The Impact Of Power And Relationship Quality On Value Creation and Appropriation in Buyer–Supplier Relationships

Abstract

Business relationships provide the means to create and appropriate superior value in business markets. However, despite the proliferation of research on the phenomenon, many questions remain unaddressed. Previous work focused almost exclusively on value after its creation and its sharing between the two exchange partners. Consequently, the appropriation of value as well as its interaction with value creation remains relatively unknown. Similarly, a few studies have examined the role of relational variables and power asymmetry in customer–supplier exchange relationships. To fill this gap, this study aims to examine the influence of relationship quality and power on value creation and appropriation and ultimately, on satisfaction and relationship continuity. Based on the theory of social exchange, this study proposes a conceptual model, which positions value creation and appropriation as central variables in the nomological network of business relationships. A quantitative study of 174 suppliers was carried out in order to compare the theoretical model with the empirical reality. The results obtained show that the relationship quality promotes greater value creation and appropriation in ongoing business relationships. As for power, its influence differs depending on how it is exercised within the relationship. Moreover, the appropriation of value remains the main driver of partner satisfaction, a sine qua non condition for the continuity of the relationship. This present research contributes to a better understanding of value creation-appropriation in ongoing business relationships. By strategically managing their customer–supplier relationships, managers can create and capture greater value and gain a competitive advantage.

Investigating the quality of the relationship, supply risk mitigation on medium and large-sized manufacturing firms' supply chain performance in the developing countries: the moderating effect of supplier involvement

“…Therefore, this study suggests that SC practitioners intensify efforts to adopt the entry of highly trusted, reliable and involved suppliers to mitigate the risks of the SC in their supply of raw materials and production requirements to MFs. Our results support previous empirical studies that such relational quality creates value, mitigates SC risk and enhances a firm's performance for the exchange partners (Alaoui and Noureddine, 2019). Therefore, managers are focused on sustaining a long-term, value-creating a relationship with reliable suppliers and mutually beneficial quality relationship to lead to the benefits of relational quality in the exchange.…”

Enabling manufacturing firms' supply chain performance in the Middle East region through boosting the quality of multi-directional relationship, and supply chain risk dilution: A moderated-mediation model

“…Consequently, this study recommends that supply chain practitioners prioritize working with highly trusted, elastic, flexible, dependable, reliable, and engaged suppliers to mitigate supply chain risks associated with raw material sourcing and production requirements. Our results align with many published papers in this topic, suggesting that such relational quality generates value, mitigates and dilutes supply chain risk, and enhances exchange partners' performance [ 110 ]. Thus, managers should concentrate on maintaining strategic-term, value-adding, and win-win relationships with dependable suppliers to reap the interests of close and highly relational quality in exchanges.…”

Importance of Supplier Quality and Supplier Relationship Quality in Supply Chain

“…According to Ryu, et al, relationship quality has been considered as a key factor for success in a relationship between parties to a transaction or exchange with a long-term orientation (Yang, et al, 2020). The benefits resulting from high-quality relationships are built on fostered trust and commitment, increased value creation and appropriation, business sustainability, and superior supply chain performance (Alaoui, et al, 2019;Kros, et al, 2019;Yang, et al, 2020).…”