The influence of relationship quality on the innovation capacity in traditional food chains

Abstract

PurposeRelational aspects between actors in a chain have been found to influence innovation capacity. Yet, many studies focus rather on groups of chain members, without investigating personalized links between the chain members. Other research involved case‐studies on a limited number of individual chains. The purpose of this paper is to examine quantitatively how the perceived relationship quality among three relational linked chain members affects the innovation capacity in traditional food chains beyond the dyad.Design/methodology/approachEvidence is drawn from a survey of 90 triplets of firms (three interlinked chain members), with each triplet belonging to a single individual traditional food chain. Research was conducted in three European countries and six traditional food product categories. Heterogeneity across these chains is examined based on cluster analysis. Binary logistic regression is used to examine the influence of relationship quality on the innovation capacity in the chains.FindingsThree distinct clusters are identified and interpreted as reflecting three levels of innovation capacity: high, medium, and low. Relationship quality is defined through characteristics such as trust, social satisfaction, non‐coercive power, and reputation. Results suggest that the characteristics of the chain relationship quality may be important factors for the improvement of the innovation capacity in chains.Research limitations/implicationsAs chain relationship quality fosters sharing of resources necessary for innovation as well as the distribution of incentives, these results further strengthen the emerging conclusion from the literature that innovation can be catalyzed by collaboration strategies and building strong relationships.Originality/valueThis paper contributes to the ongoing discussion on widening the supply chain approach from dyads to triads, as it is argued that a dyad of firms is intensively influenced by the network they are imbedded in. In this case, the paper explores the influence of the relationship quality among the food manufacturer and its main supplier and customer (and vice versa) on the innovation capacity of the whole chain.

Role of power in supply chain performance: evidence from agribusiness SMEs in Uganda

“…14 Previous studies provide evidence of perceptual differences amongst supply chain members 15 with regard to the nature of relationships and SCP (Molnár et al, 2010;Whipple et al, 2010; 16 Kühne et al, 2013;Nyaga et al, 2013). (Erin Anderson and Weitz, 1992) showed that 17 perceptual differences can negatively affect the relationships among chain members and 18 results dissatisfaction and conflict.…”

“…Power imbalances usually arise due to differences in expertise, size, dependence, and the 23 nature of contract (Martin K Hingley, 2005;Belaya et al, 2009;Gellynck and Molnár, 2009; 24 Kühne et al, 2013;Li et al, 2013;Jones et al, 2014). In the context of agribusiness SMEs in Uganda, processors and wholesalers usually 1 have more resources (capital) and better access to market information as compared to their 2 suppliers and customers.…”

“…Firstly, past studies on power in supply chains have focused on its 2 influence on resource allocation (Pulles et al, 2014); power asymmetry (Nyaga et al, 2013); 3 commitment (Zhao et al, 2008); relationship strength (Maloni and Benton, 2000); and 4 performance (Crook and Combs, 2007;Molnár et al, 2010). With a few exceptions such as 5 Molnár et al (2010) and Kühne et al (2013), the majority of these studies collect and analyze 6 data from one side of a relationship dyad using a focal firm approach. Analyzing a supply 7 chain at firm or dyadic levels limits understanding the underlying dynamics of the entire 8 supply chain relationships (Molnár et al, 2010;Wu et al, 2010;Kühne et al, 2013;9 Touboulic et al, 2014).…”

“…With a few exceptions such as 5 Molnár et al (2010) and Kühne et al (2013), the majority of these studies collect and analyze 6 data from one side of a relationship dyad using a focal firm approach. Analyzing a supply 7 chain at firm or dyadic levels limits understanding the underlying dynamics of the entire 8 supply chain relationships (Molnár et al, 2010;Wu et al, 2010;Kühne et al, 2013;9 Touboulic et al, 2014). Consequently, there is a need to look beyond the dyad and into the 10 triad as a unit of analysis.…”

“…This implies that supply chain members are 1 interdependent in a complex supply chain structure (Cai et al, 2013;Chicksand, 2015; 2 Odongo et al, 2016). Supply chain management (SCM) literature demonstrates that power is 3 a vital predictor of supply chain performance (SCP) (Molnár et al, 2010;Nyaga et al, 2013), 4 adoption (Liu et al, 2015), innovation capacity (Kühne et al, 2013), and customer 5 integration (Zhao et al, 2008). However, the role of power relations in supply chains is evolving as firms become 7 more complex and multifaceted.…”