Power source drivers and performance outcomes of functional and dysfunctional conflict in exporter–importer relationships

Abstract

Although conflict is natural in buyer-seller relations, the issue has largely been studied in domestic market settings despite increasing globalization and the surge of cross-border interfirm relationships. This research focuses on two different types of conflict, functional and dysfunctional, and examines how these are linked to coercive and non-coercive power bases and performance outcomes in exporter-importer relationships. Using survey data from 105 pairs of exporters and their foreign distributors, we find that only in the exporter group the use of coercive power by the foreign distributor lowers functional conflict. However, the use of coercive power by the overseas partner increases dysfunctional conflict and the use of noncoercive power reduces such conflict across both exporters and importers, although in the importer group this link is not significant. The results also suggest that functional conflict enhances performance only among importers. The use of problem solving conflict resolution boosts functional conflict's impact on performance among exporters, but adversely affects the performance effect of such conflict in the importer group. Nonetheless, problem solving resolution negatively affects the impact of dysfunctional conflict on performance in both the exporter and importer groups. Moreover, we find that power distance boosts the impact of dysfunctional conflict on performance in the relationship across the groups of exporters and importers. Implications of the findings for international marketing theory and practice are discussed, and limitations of the study considered along with future research directions.

What Drives Importer Opportunism? Learning from a Developing Country in Latin America

“…In high power distance cultures, coercive power is more likely to be used to influence others (Kale & McIntyre, 1991). Further, previous research indicates that coercive power worsens cooperative relationships (Brown et al, 1995;Matanda & Freeman, 2009;Pfajfar et al, 2019;Yeung et al, 2009).…”

Influence of marketing channel conflicts on channel innovation capability: the mediating role of channel cohesion and the moderating role of channel network structure

“…Functional conflicts are generally taskrelated, aimed at resolving disagreements and facilitating channel goal achievements (Loughry and Amason, 2014). These conflicts are typically considered healthy because openminded debates on diverging views offer superior results compared to individual perspectives (Pfajfar et al, 2019). They contribute to channel cohesion in three ways:…”

“…(1) fostering a free expression atmosphere that motivates both manufacturer and distributor network to interact and collaborate closely (Tang et al, 2017;Webb, 2002;Pfajfar et al, 2019), resulting in higher levels of channel cooperation and interaction-a typical characteristic of a cohesive organisation (Montes et al, 2005;Li and Zhang, 2010); (2) encouraging channel members to work efficiently, which contributes to higher centripetalism and task commitment towards common goals and leads to greater organisational cohesion (Jehn and Chatman, 2000;Jehn and Mannix, 2001;Mullen and Copper, 1994;Li and Zhang, 2010;Huang et al, 2011); and (3) exerting a positive influence on knowledge sharing and exchanging information with concerned parties (Tang et al, 2017), making channel members complementary. This benefit-sharing behaviour is also a critical dimension of cohesion (Li and Zhang, 2010).…”

“…Channel conflict is inevitable in channel relationship management (Tang et al, 2017), and an integral component in organisational customers' and suppliers' interactions (Pfajfar et al, 2019). Although some previous studies have viewed channel conflict as harmful and not constructive (Gaski, 1984), others have proposed that conflict can produce positive and constructive outcomes (Menon et al, 1996) by helping to eliminate channel monopoly, attain information symmetry (Schmidt and Kochan, 1977), stimulate innovation (Song et al, 2006;Clercq et al, 2009), inspire original and divergent viewpoints (van Dyne and Saavedra, 1996), promote marketing capability (Tang et al, 2017) and improve relationship performance (Claro et al, 2018).…”

Strategic and Operational Levels of CSR Marketing Communication for Sustainable Orientation of a Company: A Case Study from Bangladesh

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