Discuss the Role of International Contract

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Introduction As the global market perpetuates itself, business survival hinges on a company's ability to compete globally. To maintain market competitiveness, companies are actively looking beyond their national boundaries to source for components and/or finished goods (Rajagopal & Bernard, 1994) and continuously searching to integrate and streamline business activities with its suppliers to improve supply chain responsiveness (Toni et al, 1994). According to Burt et al (2003), such buyer-supplier collaboration requires the companies to proactively manage its supplier management as well as the contract management that administer the terms of the business relationship with its suppliers. Business relationships between separate organisations involved some degree of agreement to exchange goods, services or information and such relationship can be stabilized through a contract (Frankel et al, 1996). Skipper (1999) illustrated that a contract is an agreement that defines a relationship between one or more parties and a contract may be in verbal or written form. Meanwhile, Van Den Heuvel & Weigand (2000) went on further to illustrate that contracts are used to explicit the commitments made between the parties and are often used to prescribe the coordination between the business workflows. Hsiao et al (2002) added on to exemplify that a contractual agreement specify the obligations and roles of both contracting parties in the relationship. Contracts can be managed through either formal or informal mechanism (Skipper, 1999). While formal mechanism are through the use of written document or agreement, informal contract, on the other hands, are unwritten agreements between the parties which are enforce not by legal suit but by mainta... ... middle of paper ... ...ssary/contracts.html Stegink, L. A. (2004). Negotiating international meeting contracts. MeetingsNet, Corporate Meetings & Incentives. May. [Online]. Available http://cmi.meetingsnet.com Toni, A. D., Nassimbeni, G. & Tonchia, S. (1994). New trends in supply environment. Logistics Information Management. 7(4), 41-50. Van Den Heuvel, W. J. & Weigand, H. (2000). Cross-organisational workflow integration using contracts. Business Object Component Workshop. Tilburg, The Netherlands: Tilburg University, INFOLAB. [Online]. Available http://www.jeffsutherland.com/oopsla2000/vandenheuvel/vandenheuvel.htm Wong, Y. H. & Leung, T. K. P. (2001). Guanxi: relationship marketing in a Chinese Context. New York: The Haworth Press.

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