ASSESSING EFFECTIVE EXCHANGE RELATIONSHIPS: AN EXPLORATORY EXAMINATION
Faye S McIntyre; James L Thomas Jr; K J Tullis; Joyce A Young
Journal of Marketing Theory and Practice; Winter 2004; 12, 1; ABI/INFORM Global
pg. 36
ASSESSING EFFECTIVE EXCHANGE
RELATIONSHIPS: AN
EXPLORATORY EXAMINATION
Faye S. Mclntyre State
University of West Georgia
James L. Thomas, Jr.
Jacksonville State University
K. J. Tullis University of
Central Oklahoma
Joyce A. Young Indiana
State University
The authors would like to acknowledge the financial support of the Jackson College of Graduate Studies and Research,
University of Central Oklahoma, in the collection of data used for this study, and to thank the editor and three anonymous
JMT&P reviewers for their helpful comments about earlier versions of this article.
This article presents the findings of an exploratory study examining how suppliers can strengthen customer relationships by
developing more effective partnerships. Using a relationship marketing framework, we assess four aspects of interorganizational
relationships and their impact on effectiveness. A mail survey was sent to all available retailers licensed by the state of Oklahoma
LP Gas Board. An OLS regression indicates that the four predictor variables explain over one-third of the variance in relationship
performance. Relational context and the ability to predict changes in the environment are both significant predictors of
effectiveness; higher levels of each lead to more effective relationships. Though the coefficients for strategic synergy and
environmental volatility are as expected, neither is significant. Managerial and research implications are discussed.
36
Journal of Marketing THEORY AND PRACTICE
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INTRODUCTION
In response to an increasingly global environment, American
companies continue to search for business practices that may
give them a competitive advantage in the marketplace. The
development of cooperative exchange relationships between
supply channel members is one practice that has received
significant attention over the last two decades by both
academicians and practitioners. Manufacturers have
discovered the managerial, technological, and financial
benefits that may accrue as a result of close ties with suppliers
(Ellram 1990). As supply channel members voluntarily
increase their dependence upon each other for long-term
survival, effective exchange relationships must be created
between the parties. Higher performing relationships can help
overcome inevitable differences that arise between partners
over time (Day 1995).
The formation of cooperative exchange relationships between
supply channel members is still not fully understood, and
further investigation of the process has been called for by a
number of authors (e.g., Heide and John 1990; Cannon and
Perreault 1999). Relationships that are more cooperative do
exhibit higher performance (Johnson and Raven 1996);
however, the identification of factors that affect the
performance of such exchange relationships is a basic research
question that has yet to be fully answered. Indeed, the
empirical evidence assessing performance implications is
limited (Rindfleisch and Heide 1997; Buvik and John 2000).
This exploratory study adds to the growing relationship
marketing literature by examining how suppliers can
strengthen their customer relationships by developing more
effective partnerships.
RELATIONSHIP MARKETING IN CHANNEL
CONTEXTS
Parvatiyar and Sheth (2000, p. 9) define relationship marketing
as "the ongoing process of engaging in cooperative and
collaborative activities and programs with immediate and enduser customers to create or enhance mutual economic value at
reduced cost." However, Morgan and Hunt (1994, p. 22) view
relationship marketing as encompassing "all marketing
activities directed toward establishing, developing, and
maintaining successful relational exchanges." This broader
definition covers all types of relational exchanges, both
internal and external, forward and backward in the channel.
Though there is no universally accepted definition for
relationship marketing, the many existing definitions have
much in common (Robicheaux and Coleman 1994; Hunt
2002). One common ingredient is the concept of cooperation
with other stakeholders (channel members and/or end users) in
order to better compete (Hunt and Morgan 1994). A second
commonality, expressed explicitly in some definitions and
implicitly in others, is the concept that not all relationships
constitute relationship marketing (Hunt 2002; Sheth and
Parvatiyar 2002).
The impact of relationship marketing efforts differs in
contractual versus non-contractual contexts (Reinartz and
Kumar 2000). The possibility has been raised that the ultimate
impact of relationship marketing in a channel context may
differ from its impact in supplier—manufacturer,
manufacturer—consumer, or strategic alliance contexts (Nevin
1995), which often involve exclusive relations. However,
supplying firms using intensive and selective distribution
systems have chosen to provide coverage to a territory through
multiple channel members, limiting their dependency on any
one member. Thus, these firms may find it difficult to generate
the substantial interdependency prevalent in relationship
marketing. Indeed, marketers often fail to effectively manage
their customer relationships, resulting in relationships whose
quality never fully develops (Dorsch, Swanson, and Kelley
1998).
Morgan and Hunt (1994, p. 22) argue that the central issue in
understanding relationship marketing is "whatever produces
relationship marketing successes instead of failures." The
success of a relationship can be defined as its ability to
effectively achieve the firms' ex ante goals and objectives
(Van de Ven 1976; Young, Gilbert, and Mclntyre 1996). We
examine how suppliers might strengthen their customer
relationships by building more effective working relationships.
BUILDING EFFECTIVE RELATIONSHIPS
Performance in interfirm relationships is a complex, multidimensional concept that includes affective and behavioral
components as well as economic aspects; though the affective
and economic components of performance no doubt relate, a
comprehensive picture of the channel relationship should
include both (Johnson and Raven 1996). Dwyer, Schurr, and
Oh (1987) employ the terms "effectiveness" and "perceived
effectiveness" for relationship quality, and Woodside, Wilson,
and Milner (1992) define quality as a global evaluation of the
effectiveness and efficiency of the relationship. Successful
performance of a channel relationship includes both effort of
the channel members and achievement of firm goals (Spriggs
1994). Thus, perceived effectiveness may provide an overall
measure of satisfaction with the economic and non-economic
aspects of the relationship. Van de Ven and Ferry (1980) assert
that effectiveness of inlerorganizational relationships can be
measured as the extent to which parties perceive their selfinterests are attained and the extent to which they perceive
involvement in the relationship is worthwhile, productive, and
satisfying. Perceived effectiveness is defined as the extent to
which both parties in an exchange find the relationship
productive and worthwhile and thus, are committed to the
relationship (Bucklin and Sengupta 1993).
Winter 2004
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37
Though there are many factors that contribute to the success of
relationship marketing efforts (Morgan and Hunt 1994), we
assess four aspects of interorganizational relationships and
their impact on relationship effectiveness. Strategic synergy
provided by the relationship and the development of a
relational context should have a positive impact on perceived
effectiveness; volatility in the environment should have a
negative impact, but the ability to correctly predict
environmental changes should have a positive impact. An
examination of each determinant is presented in the following
sections.
relationship (Saxton 1997), positively impact communication
and cooperation among exchange partners (Anderson and
Narus 1990; Morgan and Hunt 1994), and increase a partner's
commitment to the relationship (Lambe, Wittmann, and
Spekman 2001). Thus, the relationship's ability to produce
strategic synergy should increase the partners' perceptions of
relationship effectiveness, and we hypothesize:
H1: Higher assessments of strategic synergy
will increase perceived effectiveness of the
relationship.
Relationalism
Strategic Synergy
Day (1995, p. 298) posits that relationships such as strategic
alliances are developed as a means of building competitive
advantage, but that a "healthy measure of skepticism" about
the realized benefits is warranted. When a relationship leads to
better positional advantages, it likely will lead to higher
performance (Day and Wensley 1988). However, the
effectiveness of an exchange relationship is primarily
dependent upon its ability to accomplish the parties' objectives
(Van de Ven 1976; Young, Gilbert, and Mclntyre 1996). As
such, effectiveness is dependent upon the individual goals of
each partner and the ability of the partnership to reach these
goals over time.
Three broad categories of characteristics (firm, industry, and
environmental) influence the formation and success of
interorganizational
relationships
(Varadarajan
and
Cunningham 1995). Lynch (1989) suggests a number of
specific strategic goals that may motivate a firm to form
stronger relationships, such as: 1) its ability to predict
technological changes; 2) its capital costs expenditures and,
thus, access to capital; 3) its prospects for market growth; 4)
the level of competition in its markets; and 5) its ability to
predict changes in sales volume. A firm with a weakness in
one or more of these areas should select a partner with
corresponding strengths in order to build "strategic synergy"
(Lynch 1989, p. 58). Cooperative relationships cannot survive
without such mutual advantage (Lynch 1993). Indeed, the
overriding objective of interorganizational relationships is the
attainment of goals the firm cannot achieve independently
(Van de Ven and Ferry 1980).
Ensuring the relationship's ability to produce strategic synergy
requires ongoing evaluation. Assessments of initial
experiences shape trust in the other party and expectations for
future transactions (Lambe, Wittmann, and Spekman 2001).
Anderson and Narus (1990, p. 44) suggest that when
evaluating ongoing relationships, the appropriate starting point
is an assessment of the "current evaluation of past relationship
outcomes"; these outcomes are critical to understanding
partnerships. Such an evaluation is needed since even
successful relationships change over time (Harvey and Speier
2000). Positive evaluations lead to initial satisfaction with the
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Relational exchange is one framework for the study of
exchange relationships (Robicheaux and Coleman 1994).
Increasing levels of relationalism enhance relationship
performance (Noordewier, John, and Nevin 1990; Cannon,
Achrol, and Gundlach 2000). Though relational exchange
"accounts explicitly for the historical and social context in
which transactions take place" (Heide 1994, p. 74, italics
added), marketing researchers have almost exclusively
operationalized the relational nature of a relationship using
norms (e.g., Boyle et al. 1992; Heide and John 1992). Norms
are expected and accepted patterns of behavior between
partners (Heide and John 1992). For example, Simpson and
Mayo (1997) operationalized relationalism as a second-order
factor consisting of four norms. Boyle et al. (1992, p. 464)
chose three norms viewed as "central to relational exchange"
in their first study, then used a global scale to assess
relationalism in their second. And Cannon and Perreault
(1999, p. 447) developed a six-item scale to assess
"cooperative norms." High correlations among relational
norms exist (e.g., Noordewier, John and Nevin 1990).
Nevin and Spriggs (1995) contend that, rather than focusing
exclusively on relational norms, one must examine the
relational context of an exchange to truly understand each
party's satisfaction with, or perceived effectiveness of, the
relationship. They build on Macneil's (1974,1980) contractual
elements to define relationalism, stating that these contextual
elements "capture the exchange context or socioeconomic
structure within which exchange takes place" (Nevin and
Spriggs 1995, p. 143). In their empirical examination, they
conclude that the relational context has a positive impact on
relationship satisfaction.
Though relational context has not yet gained widespread
acceptance in the literature, its use has some support. For
example, two studies were identified that use contractual
elements in conjunction with norms to assess the relational
nature of relationships (Simpson and Paul 1995; Young,
Gilbert, and Mclntyre 1996). However, even this evidence
appears cursory, at best. Young, Gilbert, and Mclntyre (1996)
found a positive correlation between the effectiveness of the
relationship and the two contractual elements they assessed,
but this was not a primary part of their investigation. This is
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found in the correlation table provided as a precursor to the
"real" analysis. Indeed, there is much indirect but little direct
support for the link between relational structure and
performance (Robicheaux and Coleman 1994). Heide (1994,
p. 72) notes the "limited attention to the effect of contextual
variables in interorganizational research." An explicit
examination between the relational context and the
effectiveness of the relationship is clearly needed. We
hypothesize:
H2: Higher levels of relational context will
increase perceived effectiveness of the
relationship.
relationship continuity; however, volume unpredictability had
no significant impact on continuity expectations.
The inability to correctly predict environmental changes, such
as "betting on the wrong technology," leads to reduced
relationship effectiveness (Lambe and Spekman 1997, p. 114).
Environmental uncertainty increases negotiation costs (Artz
and Brush 2000) and both outcome- and behavior-based
coordination efforts (Celly and Frazier 1996). These higher
negotiation costs and the potential for increased costs of
coordination efforts may affect the economic value of the
relationship. Clearly, the performance of a relationship may be
affected not only by changes in the environment, but also the
firm's ability to anticipate or predict changes. Therefore:
H4: The ability to accurately predict
environmental changes will increase
perceived effectiveness of the relationship.
Environmental Volatility and Ability to Predict
Firms may enter into cooperative agreements as a means of
coping with environmental turbulence (Day 1995; Lambe and
Spekman 1997) or as a means of sharing the risks of rapid
environmental changes (Bucklin and Sengupta 1993). Change
in customer, competitor, and supplier environments is an
accepted part of the firm's condition that can impact not only
effectiveness of established relationships (e.g., Doty, Glick,
and Huber 1990), but firm survival itself (Porter 1980;
Williamson 1990). Environmental volatility increases the
complexity of channel relationships (Dwyer and Welsh 1985)
and coordination of channel efforts (Celly and Frazier 1996),
which may increase the costs of managing the relationship.
Thus:
H3: Higher levels of environmental
volatility
will
reduce
perceived
effectiveness of the relationship.
While environmental volatility and the ability to predict this
volatility are certainly related constructs, they are not the
same. We differentiate between competitive volatility as
changes in the environment and uncertainty as the inability to
forecast or predict these changes (e.g., Miller and
Shamsiel999). A firm's ability to successfully predict new
innovations within the industry may influence the degree of
uncertainty faced by the firm. Buvik and John (2000, p. 53)
define uncertainty as "unanticipated changes in the task
environment"; similarly, Artz and Brush (2000, p. 343) define
environmental uncertainty as the "inability to predict
changes." Technological unpredictability leads to lower levels
of commitment and higher levels of opportunism (Joshi and
Stump 1999), both of which can negatively impact
performance (e.g., Gundlach, Achrol, and Mentzer 1995;
Achrol and Gundlach 1999; Brown, Dev, and Lee 2000). Since
technological unpredictability is believed by many to be
managed best through loose coupling, rather than strong
relationships, firms may prefer to retain the flexibility to
switch partners. Heide and John (1990) found that
technological unpredictability leads to lowered expectations of
METHODOLOGY
Given the previous discussion, an exploratory investigation of
relationship effectiveness may provide an incremental step in
our understanding of how to build cooperative relationships.
The following sections describe the sampling and
measurement procedures used in this study.
Sample
The questionnaire in this study was sent to all available
retailers currently licensed by the state of Oklahoma LP Gas
Board. The term "LP Gas Industry" generally refers to the
activities associated with the processing, wholesale marketing,
transportation, storage, and retailing of propane gas. This
industry provides an appropriate setting within which to assess
relationship marketing. Since consumers recognize brand
names, suppliers strive to build strong relationships with retail
distributors that will uphold and protect their brand image.
Thus, most suppliers use a selective distribution strategy. LP
gas retailers have limited alternatives for supply. The limited
number of suppliers combined with strong competition at the
retail level lead most retailers to align with one supplier. The
LP gas industry clearly exhibits characteristics conducive to
relationship marketing efforts.
Although the term "Liquefied Petroleum Gas" encompasses
any petroleum product that would be gaseous at normal
ambient temperatures, yet is stored in a liquid state under
pressure, LP gas has come to mean "propane" for most
consumers. Propane has been in common use for home
heating, industrial fuel, crop drying, motor vehicle fuel, RV,
cooking, etc., since the 1950s. Prior to this time a similar
product, Butane, was more widely used. Butane is stored at
much lower pressures than Propane. Propane equipment must
be more robust in order to be handled and stored safely.
Winter 2004
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39
Propane is generally sold at retail in one of three ways: 1)
retail filling of small containers on site, 2) motor vehicle tanks,
or 3) delivery of bulk product via small tankers.
Although butane and propane are used in many situations other
than shown above, and although there are many other
liquefied-gas products besides these two, these are the only
two in widespread distribution to consumers. For most
consumers, propane substitutes for natural gas in home use and
is most common in places where natural gas supply lines do
not exist. Since natural gas lines have proliferated in most
urban and suburban areas, the majority of home use of LP gas
is in rural areas. Butane is no longer available at retail in most
markets. It is widely used as an additive for gasoline, as an
aerosol propellant, and as lighter fuel. These uses are generally
not included in the retail/commercial LP gas market.
Sampling Procedures
The data for this study were collected via mail survey. A letter
of introduction requesting participation in the study was sent
to 252 LP gas retailers. Approximately two weeks later, the
questionnaire was sent to participants, along with a cover letter
and return envelope. No additional contacts were made. The
mailing resulted in 49 usable responses, for a response rate of
19.44%. Though the sample size is small, it is comparable to
other exploratory studies in the channels literature (e.g., Perez
and Descals 1999, n = 55; Johnson, Krapfel, and Grimm 2001,
n = 76; Young, Hoggatt, and Paswan 2001, n = 30).
Construct Measures
Respondents were asked to focus on their primary supplier in
answering the interfirm relationship questions. Those with
multiple suppliers were asked to focus on the relationship with
the supplier of their top volume brand or product. These
relationships are believed to hold strategic significance for LP
gas dealers since the productivity of purchasing ties provide
direct gains to firms' bottom lines (Buvik and John 2000).
The perceived effectiveness of the relationship was measured
using Bucklin and Sengupta's (1993) five-item, 7-point Likerttype scale (with a reported alpha value of .84). This scale
assesses the degree to which the respondents perceive that
both parties have fulfilled commitments to the relationships,
ranging from (1) not at all to (7) to a very great extent. Global
scales, such as this one, elicit an overall summary evaluation;
they provide benefits of brevity and simplicity in survey
research and are particularly appropriate when examining the
impact of other constructs on overall performance (Kumar,
Stern, and Achrol 1992). The mean was computed, and the
scale exhibited strong internal consistency with an alpha of
.9321.
A six-item, 7-point scale was developed to measure strategic
synergy. Respondents were asked to what extent they are able
to realize benefits because of the relationship, ranging from (1)
40
not at all to (7) to a very great extent. Since no scale was
available in the extant literature, the authors developed a series
of items based on Lynch's (1989) work to assess the degree to
which the firm has achieved strategic synergy from the
relationship with the identified supplier. Five fellow
academicians and industry experts then evaluated the scale
items to assure face validity. Given the exploratory nature of
the study, no pretest was conducted. An alpha value of .9103
fits within the common threshold of .70 (Hair et al. 1992) and
goes well beyond the standard of .60 deemed acceptable for
exploratory research (Bagozzi and Yi 1988).
Nevin and Spriggs (1995) developed an exchange context
measure consisting of eight bipolar adjectives, though no
assessment of reliability was reported. Each pair of adjectives
was intended to share a common core but contribute a unique
aspect of the exchange context measure. Though Nevin and
Spriggs used a summed score to measure the exchange
context, we use the mean score to allow for easier comparison
with other construct measures. The eight-item, 7-point scale
produced an alpha of .8982.
A three-item, 7-point scale was used to assess environmental
changes during the past year, ranging from (1 )few changes to
(7) many changes. A second three-item, 7-point scale was used
to assess the firm's ability to predict these changes over the
past year, ranging from (1) inaccurate to (7) accurate. These
scales asked respondents to assess the extent of behavior
changes and respondents' ability to predict changes of: 1) key
suppliers, 2) key competitors, and 3) key customers/clients.
Both are modifications of scales used by Doty, Glick, and
Huber (1990), who reported alpha values of .77 and .73,
respectively. A mean was computed for each scale, and the
coefficient alphas for the two scales were .7013 and .7738,
respectively.
Scale items for all constructs are presented in Table 1.
Composite measures for each scale were computed using the
mean score. The item-to-total correlation of each scale was
first assessed. One item from the relational context scale was
deleted at this point. Next, principal component factor analysis
was conducted. Two additional items from the relational
context scale were deleted due to cross-loadings. Results of the
factor analysis are presented in Table 2. Significant factor
loadings on the expected constructs provide evidence of
convergent validity. Hair et al. (1992) recommend that a factor
analysis with sample sizes of fewer than 50 be interpreted
cautiously. Though this analysis meets their suggested ratio of
observations to variables of at least 2:1, the sample size of 49
merits note.
Reliability scores and correlations among the factors are
presented in Table 3. Though many of the correlations are
significant, they all fall below .80, indicating that
multicollinearity is not problematic.
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TABLE 2
FACTOR LOADINGS
TABLE 1
MEASUREMENT SCALES
Construct
Items
Exchange
Context
Our relationship with this
supplier is..."
Distrustful... Trusting
unbalanced... Balanced"
Inflexible... Flexible
No Sharing... Sharing"
One-Sided... Participative
Impersonal... Personal
Competitive... Cooperative
Number
of Items
4
Cronbach's
Alpha
.8982
b
Strategic
Synergy
Perceived
Performance
Explicit Rules... Implicit
Understandings
Because of my relationship
with this supplier...0
I am better able to predict
sales volume for my firm.
I can more easily adapt to
technology changes.
My market share has
increased.
I am better able to compete in
the local market.
I have better prospects for
future growth.
I am better able to secure
financial resources.
To what extent has ...c
6
5
.9103
.9321
this supplier carried out its
responsibilities and
commitments with respect to
this relationship?
your firm carried out its
responsibilities and
commitments with respect to
this relationship?
this relationship been
productive?
the time and effort spent in
developing and maintaining
this relationship been
worthwhile?
this relationship been
satisfactory?
Environmental Over the past year, how
3
Changes
many important changes
have occurred in the
behavior of key ...d
suppliers
competitors
customers/clients
Ability to
Over the past year, how
3
Predict
accurate were your
Changes
predictions regarding
important changes in
behavior of key ...c
suppliers
competitor
customers/clients
" Seven-point semantic differential scale.
b
Deleted from final scale.
° Seven-point scale: 1 = not at all, 7 = to a very great extent.
d
Seven-point scale: 1 = few changes, 7 = many changes.
• Seven-point scale: 1 = inaccurate, 7 = accurate.
.7013
.7738
Items
Fl
Market Share Increase
.871
Have better future
growth prospects
.837
Adapt to technology
changes
.825
Better able to secure
financial resources
.818
Better able to predict
sales volume
.813
Better able to compete
in local markets
.706
F2
Supplier carried out
its responsibilities and
commitments
.854
Relationship has
been productive
.837
Relationship has
been satisfactory
.776
Time and effort has
been worthwhile
.776
Your firm carried out
its
responsibilities and
commitments
.753
F3
Inflexible.Flexible
.845
Impersonal... Personal
.845
Distrustful...Trustful
.806
One-Sided...
Participative
.802
Explicit Rules...Implicit
Understanding
.781
F4
Accurate customer
predictions
.855
Accurate competitor
predictions
.816
Accurate supplier
predictions
.748
F5
Changes in suppliers
behavior
.831
Changes in competitors
behavior
.767
Changes in customers
behavior
.766
Winter 2004 41
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DISCUSSION
TABLE 3 CORRELATION AND
RELIABILITY SCORES
Constructs Performance Synergy
Performance
.9321
Synergy
.377*
.9103
Context
.523*
.403*
Changes
-.088
-.001
Predict
.452*
.296*
Reliabilities are in diagonals in bold. *
Correlation is significant at p < .05.
Context
Changes Predict
.8982
-.018
.337*
.7013
-.145
.7738
DATA ANALYSIS AND FINDINGS
An OLS regression analysis was conducted to test for the
impact of strategic synergy, relational context, environmental
changes, and ability to predict changes on relationship
effectiveness. The sample size is well within the recommended
minimum of four observations per predictor variable (Hair et
al. 1992). The regression results are presented in Table 4.
TABLE 4
REGRESSION MODEL
Independent Variables
Strategic Synergy
Relational Context
Changes
Ability to Predict
Standardized
Coefficient
.145
.370
-.040
.278
R2
.377
F (n,m)
(4.43J
" Significant at the .05 level.
b
Significant at the .01 level.
c
Significant at the .001 level.
(t-value)
VIF
(1.083)
(2.726)"
(-331)
(2.115)'
1.24
1.27
1.02
1.20
= 6.516c
in OLS
regression is assessment of the variance inflation factor (VIF)
for each independent variable (Neter, Wasserman, and
Kutner 1985; Hair et al. 1992). VlFs of 1.0 indicate the
absence of multicollinearity; a maximum VIF in excess of 10.0
and/or an average VIF considerably larger than 1.0 indicate
serious multicollinearity (Neter, Wasserman, and Kutner
1985). The maximum VIF for the independent variables in this
analysis is 1.27 (see Table 4), and the average VIF is 1.18,
both indicating that multicollinearity is not unduly influencing
the least squares estimates.
A formal measure to test for the presence of multicollinearity
The model is significant (p = .000), and the R2 of .377
indicates that the regression model explains over one-third of
the variance in relationship effectiveness. Relational context
and the ability to predict changes in the environment are both
significant predictors of effectiveness, supporting H2 and H4.
Higher levels of each lead to higher performing relationships.
Though the directionality of strategic synergy and changes in
the environment are as predicted, neither of these coefficients
is significant. Thus, we reject HI and H3.
The formation of closer purchasing ties may provide attractive
opportunities for many firms. As executives seek to expand the
scope and/or scale of these relationships, issues of
effectiveness become more important. The results of this
exploratory study provide a basis that may guide academicians
and practitioners as they attempt to understand how to develop
more effective relationships.
Managerial Implications
The findings of this study confirm and extend the traditional
assessment of relationalism. Higher levels of relationalism do
lead to higher performing relationships. However, building
relational norms is apparently not the only way to increase
relationalism. Increasing relationalism via the context of a
relationship also increases relationship effectiveness, and may
serve in addition to or as a supplement to the construction of
relational norms.
When assessing a firm's environment, it appears that the
ability to predict changes is a more significant indicator of
relationship performance than is environmental volatility per
se. This may be due in part to the very nature of business;
managers understand that change is an inevitable aspect of the
environment, and effective relationships must work within a
change-infested environment. A second possible explanation
for the insignificant coefficient for change is that managers
select relationships that are appropriate given the existing level
of environmental change. Thus, a relationship may be selected
because of its ability to be effective in a stable or volatile
environment.
Clearly, one of the relevant findings of this study for suppliers
wanting to enhance relationships is the need to help customers
develop their ability to predict changes in suppliers, customers,
and competitors. Initial evidence from this study shows that
increasing this ability does lead to higher performing
relationships.
Surprisingly, strategic synergy is not a significant predictor of
relationship performance. Though strategic synergy may be
key in the formation of interorganizational relationships, it
does not, in fact, drive assessments of ongoing relationship
performance. This can be viewed as the "what have you done
for me lately" attitude. However, it may also be an artifact of
the data and sampling instrument. Though the survey clearly
indicated "Because of my relationship with this supplier..."
one possible explanation for these findings is that the scale
does not adequately capture the construct of strategic synergy.
Research Agenda
Though this study provides initial evidence useful in building
more effective relationships, much remains unknown. Given
the findings of both this and Nevin and Spriggs' (1995) study
42 Journal of Marketing THEORY AND PRACTICE
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that relational context is an important influence in channel
relationships, the need arises to extend knowledge beyond the
current focus on the impact of relational norms. Future studies
should assess both relational context and relational norms to
assess both their individual impact and the interaction affect on
relationships. For example, the extant literature indicates that
relational norms are associated with lower OEM negotiation
costs (Artz and Brush 2000) and increases in recommendations
and information exchange, but decreases in requests, legalistic
pleas, and threats as influence strategies (Boyle, et al. 1992).
Relationalism also enhances relationship performance
(Cannon, Achrol, and Gundlach 2000). A cogent argument can
be made that studies assessing the impact of relational context
on these and other relationship variables would enrich the
discipline's knowledge base.
Additionally, the nature and impact of relational norms varies
in different market relationships. Bilateral alliances and
market-based transactions can both yield positive outcomes,
but the desired outcomes are attained through the use of
different norms (Dahlstrom, McNeilly, and Speh 1996).
Relationalism varies significantly from corporate systems to
franchise systems, both of which differ from market and
aligned systems (Boyle et al. 1992). It is reasonable to
question if the relational context differs across market
structures as well; this is certainly worthy of further
assessment.
Given the importance of enhancing customers' ability to
predict changes in the environment, future research should
clarify the types of behaviors or systems that build this skill.
Suppliers have a number of support options available for
customers, and those that build stronger relationships should
be identified and included in support packages.
The data in this study represent specific responses from LP gas
retailers in Oklahoma, and the regional nature of the sample
may not be representative of the entire national population in
the industry. Also, the nature of collaborative relationships
varies across industries (Mowery 1988). Thus, the findings of
this study may be context-specific and should be assessed in
a cross section of industry settings and geographic locations.
The relationships between the variables in this study are not
necessarily simple ones. Much empirical evidence exists to
show that uncertainly or the inability to predict environmental
volatility impacts coordination efforts of partners (Celly and
Frazier 1996), lowers expectations of relationship continuity
(Heide and John 1990), and leads to lower levels of
commitment and higher levels of opportunism (Joshi and
Stump 1999). But Cannon and Perreault (1999) found that
changes in the environment affect relationalism (measured as
norms) which in turn affects performance, and both the degree
and direction are dependent upon the type of buyer-seller
relationship. Likewise, Noordewier, John and Nevin (1990)
found that use of closer purchasing ties under conditions of
uncertainty lead to enhanced performance, but the same does
not hold true under conditions of low uncertainty. Future
research should compare the interaction affects of these
variables on relationship effectiveness and assess the
potentially moderating role of relationalism and/or uncertainty.
Purchasing relationships are, by definition, dyadic; exchange
partners may have differing motives for forming relationships
and, thus, may approach the development of relationships
differently (Heide and John 1990). Though Anderson and
Narus (1990) found similar perspectives of distributors and
manufacturers on antecedents of satisfaction (which they
contend is a close proxy for relationship effectiveness), partner
perceptions of relationship effectiveness may differ (Culpan
1993). Future studies should assess performance from both the
supplier's and buyer's perspective.
Inter-firm coordination efforts are more strongly related to
environmental uncertainty in international relationships than
in domestic ones (Anderson and Buvik 2001). In one
international study, environmental volatility is related to
commitment and performance, but only indirectly through
opportunism (Skarmeas, Katsikeas, and Schlegelmilch 2002).
Thus, all of the above relationships should be studied in both
domestic and cross-border relationships before generalizing
beyond U.S. boundaries.
Limitations
Several limitations of the study should be noted. The sample
size and industry-specific context of the study limit
generalizability of the findings. Additionally, there is the need
for further scale development. The inconsistency of factor
analysis results for the exchange context scale between this
study and Nevin and Spriggs' (1995) study illustrates that
further examination and scale purification are needed. And
though the scale to measure strategic synergy exhibits strong
face validity, convergent validity, and internal consistency,
this study represents only a first step in the measure
development process. Replication of this measure is clearly
needed.
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AUTHOR BIOGRAPHY
Faye S. Mclntyre (Ph.D. from the University of Georgia) has completed professional development programs at Columbia
University and University of California at Berkley. Dr. Mclntyre is Interim Dean of the Richards College of Business and
Professor of Marketing at the State University of West Georgia. Her work is published in International Marketing Review,
Journal of International Marketing, Journal of Business Research, Journal of Marketing Management, and other journals,
as well as numerous national and regional conference proceedings and trade publications. She has been invited to present
research at such forums as the AMA's 1991 Global Marketing Conference and the International Franchising Association's
1994 Annual Convention.
46 Journal of Marketing THEORY AND PRACTICE
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AUTHOR BIOGRAPHY
James L. Thomas, Jr. (Ph.D. from the University of Mississippi) is associate professor of Marketing at Jacksonville State
University. His work has been published in the Journal of Marketing Education, the Journal of Marketing Theory and
Practice, and various regional conference proceedings. Dr. Thomas' research interests include marketing ethics, services
marketing, retail marketing, and business-to-business marketing.
AUTHOR BIOGRAPHY
K.J. Tullis (Ph.D. in Management from the University of Arkansas) is associate professor and Chair of the Department of
Management at the University of Central Oklahoma, and an MBA from the University of Houston. Prior to returning to
academia, Dr. Tullis spent over a decade in various marketing and operations management roles for a multinational
manufacturing firm. He currently teaches in the area of Strategic Management and Organization Theory.
AUTHOR
Joyce A. Young (Ph.D. from the University of Mississippi) is professor of Marketing at Indiana State University,. Her
research has been published in the Journal of Business Research, International Journal of Purchasing and Materials
Management, Research in Marketing, Franchising Research: An International Journal, Journal of Business &
Entrepreneur ship, Journal of Business & Industrial Marketing, Journal of Business-to-Business Marketing, Journal of
Marketing Theory and Practice, Journal of Marketing Management, Journal of Product and Brand Management, Global
Business and Finance Review, Journal of Marketing Education, and numerous international, national, and regional
conference proceedings.
Winter 2004
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47