Supply Chain Portfolio Characteristics: Do They Relate to Post-IPO Financial Performance?

Abstract:In the years following an initial public offering (IPO), firms have to manage portfolios of customers and suppliers in order to achieve growth goals during this particularly uncertain time in a firm’s lifecycle. The current research sheds light on three key questions: (1) Do firms benefit from conducting a large portion of business with a large customer or supplier? (2) Is it beneficial if the focal firm represents a large portion of business for customers and suppliers? And, (3) is balanced portfolio dependence helpful to a focal firm? The extant literature, drawing insights from the logics of power and embeddedness, is divided on these questions. We utilize a secondary data set of focal firms (post-IPO) and their portfolios of relationships with customers and suppliers to explain where each theoretical perspective applies to the management of supply chain portfolios.