Sustained Monopolistic Business Relationships: An Interdisciplinarity Case

Abstract

Business‐to‐business relationships within sustained monopolies, such as those within UK defence procurement, have received scant attention by management researchers. This is unusual because under these market circumstances there appear to be few incentives to achieve mutually beneficial outcomes despite their strategic policy importance. This paper argues that an understanding of the monopolistic environment using a transaction cost economics theoretical framework and supply‐chain management, relationship marketing and transaction cost economics concepts provides an innovative, interdisciplinarity approach to solving this problem as well as testing aspects of these disciplines empirically in a novel area. This paper describes the results from a substantial research project to test this hypothesis in the UK defence procurement situation. It reveals a number of key dynamics within the sustained monopolistic relationships surveyed and suggests considerable potential for further research.

UK defence supply chain relationships: a study of sustained monopoly

“…These findings are borne out by the data described in the previous section. Difficulties in achieving effective SCM implementation could be traced to the normal, commercial difficulties surrounding order book performance, joint objectives and service level systems framework (Humphries & Wilding, 2004, Lamming, 1993, Tompkins, 2000. Environmental Although the research was designed to take an aggregate view of the data and did not differentiate between the views of the MoD and Industry respondents, it was noticeable that qualitative opinions were reasonably balanced.…”

“…Lambert et al's (1996) Partnering process model demonstrates the important features that impact upon partners when establishing and maintaining a partnership and describes a continuous improvement approach with the reinforcement of success. Under monopolistic conditions the partners have no choice in the arrangement and depending on the degree of negativity affecting the business drivers for co-operation and the facilitators deployed to operationalise the relationship will, through a negative feedback loop, potentially generate a self-reinforcing, low quality relationship (Humphries & Wilding, 2004). We conclude that these findings support Williamson's (1975) concepts when applied to sustained, public sector, monopolistic, business relationships and moreover, provide additional evidence that builds upon Spekman et al's (1998) work in addressing the reasons why SCM relationships are difficult to implement and sustain.…”

Understanding collaborative supply chain relationships through the application of the Williamson organisational failure framework

“…Humphries and Wilding (2004a) and Spekman et al (1998) suggest that co-operative, co-ordinating and collaborative behaviours involve working together/jointly to bring resources into a required relationship to achieve effective operations in harmony with the strategies/objectives of the parties involved, thus resulting in mutual benefit. Spekman posed the view, as shown in Figure 4, that a shift in the level of intensity between partners was necessary.…”

Relationship or revenue: Potential management conflicts between customer relationship management and hotel revenue management

“…The findings show that, in order to achieve the goal of RevM, the sample hotels were focusing on the daily revenue maximisation opportunities. However, CRM studies (Morgan and Hunt, 1994;Gronroos, 1996;McDonald et al, 2000;Humphries and Wilding, 2003) advocate building a 'trusting relationship' that has a 'long-term payoff' for both parties. Similarly, Cheverton (1999:8) views customer relationships as 'an investment of time and effort' and asserts that in many cases this investment requires 'a shortterm sacrifice for prospective long-term gains'.…”