Supplier development is an important buyer tool for enhancing supplier performanceand capability. However, it does not come with a guarantee for success. The reportedless-than-expected outcomes of supplier-development are sometimes explained by aone-way view of supplier development based in the buyer’s perspective. The supplier’sperspective is seldom considered. This research does the opposite; it takes its startingpoint in the perspective of the supplier, because, for supplier development to besuccessful, the supplier needs to be both able and willing to respond to a buyer’ssupplier-development effort. Complexities, integral to supplier development, andincentives, are investigated in this research.

Little is known about supplier development beyond the dyad. The supplierdevelopmentmay, however, be affected by what goes on elsewhere in the supplier’ snetwork of buyers or by the need to transfer the supplier development further up thesupply chain. This research investigates supplier development within, as well asbeyond, the dyad.

The purpose of this dissertation is to increase the knowledge of supplier developmentwithin and beyond the dyad, based on the experiences of suppliers.

The dissertation is a paper-based compilation of four empirical papers and astructured literature review of interorganizational supply chain interaction forsustainability. The theoretical lens of agency is applied to support the analysis.

The findings suggest a supplier-development interaction based on buyer power,referred to as hierarchical collaboration. Lack of trust, lack of communication andinformation-sharing, and decoupling between individuals are understood as sourcesof complexities and characterize the supplier-development interaction.

The findings suggest five types of complexities: the complexities of contradictorypractices, decoupled relationships, and contradictory incentives, identified within thedyad, and the complexities of contradictory interests in the supplier’s network ofbuyers and Chinese Whispers and other information asymmetries in multi-tiersupply chains, identified beyond the dyad. The complexities are proposed to hinderthe supplier’s ability or willingness to partake and comply with the supplierdevelopmenteffort. Any supplier noncompliance as a result of complexities withinthe dyad are not considered agency problems, instead, they are suggested to be“principal problems”.

Three incentives are identified: the preferred-supplier incentive, and the contractincentive (buyer-provided incentives), and the customer attractiveness incentive. Thebuyer-provided incentives are understood to disincentivize supplier-developmentcompliance. This directs interest towards incentive alignment and how incentives arepresented to suppliers.