Developing the Concept of Transparency for Use in Supply Relationships

Management concern surrounding the supply of goods and services from business to business, and the related attempts to understand the phenomena observed therein, appears to rest upon a broad range of incompatible perspectives, from political science (often limited to considerations of power) to the logistical (akin to manipulation of a great, benign but dynamic jigsaw puzzle). It appears that all perspectives abrade against the difficulties of exchanging information, knowledge and innovation within the relationships between buying and selling organizations and the apparent chronic systemic inefficiency that transactions often represent in this context. This article addresses these concerns, exploring the concept of transparency and the developments necessary for it to be useful in exchanging sensitive information and tacit knowledge in supply relationships. Our central concern is how the understanding of transparency and its commercial importance may change when it is expressed as a manageable element of the relationship between two organizations rather than as a general property of a broader system (e.g. a supply network, industrial sub‐sector, geographical cluster) and what utility this differentiation might hold for managers. The conclusion to the article, and the implication for managers, is that transparency might indeed be created and usefully managed within supply relationships but that it would differ fundamentally in meaning from previously posited concepts, with the same name, in different contexts.