Satisfaction in relation to the metrics of quality constructs in south African manufacturer-supplier relationships.

Author:Mpinganjira, Mercy
Position::Art
 
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Introduction and literature review

Inter-organisational relationships form an intrinsic part of the modern business world (e.g. Cubillo, 2008; Svensson, 2008). The quality between parties is often essential in business-to-business relationships, and is framed differently (e.g. Cambra and Polo, 2006; Sosa, Svensson and Mysen, 2011); this is mainly because of the many benefits associated with closely working together with business stakeholders. Literature on business-to-business relationship marketing shows that having close working relationships between suppliers and buyers often results in improved competitive advantage to all firms involved (Athanasopoulou, 2009). While there is often a general agreement in literature on the benefits of relationship marketing, researchers and practitioners, there is a general lack of agreement on how various business relationship-related factors work together in order to ensure the existence of good business relationship quality. Literature shows that three factors, namely commitment, trust and satisfaction, are commonly accepted to be the key factors for establishing and maintaining close working relationships that are essential to business success (Palmatier, Dant, Grewel, and Evans, 2006). There is lack of consensus on how these constructs interrelate, as well as the extent of their relationship (Ulaga and Eggert, 2006).

Of much debate in the relationship of the three constructs is the position of satisfaction in relation to commitment and trust. There is often much debate on whether satisfaction is an precursor or an outcome of commitment and trust. Researchers such as Svensson, Mysen, and Payan (2010), as well as Garbarino and Johnson (1999), found that satisfaction mediates the influence of commitment and trust on continuing relationship. It is however important to note that the findings of satisfaction as a mediating factor between commitment and trust on continuing relationship (Garbarino and Johnson (1999) were observed on transactional relationships that were infrequent in nature. The same study found that for high-relational customers, satisfaction precedes trust and commitment. Other researchers, notably Moliner et al. (2007a, 2007b) as well as Geyskens and Steenkamp (2000), also found results that are supportive of the argument that satisfaction comes before commitment and trust. It can thus be argued that the manner in which satisfaction relates with commitment and trust in a nomological network is an issue that is still unresolved.

The nature of the relationship that exists between commitment and trust is also the subject of much debate and conflicting findings. For example, Morgan and Hunt (1994) found that trust is an antecedent of commitment. A number of other researchers, including Caceres and Paparoidamis (2007), Moliner, Sanchez, Rodriguez, and Callerisa (2007a, 2007b), Ulaga and Eggert (2006), Bansal, Irving, and Taylor (2004), reported similar findings. Some researchers on the other hand argue that in business-to-business relationships, commitment comes before [begin strikethrough]of[end strikethrough] trust (Gundlach, Achrol, and Mentzer, 1995). It can furthermore be argued that trust, commitment, and satisfaction constitute core dimensions of a higher-order relationship-quality construct. For example, Skarmeas, Katsikeas, Spyropoulou, and Saleh-Sangari (2008) argue that satisfaction is a "focal outcome of buyer-seller relationships that are generally unlikely to develop in the absence of trust and commitment."

The lack of agreement on the interrelationships between trust, commitment, and satisfaction may be partly due to the emphasis in past research which "has been on developing and testing new theory rather than on establishing empirical generalizations (Geyskens, Steenkamp, and Kumar, 1999)

The main objective of this paper is to ascertain the position of satisfaction in relation to trust and commitment, as well as its relationship with three important outcomes in business relationships, namely coordination, cooperation, and continuity expectancy. In trying to do so, the authors argue for the position of satisfaction as a mediating factor between trust and commitment on one hand, and the three outcomes of successful business relationship on the other side. The support is based on four main reasons Firstly, numerous studies including Johnson, Sividas, and Garbarino (2008), Payan and Svensson (2007), Farrelly and Quester (2005), Mohr and Spekman (1994), Smith and Barclay (1997), Roath and Sinkovics (2006), Wong and Zhou (2006), Svensson, Mysen, and Payan (2010) show that trust and/or commitment appear to be precursors to satisfaction. The second reason is the belief that the relationship between satisfaction and the outcomes of successful business relationships may be stronger that that between trust and the outcome. Studies by Rauyruen and Miller (2007), Leonidou, Barnes, and Talias (2006) as well as Ulaga and Eggert (2006) support this thinking. The third reason relates to the timing as to when trust and commitment arise. It is important to note that other researchers argue that trust in particular, as well as trusting intention and trusting beliefs, can be established very early in business relationships before the exchange partners express high levels of relationship satisfaction. They note that a number of factors can lead to this, including the existence of a trusting disposition and because of "structural assurance belief effects" McNight, Cummings, and Chervany (1998). Shapiro (1987), as quoted by McNight et al. (1998), argues that factors such as guarantees, exchange regulations, and legal recourse make it possible for partners to feel certain about each other's behaviour and to reduce perceptions of risk. Such factors also enhance the trusting partner's belief that the trusted partner will make every effort to live up to expectations. The fourth and last reason is the belief that satisfaction may be the strongest component of the relationship quality (Moliner et al. 2007a, b).

The four reasons given above suggest that satisfaction may function as the closest cause of important business relationship outcomes, more so than trust or commitment. It is for this reason that satisfaction in this study is placed as mediator between trust and commitment on the one hand, and the three outcomes of coordination, cooperation and continuity on the other.

According to Payan and Svensson (2007) the basic fundamental principle of interorganisational research is that joint activities between organisations (or actual relationship-oriented intentions/behaviours) are essential for business success. As a result, this study includes three rarely studied outcomes of coordination, cooperation and continuity expectancy.

The paper has been organised into three main parts The first part provides a theoretical framework for the study. This is followed by the second part which provides details of the methodology used in the study and results of the data analysis. The last part of the study provides details relating to conclusions drawn from the findings, limitations of the study as well as suggestions for future.

Conceptual model and hypotheses

The conceptual model for this study is presented in figure 1 and positions satisfaction as a positive mediator between trust and commitment on the one side and outcomes of cooperation, coordination and continuity on the other. Note that all the paths in the model are hypothesised to be positive (refer to Figure 1). The preceding section provides the details relating to the specific hypotheses of the study.

[FIGURE 1 OMITTED]

Wilson (1995) as well as Oliver (1997) noted that satisfaction can be viewed as an affective state that results from a judgement on how a company performs in comparison to expectations. In this study, satisfaction is conceptualised as an overall affective state representing the manufacturer's contentment with a supplier, which is in line with Andaleeb (1996). Commitment and trust are conceptualised in this study in line with how Morgan and Hunt (1994) conceptualised the two constructs. This means that commitment can be seen as an indication that a company believes the partnership with the supplier is worthwhile to be ongoing. Trust on the other hand denotes a company's confidence in the reliability and integrity of the supplier.

The argument put forward in the hypotheses involving trust and commitment relative to satisfaction is that each of the two constructs positively influences satisfaction. Andaleeb (1996) and Ganesan (1994) noted that trust may positively impact satisfaction because companies feel secure that...

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