The Effect of Integrating 1st-tier Suppliers into the Product Development Process on the Environmental Performance : A Study in the German Automotive Industry

Abstract: Title: The Effect of Integrating 1st-tier Suppliers into the Product Development Process on the Environmental Performance – A Study in the German Automotive Industry Background: The research of this paper is based on the topics of 1st-tier supplier integration into the product development process and corporate social responsibility, with the environmental dimension as field of research. Furthermore, the German automotive industry is selected as a sample industry in which research is undertaken. Purpose: This research aims on finding a relation between 1st-tier supplier integration into the product development process and environmental performance. The dyad being examined is manufacturer and their 1st-tier suppliers – from the manufacturer’s point of view. I investigate the effect of supplier integration on the environmental performance in order to see whether the integration concept can support organizations in reaching their goals of customer satisfaction and image preservation. The German automotive industry is being utilized as it is recognized as pioneer industry in order to make an example for other sectors on how to measure 1st-tier suppliers’ environmental performance and how to efficiently integrate them in the manufacturer’s product development with the overall aim of enhancing environmental performance of manufacturers. Method: A qualitative research approach with multiple case studies based on semi-structured interviews has been applied for empirical data collection. The gathered data of three cases has been analyzed in a cross-case synthesis comparing the different cases with each other and with peer-reviewed literature. Results, conclusion: The gathered empirical information showed that German car manufacturers only rarely measure their 1st-tier suppliers’ environmental performance due to close and long-term relationships; additionally, the ISO 14001 standard is a minimum criterion of being a supplier in this industry and some quotes regarding3environmental performance are being forwarded to suppliers by manufacturers. In terms of 1st-tier supplier integration research shows in contrast to literature that the process of integration is not as relevant as other factors such as the supplier, the product and components. Regarding the 1st-tier supplier integration into the product development process affecting manufacturers’ environmental performance, the research at hand has shown a positive correlation. I believe that these results can be an example for other industries and dyads within the industry.