Interfirm Adaptation in Business Relationships

Piggy in the Middle: How Direct Customer Power Affects First-Tier Suppliers’ Adoption of Socially Responsible Procurement Practices and Performance

“…The concept of power is used extensively in supply chain management literature to explain the performance of supply chain relationships in terms of trust (Kumar et al 1995;Maloni and Benton 2000), cooperation (Frazier and Rody 1991;Maloni and Benton 2000), commitment (Kumar et al 1995;Maloni and Benton 2000;Zhao et al 2008), adaptation (Hallen et al 1991;Nyaga et al 2013) or satisfaction (Benton and Maloni 2005;Frazier and Summers 1986;Maloni and Benton 2000). Power is a key variable in supply chain relationships as it directly relates to the control and influence of one party over another (Maloni and Benton 2000;Nyaga et al 2013).…”

“…For example, power asymmetry arises in supply chain relationships if the buyer purchases a large share of a supplier's outputs, thus creating dependence; if one party has unique expertise; or if one party has developed a contract structure which makes finding another partner very difficult (Belaya et al 2009). One study found the perception of customer importance by the supplier to be the most reliable indicator of supplier dependence (Hallen et al 1991).…”

Pricing to manage export channel relationships

“…To cope with the internal competition, exporters must come up with mechanisms that 1 We also refer to exporters as suppliers. 2 We also refer to importers as resellers, intermediaries, or distributors, 3 We refer to distributor-level competition as internal competition to contrast it with external (market-level) competition provide the importer with superior benefits and keep the working relationship fruitful and lively (Hallén, Johanson, & Seyed-Mohamed, 1991). Some authors therefore speak of a customer relationship between the exporter and the importer (Lye & Hamilton, 2001;Solberg & Nes, 2002).…”

Environmental Adaptation in Supplier-Customer Relationships

“…This type of adjustment is important throughout the duration of a relationship and may be needed to improve its efficiency and to enable companies to respond to external market dynamics. Previous studies have established links between factors which contribute to adaptations being introduced and actual adaptation behaviour (Hallen et al 1987 and1991). However, little empirical research has been conducted which presents a processual perspective (Van de Ven 1992) of adaptations.…”

“…The adaptations introduced into the four relationships featured resulted from efforts by companies to respond to elements of uncertainty, to achieve cost reductions and by companies learning about the needs and capabilities of each other (Hallen et al 1987 and1991).…”