Broadening our understanding of interfirm rivalry: A call for research on how supply networks shape competitive behavior and performance

Abstract

In their pursuit of greater performance, firms invariably compete with their rivals for customer demand or scarce resources in factor markets. Firms' competitive behavior—the series of competitive actions taken to create or maintain competitive advantage—thus, is a key predictor of profitability and has received much attention in the strategic management literature. The central tenet of this article is that supply networks and the relationships among firms in these networks fundamentally shape the nature of interfirm competition and, ultimately, firm performance. Although prior research has amply studied the competitive dynamics among (horizontal) rival firms as well as the linkages between supply network characteristics and firm performance, there remain important opportunities to examine how supply networks enable and shape firms' competitive behavior and the effectiveness of their rivalrous activity. The goal of this article, therefore, is to take stock of the advances made in prior literature and to outline topics for future study at the intersection of competition and supply chain management. Collectively, we lay out a comprehensive perspective on the role that supply networks can play in affecting competition that, we hope, will inform and guide efforts to enhance our understanding of firm-level competitive behavior and associated performance outcomes.