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The effects of supplier capabilities on industrial customers' loyalty: The role of dependence

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Abstract

This research examines whether suppliers’ capabilities impact OEM customers’ dependence on the supplier and thereby generate customer loyalty. Using a sample of purchasing managers focusing on a single key component supplier, we examine three supplier capabilities, two dependence dimensions, and three aspects of customer loyalty. Core offering capability increases the customer firm’s benefit-based dependence. Operations capability has a more comprehensive effect, enhancing both benefit-based and cost-based dependence. Benefit-based dependence leads to relational loyalty and, through its effect on relational loyalty, to insensitivity to competitive offerings and future purchase expansion. Cost-based dependence motivates insensitivity to competitive offerings, but does not affect relational loyalty or purchase expansion. The supplier’s communication capability is associated with relational loyalty, but this effect does not flow through the customer firm’s dependence. The divergent pattern of antecedents and effects of benefit-based dependence and cost-based dependence may explain the inconsistent and insignificant research findings in previous research on dependence. Our results suggest that adopting a bi-dimensional model of dependence more fully captures the theoretical domain of dependence, thereby permitting researchers to better examine its role in supply chain, channel, and marketing relationships. KeywordsBusiness to business relationships-Loyalty-Dependence-Supplier–buyer relationships-Marketing capabilities

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... Drawing on resource-dependence theory (RDT), we suggest that manufacturers with a wellestablished dependence advantage, due to their core resources and capabilities, are less likely to acquiesce. Building on the work of Scheer, Miao, and Garrett (2010), we identify industrial knowledge and technological capabilities perceived by buyers as two essential types of resources that enable manufacturers to cultivate buyer dependence by providing high conformance quality and rapid solutions. RDT suggests that in business networks, a party's dependence advantage can be challenged by a coalition formed by others (Emerson 1962). ...
... RDT identifies two forms of dependence based on their origins: value-based dependence, which arises from the unique irreplaceable value obtained from a particular relationship, and cost-based dependence, which arises from the anticipated latent costs that may occur once the relationship terminates (Scheer, Miao, and Garrett 2010). According to Olavarrieta and Ellinger (1997), firms can establish a dependence advantage by cultivating core competencies. ...
... According to Olavarrieta and Ellinger (1997), firms can establish a dependence advantage by cultivating core competencies. Scheer, Miao, and Garrett (2010) further identify operational capability and core offering capability as a manufacturing firm's core competencies. Operational capability refers to a manufacturer's ability to identify and solve problems quickly, while core offering capability refers to the ability to offer products or services that meet customer needs and have a high level of conformance quality. ...
Article
Purpose: This study examines a three-level interdependent hierarchical supply chain and explores the antecedents and consequences of a manufacturer’s acquiescence to a buyer’s request to source a component from a designated component supplier. Methodology: This research collected survey data from 212 Chinese mining companies and analyzed the data using structural equation models. Findings: First, a manufacturer’s acquiescence is negatively associated with its industrial knowledge and technological capability as perceived by the buyer, but positively correlated with the relational ties between the buyer and the designated component supplier. Second, the detailing efforts strengthen the impact of perceived industrial knowledge but weaken that of relational ties on acquiescence. Third, the manufacturer’s acquiescence ensures the buyer’s power maintenance and procurement outcome certainty, and improves the manufacturer’s customer loyalty and control of sourcing information. Research implications: The research highlights the significance of understanding acquiescence within an interdependent supply chain network and indicates that acquiescence will not necessarily lead to the acquiescing firm’s dependence disadvantage. Practical implications: The research suggests that firms can use acquiescence to preserve interdependent supply chain relationships. When deciding whether to acquiesce or not, firms should consider not only the market perceptions of their resources and capabilities but also the supply chain networks. Detailing can be an effective method to reduce the pressure for acquiescence. Originality: In the context of a manufacturer’s sourcing decisions, the research provides fresh insights into acquiescence in a three-level hierarchical supply chain relationship.
... Extensive research by scholars has conducted on this topic. They examined the direct and indirect effects of dependence on various aspects, including interfirm trust (e.g., Jia and Yang 2021), governance choices (e.g., Lee and Zhong 2020), alliance performance (e.g., Chen and Wang 2020), intention to adopt B2B e-commerce (e.g., Alsaad, Mohamad, and Ismail 2019), establishing coordinated partner relationships (e.g., Clark, Scholder, and Boles 2010), satisfaction (e.g., Razzaque and Boon 2003), loyalty (e.g., Scheer, Miao, and Garrett 2010), relationship-specific investments (e.g., Dong, Zeng, and Su 2019), performance in the procurement relationship (e.g., Gulati and Sytch 2007), the search for alternatives (e.g., Eggert and Ulaga 2010) and conflict (e.g., Zhou, Zhuang, and Yip 2007). ...
... Studies which operationalized inter-firm dependence as multidimensional constructs, such as Scheer, Miao, and Garrett (2010) and Huo et al. (2017) failed to distinguish passive dependence from active dependence. Scheer, Miao, and Garrett (2010) classified dependence into beneficial versus cost dependence. ...
... Studies which operationalized inter-firm dependence as multidimensional constructs, such as Scheer, Miao, and Garrett (2010) and Huo et al. (2017) failed to distinguish passive dependence from active dependence. Scheer, Miao, and Garrett (2010) classified dependence into beneficial versus cost dependence. Beneficial dependence measures the irreplaceability of the value brought by a relationship, while cost dependence measures the switching costs of replacing a relationship. ...
... Dependence, as a unidimensional construct, reflects the vulnerable party's motivation to maintain the exchange relationship [38]. The global dependence measure concentrates on the extent of dependence, but it is incapable of explaining why one party depends on its partner and reveals nothing about the configuration or nature of that dependence [39,40]. To address this research gap, recent studies suggest that dependence should be divided into benefit-based dependence and cost-based dependence, representing positive and negative motivations to maintain the current relationship, respectively [40]. ...
... Benefit-based dependence is defined as the positive motivation of one party to maintain the exchange relationship with its partner [40], arising when benefits generated by the current exchange relationship cannot be replaced by other alternatives [39]. Previous research has found that relationship satisfaction is a salient antecedent of a party's positive motivation to depend on the relationship with its partner, such as customer dependence [48], loyalty [49], and word-of-mouth recommendations [50]. ...
... Previous research argues that benefit-dependence will lead to a long-lasting exchange relationship [39]. In an incubated startup-entrepreneurial incubation platform exchange, incubated startups who are dependent on the incumbent platform for supe-rior entrepreneurial benefits are inclined to perceive competitive values [52] and experience the enjoyment of entrepreneurial goal fulfillment [53]. ...
Article
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In recent years, despite the rapid growth in the number of entrepreneurial incubation platforms in China, many of them are experiencing the sustainability dilemma caused by the loss of incubated startups. However, there is a dearth of research that explores how to promote incubated startups’ continuance intention towards entrepreneurial incubation platforms. Addressing this gap, the present study develops a dedication–constraint model based on the dual model framework, investigating the distinct impacts of entrepreneurial support and relationship-specific investment on incubated startups’ continuance intention towards entrepreneurial incubation platforms. A sample of 534 incubated startups in China was employed to test the research model, and the structural equation modelling was adopted for data analysis. Empirical results indicate that the dedication-based mechanism and constraint-based mechanism simultaneously, yet differently, affect incubated startups’ continuance intention towards entrepreneurial incubation platforms. Specifically, in the dedication-based mechanism, social support and technical support are revealed as the antecedents to relationship satisfaction that significantly leads to benefit-based dependence. As for the constraint-based mechanism, setup activity is the only salient indicator to termination costs, which consequently has a positive effect on cost-based dependence. Incubated startups’ continuance intention towards entrepreneurial incubation platforms is influenced by both benefit-based dependence and cost-based dependence, ultimately.
... Relationship investment not only offers customers additional benefits and value, but also produces barriers or costs for customers' switching behavior (Al-hawari, 2014; Pick and Eisend, 2014). Based on motivation theory, relationship benefit and switching cost are the two crucial elements for a person-firm relationship, and furthermore drive the positive or negative motivation of customers to establish and maintain their business relationship with the service provider (Scheer et al., 2010). Thus, the nature of dependence customers perceived can be based on positive motivation due to the inherent benefits or based on negative motivation such as switching costs (Scheer et al., 2010;Najafi-Tavani et al., 2020). ...
... Based on motivation theory, relationship benefit and switching cost are the two crucial elements for a person-firm relationship, and furthermore drive the positive or negative motivation of customers to establish and maintain their business relationship with the service provider (Scheer et al., 2010). Thus, the nature of dependence customers perceived can be based on positive motivation due to the inherent benefits or based on negative motivation such as switching costs (Scheer et al., 2010;Najafi-Tavani et al., 2020). Following Scheer et al. (2010), our research adopts their decomposition of the overall customerperceived dependence into two components, namely the relationship-value dependence (RVD) and switching-cost dependence (SCD). ...
... Thus, the nature of dependence customers perceived can be based on positive motivation due to the inherent benefits or based on negative motivation such as switching costs (Scheer et al., 2010;Najafi-Tavani et al., 2020). Following Scheer et al. (2010), our research adopts their decomposition of the overall customerperceived dependence into two components, namely the relationship-value dependence (RVD) and switching-cost dependence (SCD). The former concerns a customer's need to maintain a relationship with a service provider due to the unique value or irreplaceable benefits associated with its core offering or operations capability. ...
Article
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Service failure is almost inevitable with the intensifying competition in the service market and expectation of heterogeneous customers. The customer–firm relationship can significantly influence customers’ subsequent attitudes and behaviors to the service provider when they encounter service failure. This study proposes a theoretical model to examine how customer-perceived dependence affects their forgiveness toward a service failure in attribution logic. According to an experiment with 138 and a survey with 428 commercial bank customers, we used a multivariate approach to validate our model. The results show that relationship-valued dependence (RVD) leads to external attribution, which is positively related to customer forgiveness. In contrast, switching-cost dependence (SCD) leads to internal attribution, which is negatively related to customer forgiveness. The relationship length is a relevant contextual factor that acts as a negative moderating factor. Our study contributes to the service recovery literature by elucidating the underlying process of forgiveness with the presence of the customer–firm dependence relationship.
... This paper focuses on the Brazilian logistics services sector to answer the following research question: What are the effects of dependence based on benefits between buyer and supplier and supplier satisfaction? Benefit-based dependence is understood to be the need to maintain the relationship because a company cannot replace the benefits that derive from the current relationship with another partner (Scheer, Miao, & Garrett, 2010;Vázquez-Casielles, Iglesias, & Varela-Neira, 2017). In this study, data were collected from shippers and third-party logistics (3PLs). ...
... In this study, we used the classic conceptualization of dependence by Emerson (1962) and the twodimensional dependence model by Scheer, Miao and Garrett (2010). For Emerson (1962), interdependence is composed of mutual dependence, or the sum of the actors' dependencies, the dependence asymmetry, or the difference in the dependencies of the actors. ...
... Thus, the interorganizational dependence study requires the adoption of a bilateral view, taking into account the buyer and supplier dependence. Kumar, Scheer and Steenkamp (1998), Scheer et al. (2010) and Vázquez-Casielles, Iglesias and Varela-Neira (2017) identify two distinct components of dependence that constitute different reasons why a part can maintain its relationship with a current partner. Benefit-based dependence is the need for a part to maintain its relationship with an exchange partner because of the irreplaceable and unique value that would be lost if that relationship ended (Scheer et al., 2010;2015). ...
Article
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Context studies argue that similar levels of dependence are essential for supplier satisfaction in buyer-supplier relationships. However, asymmetric relationships can also lead to supplier satisfaction. Objective this paper investigates the effects of benefit-based dependence (positive motivations for maintaining relationships) between buyer and supplier and supplier satisfaction. Methods response surface analysis (RSA) was used to test the relationship between third-party logistics (3PL) dependence and satisfaction dimensions in 174 dyads. Results the results demonstrated that about supplier satisfaction, instead of dependence asymmetry what really matters is the degree of dependence between the parties. The more dependent one part is on the other, usually, the greater the supplier’s satisfaction. In many circumstances, a degree of dependence is acceptable and necessary to access resources and opportunities. Conclusions the interaction between buyer and supplier dependence and supplier satisfaction is complex. Situations of dependence asymmetry in which the supplier is highly dependent on the buyer may still be satisfactory. Keywords: dependence; satisfaction; RSA; 3PL; outsourcing
... Firms are increasingly dependent on the capabilities and critical resources of their key suppliers to help develop the buying firm's capabilities and performance (Koufteros et al., 2012). A buyer's dependence on its key supplier is partly a result of the firm's strategic decision to access the critical resources and capabilities it needs beyond its boundaries (Scheer et al., 2010). For example, the desire to develop an ability to respond quickly to consumers' preferences leads firms to heavily rely on their suppliers' responsiveness (Wathne and Heide, 2004). ...
... For example, the desire to develop an ability to respond quickly to consumers' preferences leads firms to heavily rely on their suppliers' responsiveness (Wathne and Heide, 2004). As the product life cycle is getting shorter (Slater and Narver, 2000), the supplier's capability is increasingly important for the buying firm (Scheer et al., 2010). Superior resources and capabilities allow suppliers to recognize and implement buying firms' desired changes, creating value for the buying firms and increasing their dependence (Scheer et al., 2010). ...
... As the product life cycle is getting shorter (Slater and Narver, 2000), the supplier's capability is increasingly important for the buying firm (Scheer et al., 2010). Superior resources and capabilities allow suppliers to recognize and implement buying firms' desired changes, creating value for the buying firms and increasing their dependence (Scheer et al., 2010). In this study, we identify the buyer's dependence as a reflection of a supplier's criticality to the buyer's operations. ...
Article
Purpose Buyer’s dependence on its key supplier for critical resources and capabilities is generally considered as creating a disadvantageous position for the buyer and undermining its business performance. This study aims to invoke arguments from resource dependence theory (RDT) to examine if this adverse effect of buyer’s dependence is moderated by the buyer’s absorptive capacity and a long-term relationship with the key supplier. Design/methodology/approach Using a data set drawn from 204 manufacturing firms in Australia, this study tested the proposed model using hierarchical moderated regression analysis. Findings The finding shows that buyer’s dependence on its key supplier by itself has no significant effect on the buyer’s business performance. However, the link between buyer’s dependence on its key supplier and performance is positively moderated by the level of the buyer’s absorptive capacity, as well as by the joint effect of buyer’s absorptive capacity and a long-term relationship with the key supplier. Practical implications As buyer’s dependence is often difficult to avoid, the finding of this study is instructive in showing managers how to strategically mitigate the effect of their firm’s dependence on a key supplier; indeed, turn it into a positive outcome. Originality/value This is the first study, which integrates the internal and external resources in mitigating the effect of buyer’s dependence on the supplier.
... Nowadays, a shorter delivery lead time is an important functional performance that customers seek from their suppliers and therefore a critical criterion in the supplier selection (Cormican and Cunningham, 2007;Nair et al., 2015). Strong delivery performance allows the supplier to implement the customer's desired changes and to create unique benefits for the customer, thus increasing the customer's benefit-based dependence (Flint et al., 2002;Scheer et al., 2010). Suppliers offering short lead time in transactions differentiate themselves by improving their functional customer value, making them attractive to new customers and being able to foster customer loyalty (Bianchini et al., 2019;Scheer et al., 2010). ...
... Strong delivery performance allows the supplier to implement the customer's desired changes and to create unique benefits for the customer, thus increasing the customer's benefit-based dependence (Flint et al., 2002;Scheer et al., 2010). Suppliers offering short lead time in transactions differentiate themselves by improving their functional customer value, making them attractive to new customers and being able to foster customer loyalty (Bianchini et al., 2019;Scheer et al., 2010). Delivery lead time is also an important consideration when it comes to using resources efficiently, keeping production moving as efficiently as possible and optimizing the order fulfillment process. ...
Chapter
Seller indicators are becoming the new norms on digital platforms. Yet, B2B seller firm indicators have not been widely examined in academic studies. For instance, Alibaba uses supplier online performance index (SOPI), a data-driven indicator of business performance, to measure presentation quality, product popularity, transaction volume, and service quality (Alibaba, n.d.).Signaling theory holds when parties (individuals or organizations) in an exchange have access to different kinds and degrees of information. Besides signaling theory, a relevant research topic for this paper is trust. Trust development in a digital platform has more barriers for B2B sellers to overcome because of the high degree of uncertainties and trading risks (Kim & Ahn, 2007; Pavlou & Gefen, 2004). In the context of B2B seller firm indicators on digital platforms, transaction level indicators (e.g., Alibaba’s SOPI indicators) can be useful ways for buyers to establish observable and credible signals.Secondary data from Alibaba was collected in 2020. After cleaning, there were a total of 220 B2B seller firms in the electronics industry covering multiple product categories. Multiple regressions and mediation analyses using SPSS 27 were conducted to test our proposed hypotheses. The results indicate that both transaction level and WOM volume were significant predictors of total numbers of transactions. There is a full mediation of transaction level on the total number of transactions through WOM volume.We propose that seller indicators are important trust signals of B2B firms on digital platforms. Buyers can perceive seller firm indicators as trust signals positively through the number of reviews, which further impacts seller business performance. This study contributes to the marketing literature by revealing that the relationship between seller indicators and business performance is fully mediated by WOM volume. B2B digital platforms generally incorporate a variety of mechanisms for suppliers to convey information to prospective buyers to mitigate information asymmetry to facilitate online transactions.KeywordsTrust signalsB2B buyer-seller relationshipFirm indicatorsDigital platforms
... Research over the past three decades firmly establishes that (i) SCM plays a significant role in corporate strategy (e.g., Ellram & Carr, 1994;Fawcett et al., 2011) and (ii) capabilities are foundational to supply chain strategy (e.g., Liao et al., 2017;Morash, 2001). While SCM scholarship strongly supports these notions and emphasizes the importance of different types of SCM capabilities for firms (e.g., Krause, 1999;Lynch et al., 2000;Morash et al., 1996;Scheer et al., 2010;Weigelt, 2013), research in the information systems (e.g., Grover & Kohli, 2012;Rai et al., 2006), management (e.g., Eisenhardt & Martin, 2000;Grant & Baden-Fuller, 2004), and marketing (e.g., Day, 1994;Selnes & Sallis, 2003;Swaminathan & Moorman, 2009) disciplines also emphasize the importance of relevant capabilities for SCM effectiveness. Consistent with capabilities-based research in the neighboring business disciplines, SCM research also suggests and/or finds strong positive results for the impact of different types of capabilities on firm performance (e.g., Krause, 1999;Liao et al., 2017;Rajaguru & Matanda, 2019;Tang & Rai, 2012). ...
... Research across the business disciplines either suggests and/or finds strong positive results for the impact of different types of capabilities on firm performance outcomes (e.g., Bharadwaj, 2000;Morgan et al., 2012Morgan et al., , 2018Morgan, Slotegraaf, et al., 2009;Song et al., 2005;Vorhies & Morgan, 2005). The same is true of research on the relationship between SCM capabilities (i.e., the outcome of bundling) and performance outcomes (e.g., Krause, 1999;Lee et al., 2013;Liao et al., 2017;O'Cass & Ngo, 2012;Oh & Rhee, 2010;Rai et al., 2006;Rajaguru & Matanda, 2019;Scheer et al., 2010;Tang & Rai, 2012;Weigelt, 2013;Wong et al., 2012). Indeed, SCM scholars regularly examine financial performance, operational performance, and market performance. ...
Article
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Effective supply chain management (SCM) capabilities are critical to the success of organizations. Although research over the past three decades (i) firmly establishes that SCM plays a significant role in corporate strategy, (ii) either suggests and/or finds strong positive results for the impact of different types of SCM capabilities on firm performance, and (iii) indicates that intra‐firm and inter‐firm capabilities are central to the effectiveness of SCM, how firms come to have the SCM capabilities stays somewhat underexplored. Therefore, to understand how firms can bundle effective SCM capabilities, we (i) develop a brief overview of capabilities research, (ii) use the subprocesses of capability bundling—stabilizing (building), enriching (developing), and pioneering (creating)—as a framework for reviewing SCM research, (iii) review 236 articles from 66 journals to develop an integrative framework of capability bundling for SCM effectiveness, (iv) discuss the findings from the review for SCM capability bundling, and (v) delineate a comprehensive research agenda that provides specific insights into how firms can come to have SCM capabilities for competitive advantages in the marketplace. In doing so, we hope to initiate a silo‐breaking, cross‐disciplinary research program on how firms bundle capabilities for competitive advantages.
... The items were measured on seven-point Likert-type scales ranging from 1 = "I strongly disagree" to 7 = "I strongly agree." We used a single-item scale to measure customer tenure (Scheer et al., 2010) on a scale from 1 = "< 6 years" to 7 = "> 30 years." Table 2 contains descriptive statistics and correlations. ...
... We are able to retain the majority of our service customers. Customer tenure (adapted from Scheer et al., 2010) <6 years 6 to 10 years 11 to 15 years 16 to 20 years 21 to 25 years 26 to 30 years >30 years Customer open-mindedness (adapted from Yoon and Steege, 2013) Our customers are open toward new ways of thinking and doing. Our customers like to think up new ways of doing business. ...
Article
Purpose This study aims to conceptually propose and empirically validate a path perspective on the servitization process of manufacturing firms. It identifies a customer and an outcome path to servitization, sheds light on the pivotal role of digital technology usage for both value-creating paths and explores their financial and relational performance outcomes. Design/methodology/approach The authors use a mixed-method approach, combining a qualitative study with a cross-sectional survey in the USA, the UK and Germany. Findings Manufacturing firms choose between two generic paths to servitization, a customer and an outcome path. Digital technology usage is equally important for both value-creating paths. Progress on the outcome path has a positive effect on firms’ financial performance, whereas the customer path has an indirect effect only, fully mediated by firms’ relational performance. Customer tenure and customer’s open-mindedness are contingency variables in the digital technology usage – servitization path – firm performance framework. Research limitations/implications A path perspective is useful to conceptualize the servitization processes in manufacturing industries. Future research should investigate the sequential choice of servitization paths and explore its drivers and performance outcomes. Practical implications To create and claim superior value for their customers, managers can choose between two servitization paths, leading to differential performance outcomes. While digital technology usage is key to progress on both paths, it is particularly effective for newly acquired customers on the customer path. Suppliers should target their value-creating service offerings at open-minded customer firms to reap their full performance potential. Originality/value Propose and empirically validate a path-perspective on servitization. Understand the pivotal importance of digital technology usage for both servitization paths.
... Nowadays, a shorter delivery lead time is an important functional performance that customers seek from their suppliers and therefore a critical criterion in the supplier selection (Cormican and Cunningham, 2007;Nair et al., 2015). Strong delivery performance allows the supplier to implement the customer's desired changes and to create unique benefits for the customer, thus increasing the customer's benefit-based dependence (Flint et al., 2002;Scheer et al., 2010). Suppliers offering short lead time in transactions differentiate themselves by improving their functional customer value, making them attractive to new customers and being able to foster customer loyalty (Bianchini et al., 2019;Scheer et al., 2010). ...
... Strong delivery performance allows the supplier to implement the customer's desired changes and to create unique benefits for the customer, thus increasing the customer's benefit-based dependence (Flint et al., 2002;Scheer et al., 2010). Suppliers offering short lead time in transactions differentiate themselves by improving their functional customer value, making them attractive to new customers and being able to foster customer loyalty (Bianchini et al., 2019;Scheer et al., 2010). Delivery lead time is also an important consideration when it comes to using resources efficiently, keeping production moving as efficiently as possible and optimizing the order fulfillment process. ...
Article
Purpose Building on the expectancy value theory, the purpose of this paper is to examine the effects of word-of-mouth (WOM) and customer value (i.e. functional value and ease-of-doing-business value) on B2B business performance in the B2B sales process. Design/methodology/approach The authors develop a framework to understand how B2B WOM and customer value influence supplier sales performance. This model was tested using structural equation modeling with a sample of 220 suppliers on Alibaba.com. Findings The empirical findings demonstrate that B2B WOM valence and volume have positive influences on the number of quotations and the number of transactions, respectively. Additionally, B2B WOM volume mediates the relationship between operational performance and the number of transactions. Response rate mediates the relationships between response time and both the number of quotations and the number of transactions, respectively. Originality/value This study contributes to the industrial marketing of B2B sales on the digital platform by investigating two influencers on sales performance: WOM and customer value.
... Nowadays, a shorter delivery lead time is an important functional performance that customers seek from their suppliers and therefore a critical criterion in the supplier selection (Cormican and Cunningham, 2007;Nair et al., 2015). Strong delivery performance allows the supplier to implement the customer's desired changes and to create unique benefits for the customer, thus increasing the customer's benefit-based dependence (Flint et al., 2002;Scheer et al., 2010). Suppliers offering short lead time in transactions differentiate themselves by improving their functional customer value, making them attractive to new customers and being able to foster customer loyalty (Bianchini et al., 2019;Scheer et al., 2010). ...
... Strong delivery performance allows the supplier to implement the customer's desired changes and to create unique benefits for the customer, thus increasing the customer's benefit-based dependence (Flint et al., 2002;Scheer et al., 2010). Suppliers offering short lead time in transactions differentiate themselves by improving their functional customer value, making them attractive to new customers and being able to foster customer loyalty (Bianchini et al., 2019;Scheer et al., 2010). Delivery lead time is also an important consideration when it comes to using resources efficiently, keeping production moving as efficiently as possible and optimizing the order fulfillment process. ...
Article
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Purpose-Building on the expectancy value theory, the purpose of this paper is to examine the effects of word-of-mouth (WOM) and customer value (i.e. functional value and ease-of-doing-business value) on B2B business performance in the B2B sales process. Design/methodology/approach-The authors develop a framework to understand how B2B WOM and customer value influence supplier sales performance. This model was tested using structural equation modeling with a sample of 220 suppliers on Alibaba.com. Findings-The empirical findings demonstrate that B2B WOM valence and volume have positive influences on the number of quotations and the number of transactions, respectively. Additionally, B2B WOM volume mediates the relationship between operational performance and the number of transactions. Response rate mediates the relationships between response time and both the number of quotations and the number of transactions, respectively. Originality/value-This study contributes to the industrial marketing of B2B sales on the digital platform by investigating two influencers on sales performance: WOM and customer value.
... Researchers have debated whether the PV/RQ perspective (i.e., perceived value → relationship quality → customer loyalty) and the switching costs perspective are independent or related processes. Lam et al. (2004) consider switching costs independent of the PV/RQ perspective; Scheer et al. (2010) support a bidimensional model, with separate paths from benefit-based dependence (i.e., relational benefits) versus cost-based dependence (i.e., switching costs) to loyalty. In contrast, Pick and Eisend (2014) propose a path from relationship quality to switching costs-suggesting that customers lose the benefits from their relationship with a firm when they leave. ...
... Customers driven by special treatment benefits may remain loyal only until a competitor offers better benefits; our findings suggest that a diminished emphasis on special treatment benefits can be a prudent strategy. One caveat though is that when the customer views a special treatment benefit as essential (i.e., benefit-based dependence, Scheer et al. 2010), failing to offer it might exclude the firm from the customer's consideration set. Such a scenario may arise if most competitors have enhanced their offering with this benefit, such that what was once viewed as a (differentiating) special treatment factor is now simply a point of parity and an industry standard. ...
Article
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Recent meta-analyses provide clear insights into how service firms can benefit from relationship marketing, whereas investigations of customers’ relational benefits (1) are unclear about the absolute and relative strengths by which different relational benefit dimensions induce different customer responses and (2) have not simultaneously examined the various mediating processes (including perceived value, relationship quality, and switching costs) through which relational benefits reportedly affect customer loyalty. To consolidate extant research on the benefits of relationship marketing for customers, this meta-analysis integrates 1242 effect sizes drawn from 235 independent samples across 224 papers disseminated in the past two decades. The results reveal that all three relational benefits affect loyalty, though confidence benefits and social benefits have the strongest effects. Among the three identified mediation paths through which relational benefits influence customer loyalty, the sequential path through perceived value and relationship quality is the strongest. From a service research perspective, this study provides novel empirical generalizations; managerially, the findings suggest that a primary goal for service managers should be strengthening confidence and social benefits.
... Market dynamics significantly influence procurement decisions through factors such as supplier consolidation, pricing pressures, and product innovation [31]. Healthcare organizations must navigate these market forces while ensuring compliance with insurance policy requirements and maintaining focus on quality care delivery. ...
Article
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This comprehensive review examines the complex relationship between healthcare procurement processes and health insurance policies within the Medicare and Medicaid systems in the United States. The study analyzes how procurement strategies influence healthcare delivery, cost management, and patient outcomes while considering the intricate policy frameworks governing these public insurance programs. Through analysis of existing literature, policy documents, and administrative data, this review identifies key challenges and opportunities at the intersection of procurement and insurance administration. The research reveals significant variations in procurement practices across states and their impact on healthcare access, quality, and cost-effectiveness. Notable findings include the critical role of value-based purchasing initiatives, the influence of formulary management on pharmaceutical procurement, and the evolving landscape of managed care contracting. The study also highlights the importance of data integration and technological infrastructure in improving procurement efficiency and insurance administration. The findings suggest that optimizing the alignment between procurement strategies and insurance policies could significantly enhance healthcare delivery efficiency while maintaining program sustainability.
... Scheer et al. (2015, p.697) defined switching costs as 'the need to maintain a relationship with a specific partner because of the unrealized costs that would be incurred if the relationship ended'. In a previous study, Scheer et al. (2010) split dependence into benefit-based dependence and costbased dependence. Benefit-based dependence stems from a party's need to stay in an existing relationship for benefits such as value, sales and resource access. ...
... No que tange o fluxo de pesquisas que investigam a dependência, é predominante a investigação a partir de apenas um lado na díade, seja do fornecedor (Jia, Cai & Xu, 2014) ou do comprador (Scheer, Miao & Garrett, 2010), sendo escassas as pesquisas que investigam a dependência com dados coletados dos dois lados da díade abordando as mesmas dimensões, uma vez que é comum a investigação da dependência conjunta abordada a partir da perspectiva dos parceiros de troca, mas com os dados coletados apenas com um parceiro. ...
Article
O objetivo dessa pesquisa é examinar como o compartilhamento bidirecional de informações afeta a performance da empresa considerando as relações de dependência entre os parceiros diádicos. A amostra é composta por 270 empresas do ramo automotivo, sendo fornecedores e compradores, totalizando 135 díades. A partir da aplicação de técnicas estatísticas, os resultados mostram que, mesmo em dependência, fornecedores e compradores tendem a compartilhar informações e que a compreensão da configuração das relações diádicas, no tocante ao compartilhamento de informações, é fundamental para que as empresas tenham condições de desenvolver a capacidade de adaptação e melhorar a performance.
... Oliver (1999, p. 34) pointed out that "loyalty is a deeply held commitment to re-buy and re-patronize a preferred product of service constantly in the future". All forms of loyalty (behavioural, attitudinal) are indicative of the gradual accumulation of positive encounters between the manufacturer and the customer (Oliver, 1999;Scheer et al., 2010). Several studies have shown that delivering superior value derived from the complete experience with the service is one of the most important means of generating customer satisfaction and customer loyalty (Oliver, 1999). ...
... Marketing communications capability refers to the effectiveness and efficiency with which the marketing group creates desired message reception among target customers, suppliers and prospects (Vorhies and Morgan 2005). This is an essential marketing capability associated with customer value delivery (e.g., Akdeniz, Gonzalez-Padron and Calantone 2010) and superior customer loyalty (Scheer, Miao and Garrett 2010) in B2B markets. This capability is typically built on fundamental lower-level marketing capabilities, such as advertising, promotion, trade shows, and public relations (e.g., Vorhies and Morgan 2005). ...
... This finding conflicts with research that has found positive effects of DEPENDENCE on a supplier's commitment to the customer. For example, Scheer, Miao, and Garrett (2010) show that higher ECONOMIC DEPENDENCE increases a supplier's long-term orientation toward the relationship. To maintain the benefits obtained from the relationship, dependent parties are expected to adhere to rules and procedures and refrain from opportunistic behaviors (Brown et al. 2016). ...
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Horizontal referrals –when suppliers recommend other suppliers– are a common phenomenon in complex B2B markets. For the referring supplier, giving the best-possible horizontal referral may strengthen the relationship with its customer, yet it may also threaten the referring supplier’s future revenues and cross-selling opportunities. Instead, the supplier could make an obligatory referral, one that fulfills the obligations of recommending another supplier while keeping referring supplier’s own interests paramount. We rely on role theory and its antecedents (mutual trust and referring supplier’s dependence) to determine when a referring supplier adopts the role of a friend (vs. a businessperson) and gives the best-possible referral (vs. an obligatory referral). Study 1, an experiment, supports our theoretical model. Study 2, a conjoint study, links the observable antecedents of the referring supplier-customer relationship to their choice of horizontal referrals. Study 3, another experiment, looks at the consequences of the horizontal referral on the referring supplier-customer relationship and shows that providing an obligatory referral can hurt the customer’s intent to continue their relationship with their supplier. This effect is mediated by the customer’s perceived alignment of interest with their supplier. For B2B marketing research and practice, we report that the supplier’s dependence is critical to predicting the quality of horizontal referrals, even though an exploratory survey showed that customers overlook that dimension and focus on mutual trust when seeking referrals.
... Dependence can influence buyer-supplier relationships in other ways (see review Kim and Fortado, 2021) such as relationship commitment (Chang et al., 2012), trust (Payan andMcFarland, 2005), R&D investment (Kim and Zhu, 2018), and use of power (Huo et al., 2019). Moreover, most studies to date only studied dependence in its 'current' or 'presently-realized' terms (Scheer et al., 2010), and future perspectives have received scant attention. In this study, we explicitly examine supplier anticipated future dependence on a buyer, and postulate its effects on suppliers' motivation to share knowledge via the three motives. ...
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Purpose This paper draws on social exchange theory to theorise supplier motivation to share knowledge. It examines the effects of supplier anticipated future dependence on their motivation to share knowledge with a buyer, mediated by economic, relational and learning motives. It also examines the conditional effects imposed by the current embeddedness of the relationship. Design/methodology/approach The study tested the proposed moderated mediation model using a scenario-based experimental method. Findings The results show that supplier anticipated future dependence increases their motivation to share knowledge, mediated by relational and learning motives. The results also show that current embeddedness has negative moderation effects on economic and learning but not relational motives. Originality/value The study deepens our understanding of supplier motivation to share knowledge as social exchange and offers insights on buyer-supplier relationship embeddedness.
... Once again, this creates a trend in understanding what breaks trust in a customersupplier relationship and how to repair it (Laeequddin and Sardana, 2010). At the same time, research agender on how to maintain the positive outcome of the relationship between service performance, service quality and loyalty intentions (Briggs and Grisaffe, 2010), as well as to increase competitive offerings and future purchase expansion (Scheer et al., 2010). ...
Article
Purpose In the past few decades, relationship management (RM) theory and RM strategies in business-to-business (B2B) contexts have evolved tremendously, driven by constant innovation. Hence, the purpose of this study is to understand the trends and evolution of RM and relationship quality (RQ) in B2B contexts and empirical insights on RM and RQ in B2B, which in turn would provide insights into trends and future research directions. Design/methodology/approach Grounded on the industrial marketing and purchasing group, this study adopts a critical systematic literature review to provide a comprehensive analysis of the past, current and future trends in empirical research insights of RM and RQ in B2B markets. Findings This study provides some novel insights into RM in B2B context by using a multidimensional approach to RM and RQ and analyzing prior marketing research from three perspectives: the evolution of RM and RQ in B2B context; prior empirical research; and practical business insights. Overall, these perspectives inform the development of an evolving side of RQ in B2B contexts, leading to some predictions regarding the future of RM in B2B markets. Practical implications The exploratory results of this study shed light on the key factors that drive RQ and the importance of RM in B2B markets in the digital age where customers still long for human interaction regardless of the prevalence of advanced technology. Originality/value In the wake of advanced technologies and particularly, B2B companies had to turn to virtual platforms and embrace digital transformation to establish and manage their customer relationships. Yet, managing relationships via digital channels has its own challenges for both B2B practitioners and scholars. This indicates that there is still a huge need for attuned RM strategies that align with the changing environments – mainly driven by technological advancement – in B2B markets.
... Once again, this creates a trend in understanding what breaks trust in a customersupplier relationship and how to repair it (Laeequddin and Sardana, 2010). At the same time, research agender on how to maintain the positive outcome of the relationship between service performance, service quality and loyalty intentions (Briggs and Grisaffe, 2010), as well as to increase competitive offerings and future purchase expansion (Scheer et al., 2010). ...
Article
Purpose-In the past few decades, relationship management (RM) theory and RM strategies in business-to-business (B2B) contexts have evolved tremendously, driven by constant innovation. Hence, the purpose of this study is to understand the trends and evolution of RM and relationship quality (RQ) in B2B contexts and empirical insights on RM and RQ in B2B, which in turn would provide insights into trends and future research directions. Design/methodology/approach-Grounded on the industrial marketing and purchasing group, this study adopts a critical systematic literature review to provide a comprehensive analysis of the past, current and future trends in empirical research insights of RM and RQ in B2B markets. Findings-This study provides some novel insights into RM in B2B context by using a multidimensional approach to RM and RQ and analyzing prior marketing research from three perspectives: the evolution of RM and RQ in B2B context; prior empirical research; and practical business insights. Overall, these perspectives inform the development of an evolving side of RQ in B2B contexts, leading to some predictions regarding the future of RM in B2B markets. Practical implications-The exploratory results of this study shed light on the key factors that drive RQ and the importance of RM in B2B markets in the digital age where customers still long for human interaction regardless of the prevalence of advanced technology. Originality/value-In the wake of advanced technologies and particularly, B2B companies had to turn to virtual platforms and embrace digital transformation to establish and manage their customer relationships. Yet, managing relationships via digital channels has its own challenges for both B2B practitioners and scholars. This indicates that there is still a huge need for attuned RM strategies that align with the changing environments-mainly driven by technological advancement-in B2B markets.
... Among them, positive motivation means that it will bring irreplaceable relationship benefits to itself, including sales benefits (Heide and John, 1988), other resources, the importance of partners, etc. Negative motivation refers to avoiding or reducing the conversion cost caused by changing partners (Anderson and Narus, 1990). In addition, Scheer et al. (2010) divided dependence into benefit based and cost based in their research on dependence between customers and buyer and seller. Among them, benefit-based dependence refers to the demand for maintaining relationship due to irreplaceable net income. ...
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Behavioral psychology is increasingly important in relationship marketing. As key factors of emotional interactions between buyer and seller, psychological contracts and opportunistic behaviors play a critical role in interorganizational relationships which are based on personal relationships of boundary spanners and top management. Most of the existing research mainly focus on positive performance of cooperation but ignoring the dark side of relationships. This study introduces the psychological contract into the exploration of why formal contracts cannot completely avoid opportunistic behaviors. It mainly investigates whether psychological contracts in relationships can reduce the occurrence of opportunistic behaviors. The results show that psychological contract has a significant positive effect on the relationship quality, and negatively affect opportunistic behavior through trust and commitment. The positive relationship between psychological contracts and relationship quality is moderated by dependence. This study enriches and expands the domestic and foreign research on psychological contracts and opportunistic behaviors in relationship marketing.
... We extend the theory by considering the firm's trade credit received from its suppliers. We theorize that the firm's favorable perceptions of the suppliers increase its need to maintain the relationship with the supplier-that is, increase the firm's dependence on the suppliers (Scheer et al. 2010). Whereas customers' dependence on the firm is value-enhancing for the firm, the firm's dependence on its suppliers is value-diminishing for the firm because it lowers the firm's perceived costs of switching from the current suppliers. ...
... Across studies and contexts, interfere communication is found to have mainly positive effects on the relationship, as communication mediates various important relationship outcomes (Duncan and Moriarty, 1998). Communication affects satisfaction (Cannon and Perreault, 1999;Mohr and Sohi, 1995) trust (Morgan and Hunt, 1994) and loyalty (Scheer et al., 2009). Communication also serves as a means of relational governance that increases affective commitment toward the business relationship (Mohr et al . ...
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Purpose: the proposal will focus on marketing by gathering three variables (quality social of communication, stealth marketing, and re-engineering customer relationship) to figure out the relationship and effects among them. Also, to establish the roll of quality social of communication as a moderator to enhance the negative relation between stealth marketing and re-engineering customer relationship. Objectives: understand the importance of Quality of Social Communication and to understand the importance of social customer relationship management and compare it with traditional customer relationship management. Also, understanding the relationship between Quality of Social Communication and stealth marketing. In addition, find out the negative role of stealth marketing on re-engineering customer relationship. Methodology: formulating the research design depend on the objectives that should be achieved. So, hypothesis will determine to understand the relation and effect among the three variables. As well as, judgmental sample will be used. Moreover, the study will use quantitative research technique to collecting data by questionnaire. Lastly, the researcher will use Statistical Package for the Social Sciences (SPSS) program to analyze the data which is collected by the questionnaire.
... We extend the theory by considering the firm's trade credit received from its suppliers. We theorize that the firm's favorable perceptions of the suppliers increase its need to maintain the relationship with the supplier-that is, increase the firm's dependence on the suppliers (Scheer et al. 2010). Whereas customers' dependence on the firm is value-enhancing for the firm, the firm's dependence on its suppliers is value-diminishing for the firm because it lowers the firm's perceived costs of switching from the current suppliers. ...
Article
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With over half a trillion dollars in trade credit flowing between firms in the U.S., it is critically important for managers to understand how the trade credit that their firm receives and provides affect its value. Trade credit is a strategic investment in supply chain relationships that allows the recipient to make payment later rather than at the time of the sale. A firm provides trade credit to its downstream business customers and also receives trade credit from its upstream suppliers. Although research has shown that provided trade credit builds a firm’s shareholder value, it has not examined what effect, if any, received trade credit has on the firm’s value. As a result, one might assume that received trade credit affects firm value in the same manner as provided trade credit. We argue otherwise and show that received trade credit and provided trade credit have differential effects on firm value. Received trade credit has a negative direct effect and a positive indirect effect (through profit), whereas provided trade credit has a positive direct effect and a negative indirect effect. The difference in direct effects hinges on the disparate nature of dependence in the supply chain. Provided trade credit increases customers’ dependence on the firm, building the firm’s value. In contrast, received trade credit increases the firm’s dependence on its suppliers, destroying the firm’s value. Empirical results using a sample of 2,804 firms from 1986 to 2017 provide robust support for the hypotheses. They show that managers risk over‐estimating the value of a 1 SD increase in received (provided) trade credit by 284.74(284.74 (74.95) million, on average, if they do not consider both the direct and indirect effects it has on their firm’s value.
... First, dependence is caused by the rewards obtained from the source of dependence [26,27], which can be considered as benefit-based dependence and associated with the need to remain in the relationship, e.g., the inherent benefits related to the various offerings of the seller. Second, dependence is inversely related to the number of alternative sources of those rewards [28], which can be regarded as cost-based dependence and connected with the need to avoid potential negative consequences, e.g., replacement/switch costs [29]. In the buyer-seller relationship, buyer dependence also is related to the extent to which a buyer needs a relationship with a seller to gain inherent benefits, prevent high switching costs and/or solve the problem of finding suitable alternatives [30]. ...
Article
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This study explores how social influence approaches alter buyer–seller swift guanxi, trust in the seller and repurchase intention when considering the influence of buyer dependence. Based on the results of an online survey in three cities of Taiwan, we empirically test the research model using partial least squares analysis. We found that buyer dependence exerts different but positive effects on each social influence approach usage and only the identification approach contributes to buyer–seller swift guanxi, trust in the seller and repurchase intention. The buyer–seller swift guanxi also mediates the effects of the identification approach and trust in the seller on repurchase intention. This study clarifies the role of buyer dependence on the seller’s social influence approaches and buyer–seller swift guanxi in the online C2C marketplace context. A seller should exploit buyer dependence, learn how to use each social influence approach and develop close buyer-seller swift guanxi, then repurchase intention can be secured.
... For example, B2B loyalty parents' different synonymous research areas include repurchase 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 J o u r n a l o f B u s i n e s s a n d I n d u s t r i a l M a r k e t i n g 5 intention (Lewin & Johnston, 2008;Olaru et al., 2008, Russo et al., 2017, customer retention (Jones et al., 2003;Blocker et al., 2011), relationship continuation (Kofi et al., 2020, customer loyalty (Ramaseshan et al., 2013;Yang, 2015;Cassia et al., 2017;Kittur & Chatterjee, 2020), supplier loyalty (Scheer et al., 2010;Gil-Saura et al., 2011) , brand loyalty (Chaudhuri and Holbrook 2001;Elsaber & Wirtz, 2017), and word of mouth (Anaza & Rutherford, 2014;Wangenheim & Bayón, 2007). The constructs mentioned earlier have to be considered for exploring B2B loyalty scientific communication in detail, which we are attempting in this paper. ...
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This study aims to identify evolution and advancement in the field of B2B loyalty knowledge area by analyzing its intellectual structure. We employ bibliometric analysis for quantitative evaluation of scholarly articles published on B2B loyalty area over a period of 27 years (1993 to 2020). We analyze intellectual knowledge base of B2B loyalty area by looking into 263 articles with 14028 references authored by 693 researchers. The results provide a comprehensive review of B2B loyalty area by identifying its foundations, influential works, and intellectual communication linkage between these works. Notably, the analysis reveals most cited articles, key authors, important keywords, intellectual turning points, and emerging trends of research in the discipline. This study creates a baseline for presenting precise and comprehensive insights into research themes in B2B loyalty area, and identifies progressive trends over a period. This study is also helpful for researchers in identifying future directions of research in the discipline. This article reveals the intellectual structure of B2B loyalty area.
... Similarly, in the marketing research studies, dependency has been recognized as a focal factor which can affect firms' strategy, behavior, and economic outcomes (e.g. , Frazier 1983a, b;Frazier, Gill, and Kale 1989;Frazier and Rody 1991;Heide and John 1988;Hibbard, Kumar, and Stern 2001;Kumar, Scheer, and Steenkamp 1995;Lusch and Brown 1996;Scheer, Miao, and Palmatier 2015). For example, dependency on suppliers can affect the level of governance mechanisms which is elected by focal firms (Gilliland, Bello, and Gundlach 2010), and also increase the focal firm's loyalty to the suppliers (Scheer, Miao, and Garrett 2010). Scheer, Miao, and Palmatier (2015) found that dependency has substantial effects on the quality of relationship and cooperation. ...
Article
Purpose: This paper develops a conceptual framework to analyze the impact of a supply chain network (SCN) structure on relationship management strategies (RMS) that focal firms apply to manage sustainability issues within the SCN. Design/methodology/approach: This paper is based on a comprehensive review and analysis of the industrial marketing and purchasing (IMP), sustainable supply chain management (SSCM), and SCN literature. Findings: The conceptual framework expands the network perspective in the SSCM context by considering the important role of the SCN structure in the firm’s decision-making process. Four factors (dependency, distance, power, and transparency) were found that are useful in conceptualizing the SCN structure. The conceptual framework also categorizes various sustainability practices into four RMS (noncompliance, transactional, dictatorial, and collaborative), which are needed to make an SCN more sustainable. In addition, 16 propositions are developed based on how firms may identify the most effective RMS to implement appropriate sustainability practices through examining their SCN structure. Research limitations/implications: The conceptual framework, developed as a result of a comprehensive review of the literature, led to the development of 16 propositions, which can assist in furthering a research agenda on RMS to diffuse various sustainability practices within SCN structures. Originality/value: The relationship between SCN structure and RMS in the sustainability context remains an under-researched but emerging area of interest. This paper leverages existing research to develop a conceptual framework suitable for empirical testing.
... Studies elsewhere in the marketing discipline do however show quality communications to be a driver of relationship loyalty in both Western (e.g. Dagger, David, & Ng, 2011;Hänninen & Karjalioto, 2017;Scheer, Miao, & Garrett, 2009) and Eastern (e.g. Yen, Wang, & Horng, 2011) contexts. ...
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The expanding role of Asian firms in global supply chains has meant that their Western counterparts need to be capable of transcending the East-West divide in their relational building efforts if they wish to successfully participate in these networks. This paper draws upon social exchange (SE) theory to integrate the exit, voice, loyalty, neglect (EVLN) typology with the psychological contract (PSYCON) literature, to examine how Australian buyer firms build and nurture relationships with their Chinese suppliers. Data from 327 Australian managers collected using an online self-administered questionnaire reveals the negative effects of PSYCON breaches towards their suppliers on neglect, voice and loyalty in the relationship. In addition, contrasting effects of neglect and voice behaviours on trust and commitment, suggest that these behaviours can help erode and build East-West B2B relationships, respectively. These findings extend research on B2B relationships and offer useful managerial insights for decision makers operating in global supply chains involving relationships between firms from Eastern and Western backgrounds.
... perceived switching costs. Some of these antecedents are quality of the product offerings and relationships (Burnham, Frels and Mahajan 2003;Jones, Mothersbaugh and Beatty 2002), buyer and seller investments (Burnham, Frels and Mahajan 2003;Scheer, Miao and Garrett 2010), availability of alternative offerings and market competition. Pick and Eisend (2014) summarize these antecedents in an influential meta-analysis. ...
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Purpose This study examines the customer strategies for small- and medium-sized manufacturing suppliers (SMMSs) in customer dominance markets, particularly regarding power asymmetry. It has two key objectives: (1) to identify factors impacting SMMSs' customer strategies, including technological and marketing capabilities and the importance of the main customer and (2) to examine the impact of these strategies on firm growth. Design/methodology/approach Using the survey data on 279 Korean manufacturing suppliers in B2B markets, nine hypotheses were verified through a structural equation model (SEM). It involved capturing the varied influence of organizational capabilities on the two types of customer strategies and the link between customer strategy and firm growth. Findings Technology and marketing capabilities affect new customer acquisition directly, while in the case of main customer retention, marketing capability affects main customer retention through the overall satisfaction about the existing relationship. Although the importance of the main customer suppresses new customer acquisition strategies, SMMSs should actively pursue both customer acquisition and retention to promote firm growth. Originality/value The findings reveal how SMMSs, leveraging technological and marketing capabilities, can concurrently pursue new customer acquisition and main customer retention. Additionally, it empirically demonstrates the impact of the main customer’s importance on these customer strategies and underscores the positive impact of both strategies on firm growth. This provides a blueprint for a value-creation process linking capabilities, customer strategies and firm performance.
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Purpose Vertical business-to-business (B2B) relationship models are dynamic and depend on economic and relational constructs. However, it remains unclear how relationship termination intentions evolve across the mature and final stages of the B2B relationship cycle, particularly in the hospitality sector. Thus, this study investigates the dynamics of B2B relationship termination mechanisms. Design/methodology/approach The authors use a two time-lag interval method to provide insights into how these two variables (relational satisfaction and partner trust) mediate (e.g. strengthen or weaken) the relationship between social dependence and relationship termination intentions over time. Findings The authors demonstrate that relational satisfaction is not directly linked to relationship termination intentions across B2B relationship stages. However, our findings show that social dependence and partner trust are both key determinants of relationship termination intentions over time. Based on the mature and final stages of a B2B relationship cycle, these results suggest that researchers must understand the theoretical mechanism of B2B relationships and the roles key constructs play in determining how these relationships conclude. Originality/value This study is novel in capturing the evolution of B2B relationship stages. This research presents the first collection of ample evidence on the manifestation of relationship termination in the transition from social dependence to reduced partner trust.
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This study assesses the value of excess and deficit patronization intentions toward a service provider in predicting future customer behavior and its financial consequences for the provider in a continuous service context. The excess and deficit patronization measures employ widely available customer feedback data and can be used by managers to identify at-risk customers and those unlikely to defect. We argue that a customer's satisfaction provides a baseline level of patronization intentions and that excess patronization intentions-intentions greater than those that can be explained by a customer's satisfaction with a firm's offerings (i.e., the residuals in a model that regresses patronization intentions on satisfaction)-are generated in part by the presence of customer-level switching costs. Conversely, any deficit patronization intentions are generated in part by a customer's variety seeking. Using data from the financial services industry, we find that these residuals serve as indicators of the presence and extent of customer-level switching cost and variety seeking. In addition to providing measures of interesting and under-researched phenomena , this suggests that the measures may serve as proxies to test existing theories concerning switching costs and variety seeking in situations where measurement and data availability have previously limited such research.
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Purpose This paper aims to investigate the interrelated role of relational commitment and dependence as drivers of key performance outcomes. Specifically, the authors provide a conceptual model of the impact of commitment on relationship value dependence and switching cost dependence. The authors further investigate how these dimensions of dependence offer differing noneconomic and economic paths to strategic and financial performance. Design/methodology/approach Survey data was collected from 296 purchasing agents across multiple industries located in the USA. The conceptual model and accompanying hypotheses were tested via partial least squares structural equation modeling. Findings The results show that the relational path is driven by affective and normative commitment, which are related to relationship value dependence. Conversely, calculative commitment is related to switching cost dependence. This economic path is related to both strategic and financial performance, whereas the relational path is more closely related to strategic as opposed to financial performance outcomes. Research limitations/implications This study extends research on Business-To-Business (B2B) relationships by leveraging social exchange theory to examine the interrelated roles played by two forms of dependence on performance outcomes. Thus, the authors answer Scheer et al.’s (2015) call for research into the two distinct types of dependence – relationship value and switching cost dependence – and their roles in determining B2B relationship outcomes. The findings contribute to the literature by integrating social exchange and relationship marketing concepts to develop a dual pathway approach to B2B partnerships. Practical implications The results suggest that dependence is not necessarily negative for firms. Specifically, buyers can and do still exhibit positive performance, both strategic and financial, in relationships with suppliers even when dependent on the relationship. Regardless of whether buyers are dependent due to a relationship or economic factors, both can, in different ways, lead to positive strategic and financial outcomes. Together, the authors contribute to the understanding of B2B partnerships by offering guidelines for both buyers and suppliers in the dyad. Originality/value The authors derive a comprehensive model depicting primarily relational and economic paths to performance through different types of commitment and dependence. The authors contribute to the literature by demonstrating that relational and economic paths to success are not the same, highlighting how firms could influence performance even when the relationship is not necessarily characterized by generally positive relational benefits and behaviors.
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This study explores the impact of supplier digital transformation on customer risk‐taking capability and further explores its impact mechanism in China using A‐share listed companies from 2010 to 2020. The empirical results indicate that the supplier digital transformation mechanism test has a significant and positive impact on the risk‐taking capability of customers. They reveal that supplier digital transformation improves the risk‐taking capability of customers by easing customer financing constraints and driving customer product innovation. Additionally, the results of the heterogeneity test indicate that supply chain relationships play a moderating role in the impact of supplier digital transformation on customer risk‐taking.
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Offering highly customized products and services is an attractive strategic option for firms in business‐to‐business (B2B) markets. However, as effective customization for downstream customers requires significant reliance on upstream suppliers, capabilities of upstream suppliers become central to firm strategies to produce customized offerings. Despite the importance of upstream supplier capabilities for downstream customization , there is a scarcity of research on how firms build their suppliers' capabilities for effective customization. Building on the foundations of research streams on customization, capabilities, and collaboration, this research tests a model which illustrates that (i) upstream supplier capabilities can result in positive customization outcomes for downstream markets and (ii) a firm's collaboration capital can build upstream supplier capabilities directly and also indirectly through supplier communication. Analyses of data collected from 189 organizations that extensively engage in downstream customization reveal the role of collaboration capital—conceptualized as a higher order factor with collaboration orientation, collaborative flexibility, and collaborative communication as first‐order dimensions—in building upstream supplier capabilities for downstream customization. We conclude with a delineation of the contributions, theoretical and practical implications, and limitations of this research.
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Purpose Supply chain agility (SCA) is the primary strategy for reducing impacts and quick recovery when supply chains experience a disruption risk, such as the COVID-19 pandemic. This study will investigate how SCA can be achieved through supply chain information sharing (SCIS) under the different dependence relationships (DR) with suppliers or customers. The purpose of this paper is to investigate this issue. Design/methodology/approach Based on information process and resource dependency theories, this study constructs and empirically tests a proposed model of the relationships amongst the three dimensions of SCIS and the two areas of SCA and the contingency effects of two types of DR on those relationships. Using a dataset collected from 400 manufacturers in China, the authors tested this theoretical model using multi-group and structural path analysis. Findings The results of the structural path and multi-group analyses show that (1) all dimensions of SCIS are positively correlated with both areas of SCA and (2) dependence on the supplier and dependence on the customer have completely different impacts on the relationship between SCIS and SCA. Originality/value This study can improve the understanding of the multidimensional concepts of SCIS and SCA and relationships between them under two different DR conditions in the Chinese manufacturing setting. It contributes to IS and the SCA literature and provides theoretically driven and empirical explanations for the diverse dynamics between the dependence on the supplier and customer.
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Context studies argue that similar levels of dependence are essential for supplier satisfaction in buyer-supplier relationships. However, asymmetric relationships can also lead to supplier satisfaction. Objective this paper investigates the effects of benefit-based dependence (positive motivations for maintaining relationships) between buyer and supplier and supplier satisfaction. Methods response surface analysis (RSA) was used to test the relationship between third-party logistics (3PL) dependence and satisfaction dimensions in 174 dyads. Results the results demonstrated that about supplier satisfaction, instead of dependence asymmetry what really matters is the degree of dependence between the parties. The more dependent one part is on the other, usually, the greater the supplier’s satisfaction. In many circumstances, a degree of dependence is acceptable and necessary to access resources and opportunities. Conclusions the interaction between buyer and supplier dependence and supplier satisfaction is complex. Situations of dependence asymmetry in which the supplier is highly dependent on the buyer may still be satisfactory. Keywords: dependence; satisfaction; RSA; 3PL; outsourcing
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The study looked at the use of internal business process metrics within the performance assessment framework of the Nepalese telecom industry. It employed a descriptive study approach and an organized questionnaire survey instrument. The population of this study included all of Nepal’s telecom operators and their employees. The sample organizations from which random sampling techniques obtained the responses of 318 employees were Nepal Telecom and Ncell. The employees who hold at least offers and above positions at their company were the targeted respondents of the study. Three parts of the survey questionnaire were set up with 27 questions of different types to gather data. SPSS (statistical package for social sciences) program was employed to process and analyze the data. Sixteen measuring variables within four constructs were examined to assess the IBPP (internal business process performance). Three of these constructs: operations management (β = 0.229, p < 0.01), customer management (β = 0.380, p < 0.01), and regulatory and social processes (β = 0.175, p < 0.01) were found to have a statistically significant and favorable impact on the IBPP while innovation processes (β = 0.024, p > 0.05) was not properly applied and understood in the Nepalese telecom industry. The findings of this study will help identify the primary drivers of performance metrics and their relevance in organizational performance for the Nepalese telecom industry.
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The purpose of this study is to examine how formal contracts affect alliance innovation performance. To understand the mechanism underlying the impact, this study tests whether relationship learning mediates the impact of formal contracts on alliance innovation performance and how guanxi moderates the mediating effect. This study is conducted with a sample of 225 manufacturers in China. This paper used hierarchical regression analysis to test the hypotheses and used the PROCESS method to test the mediating effect of relationship learning. We find that formal contracts positively affect relationship learning, which facilitates alliance innovation performance. Guanxi positively moderates the effect of formal contracts on alliance innovation performance. Relationship learning mediates the relationship between formal contracts and alliance innovation performance. Moreover, guanxi positively moderates the mediating effect.
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Academic research has paid more attention to formation and management of business relationships than to their dissolution. For example, not much is known about the extent to which dissolution intentions are predictive of actual dissolution, and whether certainty with which these intentions are held influences the likelihood of relationship dissolution. To address these questions, authors collect data in two stages from a franchise system in Korea. They specify the judgment uncertainty and magnitude parameters (JUMP) model to tease apart the magnitude and uncertainty of intention from a single measure, and a duration analysis model to study translation of intentions into behavior. Results show that not only strong intentions to dissolve a relationship are more likely to result in actual dissolution but weak intentions also are more likely to lead to dissolution if the holder is doubtful and uncertain about the relationship. Ignoring uncertainty of dissolution intentions thus can seriously downplay their risk of translating into actual dissolution.
Article
Purpose The use of threats to force supplier compliance is a common practice in current business affairs. Unfortunately, little is known regarding the supplier’s decision process to comply to or resist such a coercive strategy. The paper aims to develop a more comprehensive view of the decision process used by suppliers when threatened by their customers, as well as discover new phenomena regarding supplier Decision-Making Under Threat (DUT). More specifically, it aims at (1) gaining a better understanding of threats by looking at their patterns and commonalities and (2) identifying which consideration factors are relevant when suppliers evaluate threats. Method To identify which consideration factors are relevant to suppliers when deciding how to react to threats, the study employed an exploratory approach by interviewing 17 marketing practitioners with experiences in DUT. The in-depth interviews lasted between thirty-five and sixty-five minutes and were transcribed. Descriptive coding and template analysis generated thirty-nine descriptors and nine categories that are deemed important when considering DUT. The authors also evaluated the intensity of each of the consideration factors present in the decision process. Findings The results reveal that it is possible to categorize threats into three components: Objectives, Penalties and Manifestations. Objectives are what the customer is trying to achieve by using the threat, namely demanding price reductions, appropriating intellectual property, procuring financial statements, receiving a bribe, increasing technical requirements, accessing a cost breakdown, modifying delivery terms, and modifying payment terms. The penalty is what the supplier can expect to happen when refusing to comply, such as losing the customer’s sales. Finally, manifestations describe how the threat is presented by the customer. Study results show that these manifestations may be categorized according to their level of ambiguity, predictability, and candor. The results also reveal that at least five cognitive decision criteria are typically considered during the decision process although at different intensity levels from each participant. These criteria include: Dependence, Cost-Benefit Analysis, Relationship Quality, Relational Norm Violations, and Mimetic Isomorphism. Several interesting discoveries were made. For example, Dependence is both the consideration factor for which most people emphasized its influence on their decision and for which most people said that it had no influence at all. Relational norm violations is unique by being the only criterion for which no participant mentioned that it does not influence their decision. The overwhelming majority of study participants considered more than three criteria during the DUT process. Finally, participants said that they experienced negative emotions such as anger and frustration when exposed to threats albeit most did not recognize that it played a role in their decision. These emotions are however believed to be a factor in reducing the supplier’s willingness to comply. Overall, the study finds that DUT is a complex decision process regarding supplier adaptation, and can be a highly emotional experience with long-lasting effects. Research implications The face-to-face interviews used to collect narratives of participants being exposed to customer threats is deemed an appropriate and highly recommendable methodological approach. When collecting data on reactions to threats and their accompanying emotional reaction several non-verbal signs that the participants physically demonstrated were an essential component in fully interpreting the data. As such, future research on the topic could include video recordings of the interviews. The narratives were also very efficient in recalling the emotions associated with the coercive event though the interviews sometimes occurred several years afterward. The participants’ opinions are consistent with academia’s view regarding the ambiguous role of emotions during decision-making. On the one hand, emotions are recognized to play an important role, they should be acknowledged and understood, while on the other hand, many believe that emotions should not contaminate the decision process. By combining five cognitive criteria with emotions in a DUT framework, the paper incorporates knowledge from the field of psychology into the business-to-business marketing literature. The article highlights the fact that the study of both threats in a business setting and the role of emotions in decision-making are neglected topics that deserve more academic attention. Practical implications From the customer’s perspective an improved understanding of the supplier’s DUT may help customers limit the damage to relationships when using coercive influence strategies such as threats. From the supplier’s perspective, the results emphasize the importance to decompose their customer’s threat in order to better respond to its use. By also taking into account all consideration factors suppliers can take better quality decisions. The results provide several recommendations such as to include intangibles in the cost-benefit analysis instead of solely focusing on the short-term financial impact. Emotional control has been stressed by the participants as a key managerial ability to master when faced with threats. Originality/value/contribution By merging the influence strategy research stream and the supplier adaptation research stream together, the study generates a few original and noteworthy contributions. A better understanding of threats is garnered by breaking them down into three components, which consequently extends our understanding of influence strategies. The study also contributes to a deeper understanding of the supplier’s DUT, a new concept described in the paper, by identifying how decision makers include multiple criteria in their decision process. Very few academic papers have specifically looked into threats as a coercive strategy despite its prevalent use in business environments. Those that did focused on a limited set of criteria when analyzing the decision to adapt. The article expands on these previous studies by proposing five decision criteria, which are often considered collectively by participants when examining adaptation under threat, and emphasizes a factor neglected in previous research, namely the role of emotions. Pre-print version available at : https://depositum.uqat.ca/id/eprint/1244/
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