Partnering characteristics: A dyadic perspective

Journal of Business Logistics, 1995 by Ellram, Lisa M, Hendrick, Thomas E

"Partnering" or alliance relationships are an increasingly prevalent topic of discussion in both the academic and popular press. Articles have been written and studies conducted that look at partnering success variables.(1,2,3) partnering selection factors,(4) partnering success rates,(5) and that even suggest models for partnering implementation.(6,7,8)

Partnering takes on many forms. Sheth and Parvatiyar(9) showed that partnering may be among competitors or noncompetitors, and may exist for strategic or operational reasons. This paper examines alliances with a noncompetitive focus: industrial buying organizations and their suppliers. These relationships generally exist in order to improve operating procedures and efficiency; thus they are classified as cooperative arrangements. To the extent that such buyer-seller partnering relationships exist to develop new products and/or new technologies, the relationship may go beyond cooperation to include collaboration.

For purposes of this research, partnering is defined as an on-going relationship between two firms that involves a commitment over an extended time period, and a mutual sharing of information and the risks and rewards of the relationship.

Most research that has explored partnering efforts and their successes is from the perspective of the industrial buying firm or the supplier.(10,11,12) Partnering relationships have also been researched based on secondary data, focusing on outcomes or characteristics.(13,14,15) Yet few studies have looked at partnering relationships from the perspectives of both the buyer and supplier simultaneously.(16,17)

This study provides a different perspective, by looking at the industrial buying relationship from the viewpoint of buying and supplying firms, which agree that they are mutually involved in a partnering relationship. This study specifically explores the following questions:

1. What are the similarities and differences between the manner in which buying and supplying firms characterize their partnership relationship?

2. What are differences between current partnership relationship characteristics and desired partnership characteristics for buying firms?

3. What are differences between current partnership relationship characteristics and desired partnership characteristics for supplying firms?

4. What are differences in ideal partnership relationship characteristics between buying and supplying firms?

A partnership is, by definition, a "meeting of the minds" of two firms. Yet little has been done to test whether such a meeting of minds exists. A dyadic approach, surveying both buyers and suppliers regarding the same, shared partnership relationship, is needed to test just how "mutual" these relationships are. Thus, this research attempts to describe buyer-supplier partnerships as they exist, and "prescribe" the way that buyers and suppliers would like these relationships to be.

Before proceeding with a discussion of the research, a sampling of the partnership literature will be reviewed. This is followed by a discussion of the methodology of the research and presentation of results.

LITERATURE REVIEW

There is a strong economic and competitive rationale for cooperative buyer-supplier relationships supported by the literature.(18,19,20,21) Such cooperative relationships allow the participants to enjoy many of the benefits of vertical integration, without the commensurate risks of ownership.

There has further been extensive writing and model building in the area of characterizing partnerships, i.e., what distinguishes a partnership relationship from other relational forms?(22,23,24,25,26,27,28,29,30,31 32,33,34,35,36,37,38) Yet, there has been limited empirical testing of these factors. This topic is of interest in this paper.

Some of the characteristics of partnering relationships identified in previous research are summarized in Table 1. The partnering characteristics in Table 1 that are not noted with an asterisk were previously tested by La Londe et al., specifically for logistics relationships. The items noted with a double asterisk come from Bhote, and were not previously empirically tested. The addition of the constructs from Bhote's work expands the work of La Londe et al., beyond logistics partnerships to broader buyer-seller partnership relationships. The characteristics shown in this table have been suggested by many other authors as well. Table 1 illustrates that partnering is characterized by a long-term futuristic orientation, sharing and trust, and open, two-way communications.(39)

METHODOLOGY

A survey questionnaire was developed based on previous research and theory in collaborative/partnering relationships,(40,41,42,43,44,45) and input from academicians and high level purchasing professionals. This instrument was pretested and modified based on recommendations of the aforementioned experts. A companion, near "mirror-image" survey was developed to test supplier's perceptions of the buyer-supplier partnership. This "pairing" methodology provides a unique comparison of partnering perceptions between buying and supplying firms.