Baron and Kenny's terms. In other words, those beverage companies that establish strong relationships with reliable suppliers through long-term contracts, participate in the design of products and services, join ventures in the purchase and transfer of technology and share knowledge and information permanently can monitor market trends, competitors, customers and government policies in the field of business and thus turn to innovative designs in response to environmental variables.
Conclusion: In the highly competitive non-alcoholic beverage industry, those manufacturers who share knowledge and information with suppliers, consult them in the selection of raw materials, and participate in product design and technology investment with suppliers can achieve competitive advantage in the market through joint and innovative designs. In fact, innovative co-designing between suppliers and manufacturers, which leads to synergistic efforts, requires an intelligent approach to the market and the monitoring of the variables affecting it. Also, empowered suppliers can present their products according to the wishes of manufacturers. In fact, well-known brands in the beverage industry create value by fixing efficient contracts with a range of suppliers and empower them to produce according to parent company standards.