Study On Cooperation Among Enterprises Of Supply Chain Based On The Theory Of Principal-Agent

The market competition has changed fundamentally with the fast development of globalization. The competition of tangible product and service has stepped into the field of intangible culture, technology and brand, while the competition among individual enterprises of the same industry has change into the competition of the supply chains composed of up-and-down stream enterprises. The study shows that effective cooperation of enterprises in supply chain can bring exert an important influence on improving the competitive strength.It is principal-agent relationship among enterprises in supply chain. In the relationship, both the principal and the agent are benefit individuals. They all focus on their own benefits. Furthermore, globalization has caused delay and expansion of product line, which are making information transmission more and more complicated. The principal don't command the individual information compared with the agent, which lead to information asymmetry. The agent can make use of the information advantage to carry out opportunist behaviors. That is the problem of principal-agent. The opportunist behaviors of the agent not only are detrimental to the interest of the principal but exert an influence on the total returns of the supply chain. Furthermore, the behaviors are also unfavorable to the agent's self-development. Therefore, it is key to the survival and development of enterprises in the supply chain to control the principal-agent problem and promote the cooperation.Most of the previous studies and literatures focused on the operation with the aim to solve the operational efficiency of individual enterprise. The supply chain, however, is integrated cooperation of enterprises not the inter-integration of individual enterprise. Therefore, the management of supply chain should extent to the problem of cooperation of enterprises while the field has not been studied deeply.Based on the theory of principal-agent, the paper studies the cooperation of enterprises in supply chain, build the principal-agent model, analyze influential factors of cooperation and their inter-relationships and then propose the development tactics to promote cooperation, which are important for enterprises to optimize the cooperation, adapt to global business and improve survival and competitive strength. There are five sectors in the paper.The first sector is introduction. The sector introduces the background, significance, ideas and structure guided by putting theory into practice, considering both China and foreign countries and combining the past with the present.The sector gives a brief account of cooperation of enterprise in supply chain. Based on defining the supply chain and cooperation, analyze characteristics of supply chain and cooperation, the significance and the rules building the cooperative relationship and the status quo. The paper finds out that fine cooperation is key to the development of supply-chain enterprises'business and also there are a lot of problems of principal-agent among Chinese supply-chain enterprises which are unfavorable for the survival and development of cooperation.The third sector analyzes the use of principal-agent theory in supply chain and the enterprise in it. Based on the theory, analyze the concrete the problem of principal-agent and the reasons which cause it. Then build the principal-agent model and work out the influential factors which provide the theoretical base for the tactics of promotion of cooperation. Analyze how Honder cooperated with suppliers which test and verify the rationalization of the model and provide practical example.The fourth sector shows the tactics to develop the cooperative relationship. The paper proposes the tactics with the aim to reduce the problems of principal-agent and promote the cooperation. Governments perfect relative policies in order to guarantee the cooperation. The cooperative enterprises should strengthen inter-management, choose cooperators carefully, build the evaluation system of performance, introduce effective incentive system, further mutual trust and share information in order to create favorable conditions for cooperation.The final sector sums up the conclusion. It is key to carry out supply chain strategies for enterprises to reduce the principal-agent problem, promote effective cooperation and then strengthen the competitive advantage. Directed by the theory, enterprises should adopt the tactics of promoting cooperation to control the principal-agent and then improve the competitive power of the supply chain, which can enable them to get the competitive advantages in the market.