Creating value in business relationships: The role of sales

Understanding the creation of value in business relationships has been a long-standing goal of researchers and managers alike. By adopting a relational perspective, recent research on business relationships has made much progress in understanding value-creating processes. As the sales function is thought to be a pivotal part of the value-creating processes in business relationships, the evolving view on creating relationship value clearly has implications for our understanding of the role of sales in these processes. In contrast to its importance, the question of how the sales function contributes to creating value in business relationships has been largely neglected in extant literature. The objective of our paper is to answer this question by systematically linking the relational value creating process to the sales function's content. Interpreting value creation as interaction process, we identify four features of value-creating processes in business relationships suggested in recent research (i.e., jointness, balanced initiative, interacted value, and socio-cognitive construction) and, based on these, outline a framework that is used to define a set of tasks that are key to creating value in business relationships and hence become critical for sales in its hitherto neglected role as co-creator of relationship value. We illustrate the various tasks of this new role of sales with data from 43 interviews with sales managers and salespeople. Along with related normative recommendations in extant literature, the interviews provide support for the validity and relevance of our framework for understanding the role of sales in creating relationship value. This framework puts forward a much-needed first effort towards a theory of sales' role in creating relationship value and offers several opportunities for future research.     

Women as industrial sales representatives

The incidence of women in industrial sales is rising, and females can now be found frequently in traditional all-male type industries such as steel, lumber, and heavy machinery. A strong consensus exists among sales managers that women are effective in industrial selling, and the representatives' records sustain this opinion. Women are proving themselves as worthy, capable, and competent, although they do face special problems in this type of work, some of which are role reversal, production pressures, sexual overtures, and loneliness during travel.     

Securing business-to-business relationships: The impact of switching costs

While the relationship marketing literature acknowledges the importance of switching costs for increasing customer retention, little is known about its relevance in industrial markets. In particular, it is unclear whether switching costs, and associated dimensions, impact on behavioral outcomes of buyer–seller relationships in business-to-business (B2B) markets. In order to contribute to theory development in this important area, our research first explores the dimensions of switching costs for the B2B domain and also tests the relative impact of these dimensions on business customers' actual purchase behavior. Results suggest that switching costs in B2B settings are a multi-faceted construct, including (i) procedural, (ii) financial, and (iii) relational switching costs. Moreover, we find relational switching costs to be most important for securing B2B buyer–seller relationships since they impact a customer's (a) share-of-wallet, (b) cross-buying behavior, and (c) actual switching behavior. While procedural switching costs only influence share-of-wallet, financial switching costs solely impact customer's cross-buying behavior. These findings contribute to a better understanding on how to secure B2B buyer–seller relationships.     

Complexity of sales situation and sales lead performance: An empirical study in business-to-business company

Close collaboration in business-to-business relationships has been an interest of both researchers and managers; however, companies are often struggling to obtain the benefits of close collaboration with their customers. Our study examines the complexity of the sales situation from three perspectives 1) relational complexity, 2) complexity of internal sales tasks, and 3) vendor's cross-business unit collaboration, and its effect on the sales lead performance in a business-to-business context. We adopted a mixed methods approach; our data consists of interviews with sales personnel and a Customer Relationship Management (CRM) system data of 4000 sales leads from a large IT company that sells integrated solutions. Sales leads are classified into three categories: win, lost, and canceled. Based on multinomial logistic regression analysis, the results show that close collaboration with customers increases the probability of sales leads to be canceled. Our findings suggest that the selling approach focusing on close collaboration with the customers may not be a method to increase hit rates, due to possible high amount of canceled sales leads. This should be considered when salespeople's performance is measured in highly collaborative business-to-business environment. We conclude our paper with managerial and theoretical implications, and avenues for the further research.     

Testing the conflict-performance assumption in business-to-business relationships

There is little empirical research published testing the interdependency between conflict in business-to-business relationships and commercial performance. The “conflict-performance assumption”—all other factors being equal, relationships where conflict is low will outperform relationships where conflict levels are higher—remains central in the marketing channels' literature despite insufficient and contradictory empirical evidence. There are several explanations for the lack of a clear relationship between conflict and performance. Rosenbloom [J. Mark. 37 (1973) 26] theorises that the relationship between conflict and channel performance follows an inverted U-shaped curve, where conflict is most productive at moderate levels and least productive at very low or high levels. Others have argued for a simpler, linear relationship between conflict and performance, usually negative in nature. Various theories about the conflict-performance relationship are empirically tested in a large marketing channel, using a number of dyadic and monadic measures of conflict (latent, perceived, and affective) and two objective measures of performance (effectiveness and efficiency). A linear model (performance declining as conflict increases) is adequate to explain the relationship between dyadic measures of both perceived and affective conflict and channel effectiveness. A threshold model is found to be superior to a linear model in explaining the relationship between dyadic measures of perceived and affective conflict and efficiency. Conflict increases slowly as efficiency falls until a threshold is reached when conflict escalates. Practical implications include that companies need to consider whether performance criteria affecting efficiency are as important to their business partners as those affecting effectiveness. If they are not, then business partners should be rewarded for meeting any such criteria that are more important to the one side of a relationship dyad than to the other.     

A multidimensional perspective of business-to-business sales success: A meta-analytic review

The role and nature of business-to-business (B2B) sales has evolved since the end of the 20th century, mostly driven by technological, organizational and social changes. However, the literature has yet to catch up with that evolution. Particularly, the literature lacks contemporary studies that exclusively showcase the key determinants and practices that facilitate the success of B2B sales. Hence, we conduct a meta-analysis of the literature and summarize the results of 139 independent published studies from 1980 to 2019 that examined the relationship between several determinants and B2B sales success. Our results show that such success may be influenced by 31 different determinants associated with four dimensions of the selling process (i.e., salesperson, organization, customer, and environment). We also investigate the moderator effects of measurement source (subjective vs. objective), measurement items (single vs. multiple), industry context (goods vs. services), number of industries (single vs. multiple), sales function (inside sales vs. outside sales) and year of publication (before 2010 vs after 2010) between several determinants and B2B sales success. Our findings convey important implications for theory and practice on the key determinants of B2B sales success, as well as the conditions on which each determinant is effective. We also provide recommendations for further research on B2B sales success.     

Trust and forms of capital in business-to-business activities and relationships

The IMP group's ARA model, with its emphasis on interaction, captures social and economic dimensions of exchanges. We draw on it to compare three cases and assess how actors act in skilful and nuanced ways in mobilizing resources, given the very different norms of social and economic capital. We prioritize action ahead of structure and, given the inherent uncertainties that actors encounter in connection with resources, argue that trust is a cognitive and heuristic dimension of action, distinct from resources, actor-bonds and social capital. We conclude that for business practice, managers should be mindful that in order to trust others, they need to act in the distinct realms of social and economic capital, tempting though it is to interpret and measure the costs of actions economically.     

A framework for offshoring marketing processes in business-to-business marketing relationships

Outsourcing has been a prominent aspect of business strategies in the last three decades. Outsourcing of manufacturing processes is now complemented with outsourcing of various marketing process as well. More importantly, outsourcing to foreign locations — offshoring — has increased for marketing processes in recent years. In this context, the present paper develops a model that identifies the types of marketing interactions and processes that can be offshored in business-to-business markets. We suggest that the decision to offshore marketing processes and interactions depend upon the interaction process that is preferred and the importance of interaction process itself. Marketing interactions that are not critically important and/or those that can be performed through technology can be easily offshored. However, other marketing processes need to be examined in depth before being offshored. Implications for research and practice in the area of offshoring, as well as in the broader area of outsourcing, are also highlighted.     

The strategic role of relational capabilities in the business-to-business service profit chain

This paper extends the original service profit chain by examining the role of relational capabilities with employees, customers and strategic partners on process and performance outcomes in a business-to-business context. More specifically, we demonstrate how satisfied and loyal employees are better in developing relationships with customers and strategic partners. These relationships enable firms to be more responsive towards customers and become more innovative, which increase customer satisfaction and loyalty and, ultimately, financial performance. Our results provide support for the development of relational capabilities in a business-to-business environment by extending the service profit chain (SPC) model. However, we find that while the development of strong customer relationships contributes to an improved service responsiveness of the firm, strategic partners do not.     

Covalence and ionic bonding in business-to-business relationships: Insights from chemistry

The paper examines business-to-business (B2B) relationships using the framework of the covalence-ionic bonding theory in chemistry as an analogy to help make soft phenomena and relationships in B2B marketing more understandable to engineers and scientists in organizations and to managers with scientific and technical backgrounds. In the tradition of cross-fertilization of various scientific fields, the authors propose that the covalence-ionic bonding theory may provide insights in determining the factors that contribute to the emergence of bilateral, unilateral, and market relationships. This study compares and contrasts interparticle bonding with ways of managing B2B relationships. Beyond sheer analogy of the two phenomena, an explanation of B2B relationships and decision-making mechanisms is proposed. In adapting this concept theoretically, the meaning of the original parameters in physical science is assigned a new meaning in the marketing context. Furthermore, the paper extends conceptually the predictive capabilities of chemistry theories to relational behaviors in marketing. Drawing from a resource-based view of the firm, complementarity of resources and dependence levels are postulated to have critical roles in business bonding. Appropriate propositions are advanced, along with implications for managers and researchers.     

An analysis of international business-to-business relationships based on the Commitment-Trust theory

Business-to-business relationships are characterized by an exchange between two or more parties. Research has identified several factors that enhance marketing and management in business relationships, mainly with a focus on large manufacturing firms. However, less is known about how service firms develop and maintain international relations during the establishment of a business. To analyze the relevance of the key mediating variable (KMV) model [J. Mark. 58 (1994) 20-38.], which maintains that business-to-business relationship requires commitment and trust, interviews were conducted with five different service entrepreneurs in Sweden, Australia and the UK. The findings demonstrate the importance of commitment, trust, relation termination costs and benefits, shared values and communication between the exchange partners.     

The significance of trust and renqing in the long-term orientation of Chinese business-to-business relationships

While business relationships with China are receiving increased attention in both practitioner and academic discourse, very little empirical work however, has been undertaken to isolate and examine measures that focus on business-to-business relationships, and as such, research in this area is somewhat scant. In an attempt to bridge this gap, and add to the knowledge in this emerging discipline, the research aims to develop a conceptual framework to explore the relationship between trust and the long-term orientation in Chinese business-to-business market relationships. Based on a survey with Hong Kong companies that have a buyer-seller relationship with Chinese companies, the empirical findings indicate the mediating role and significance of ‘renqing’ for enhancing trust and contributing towards the long-term stability in relational exchange. The results highlight several implications for practicing managers to consider when aiming to establish and develop relationships in a Chinese business-to-business context.     

Value-based sales process adaptation in business relationships

In business relationships, the seller is often expected to adapt to the buyer. The main purpose of this study is to understand how business firms adapt their sales processes to the buyer. The resulting framework, which reveals how different modes of adaptation are contingent upon the type of product being purchased, includes three layers: sales process adaptation, seller–buyer relationship orientation, and the purchasing portfolio. The study is a qualitative one and utilizes a retrospective case study, where the main sources of information are in-depth semi-structured interviews with key informants representing the seller and buyer counterparts in the ICT industry. Our study adds to the understanding of how different modes of adaptation are contingent upon the type of item being sold and purchased. Managerial implications include that to strategically adapt, the seller could focus on the purchasing portfolio. Although previous research has recognized adaptation as a central aspect in relationships, how the sales process could be adapted to the buyer has received little attention. This study focuses on the adaptation of sales to strategically match it to the buyer's situation.     

The role of corporate image in business-to-business export ventures: A resource-based approach

Although a growing body of studies suggests that good corporate images have strategic value for the firms that possess them, no research to date has looked at the role of corporate image in export markets. To fill this gap in the extant literature, this study draws on the resource-based view and insights from qualitative interviews to develop a model that links an exporter's financial resources and relationship management capabilities with its corporate image advantage and its performance in the export market. Findings reveal that both financial resources and relationship management capabilities are significant contributors of corporate image advantage, which, in turn, is an important determinant of superior export performance. The study concludes with a discussion of the implications of the findings for marketing theory and practice and suggestions for future research.     

Nature and evolution of trust in business-to-business settings: Insights from VC-entrepreneur relationships

While the importance of trust in B2B relationships has been well established, research is yet to investigate its processual nature. This study investigates the VC-Entrepreneur relationship – a special B2B relationship to outline the nature and evolution of trust across a venture's life cycle. Results suggest that early-stage relationships are characterized by asymmetric trust, which declines with time and impacts cooperation between both sides, access to funding and business networks, contract enforcement, feedback, mentorship, and knowledge sharing. Late-stage VC- Entrepreneur relationships suffer from symmetric distrust, which increases with time, resulting in an overt emphasis on contracts, syndicated investments, disagreements during decision making, and pressure to exit. This study extends B2B trust literature by offering a relationship-phase-contingent view of trust across a venture's life cycle, outlining specific contexts that question the reciprocal and symmetric assumption of trust in dyadic relationships. It highlights how the interplay among power, opportunism, and weak institutional environment dictate dyadic trust. And finally, the paper outlines three testable propositions on trust in VC- Entrepreneur relationships that can be extended to other emerging economies.     

Adding co-creation as an antecedent condition leading to trust in business-to-business relationships

Trust enjoys wide acceptance among scholars as a key facilitator of inter-organisational relationship development, and successful relationship development demands an understanding of what drives the propensity to trust between organisations within both cognitive and affective dimensions of trust. The six most salient antecedents of trust within contemporary trust literature have been identified as satisfaction, communication, competence, shared values, benevolence and integrity. This research suggests that co-creation is also an important antecedent of trust in business-to-business relationships. Co-creation is described here as the active participation, interactions and collaboration of the buyer and seller and other actors in the marketing exchange to develop a deeper understanding of the customer problem solving context.The relative strength of the cognitive and affective aspects of trust antecedents, the moderating influence of business experience and seniority on the relationship between significant antecedents and trust is also explored. The analysis uses statistical tools and then probes deeper using fuzzy-set qualitative comparative analysis (fsQCA).     

Measuring intangible value in business-to-business buyer-seller relationships: An intellectual capital perspective

The value that resides in a firm's relationships has both tangible and intangible aspects and both need to be developed and managed carefully. Marketing managers need to be able to understand these dimensions of value to manage them and to argue for their share of the firm's resources to effectively develop the value of the firm's relationships. This paper describes a study that adds to current knowledge of relationship value by testing a hypothesized model of the intangible part of the value that is manifested in buyer-seller relationships and by developing a set of scales to measure the hypothesized dimensions. The focus of the research, which synthesizes a conceptual framework from the intellectual capital literature, is on business-to-business situations and on the value of the relationship to the seller, rather than to the buyer. The analysis of data from a survey of relevant managers, using structural equation modeling techniques, gives support to the model and scales.     

Managing business-to-business relationships under conditions of employee attrition: A transparency approach

Client-contact employee attrition can negatively affect client-supplier relationships, a problem all the more obvious within the knowledge-intensive service industry in which the untimely loss of employees adversely affects client relationships. From the client's perspective, employee attrition increases uncertainty over the perceived quality of service and results in the loss of valuable tacit knowledge from the provider. Drawing on case study materials, this paper seeks to develop a framework for understanding how firms can successfully manage client relationships despite threats of employee attrition. This paper suggests that relationship transparency based on the active transfer of information, knowledge retention and sharing, the implementation of succession plans, and timely intervention by the management, can reduce clients' perceived uncertainty, thereby fortifying a trusted relationship with their provider. This study offers a transparency-based conceptual framework that contributes to the business-to-business relationship literature within the knowledge-intensive service industry and discusses managerial implications.     

Understanding demand and supply paradoxes and their role in business-to-business firms

In this paper, we explore paradoxes firms face when managing demand and supply activities and managers' experience of coping with and transcending these paradoxes. Following an exploratory research approach and based on the analysis of interviews with executive managers, documents from, and observations of 19 business-to-business (B2B) firms, we develop empirically grounded propositions. We first find and explain three major demand and supply paradoxes, namely collaboration-competition, concord-conflict, and integration-differentiation. We then expand on the handling mechanisms B2B firms employ to respond to these paradoxes. We find that B2B firms that understand, balance, and transcend demand and supply paradoxes achieve greater synergy between demand and supply activities and leverage both demand and supply approaches as overarching guiding principles for their strategy. Our study informs B2B marketing and marketing strategy by exploring the nature and role of paradoxes that shape the relationships between demand and supply activities. In doing so, it also offers an empirical account of the discrepancy between the theory and practice of demand and supply integration.