Relational Strategies and Firm Performance: Insights From an Orienting Conceptual Framework

• Author: Adriana R. Hofer,Amydee M. Fawcett,Stanley E. Fawcett
• Date: 01 June 2014
• Published date: 01 June 2014
• DOI: http://doi.org/10.1111/jbl.12049

Relational Strategies and Firm Performance: Insights From an

Orienting Conceptual Framework

Amydee M. Fawcett

1

, Adriana R. Hofer

2

, and Stanley E. Fawcett

1

1

Weber State University

2

University of Arkansas

Managing relationships to create distinctive value is the essence

of supply chain management. Thus, relational strategies have

been widely—if not deeply—studied over the past 20 years.

Meta-analyses evaluating the link between supply chain integra-

tion/collaboration and firm performance have recently appeared.

Although a typically positive link is demonstrated, these meta-

analyses reveal that we have yet to fully understand relational

strategies’nuanced mechanics. Mackelprang et al. (2014) note

the following:

1. Supply chain relational strategies are important, complex, and

multifaceted.

2. Inconsistent empirical findings are pervasive, leaving vital

questions unanswered.

3. Relational strategies should not be universally viewed as

improving performance—fully 26% of integration-perfor-

mance links are not significant. Some are negative.

4. The integration-performance link is context dependent. Two

in three examined X?Y relationships are subject to unknown

moderating factors.

Mackelprang et al. argue that more clearly defined constructs

and rigorously developed measures are needed. We present an

orienting conceptual framework to extend this dialogue, contex-

tualize relational strategies, and guide the development of more

refined and robust constructs. Our goal: Help researchers provide

deep insight into the dynamics of relational strategies.

AN ORIENTING CONCEPTUAL FRAMEWORK

By helping interpret the interplay among theoretical views on

supply chain relationships—or as anthropologists would say,

between the etic and the emic—an orienting conceptual frame-

work encourages deeper sense making and new perspective about

essential why and how questions that underlie relational strate-

gies (see Figure 1). Orienting conceptual frameworks contrast

decision-making traditions, deriving concepts and constructs from

theoretical lenses. That is, management practice develops from

and into distinct traditions. Explanatory paradigms emerge, lend-

ing credibility to potentially divergent theories. Transaction cost

economics (TCE) and resource-based view (RBV), for instance,

are focal theories used to explain the whys and how-to of supply

chain governance and outcomes. TCE explicates value appropria-

tion. RBV delineates value cocreation. Moving toward more

granularity, concepts emerge from theories; for example, oppor-

tunism and relation-specific assets from TCE and distinctive

(valuable, rare, inimitable, and nonsubstitutable [VRIN)])

resources from RBV. Such concepts guide the conceptualization

and operationalization of research constructs.

VALUE APPROPRIATION

The value appropriation perspective—supported by TCE,

resource dependency, and social dilemma theories—maintains

that firms work closely to: (1) assure access to scarce resources,

(2) minimize transaction costs, and (3) reduce the risks of oppor-

tunistic behavior. Without tightly coupled relationships, resource

access and organizational performance are jeopardized. Decision

makers must, however, safeguard against power asymmetries and

opportunistic behavior. Relational strategies driven by value-

appropriation goals are defensive; that is, firms seek tightly

coupled relationships to avoid being disadvantaged.

Within this perspective, the determinants of relationship inten-

sity are: required asset specificity, frequency of interaction, envi-

ronmental uncertainty, bounded rationality, and opportunistic

behavior. The safeguarding posture emphasizes contractual

governance. As such, information sharing, teaming, and other

relational investments are made to the extent that close relation-

ships convey resource access and mitigate problems like parts

shortages, late delivery, or defective quality. Information sharing,

for instance, is selective, focusing on near-term and operational-

planning issues. Although seeking efficiencies, decision makers

carefully hold on to sensitive information that might transfer

power.

VALUE COCREATION

The value cocreation perspective—supported by the RBV,

resource advantage theory, and the relational view—posits that

cooperative relationships enable comingling of resources to deli-

ver a distinctive value proposition. Because the resources and

routines needed to create unique value reside across organiza-

tional boundaries, value cocreation strategies require proactive

scanning to find partners that possess not only complementary

competencies but also a disposition and ability to work together

for mutual benefit. Decision makers must develop refined partner

identification, evaluation, and governance mechanisms. The goal

Corresponding author:

Amydee M. Fawcett, Business Administration, Weber State Univer-

sity, Ogden, UT 84408, USA; E-mail: amydeefawcett@weber.edu

Journal of Business Logistics, 2014, 35(2): 151–152

© Council of Supply Chain Management Professionals