Managing collaboration within networks and relationships

Building on the central theme of the inaugural meeting of the Industrial Marketing and Purchasing (IMP) Group in Asia in Perth 2002, we have selected those papers that best reflect our current thinking on managing collaboration in networks and relationships. In the nine papers that follow, we examine the impact of time, market orientation, culture, communication, and trust on relationships and examine these within the context of both the manufacturing and service industries using a variety of alternative approaches.     

Managing knowledge in industrial markets: New dimensions and challenges

Managing knowledge in industrial markets has become an increasingly important task in the last 10 years. Many industrial firms paid little attention to the topic, since it was felt that knowledge was easily handled internally and was a simple process. The growth of information technology that centered on the collection, analysis and dissemination of information during the 1990's and early 2000's has necessitated that managing knowledge be taken seriously by industrial marketing managers. By doing so industrial firms can make available increased knowledge content in the development and provision of products and services to industrial marketing managers on all levels of the firm, achieve shorter new product development cycles, and facilitate and manage organizational innovation and learning. This article outlines the new dimensions in knowledge management in industrial marketing that are important for industrial managers, academic researchers, and business firms to understand for the future.     

The intra‐alliance division of value created through collaboration

The differential benefits reaped by individual partners are a major determinant of the impact of strategic alliances on firm performance and an important (dis)incentive for alliance partners to collaborate in value creation. Theoretically, we lack an explicit theory of intra‐alliance value division; empirically, previous analysis has been hampered by methodological challenges. We propose a bargaining framework for intra‐alliance value appropriation, as well as a measure for capturing its variation. We test our hypotheses on a sample of 200 biotechnology R&D alliances, and are able to explain variation in value appropriation across alliance partners, partner types, and individual firms of each type. Copyright © 2010 John Wiley & Sons, Ltd.     

Managing customer share in key supplier relationships

Supply base consolidation is an important issue in many business markets. Against this background, the allocation of purchasing budgets across vendors becomes an area of vital interest to suppliers. In the present research, we argue that customer share is a key decision variable in business marketing settings and investigate how a supplier can proactively manage the share of its customer's business. We report the results of a cross-sectional study among purchasing managers in U.S. manufacturing industries. Our findings confirm the role of customer value as an antecedent to customer share in business relationships. The study further shows that customer share influences the stability of key supplier relationships. Rather than displaying a direct impact, our results suggest that trust mediates and dependence moderates the link between customer share and search for alternative suppliers. Based on these findings, we propose a framework for managing customer share in key supplier relationships. Four approaches of how industrial vendors can proactively manage customer share are discussed.     

Managing the challenges of business-to-business open innovation in complex projects: A multi-stage process model

Research shows that knowledge sharing and system integration are two major challenges posed by openness to business partners in complex innovation projects. However, there remains limited research on the microfoundations (i.e., actions and practices) underpinning the organizational capabilities required to address these challenges. Drawing on a case study of a pioneering electric vehicle manufacturer, we develop a multi-stage process model showing how these capabilities are developed and phased out in terms of the organizational principles (e.g., hierarchical product architecture) and actions and practices (e.g., sharing knowledge by deputing staff to/from business partners). Our study contributes to the literature by taking a microfoundations approach to unpack the ‘black box’ of organizational capabilities critical for managing complex innovation projects into actions and practices, and emphasizes the importance of firms' internal preparedness for managing openness.     

Managing supplier-retailer relationships: From institutional and task environment perspectives

This study develops an integrated model of managing channel relationships that involves task and institutional environment perspectives. Using survey data from automobile dealers in China, the authors provide empirical evidence to demonstrate the utility of the legitimacy-based institutional environment perspective in clarifying channel relationship issues, which have been considered mostly only from an economic efficiency-based task environment approach. As the institutional environment perspective's factors, imposition asymmetry and bypassing have indirect impacts on trust in supplier and the level of conflict in a channel relationship. As the task environment standpoint's factors, explicit contracts and supplier's transaction-specific investments (TSIs) are posited to have direct effects on trust in supplier and the level of conflict, however, the hypothesized relationship between supplier's TSIs and the level of conflict is not supported. The results also indicate both building a retailer's trust in its supplier and lowering the level of conflict lead to improved relationship performance.     

Beyond research method to research collaboration: Research co-production relationships with practitioners

The IMP 2018 Conference theme “From Business to Research and Back Again”, highlights the importance of academic research providing and effectively communicating findings that have value for non-academic communities. This paper argues that engaged and reciprocal research relationships with the business community can provide this value. The traditional character of a relationship between the academic researcher and the “researched” is one where researchers dictate the terms of the research, i.e. they choose what topics to consider and to try to get funding for, the modes of investigating, and ways findings are gathered, interpreted and communicated. Extending a recently-published book of readings about doing research WITH managers (Freytag & Young, 2018), the work of a number of the contributors is used as a basis for an argument that increased value is created and greater relevance is achieved by deeper forms of reciprocal research collaboration with business and government practitioners. The foundations of this kind of win-win research collaboration include epistemological compatibility, solid theoretical grounding, relevant research practices and systematic co-evaluation that are geared to specific collaborative settings. The resulting research can better advance not only practice-related knowledge but also the theoretical and empirical knowledge of business academia. This is illustrated with examples of several projects and programmes where research is effectively co-produced and benefits accrue to all.     

Managing customer relationships: Account manager turnover and effective account management

Managing relationships with customers and clients is a critical task for industrial sales organizations. This paper reports on research that focuses on improving client relationships through effective handling of account manager turnover and improved account management. Even in situations where account manager turnover is high, the relationship between the company and the SME client does not suffer if the account management turnover process is well managed. When account manager turnover is not well managed, customer satisfaction suffers. The research also identifies eleven specific management activities that are highly related to supplier satisfaction with both the account manager and the supplier financial institution.     

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.     

Key account relationships: An exploratory inquiry of customer-based evaluations

The management and retention of key accounts is imperative in facilitating a firm's long-term viability. Previous examinations of key account relationships have revealed valuable insights into the factors facilitating key account management and driving relationship strength. However, account managers often fail to recognize weaknesses within their existing key accounts and the sources of their relationship vulnerabilities. Utilizing an exploratory inquiry of in-depth interviews with 99 executive decision makers across 52 key accounts cases, the authors assess customer relationship evaluations prior to contract expirations for account retention opportunities valued at over $1.3 billion. Unique positive and negative drivers of key account relationship evaluations are identified in a thematic categorization, along with a subsequent content analysis highlighting their patterned associations with positive and negative relationship evaluations, future business intentions, and business referral behaviors. These patterned associations reveal that positive and negative perceptions of relational drivers often affect outcomes in a differential manner, resulting in a classification of conventional constructs, prevention constructs, and promotion constructs. The results indicate that the desire of a supplier to maximize positive relational outcomes or minimize negative relational outcomes is driven by distinct underlying associations and allow for insights into resource allocation strategies within key account relationships.     

Managing liquidity in research‐intensive firms: signaling and cash flow effects of patents and alliance activities

The effective holding and management of liquid assets is critical to success in research‐intensive industries. The primary output of invention is new knowledge. However, because of its ‘sticky’ characteristics, knowledge may not easily diffuse to external shareholders, leading to knowledge asymmetries between managers/employees and external suppliers of capital. Many valuable R&D projects may thus fail to attract external financing, limiting a firm's ability to invest in R&D. In this study, we examine how the cash flow and signaling properties of a firm's patents and certain aspects of its alliance strategy can attenuate such problems. Specifically, we suggest that a firm's R&D investments positively predict the level of its liquid asset holdings. This is due to the fact that invention‐induced knowledge asymmetries increase the firm's cost of accessing external liquid capital. However, holding cash entails opportunity costs. In this regard, we also find that patent production and certain alliance activities provide important signaling mechanisms, which reduce knowledge asymmetries between the firm and capital markets, and consequently lower the firm's need to hold liquid assets. Empirical tests were conducted using a sample of 108 U.S‐based biotechnology firms. Copyright © 2009 John Wiley & Sons, Ltd.     

Building firm capabilities through learning: the role of the alliance learning process in alliance capability and firm‐level alliance success

In recent years, academics and managers have been very interested in understanding how firms develop alliance capability and have greater alliance success. In this paper, we show that an alliance learning process that involves articulation, codification, sharing, and internalization of alliance management know‐how is positively related to a firm's overall alliance success. Prior research has found that firms with a dedicated alliance function, which oversees and coordinates a firm's overall alliance activity, have greater alliance success. In this paper we suggest that such an alliance function is also positively related to a firm's alliance learning process, and that process partly mediates the relationship between the alliance function and alliance success observed in prior work. This implies that the alliance learning process acts as one of the main mechanisms through which the alliance function leads to greater alliance success. Our paper extends prior alliance research by taking a first step in opening up the ‘black box’ between the alliance function and a firm's alliance success. We use survey data from a large sample of U.S.‐based firms and their alliances to test our theoretical arguments. Although we only examine the alliance learning process and its relationship with firm‐level alliance success, we also make an important contribution to research on the knowledge‐based view of the firm and dynamic capabilities of firms in general by conceptualizing this learning process and its key aspects, and by empirically validating its impact on performance. Copyright © 2007 John Wiley & Sons, Ltd.     

Managing tension in coopetition through mutual dependence and asymmetries: A longitudinal study of a Norwegian R&D alliance

Strategic alliances between competitors (coopetition) is perceived to be full of tensions that needs to be managed. This study explore the evolution of a Norwegian coopetition alliance, through how firms handle tensions over time. The study finds that the firms experience a mutual dependence towards one another and that this dependence evolves over time. In the early phases of a coopetition alliance firms handle tension by relying on a structural dependence with their partners whereas firms move towards a more harmonious relationship with their partners by building a psychological dependence through trust and generosity. Further, the results indicate these dependencies might reduce the possible tensions related to asymmetries in size and knowledge between firms.     

Free‐riding in multi‐party alliances: The role of perceived alliance effectiveness and peers' collaboration in a research consortium

Research summary : Multi‐party alliances rely on partners' willingness to commit and pool their efforts in joint endeavors. However, partners face the dilemma of how much to commit to the alliance. We shed light on this issue by analyzing the relationship between partners' free‐riding—defined as their effort‐withholding—and their perceptions of alliance effectiveness and peers' collaboration. Specifically, we posit a U‐shaped relationship between partners' subjective evaluations of alliance effectiveness and their free‐riding. We also hypothesize a negative relation between partners' perceptions of the collaboration of peer organizations and their free‐riding. Results from a mixed‐method study—combining regression analysis of primary data on a major inter‐organizational research consortium and evidence from two experimental designs—support our hypotheses, bearing implications for the multi‐party alliances literature. Managerial summary : Free‐riding is a major concern in multi‐party alliances such as large research consortia, since the performance of these governance forms hinges on the joint contribution of multiple partners that often operate according to different logics (e.g., universities, firms, and government agencies). We show that, in such alliances, partners' perceptions have relevant implications for their willingness to contribute to the consortium's shared goals. Specifically, we find that partners free‐ride more—that is, contribute less—when they perceive the effectiveness of the overall alliance to be either very low or very high. Partners also gauge their commitment to the alliance on the perception of the effort of their peers—that is, other organizations similar to them. These findings provide managers of multi‐party alliances with additional levers to motivate partners to contribute fairly to such joint endeavor. Copyright © 2015 John Wiley & Sons, Ltd.     

航天电子关键通用产品发展规划的制定与管理

<正>一、产品规划的成因中国航天电子技术研究院以惯性导航、测控通信、微电子与计算机、机电组件等传统专业技术为核心,其产品都是航天型号的关键分系统,是航天型号提高性能的主要技术基础及提高可靠性技术水平的重要保证条件,具有关键性和基础性双重属性。     

Managing business relationships during a pandemic: Conducting a relationship audit and developing a path forward

During stable times, firms will generally aim to create reliable B2B relationships that provide increased efficiency and profitability. However, tumultuous times, such as the time during a major pandemic, cause many significant disruptions in both internal and external environmental domains. Thus, we argue that it is critical during this time to reevaluate the company's business relationships as a whole. While long-term partnerships are great for handling incremental changes during stable times, disruptive environmental changes may require managers to consider disruptive changes to their businesses. A pandemic may also present opportunities for establishing new relationships as there may be other partners/suppliers who are better equipped to help the company address urgent short-term needs and to capitalize on significant long-term opportunities. In this paper, we design a new relationship audit template to help B2B firms weather the immediate crisis at hand and position themselves more strategically for the future. We explore this idea in relation to the coronavirus outbreak, introduce the idea of a B2B crisis relationship audit, and offer potential steps forward for firms.     

Managing business and social network relationships in Russia: The role of relational capabilities,institutional support and dysfunctional competition

The current study provides empirical insight into the nature of creating relational rents when managing business relationships in the context of the emerging Russian economy. Addressing both formal and social business network relationships, the study aims to understand the role of a systematic and purposeful approach to building and managing business relationships in order to generate superior relational advantage. The study explores the effects on both subjectively and objectively measured relational rents. Additionally, the role of institutional context in both shaping relationships and obtaining relational rents is considered through the inclusion of dysfunctional competition and institutional support. The results of a survey on a sample of 148 business-to-business firms demonstrate the leading role of the business relationship portfolio in generating relational rents, as well as the supporting role of relational capabilities in building this relationship portfolio. These effects are significantly affected by institutional moderators, demonstrating multidirectional effects on the mechanisms behind building relationships and obtaining the associated relational advantage.     

Alliance capability,stock market response,and long‐term alliance success: the role of the alliance function

This paper addresses two key questions: (1) what factors influence firms' ability to build alliance capability and enjoy greater alliance success, where firm‐level alliance success is measured in two ways: (a) abnormal stock market gains following alliance announcements and (b) managerial assessments of long term alliance performance; and (2) are the two alternate ways of assessing alliance success correlated? We find that firms with greater alliance experience and, more importantly, those that create a dedicated alliance function (with the intent of strategically coordinating alliance activity and capturing/disseminating alliance‐related knowledge) realize greater success with alliances. More specifically, firms with a dedicated alliance function achieve greater abnormal stock market gains (average of 1.35%) and report that 63 percent of alliances are successful whereas firms without an alliance function achieve much lower stock market gains (average of 0.18%) and only a 50 percent long‐term success rate. We also find a positive correlation between stock market‐based measures of alliance success and alliance success measured through managerial assessments. In addition to providing insights into the development of alliance capability among firms, this paper is one of the first to provide empirical support for the efficient markets argument by demonstrating that the initial stock market response to a key event positively correlates to the long‐term performance and value of the event. Copyright © 2002 John Wiley & Sons, Ltd.     

Initial conditions or process of development? Critical incidents in the early stages of new ventures

Past research on new venture creation has focussed on initial conditions of start–ups or on the process of evolution. However, few studies have investigated the transitory stage when initial conditions changeover to a process of evolution. The aim of this paper is to investigate critical incidents infant new ventures face in this transitory stage. The paper covers two areas. First, a review of selected process models of new venture creation is conducted. Results from this review concludes that existing models as described in the literature are associated with several weaknesses: they oversimplify the phenomenon studied as they most often focus on one aspect only and they do not deal with how entrepreneurs adapt to specific situational conditions. Furthermore, the review indicates that the starting–point of a process often is hard to specify and characterize. Second, an empirical study based on the critical incident technique is reported on. On the basis of interviews with founders and entrepreneurial service providers related to the companies 65 critical incidents were identified. This equals an average of 8.1 incidents per company during a period of 6–18 months. Financing and recruiting were the most frequent and most important activities to manage. Then follows reference/first customer in third place. A common pattern of occurring incidents was identified among the ventures. However, in relation to the first round of venture capital financing a strategic choice was made. Either the companies followed a growth strategy and recruitment and organizational development were key goals, or the company focussed on building a patent portfolio. A tentative model is suggested that describes this process in detail.     

Reputation for cooperation: contingent benefits in alliance activity

We model the two‐firm alliance as an iterated prisoners' dilemma game with an exit option and test several theoretical predictions in experimental studies regarding the effect of reputation information. Following the literature, we hypothesize that reputation benefits cooperation; however, our experimental results instead show that reputation decreases cooperation. A contingency explains this result while remaining consistent with the general proposition of reputation as beneficial in games of incomplete information. Implications include a recommendation for when to invest in reputation and whether the lemon's market story is applicable to alliance‐related inefficiencies. Copyright © 2009 John Wiley & Sons, Ltd.