Cooperating and competing in supply networks: Making sense of a triadic sourcing strategy

This paper introduces the concept of a “triadic sourcing strategy”. Triadic sourcing is a way for buying companies to nurture and benefit from cooperation and competition between two suppliers with partially overlapping capabilities. In contrast to hybrid sourcing strategies outlined in the literature-parallel and network sourcing—the distinctive feature of triadic sourcing is that the buyer actively creates interdependencies between two suppliers. To illustrate this principle and the characteristics of triadic sourcing, Volvo Cars’ use of two suppliers of seats is described. The paper asserts that triadic sourcing is a dynamic sourcing strategy that contributes to efficiency and innovation for the buyer and the two suppliers, together forming a triad that is subject to firm interdependence and network embeddedness.