Supply Chain Reorganization and Coordination

Three generic forms of governance——hierarchy, hybrid and market are proposed in the new institutional economics, giving an abstract description of alternative coordination and control mechanisms for general use. While this theory is known as far away from being operational and specified, a few researchers in the management and organization area are trying to extend Galbraith′ and/or Mintzberg′s organizational design theories into the application of logistical coordination for obtaining a smooth flow of products along the supply chain within and without the focal organization. In this paper, we present an explorative case study on the design of various organizational architectures of logistics activities and their relevant coordination mechanisms, especially internal and external contracts as one new kind of hybrid mechanisms for coordinating effective supply chains.