The effect of power use on specific investments: the moderating role of interdependence structure

PurposePower use widely exists in buyer–supplier relationships (BSRs). Different directions of power use (i.e. buyer's power use and supplier's power use) intertwining with different types of power (i.e. coercive and noncoercive power) make it insufficient to regard power use as a single construct when examining its effect on a firm's following response. Besides, interdependence structure characterized by joint dependence and dependence asymmetry may influence the effect of a specific power use by shaping the firm's interpretation and cognition toward the relationship. Specifically, this study examines how four types of power use a buyer facing and an interdependence structure with its supplier affect its specific investments to the supplier.Design/methodology/approachThis study tests the proposed relationships using regression analysis, based on data from 240 manufacturing firms in China on their perceived relationships with their major suppliers.FindingsResults show that buyer's coercive power use (BCP) negatively affects buyer's specific investments while noncoercive power use (BNP) does not play a significant role. Both supplier's coercive power use (SCP) and noncoercive power use (SNP) are positively related to buyer's specific investments. Joint dependence positively moderates the effect of BNP and dependence asymmetry negatively moderates the effects of BCP and SNP on buyer's specific investments.Originality/valueThis study contributes to the literature on power use by identifying different types of power use and their different roles in influencing buyer's specific investments. The study also contributes to the literature on interdependence structure by demonstrating the different roles of joint dependence and dependence asymmetry.

The Effects of Dependence on Brazilian Third-Party Logistics Satisfaction

ABSTRACT 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.

Os Efeitos da Dependência na Satisfação dos Operadores Logísticos Brasileiros

ABSTRACT 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.

Supplier-initiating risk management behaviour and supply-side resilience: the effects of interpersonal relationships and dependence asymmetry in buyer-supplier relationships

PurposeThe aim of the study is to explore how two dimensions of interpersonal relationships (i.e. size and range of relationships) affect supplier-initiating risk management behaviours (SIRMB) and supply-side resilience. Further, the study aims to explore the moderating role of dependence asymmetry.Design/methodology/approachNine hypotheses are tested based on a moderated mediation analysis of survey data from 247 manufacturing firms in China. The data are validated using a subset of 57 attentive secondary respondents and archival data.FindingsSIRMB positively relates to supply-side resilience. Further, SIRMB mediates the positive relationship between range and supply-side resilience, and this relationship is stronger at lower levels of dependence asymmetry. Yet, although dependence asymmetry positively moderates the relationship between range and SIRMB, it negatively moderates the relationship between size and SIRMB. We did not, however, find evidence that size has a conditional indirect effect on supply-side resilience through SIRMB.Practical implicationsManagers in buying firms can incentivise SIRMB to enhance supply-side resilience by developing a diverse rather than a large set of interpersonal relationships with a supplier. This might include allocating particular employees with a wide range of contacts within a supplier to that relationship, while it may be necessary to adopt different networking strategies for different supplier relationships. Firms in a highly asymmetrical relationship may seek to raise supplier expectations about the necessity to initiate risk management behaviour or look to change the dynamic of the relationship by managing contracts for fairness.Originality/valueNew knowledge on SIRMB as a mediating variable underpinning the relationship between interpersonal relationships and supply-side resilience is provided; and empirical evidence on the opposing moderation effect of dependence asymmetry is presented.

Dark side of joint R&D collaborations: dependence asymmetry and opportunism

Purpose The purpose of this study is to enhance the comprehensive understanding of the roles of resource investments, explicit contracts and three components of guanxi (i.e. renqing, ganqing and mianzi) in asymmetric research and development (R&D) partnerships. Treating dependence asymmetry as a multidimensional construct, this study examines the moderating effects of these elements on the relationships between resources and information asymmetry and opportunism. Design/methodology/approach The study was executed by issuing questionnaires to R&D managers participating in R&D projects and collaborations in the Shanghai and Jiangsu provinces via e-mail and face to face surveys. A multiple regression analysis was used to test the hypotheses. Findings The empirical test generally supported the conceptual model and produced the following findings: first, resources and information asymmetry significantly and positively affect opportunism. Second, the partner’s resource investments can weaken the effect of resources and information asymmetry on the partner’s opportunism. Third, explicit contracts can reduce the impact of information asymmetry on the partner’s opportunism. Fourth, renqing and ganqing but not mianzi can weaken the influence of information asymmetry on the partner’s opportunism. Originality/value This study provides a comprehensive and clear understanding of how opportunism can be curbed by jointly considering resource investments, explicit contracts and guanxi in asymmetric R&D cooperative relationships. Moreover, dependence asymmetry and guanxi are measured as a multidimensional construct and reveal their underlying structure, which expands previous understandings of risk management in R&D collaborations.