Organization–stakeholder fit: A dynamic theory of cooperation, compromise, and conflict between an organization and its stakeholders

• Author: Miles A. Zachary,Jonathan Bundy,Ryan M. Vogel
• Date: 01 February 2018
• Published date: 01 February 2018
• DOI: http://doi.org/10.1002/smj.2736

RESEARCH ARTICLE

Organization–stakeholder fit: A dynamic theory

of cooperation, compromise, and conflict between

an organization and its stakeholders

Jonathan Bundy

1

| Ryan M. Vogel

2

| Miles A. Zachary

3

1

Department of Management and

Entrepreneurship, W. P. Carey School of

Business, Arizona State University, Tempe,

Arizona

2

Department of Human Resource Management,

Fox School of Business, Temple University,

Philadelphia, Pennsylvania

3

Department of Management, Raymond J. Harbert

College of Business, Auburn University, Auburn,

Alabama

Correspondence

Jonathan Bundy, Department of Management and

Entrepreneurship, W. P. Carey School of

Business, Arizona State University, P. O. Box

874006, Tempe, AZ 85287-4006.

Email: jonathan.bundy@asu.edu

Research Summary: We advance the concept of organi-

zation–stakeholder fit (O–S fit) to explain cooperative

behavior between an organization and its stakeholders.

O–S fit describes the compatibility that exists between an

organization and a stakeholder when their characteristics

are well matched. We highlight two dimensions of O–S

fit: value congruence, or the supplementary fit of organi-

zational and stakeholder values, and strategic comple-

mentarity, or the complementary fit of strategic needs and

resources. For each dimension, we detail the unique rela-

tional factors—including core elements of trust, predict-

ability, attraction/exchange, and communication—that

motivate cooperation. We then explicate the ways in

which value congruence and strategic complementarity

dynamically interrelate over time. Finally, we consider

how organization-stakeholder misfit may result in alterna-

tive relational behaviors, such as conflict or compromise.

Managerial Summary: We develop a new way of think-

ing about the relationship between organizations and

stakeholders. Recognizing that positive relationships

require a degree of fit or compatibility, we argue that

cooperative behavior between an organization and its

stakeholders is maximized when relational partners share

both core values and strategic priorities. We explain that

high fit along these two dimensions increases trust, rela-

tional predictability, attraction/exchange, and communica-

tion. We also describe how positive relationships might

be formed with fit along only one dimension, and how

negative relationships might result in the presence of mis-

fit. Ultimately, we suggest that managers who want to

foster positive relationships with stakeholders should con-

centrate on aligning their values and priorities, rather than

simply concentrating on one or the other.

Received: 19 November 2016 Revised: 4 September 2017 Accepted: 15 September 2017 Published on: 21 December 2017

DOI: 10.1002/smj.2736

476 Copyright © 2017 John Wiley & Sons, Ltd. wileyonlinelibrary.com/journal/smj Strat Mgmt J. 2018;39:476–501.

KEYWORDS

cooperative strategy, fit, interorganizational

relationships, reciprocity, stakeholder management

1|INTRODUCTION

The stakeholder perspective in organizational research has traditionally recognized the importance

of managing relationships between an organization and its many stakeholders (Freeman, Harrison, &

Wicks, 2007). Stakeholders represent individuals or groups who can affect or can be affected by the

organization in the pursuit of its objectives (Freeman, 1984), including (but not limited to) cus-

tomers, suppliers, owners, creditors, alliance partners, and local communities. Given the interdepen-

dence between an organization and its stakeholders, survival and success for both are, in many

ways, jointly determined. Hence, successful organizations are often those that are able to effectively

foster cooperation with stakeholders—understood as interdependent actions that benefit both parties

or the relationship between them (Barringer & Harrison, 2000; Bosse & Coughlan, 2016; Penner,

Dovidio, Piliavin, & Schroeder, 2005).

Although early scholars generally recognized the codependent nature of organizations and stake-

holders, more recent research has focused on detailing the specific relational factors that encourage

cooperative behavior. For example, a number of scholars have detailed the roles of more normative

factors—including trust, fairness, and reciprocity norms—in facilitating cooperation (cf. Bosse, Phil-

lips, & Harrison, 2009; Bridoux & Stoelhorst, 2014, 2016; Hahn, 2015; Harrison, Bosse, & Phillips,

2010; Harrison & Wicks, 2013; Tantalo & Priem, 2016). Meanwhile, others have focused on more

instrumental factors that work to enhance cooperation, including perceptions of competence and

strategic resource interdependencies (e.g., Bosse & Coughlan, 2016; Bridoux & Stoelhorst, 2014;

Dyer & Singh, 1998; Gulati, 1999).

While this research has begun to reveal important factors that may facilitate cooperation,

researchers still lack a clear understanding of how and from where these factors originate, how they

evolve and interrelate over time, and, ultimately, why some organization-stakeholder pairs build

durable relationships while others do not (Bosse & Coughlan, 2016). For example, while it is clear

that trust can foster cooperation, we are only just beginning to understand why an organization and

a stakeholder may be prone to trust one another, how different forms of trust (e.g., character vs. -

competence-based; Gabarro, 1978) foster cooperation, how trust develops dynamically over time

(Harrison et al., 2010), and how cooperative relationships may yet emerge in the absence of trust

(Bridoux & Stoelhorst, 2014). Moreover, prior research has often been piecemeal and disjointed,

focusing on one or a few factors that may facilitate cooperation (e.g., trust or resource dependen-

cies), without considering broader frameworks that tie such factors together. In other words, stake-

holder research has trouble answering the fundamental question, “Why these factors and not

others?”Thus, scholars continue to seek a more complete and integrated view of stakeholder man-

agement that explains how mutually beneficial partnerships emerge, change, and grow. As noted by

Tantalo and Priem (2016, p. 314), “this elemental ‘how’gap…has been limiting stakeholder theory

as a tool for strategic management.”Accordingly, there remains a significant divide between what

we know about how organizations and stakeholders seek individual goals and outcomes in their

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