scholarly journals How to manage a long-term buyer-supplier relationship successfully? The impact of network information on long-term buyer-supplier relationships in the Dutch potted plant and flower industry

2004 ◽  
Vol 4 (1) ◽  
pp. 7-24 ◽  
Author(s):  
Danny Claro ◽  
D. Zylbersztajn ◽  
S. (Onno) Omta
Keyword(s):  
Transaction Cost Economics ◽  
Relationship Management ◽  
Business Networks ◽  
Business Network ◽  
Dyadic Relationship ◽  
Supplier Relationships ◽  
Potted Plant ◽  
Flower Industry ◽  
The Impact

Recently, scholars have suggested that to understand fully the nature of a dyadic relationship, greater attention must be directed to the network context. In this study we drew on emerging perspectives on inter-firm governance and networks to develop a theoretical framework to understand the successful governance of long-term buyer-supplier relationships. In order to test the research framework, we conducted a survey among 174 merchant distributors (buyers) and 67 growers (suppliers) in the Dutch potted plant and flower industry. In the estimated models, we found several positive impacts of the information obtained from the business network on the dimensions of relationship management, and ultimately performance, both in terms of operations as well as finance. The results of this study support our rationale that the business network compensates for the information asymmetry assumed in transaction cost economics. Although there are several similarities in our findings, buyers and suppliers use clearly different information strategies to achieve success. While the most successful distributors tend to take the 'hard', tangible approach using transaction-specific investments and fostering joint action, the successful growers take the 'soft', social approach by putting emphasis on norms of flexibility in the relationship. Managers may use these findings to check the adequacy of their business networks and their approach to relationship management.

The impact of horizontal and vertical connections on relationships' commitment and trust

2005 ◽  
Vol 20 (3) ◽  
pp. 136-147 ◽  
Author(s):  
Amjad Hadjikhani ◽  
Peter Thilenius
Keyword(s):  
Design Methodology ◽  
Dyadic Interaction ◽  
Business Networks ◽  
Business Network ◽  
Content Type ◽  
Horizontal Connections ◽  
The Impact ◽  
The Relationship ◽  
Lisrel Model

PurposeWhile an ever‐increasing body of research on business networks has commented on vertically connected relationships, this study embeds the horizontally connected relationships. Constructed on business network theories the paper aims to add more knowledge on business networks by developing a connection model including both vertical and horizontal connections. The model aims to explore the impact of connections on focal business relationships. It differentiates connected relationships on the basis of their vertical and horizontal natures. The purpose is to grasp the impact of these different connected relationships on the focal business relationship. The focal relationship elements are defined by commitment and trust, which capture their properties from the dyadic interaction and the two types of connected relationships.Design/methodology/approachThe paper tests the theoretical construction empirically. The empirical study is based on the IMP2 survey, utilizing information from extensive interviews with 138 firms regarding their relationships with important foreign customers.FindingsThe statistical findings in the form of a LISREL‐model clearly expose the impact of the horizontal connections and verify the validity of the theoretical model. It depicts that trust increase by vertical connections leading to increased commitment, thus strengthening the relationship while horizontal connection, on the contrary, weakens it. The facts also demonstrate how the horizontal connections impose effects on technological long‐term investments.Originality/valueMarketing researchers advocating certain theoretical views are thereby required to observe respect for the market realities with which managers are confronted.

scholarly journals The Impact of Entrepreneurial Business Networks on Firms’ Performance Through a Mediating Role of Dynamic Capabilities

2019 ◽  
Vol 11 (11) ◽  
pp. 3006 ◽  
Author(s):  
Jaffar Abbas ◽  
Saqlain Raza ◽  
Mohammad Nurunnabi ◽  
Mohd Sobri Minai ◽  
Shaher Bano
Keyword(s):  
Small Firms ◽  
Dynamic Capabilities ◽  
Surgical Instruments ◽  
Entrepreneurial Firms ◽  
Business Networks ◽  
Business Relationships ◽  
Business Network ◽  
Sustainable Performance ◽  
The Impact ◽  
The Relationship

This precise study is the first to perform a focalized investigation on the relationship between entrepreneurial business networks and sustainable performance of small firms. The entrepreneurial business network is a multifaceted business network of business firms, working together to achieve business objectives. Business relationships and firm aggregations are the main categories of entrepreneurial business networks, which help small and medium-sized enterprises to become more dynamic, innovative and competitive. The entrepreneurial business network is a networking, which provides a platform to build business relationships, identify, develop or act upon economic opportunities, share information and seek potential business partners for ventures. However, few studies have sought to understand the association of entrepreneurial business network (EBN) and firms’ sustainable performance in the context of Pakistan. This investigation aims to examine the relationship between EBN and small firms’ sustainable performance by applying the Smart PLS-SEM software V-3.2.8. This study explores how dynamic capabilities mediate the relationship between entrepreneurial business network and sustainable performance of small firms. The data received reports on small firms, manufacturing surgical instruments. The findings indicated that the entrepreneurial business network had a significant positive relationship with dynamic capabilities, which in turn presented a positive relation to a sustainable performance of small firms. By developing sustainable EBN, small firms can achieve sustainable performance by implementing dynamic capabilities in a competitive environment. The results affirmed that highly entrepreneurial firms showed a tendency to create a business network for achieving sustainable performance. The results also revealed that firms using business networks and dynamic capabilities efficiently; achieved their sustainable performance. The findings indicated that the study proposed a holistic and systematic model to achieve sustainable performance through firms’ dynamic capabilities. The generalizability of these findings provides useful insight and direction for future studies in Pakistan.

Designing Contracts for Business Networks

2010 ◽  
pp. 1400-1408
Author(s):  
Peter Rittgen
Keyword(s):  
Information Technology ◽  
Transaction Costs ◽  
Agency Theory ◽  
Transaction Cost Economics ◽  
Business Networks ◽  
Economic Activities ◽  
Coordination Costs ◽  
Trading Partners ◽  
The Impact ◽  
Networked Organizations

Economic activities within and between networked organizations can be coordinated via hierarchies (internal coordination) or markets (external coordination). There are theories that explain both agency theory (Jensen & Meckling, 1976) and transaction cost economics (Williamson, 1985). It is assumed that networked organizations design their organization and network of trading partners such that the sum of internal and external coordination costs is minimized. The impact of information technology (IT) has been assessed in different ways. Malone, Yates, and Benjamin (1987) expected that IT will lower transaction costs and lead to increased market coordination. Clemons, Reddi, and Row (1993, p. 9) posited that organizations will “move to the middle”, that is, to “more outsourcing, but from a reduced set of stable partnerships” if non-contractible issues such as quality and trust play an important role. Empirical evidence (Holland & Lockett, 1997) shows that companies often mix aspects from both markets and hierarchies.

Designing Contracts for Business Networks

2010 ◽  
pp. 395-401
Author(s):  
Peter Rittgen
Keyword(s):  
Information Technology ◽  
Transaction Costs ◽  
Agency Theory ◽  
Transaction Cost Economics ◽  
Business Networks ◽  
Economic Activities ◽  
Coordination Costs ◽  
Trading Partners ◽  
The Impact ◽  
Networked Organizations

Economic activities within and between networked organizations can be coordinated via hierarchies (internal coordination) or markets (external coordination). There are theories that explain both agency theory (Jensen & Meckling, 1976) and transaction cost economics (Williamson, 1985). It is assumed that networked organizations design their organization and network of trading partners such that the sum of internal and external coordination costs is minimized. The impact of information technology (IT) has been assessed in different ways. Malone, Yates, and Benjamin (1987) expected that IT will lower transaction costs and lead to increased market coordination. Clemons, Reddi, and Row (1993, p. 9) posited that organizations will “move to the middle”, that is, to “more outsourcing, but from a reduced set of stable partnerships” if non-contractible issues such as quality and trust play an important role. Empirical evidence (Holland & Lockett, 1997) shows that companies often mix aspects from both markets and hierarchies.

Oliver E. Williamson,

2016 ◽  
Author(s):  
Andrew B. Whitford
Keyword(s):  
Transaction Cost ◽  
Critical Analysis ◽  
Institutional Economics ◽  
Transaction Cost Economics ◽  
Antitrust Policy ◽  
New Institutional Economics ◽  
Policy Analysts ◽  
The Impact ◽  
First Time

This chapter comments on Oliver Williamson’s 1975 book,Markets and Hierarchies: Analysis and Antitrust Implications, a critical analysis of how firms operate in markets. Williamson describes a new way of understanding markets and hierarchies by using the term “New Institutional Economics” for the first time. This chapter examines Williamson’s approach and the impact of his book, first by discussing his arguments about markets and hierarchies in relation to what policy analysts sometimes call “the politics of ideas”. It then considers Williamson’s particular interest in antitrust policy as well as his thesis about transaction cost economics. Finally, it evaluates the implications of Williamson’s research for the long-term development of a politics of ideas about firms in markets.

The impact of asymmetric perceptions of buyer-supplier governance mechanisms on relational rents

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Evelyne Vanpoucke ◽  
Martin Wetzels ◽  
Frank Rozemeijer ◽  
Marion Pilzak-Blonska
Keyword(s):  
Boundary Spanners ◽  
Preferential Treatment ◽  
Governance Mechanisms ◽  
Open Communication ◽  
Supplier Relationships ◽  
Content Type ◽  
The Impact ◽  
The Relationship ◽  
Practical Implications

PurposeBuyers and suppliers often perceive relationship governance mechanisms, such as trust and contractual fairness, in different ways. These differences in perception create an extra layer of complexity that is often ignored in the extant literature. This study adds to the understanding of how perceived asymmetries in trust and contractual fairness, two key relationship governance mechanisms, impact relational rents. This study also analyzes how boundary spanners aid managers to deal with these perceived asymmetries.Design/methodology/approachBased on survey data of 103 buyer–supplier dyads from a single global manufacturer of industrial equipment, the authors test hypotheses of perceived asymmetries in trust and contractual fairness, as well as the moderating effect of boundary spanners, on relational rents.FindingsThis research challenges the belief that asymmetries negatively impact or lead to unstable buyer–supplier relationships. Furthermore, it explains how preferential treatment and length of the relationship could reduce the impact of asymmetric perceptions.Practical implicationsThis study stresses that open communication, which considers different viewpoints, helps to overcome the negative differences in attitude and perception. In addition, the authors found that long-term relationships seem to be far more resilient in dealing with asymmetries and that preferential treatments are best applied in (approximately) symmetric relationships in terms of contractual fairness.Originality/valueWhile studies on buyer–supplier relationships often assume symmetric perceptions of governance mechanisms, asymmetric perceptions are far more prominent in reality. This study aims to improve one’s understanding of the impact of these asymmetries as well as how boundary spanners can affect these perceptions.

scholarly journals The Impact of Medical Tourist Relationship Management Dimensions on Innovation Capabilities

2019 ◽  
Vol 9 (3) ◽  
pp. 70
Author(s):  
Fayez Shriedeh
Keyword(s):  
Relationship Management ◽  
Customer Involvement ◽  
Product Service ◽  
The One ◽  
Innovation Knowledge ◽  
The Impact ◽  
Joint Problem Solving ◽  
Medical Tourist ◽  
Positive Impacts

This study investigates the one-to-one effect of medical tourist relationship management on innovation capabilities. This study employed regression analysis to test the research hypotheses in a sample of 306 medical tourists in Amman, Jordan. The findings indicate that long- term relationship and joint problem solving have positive impacts on all types of innovation. Knowledge management and customer involvement have positive influences on the product, process, service, and marketing innovations. Technology-based CRM has positive impacts on product, service, and process innovation. Finally, this paper discusses practical implications and future study directions.

scholarly journals The Impact of Customer Relationship Management on Long-term Customers’ Loyalty in the Palestinian Banking Industry

2017 ◽  
Vol 10 (11) ◽  
pp. 139
Author(s):  
Raed A. M. Iriqat ◽  
Mohannad A. M. Abu Daqar
Keyword(s):  
Service Quality ◽  
Customer Relationship Management ◽  
System Integration ◽  
Banking Industry ◽  
Relationship Management ◽  
Customer Relationship ◽  
Quality Level ◽  
Crm System ◽  
The Impact

This paper aims to investigate the impact of customer relationship management on Long-term Customers’ Loyalty in the Palestinian banking industry. The data was collected through distributing questionnaires on the Palestinian banking employees. Using multiple regression analysis tests, this paper finds these results; there is a positive and strong linear relationship between dependent variable “long-term customers’ loyalty” and CRM, the CRM dimensions are service quality, customer’s database, solving customer’s problems, employees behavior, and CRM system integration. At the end, the two predictors (employee’s behavior and CRM system integration) explained 48.2% of the variance in the long-term customers’ loyalty. The scholars’ found that banks have to investigate why there is a difference in the service quality level between male and female employees where male employees more effective than females. Furthermore, banks need to update their customers’ database in order to be alerted to changes in their customers’ requirements and needs to retain their loyal relationships with customers.

A networking approach to analyzing religious tourism businesses

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ali Heidari ◽  
Hamid Reza Yazdani ◽  
Fatemeh Saghafi ◽  
Mohammad Reza Jalilvand
Keyword(s):  
Single Case ◽  
Business Networks ◽  
Business Network ◽  
Content Type ◽  
East Region ◽  
Religious Tourism ◽  
Collaborative Activities ◽  
Middle East Region

Purpose Within a religious tourism destination, the study of business networks can be used to improve understanding of the interactions taking place within or among businesses, by exploring the informal and formal connections linking them together. Hence, the purpose of this study is to map and analyze strategic business networks operating in a religious destination. Design/methodology/approach This research explores the networks of stakeholders associated with a religious context in an intensive single case study on Al-Atabat Al-Aliyat in Iraq through qualitative analysis. Multiple methods of data collection were used to build strategic networks promoting religious tourism in the Middle-East region. Key analysis practices include content analysis and social network analysis (SNA). The identified interrelationships between stakeholders were analyzed by using UCINet, an SNA tool. Findings The study reveals three different types of cooperation networks in the case of Al-Atabat Al-Aliyat, namely, a 67-actor continuous network, a 69-actor non-Arbaeen network and an 89-actor Arbaeen network. The results also pinpoint the need for more collaborative activities on the different levels of cooperation in the networks. Practical implications This paper provides important guidelines on how to manage the interrelationships within tourism networks in a religious destination such as Iraq. The findings highlight the acute need for establishing strategic and effective networks of stakeholders in Al-Atabat Al-Aliyat. Non-tangible, long-term and quantitative benefits can be found for tourism businesses investing time and money in religious networks in Iraq. Originality/value The research contributes to religious tourism literature, filling the gaps about how the interrelationships among the actors involved in a business network can evolve over time and influence the success of a certain religious destination.

Long-Term Manufacturer-Supplier Relationships: Do They Pay off for Supplier Firms?

1995 ◽  
Vol 59 (1) ◽  
pp. 1-16 ◽  
Author(s):  
Manohar U. Kalwani ◽  
Narakesari Narayandas
Keyword(s):  
Data Base ◽  
Sales Growth ◽  
Data Bases ◽  
Cross Sectional ◽  
Supplier Relationships ◽  
The Impact ◽  
Transactional Approach ◽  
Over Time

Recently, there has been a growing trend toward long-term relationships between manufacturers and their suppliers. Although much as been written about the benefits of this shift to manufacturers, little is known about the benefits to supplier firms. In this study, we empirically assess the impact of long-term relationships with specific customers on the performance of supplier firms using cross-sectional and longitudinal information available in the Compustat collection of data bases and the Compact Disclosure data base. Our results indicate that maintaining long-term relationships with select customers does not come at the expense of the rate of sales growth. Suppliers in long-term relationships are able to achieve the same level of growth as firms that employ a transactional approach to servicing their customers. These suppliers are able to reduce costs over time through better inventory utilization; however, this reduction in cost seems to be bargained away by their customers through lower prices over time. Finally, the supplier firms in long-term relationships achieve higher profitability by differentially reducing their discretionary expenses such as selling, general, and administrative overhead costs to a greater extent than their counterparts who use a transactional approach to servicing their customers.

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