Executive Summary
Previous channels research has shown that relationship commitment has many benefits, including reducing uncertainty, increasing exchange efficiency and satisfaction, and enhancing performance and profitability. In a purchasing context, incumbent suppliers might believe that a buyer’s commitment provides a cushion they can use to extract extra rents from a relationship or a buffer to protect themselves from the consequences of their misbehaviors. Even so, several studies have also suggested a “dark” side to close relationships, when the buyer’s commitment can backfire on the supplier and intensify threats to the relationship. In this research, the authors examine the circumstances in which a buyer’s commitment helps or hurts the incumbent supplier as a result of the supplier’s own misbehavior.
In this research, the authors examine two types of supplier misbehavior: opportunism and ethical violations. They demonstrate how buyers’ commitment to an incumbent supplier (1) buffers the incumbent against the supplier’s misbehaviors and (2) amplifies the harm to relationships resulting from such misbehaviors. Specifically, drawing on assimilation and contrast theory, this research specifies conditions under which buyers’ calculative and affective commitment have buffering and amplifying effects on intentions to switch suppliers when the incumbent suppliers misbehave. In particular, the authors predict and find that calculative commitment buffers relationships against mild levels of both opportunism and ethical violations, but these buffering effects attenuate as both types of supplier misbehavior become severe. The authors also predict and find that whereas affective commitment buffers relationships against mild levels of both opportunism and ethical violations, it also amplifies the threat to relationships caused by severe levels of opportunism (i.e., when an incumbent supplier is cheating on the relationship).
The authors test these hypotheses derived from assimilation and contrast theory and obtain converging evidence from three scenario-based experiments using samples of undergraduate students, executives enrolled in MBA classes, and purchasing managers. In addition to showing effects consistent with theory-based predictions, the studies also demonstrate that buyer perceptions of supplier conformance to normative standards account for the observed buffering and amplifying effects in a manner consistent with the assimilation and contrast framework.
This research offers important managerial implications. First, it delineates the specific circumstances in which buyer commitment protects or exacerbates the adverse impact of mistakes the incumbent supplier makes. Second, the consistency of amplification effects across the three studies strongly suggests that suppliers cannot rely on buyer commitment to assure relationship continuity when they misbehave in a conspicuous manner that ostensibly transgresses relational norms. Finally, this research provides useful insights for “in-suppliers” interested in maintaining the quality of ongoing relationship and for “out-suppliers” seeking to encroach on competitors’ committed relationships.
Biography
Professor Shankar Ganesan is Office Depot Professor of Marketing in the Department of Marketing at the Eller College of Management, University of Arizona. His research interests focus on the areas of interorganizational relationships, buyer–seller negotiations, service failure and recovery, and new product innovation. He is the author of several articles that have appeared in leading academic journals, including Journal of Marketing Research, Journal of Marketing, Journal of Retailing, Journal of Personal Selling and Sales Management, Journal of Academy of Marketing Science, Journal of Applied Psychology, Organizational Behavior and Human Decision Processes, and MIT Sloan Management Review. Professor Ganesan has received numerous awards and honors for his research and teaching, including the American Marketing Association’s Louis W. Stern Award for the Best Article on Marketing Channels and Distribution, Robert D. Buzzell MSI Best Paper Award from the Marketing Science Institute, the American Marketing Association’s Best Dissertation Award, the Craig and Lauri Forte Excellence Award, and the Eller College BPA Student Council’s Faculty Appreciation Award for teaching. He has also received awards from Journal of Marketing and Journal of Retailing for being an outstanding reviewer on the editorial review board. He teaches sales management to the undergraduate students, customer relationship management to the MBA students, seminars on Marketing Strategy and Research Methods to the doctoral students, and customer value module to executive MBA students. Before his academic career, he worked as a sales manager for a computer company in India.
Steven P. Brown is Bauer Professor of Marketing on the C.T. Bauer College of Business at the University of Houston. His research interests focus on identifying ways of building and sustaining competitive advantage through effective sales and service organizations. His research has investigated how organizational climate and managerial leadership motivate and facilitate the efforts of frontline sales and service personnel and how these, in turn, impact customer satisfaction and organizational performance. Other research interests include customer-perceived service quality and satisfaction, buyer–seller relationships, and methods of meta-analysis. His research has been published in leading marketing and psychology journals, such as Journal of Marketing, Journal of Marketing Research, Journal of Consumer Research, Psychological Bulletin, Journal of Applied Psychology, Journal of the Academy of Marketing Science, and Journal of Retailing, among others. He serves on the editorial review boards of Journal of Marketing, Journal of Retailing, Journal of Service Research, and Journal of Personal Selling and Sales Management. Before his academic career, he worked as regional sales manager for Latin America for the Wadsworth International Group of Belmont, California, where he was responsible for sales and distribution throughout Latin America. He also served as a top-producing sales representative for Science Research Associates of Chicago.
Babu John Mariadoss is Assistant Professor of Marketing at Washington State University, Pullman, where he currently teaches sales management, new product management, and marketing management courses to undergraduate and MBA students. His research interests are in relationship marketing, sales management, and new product strategies. He has an undergraduate degree in Mechanical Engineering (Anna University, India), an MBA in Marketing (Bharathidasan University, India), and a PhD in Marketing (University of Houston, Houston). Before receiving his PhD, he held various marketing positions in the chemical and petrochemical industries, as well as in management consulting.
Hillbun (Dixon) Ho is an assistant professor in the Division of Marketing and International Business, Nanyang Business School, at Nanyang Technological University. He received his PhD in Marketing from the University of Arizona. His primary research interests include business-to-business marketing, channel relationships, interorganizational knowledge transfer, and retailer strategies. His dissertation in the area of knowledge transfer in supplier networks has won a research award from the Institute of Supply Management.
Journal of Marketing Research, Volume 47, Number 2, April 2010
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