The impact of power and relationship commitment on the integration between manufacturers and customers in a supply chain

Abstract

Supply chain integration (SCI) has received increasing attention from scholars and practitioners in recent years. However, our knowledge of what influences SCI is still very limited. Although marketing and management researchers have investigated power and relationship commitment issues between organizations, few have examined their impact on SCI. This paper extends the powerrelationship commitment theory established in Western marketing literature and links it with SCI in China, through examining the relationship between power, relationship commitment and the integration between manufacturers and their customers. We propose and empirically test a model using data collected from 617 manufacturing companies in China. The results show that different types of customer power impact manufacturers' relationship commitment in different ways. Expert power, referent power and reward power are important in improving manufacturers' normative relationship commitment, while reward power and coercive power enhance instrumental relationship commitment. We also found that normative relationship commitment had a greater impact on customer integration than instrumental relationship commitment. These findings are interpreted in light of national culture differences between China and the U.S. in terms of power distance and collectivism, which provide a new perspective on SCI. #

Piggy in the Middle: How Direct Customer Power Affects First-Tier Suppliers’ Adoption of Socially Responsible Procurement Practices and Performance

“…The concept of power is used extensively in supply chain management literature to explain the performance of supply chain relationships in terms of trust (Kumar et al 1995;Maloni and Benton 2000), cooperation (Frazier and Rody 1991;Maloni and Benton 2000), commitment (Kumar et al 1995;Maloni and Benton 2000;Zhao et al 2008), adaptation (Hallen et al 1991;Nyaga et al 2013) or satisfaction (Benton and Maloni 2005;Frazier and Summers 1986;Maloni and Benton 2000). Power is a key variable in supply chain relationships as it directly relates to the control and influence of one party over another (Maloni and Benton 2000;Nyaga et al 2013).…”

“…For parsimony, these power bases have been further grouped into non-mediated and mediated power (Benton and Maloni 2005;Maloni and Benton 2000;Zhao et al 2008). Nonmediated power is an indirect form of power embedded in the relationship between the buyer and the supplier.…”

“…This power is made up of coercive, legitimate and reward power (Benton and Maloni 2005). Unlike non-mediated power sources, the use of mediated power is readily apparent to the parties involved in the relationship (Zhao et al 2008). …”

“…Supply chain researchers have concluded that power is antecedent to the supplier's willingness to make adaptations for its buyers (Nyaga et al 2013), with research showing that non-mediated power use has a positive impact on relationships (Benton and Maloni 2005;Zhao et al 2008).…”

“…The scales were adapted from Zhao et al (2008) and supported by Nyaga et al (2013). Expert and referent power scales consist of three items.…”