Interorganizational Relationships

Ryan, A., Tähtinen, J., Vanharanta, M. and Mainela, T. (2012) Putting critical realism to work in the study of business relationship processes, Industrial Marketing Management, Vol. 41(2) 300-311.

by Jaana Tähtinen

The complexity of business relationships and networks presents particular challenges to researchers aiming to... more The complexity of business relationships and networks presents particular challenges to researchers aiming to investigate processes over time. Critical Realism is proving to be particularly apposite in the study of such processes. Notwithstanding the growing use of critical realism, we acknowledge that is not an easy ontology to apply. In addition, characteristics of business relationships and industrial networks lead to specific challenges
in the application of Critical Realism. This paper fills this methodological gap by offering clear support in the design and execution of a study on business relationships and networks using critical realism as ontology.
We identify specific methodological challenges related to the field of industrial marketing, and how these challenges may be overcome. This will involve a discussion on how this perspective affects our view of business relationships and networks, the research design, and the theorization process, moving from
thick description common in small N studies towards analytical generalization. This paper contributes to existing discussion on the use of critical realism in industrial marketing research with the introduction of a 4-task Critical Realist Research Spiral to guide researchers in the consistent use of this ontological position. This is supported by nine reflective questions to guide researchers throughout the research process.

What to Expect After the Honeymoon: Testing a Lifecycle Theory of Franchise Relationships

by Christof Backhaus

Markus Blut, Christof Backhaus, Tobias Heussler, David M. Woisetschläger, Heiner Evanschitzky, and Dieter Ahlert. Journal of Retailing, forthcoming.

This research examines the evolution of interorganizational relationships in a franchising context. Using U-curve... more This research examines the evolution of interorganizational relationships in a franchising context. Using U-curve theory, we develop three hypotheses and contrast them with traditional lifecycle theory. Three groups of constructs are affected by lifecycle: cooperation variables, dependence variables, and relationship variables. Four distinct stages emerge, with highest levels of variables in the honeymoon stage, lower levels in routine and crossroad stages, and increasing levels in the stabilization stage. Franchisors should strive for “stability on high levels” before operational realities influence the franchisees. Franchisees’ intermediate lifecycle phases are most critical for the system, since opportunistic behavior and switching are most likely.

Data exchange in Interorganizational Relationships: Review Through Multiple Conceptual Lenses

by Natasha Veltri

Elgarah, W., Falaleeva, N.G., Saunders, C.S., Ilie, V., Shim, J.T., and Courtney, J.F. (2005) "EDI-Enabled Interorganizational Relationships: Review Through Multiple Conceptual Lenses," DATABASE for Advances in Information Systems, 36 (1), Winter, 8-29.

The Influence of Relational Experience and Contractual Governance on the Negotiation Strategy in Buyer-Supplier Disputes

by Fabrice Lumineau

Lumineau F. & Henderson J. 2012. “The Influence of Relational Experience and Contractual Governance on the Negotiation Strategy in Buyer-Supplier Disputes.” Journal of Operations Management, 30(5): 382-395.

This paper theoretically refines and empirically extends the debate on the type of interplay between relational... more This paper theoretically refines and empirically extends the debate on the type of interplay between relational experience and contractual governance in an under-researched area: supply chain disputes. We define relational experience as either cooperative or competitive; distinguish between control and coordination functions of contractual governance; and assess their interplay on the negotiation strategy used in disputes. Using a unique data set of buyer-supplier disputes, we find, in particular, that increasing contractual control governance weakens the positive effect of cooperative relational experience on cooperative negotiation strategy. However, increasing contractual control governance for a buyer-supplier dyad with competitive relational experience will increase cooperative negotiation strategy. Contractual coordination governance reinforces the positive effect of cooperative relational experience. Through this study, we reach a better understanding of how and when contractual and relational governance dimensions interact; rather than whether they act as substitutes or complements as has been studied in prior research. We discuss the implications of these findings for the field of supply chain management.

Business relationships in internet-based electronic markets: the role of goodwill trust and transaction costs

by Raluca Bunduchi

Intraorganisational power and the adoption of interorganisational IT innovations: the inside story of Covisint

by Raluca Bunduchi

Competitive flexibility in systems supplier companies in mechanical engineering industry

by Liisa Sallinen

This paper is the thesis for my Master's degree. Please ask me for a copy of this publication, as it is not publicly available.

Systems suppliers are focal actors in mechanical engineering supply chains, in between general contractors and... more Systems suppliers are focal actors in mechanical engineering supply chains, in between general contractors and component suppliers. This research concentrates on the systems suppliers’ competitive flexibility, as a competitive advantage that the systems supplier gains from independence from the competitive forces of the market. The aim is to study the roles that power, dependence relations, social capital, and interorganizational learning have on the competitive flexibility. Research on this particular theme is scarce thus far. The research method applied here is the inductive multiple case study. Interviews from four case companies were used as main source of the qualitative data. The literature review presents previous literature on subcontracting, supply chain flexibility, supply chain relationships, social capital and interorganizational learning. The result of this study are seven propositions and consequently a model on the effects that the dominance of sales of few customers, power of competitors, significance of the manufactured system in the end product, professionalism in procurement and the significance of brand products in the business have on the competitive flexibility. These relationships are moderated by either social capital or interorganizational learning. The main results obtained from this study revolve around social capital and interorganizational learning, which have beneficial effects on systems suppliers’ competitive flexibility, by moderating the effects of other constructs of the model. Further research on this topic should include quantitative research to provide the extent to which the results can be reliably generalized. Also each construct of the model gives possible focus for more thorough research.

9. Tie Failure: A Literature Review

by Rob Jansen

11. From Inter-organisational Conflict to Collaboration: The Case of the Music Recording Industry

by Rob Jansen

MARTINEZ M., CANONICO P., DE NITO E., MANGIA G, Interorganizational relationships in Italian logistic platforms: the role of Meta Logistic Operators, 88-902124-0-3; Euroma

by Marcello Martinez

MARTINEZ M., PEZZILLO IACONO M., MANGIA G., GALDIERO C., Knowledge creation and Inter-Organizational Relationships: the Development of Innovation in the Railway Industry International Forum on Knowledge Asset dynamics on Knowledge-Based Foundations of the Service Economy; ISBN 978-88-96687-05-5; IFKAD; Pagg. 206-212, 2011

by Marcello Martinez

An Explorative Analysis of the Effects of Information and Communication Technologies and Inter-Organizational Relationships on Supply Chain Management

by Pigni Federico

Co-authored with Aurelio Ravarini, Carlo Cattaneo Univ, LIUC, Italy Saglietto Laurence, Nice Sophia Antipolis Univ, GREDEG CNRS, France

This paper explores in a supply chain context the influences that inter-organizational relationships have on the use... more This paper explores in a supply chain context the influences that inter-organizational relationships have on the use of information and communication technology (ICT). In particular it analyzes the system use of the emergent patterns of supply chain management (SCM) by considering the underlying supported business processes. The research model was created for the study of the ICT usage patterns and has been applied through a detailed qualitative study conducted on the leading software distributor in Italy. The obtained results lead us to the conclusion that ICT usage emerges from the interaction of parties with available technologies.

Evaluating Interorganizational Systems for SME's

by Johan Magnusson

An Organizational Learning Perspective on the Contracting Process

by Fabrice Lumineau

Lumineau F., Fréchet M., & Puthod D. 2011. “An Organizational Learning Perspective on Contract Design.” Strategic Organization, 9(1): 8-32.

The contracting process is a crucial step in alliance development and its success. However, the existing literature... more The contracting process is a crucial step in alliance development and its success. However, the existing literature reveals surprisingly little investigation into how organizational learning relates to the process of contract making. We therefore conducted an in-depth longitudinal study of the alliance contracting process in the animated film industry. First, our findings suggest that during the contracting process, firms can learn about the way to deal with the contracting process, about themselves and their partner, and about the transaction features. Second, the case analysis indicates a combination of experiential, vicarious, and inferential learning mechanisms. Combining these insights into the objects and the mechanisms of learning during the contracting process, we discuss how contracting and learning processes are related and analyze the role of the contracting process in supporting organizational learning. The findings show that the drafting of contractual clauses fosters learning and, in turn, this learning triggers new contractual negotiations. Hence we suggest that the alignment between transaction features and the choice of contractual governance results from learning during the contracting process. We then propose avenues for future research.

Social capital: Its relationship to innovation in science and technology

by Jane Fountain

An investigation of relational contracting norms in construction projects in Malaysia

by Nasruddin Faisol

The importance of good relationship among parties in the construction industry has been accepted as one of the central... more The importance of good relationship among parties in the construction industry has been accepted as one of the central issues of an organisation’s success. The growing acceptance to the Relational Contracting approaches that representing partnering, supply chain alliances and other types of collaborative working relationships shows how construction organisations are moving forward from the traditional adversarial culture to a more harmonious working environment. However the application of the Relational Contracting Norms in the context of national culture has received relatively little attention in the literature. This study attempts to fill this void by investigating how good relationships develop within construction projects in Malaysia. It also investigates the adaptability of the relational contracting norms in different cultural setting and explores whether similar relational contracting norms emerge in different projects before developing a relationship development model that is applicable to the academic and practitioners.

By using qualitative approach, the main data was collected from 36 semi-structured in-depth interviews across four case studies. The results were validated by 20 follow-up interviews with selected respondents, two stages of expert interviews and cross-case analysis.

This study found that good relationships within construction projects in the Malaysian construction industry developed from the interplay of twelve structural and relational dimensions that went through three stages of relationship development process in project setting. It highlights the significant importance of the value and emotion-related dimensions in developing good relationships. A relationship development model was produced based on these twelve dimensions (special contract directive, power, performance, trust, commitment, loyalty, personal relationships, emotions, values, social interaction, work inter-dependency and political connection).

The research contributes to construction management literature by supporting the Transaction Cost Economics Theory and extends the Relational Contracting Theory. It proposes seven new dimensions that are incorporated in the newly proposed relationship development model. Although the study was conducted in a specific national culture, it is argued that the model is applicable to other context on the basis that spiritual, emotional and human components of the work experience could be learned by other cultures.

THE CONCEPT OF 'RELATIONAL CONTRACTING'AS A TOOL FOR UNDERSTANDING INTER-ORGANIZATIONAL RELATIONSHIPS IN CONSTRUCTION

by Nasruddin Faisol

To cite this paper: Faisol, N., Dainty, A. R. J., and Price, A. D. F. (2005) The concept of 'relational
contracting' as a tool for understanding inter- organizational relationships in construction. In:
Khosrowshahi, F (Ed.), 21st Annual ARCOM Conference, 7-9 September 2005, SOAS, University of
London. Association of Researchers in Construction Management, Vol. 2, pp 1075-1084.

Managing the relationships between the various parties involved in construction is becoming
more crucial as the... more Managing the relationships between the various parties involved in construction is becoming
more crucial as the industry moves away from fragmented and adversarial ways of working.
Under less-adversarial procurement routes and contractual arrangements such as partnering, it
is essential that the parties develop mutually beneficial objectives and a high level of
commitment, cooperation and trust. When disputes do occur, without good relationships
between the parties they are likely to refer back to the clauses of the contract which, in turn,
may start a return to adversarial ways of working. The concept of ‘relational contracting’ has
been developed by Macneil (1974, 1980, 1981 and 1983). This considers a contract to
represent a relationship between the parties and introduces a degree of flexibility into the
contract on the basis of understanding the other party’s objectives. Based on a review of recent
literature, this paper explores the dimensions of relational contracting that are applicable to the
construction industry. Since the principles of relational contracting have received relatively
little attention in the construction management literature, work from other disciplines have
been explored in order to promote a fuller understanding of its implications to understanding
the way in which people from different organizations work together. It is suggested that
previous work has viewed the concept of relational contracting in isolation rather than as an
integrated set of relational principles. It is argued that when viewed as a joined-up set of
dimensions, relational contracting has the potential to facilitate a better understanding of interorganizational
relationships within the industry.

Keywords: relational contracting, long-term relationship, construction supply chain.

PERCEPTIONS OF CONSTRUCTION ORGANISATIONS ON DEVELOPING SUCCESSFUL INTER-ORGANISATIONAL RELATIONSHIPS.

by Nasruddin Faisol

To cite this paper: Faisol, N, Dainty, A R J and Price, A D F (2006) Perceptions of construction organisations on
developing successful inter-organisational relationships.. In: Boyd, D (Ed) Procs 22nd Annual ARCOM
Conference, 4-6 September 2006, Birmingham, UK, Association of Researchers in Construction
Management, 471-479.

The purpose of this study is to investigate the general perceptions of UK construction
organisations on... more The purpose of this study is to investigate the general perceptions of UK construction
organisations on developing successful inter-organisational relationships, with the
paper reports on five case studies of different construction organisations, which
include the main contractors, a specialist contractor and a managing agent contractor.
The investigations explored their business relationships with other organisations in
the supply chain including clients, contractors, subcontractors and suppliers. The
findings show that the organisations realise the importance of developing good
relationships with their partners, which in turn increases their financial performance.
The results also revealed the practices that lead to successful relationships and
barriers to the successful relationships. The implication of these preliminary findings
show an evidence of a successful relationship can be achieved even though in the
context of a temporary organisation structure. This paper adds some important
elements of inter-organisation relationship from construction organisations
perspective to the current body knowledge.

Keywords: inter-organisational relationships, long-term relationship, successful
relationship.

The Development of Long Term Relationships Between Consultants and Project Managers in Construction Supply Chain in Malaysia

by Nasruddin Faisol

Proceedings of the 16th International Symposium on Logistics (ISL), Berlin, Germany, 10-13 July, pp. 547-554

Purpose: The purpose of the study is to explore the relationship development process between consultants and a project... more Purpose: The purpose of the study is to explore the relationship development process between consultants and a project management firm in Malaysia.
Research approach: This qualitative study was based on 6 in-depth semi-structured interviews which were carried out with the owners and senior managers of five consultant firms (an architect, quantity surveyors and structural and civil consultants) and the director of a project management firm. The data were analysed using thematic analysis method.
Findings and Originality: Although theoretically, a well developed relationship has to go through five phases of relationship development process (awareness, exploration, expansion, commitment and dissolution), the findings reveal that every consultant’s relationship with the project management firm appeared to exhibit additional developmental stages to those which are established within the literature. The results revealed that the practices that lead to a successful or failed inter-organisational relationship are greatly influenced by interpersonal factors rather than the organisation’s performance-related factors.
Research impact: This study has explored various ways in which the cultural values play significant roles in the development of long term relationships among organisations in the construction supply chain.
Practical impact: This study brings new dimensions in the context of inter-organisational construction supply chain through the significant use of cultural values, which could be practiced by other supply chains.

The Stability of Offshore Outsourcing Relationships: The Role of Relation Specificity and Client Control

by Stephan Manning

Full source: Manning, S., Lewin, A.Y., Schuerch, M. 2011. “The Stability of Offshore Outsourcing Relationships: The Role of Relation Specificity and Client Control“; Management International Review. 51, 381-406.

Offshore outsourcing of administrative and technical services has become a mainstream business practice. Increasing... more Offshore outsourcing of administrative and technical services has become a mainstream business practice. Increasing commoditization of business services and growing client experience with outsourcing have created a range of competitive service delivery options for client firms. Yet, data from the Offshoring Research Network (ORN) suggests that, despite increasing market options and growing client quality and cost efficiency expectations, clients typically renew provider contracts and develop longer-term relationships with providers. Based on ORN data, this paper explores drivers of this phenomenon. The findings suggest that providers promote contract renewal by making client specific investments in software, IT infrastructure and training, and by involving clients in outsourcing operations, thereby increasing relation specific joint equity and creating opportunities for client monitoring and control. Interestingly, these strategies apply to routine rather than knowledge-intensive tasks, and are more likely to be applied by large rather than small providers. Surprisingly, high degree of contract specification makes contract renewal less likely. The paper contributes to the growing literature on strategic outsourcing of business services and the importance of governance mechanisms addressing ‘hidden costs’ as well as ‘hidden benefits’ of offshore outsourcing relationships.