-
Similarities between Conflict and Cooperation in the Marketing
Channel
Robert H. Ross, Wichita State University Robert F. Lusch,
Oklahoma University
This article examines the relationship between two causes of
conflict: domain dissensus andperceptual incongruity, and the
levels of conflict and cooperation within a marketing channel dyad.
Utilizing a national sample of food broker-food wholesaler dyads,
four hypotheses were tested-two relating domain dissensus and two
relating perceptual incongruity to conflictlcooperation. Results
indicated no significant relationship between either perceptual
incongruities or domain dissensus and the level of conflict found
in the dyad, while a significant negative relationship was found
between both perceptual incongruities and domain dissensus and the
level of cooperation in the dyad.
Most recent studies of the interactions between members of a
marketing channel have taken Aldersons [l] perspective of the
channel as an interorganizational system. These studies assume that
channels are superorganizations . . [which] have the
characteristics of complex social organizations, even though
comprised of collectivities rather than individuals [19, p. 4061.
Thus within a channel there are activities aimed at attaining both
collective and self-interest goals; a division of functions and
tasks resulting in interdependent processes; and integrated actions
that result in channels developing a unique identity separate from
their members [ 19, p. 4061.
The interdependent relations between channel members are
important to the development of research regarding channel conflict
in that interdependency has been identified as a precondition for
the existence of conflict [4]. To date, most research on channel
conflict has focused on vertical channel conflicts causes [5, 8, 9,
12, 20, 26, 27, 321, consequences [ 11, 13, 16, 231, mechanisms of
conflict resolution [2, 13,26,27,30].
Channel interdependence also creates the need for cooperation to
assure effective channel management. Cooperation has received less
attention in intrachannel studies, with Pearsons [ 151 the only
reported empirical example. There are divergent views of the
relationship
Address correspondence to Robert H. Ross, Department of
Administration, Wichita State University, College of Business
Administration, Wichita, KS 6 7208.
JOURNAL OFBUSINESSRESEARCH 10, 237-250 (1982) 0 Elsevier Science
Publishing Co., Inc. 1982 237 52 Vanderbilt Ave., New York, NY
10017 0148-2963/82/020237-14$2.75
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238 Robert H. Ross and Robert F. Lusch
between conflict and cooperation in channels. Pearson [ 151
indicates that conflict and cooperation are at opposite ends of a
single scale, whereas Mallen [ 131, Stem and Heskett [27], and
Robicheaux and El-Ansary [20] view conflict and cooperation as
separate constructs. Stem and Reve [28] suggest that the degree of
conflict or cooperation in a given channel is the result of the
degree of power balance present, as well as the aggregate amount of
power in the channel [28, p. 581.
There has been no reported research investigating the effect of
the presence of causes of conflict with the levels of conflict and
of cooperation in a channel, even though these concepts appear to
share similar antecedents. An empirical investigation of these
relationships is the objective of this research.
Channel Conflict
Conflict has been defined as a state when incompatable
activities occur. . . an action that is incompatible with another
action, prevents, obstructs, interferes, injures, or in some way
makes the latter less likely or less effective [7, p. lo]. Within
the channel, conflict may be defined as an action by one channel
member which is inconsistent with the goals of some other member or
members at a different channel level [30, p. 61. This definition is
adopted for this research, since it implies the presence of a
vertical linkage in the channel and also implies that actions need
not be planned as conflictual to be perceived as such.
The effect of various levels of conflict on the functioning of a
channel can be either productive or destructive. Managerially, it
is important to develop strategies to manage conflict and identify
what sort of conflict behavior is most likely to lead to
constructive outcomes and which behaviors tend to be either
nonproductive or destructive [29, p. 8921. After isolating these
behaviors it is necessary to identify the variable which influence
the occurrence of these behaviors. . . [to] develop productive
intervention strategies and tactics [29, p. 8921.
To assist in understanding the conflict process, several models
have been developed. Pondy [ 171 in his model indicates the
presence of four (not necessarily sequential) stages: a latent
stage (causes of conflict present); a perceived stage (awareness of
conflict); a felt stage (conflictual parties experience tension or
stress); and a manifest stage (actual conflictual behavior takes
place). The outcome of one conflictual episode sets the stage for
the next. Similar models have been developed by Thomas [29] and in
a channel setting by Rosenberg and Stem [21,
Rosenberg and Stem [21] suggested in their empirically tested
model that interdependence, perceptual incongruity, domain
dissensus, and
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Marketing Channel 239
goal incompatibility were the causes of conflict in a channel.
These causes react with structural and attitudinal factors to
create a measurable level of conflict. The behavior occurring at
this point determines the eventual outcome of the conflict
episode.
It appears that interdependency provides the foundation for the
other causes [26, p. 1561, in that each channel member will have
its own goals and preferred method of their achievement. However,
none can pursue the goals without concern for how this pursuit will
affect other members goal attainment [26, p. 1601. Domain dissensus
is also related to interdependency in that it involves disagreement
regarding the range of products, population to be served and the
services rendered and/or functions performed [27, p. 2941 between
the member of a channel. Lastly perceptual incongruities become
particularly significant when interdependent channel members must
work together to reach chan- nelwide goals.
Cooperation
Cooperation may be defined as a situation where the individuals
composing a group are pursuing promotably interdependent goals [6,
p. 1501. In the channel, cooperation may be defined as a state or
condition characterized by members willingness to coordinate their
activities in an effort to help all channel members achieve
superordinate goals [20, p. 221. This definition is utilized in the
research at hand.
Conflict versus Cooperation
Interdependence is an antecendent of both cooperation and
conflict. Therefore knowledge of ways to manage conflict and
cooperation in interdependent channel settings has significant
managerial impact since it affects the channels ability to function
effectively. In addition, empirically based knowledge of the
relationship between conflict and cooperation in a channel has
theoretical value, since analyses of this relationship have been
somewhat ambiguous to date. As examples, Schermerhom [24] is
representative of authors suggesting that conflict and cooperation
share common roots in organizational interdependence, domains, and
goals-with the outcome situationally determined. Bonama [3], on the
other hand, indicates that the relation between conflict and
cooperation varies with the relative power of the involved parties.
The former opinion indicates that conflict and cooperation are
antithetical, while the latter indicates that they should be
considered as separate constructs.
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240 Rohert H. Ross and Robert F. Lusch
If conflict and cooperation are considered as separate
constructs, channel member behavior could be classified along one
continuum from cooperative to noncooperative, and along a second
continuum from functional to dysfunctional conflict [20, pp.
22-231. Stem [25] indicates that the cooperative orientation in
channels is obtained in a setting within which the potential for
conflict is present.
Given the common root ot interdependency, if perceptual incon-
gruities and domain dissensus result in higher levels of channel
conflict, do congruent perceptions and domain consensus lead to
higher levels of cooperation? If conflict and cooperation have
similar roots, it would seem logical that these elements in the
conflict process would also bear on cooperation.
Hypotheses
Based on this background an empirical study was conducted that
allowed testing of the relationship between two of the primary
causes of conflict in the channel: domain dissensus and perceptual
incongruity, and the level of both conflict and cooperation in a
channel dyad.
HI : the greater the domain dissensus between channel members A
& B, the higher the level of conflict in the A-B dyad.
HI: the greater the perceptual incongruity between channel
members A & B, the higher the level of conflict in the A-B
dyad.
H,: the greater the domain dissensus between channel members A
& B, the lower the level of cooperation in the A-B dyad.
H,: the greater the perceptual incongruity between channel
members A & B, the lower the level of cooperation in the A-B
dyad.
Research Design
Data and Sampling Data utilized to test the research hypotheses
were collected as part of a nationwide study of the relationships
between food brokers and food wholesalers.
A sample of 100 broker-wholesaler pairs (matches) was randomly
chosen from a nationwide list of broker and wholesaler participants
in the grocery channel. Two criteria were used: the
broker-wholesalers must be involved in the general grocery trade
and they must do business with each other. The 100 matched pairs of
brokers and wholesalers were first contacted by telephone and asked
to take part in a study of operating policies in their marketing
channel. Although no mention was made of the behavioral focus of
the study, responsents were informed that they
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Marketing Channel 241
would be rating only their business relationship with the
oposite member of their dyad. They were then mailed a
questionnaire. As an incentive, all participants were promised a
copy of a managerial summary. After one followup there were 54
usable responses. The data are unique in terms of channels research
since 1) both sides of a specific dyad are surveyed, and 2) the 54
percent response rate indicates a high interest level among
participating subject in the results of the research. Measurement
Channel Conflict and Cooperation. Rosenberg and Stem [21] used as a
measure of conflict the absolute difference between channel members
evaluation of the performance of the dyad on conflict- related
issues. This approach fails to distinguish between a cause of
conflict and conflict itself, as no measure of actual conflict was
performed. Lusch [lo] operationalized the measure of conflict in
the marketing channel as the frequency of intramember
disagreements. Although frequency of disagreement was measured, the
intensity of the disagreements was not measured.
Pearson [ 151 measured the conflictual and cooperative
orientation in the channel by generating a list of 30 adjectives,
15 having content validity in the measurement of conflict and 15
having content validity in the measurement of cooperation. Each
adjective was accompanied by a Stapel scale ranging from + 5 to + 1
and from - 1 to -5. Respondents assigned a positive number to those
adjectives that were good descriptors of the situation in their
channel, and a negative number to those that were poor descriptors,
with the magnitude of goodness or poorness reflected in the
absolute size of the assigned number. The extent to which the
conflictually based adjectives were deemed to be good descriptors
indicated the level of conflict in the channel, while the extent to
which the cooperatively based adjectives were deemed good
descriptors indicated the level of cooperation in the channel. This
measure corresponds to Pondys felt conflict stage. It is in this
stage that conflict affects the way in which the parties involved
in a conflict episode feel about each other, and therefore might be
expected to color their working relationship.
Pearson tested this procedure on two channel segments, one known
to be conflictual, the other cooperative. Through discriminant
analysis 10 of the 30 adjectives were found to be statistically
significant in their predictive power regarding membership in
cooperative or conflictual dyads. This set of ten adjectives had
criterion validity. This list of adjectives consisted of five that
were cooperative (coordination, co- alition of interests,
respectfulness, mutual confidence, companionship) and five that
were conflictual (unreasonable demands, crossness, inconsistency,
emotional outbursts, dissension).
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242 Robert H. Ross and Robert F Lusch
In the study at hand, these ten adjectives, with a lo-point
Stapel scale, were used to measure the level of felt channel
conflict and cooperation. A major concern with this methodology is
that channel members might resist making responses that would
indicate the presence of conflict out of fear of damaging their
business relationships with the opposite member of the dyad. To
overcome this concern, respondents were assured both during the
original telephone contact and in writing on the questionnaire as
to the confidentiality of their response. Domain Dissensus. Domain
dissensus in a channel dyad refers to the absence of agreement
between members of the dyad regarding their respective performance
of functions, activities, or decision making- specifically, whose
domain these functions, activities, or decision fall within. After
consulting with food brokers and food wholesalers and reviewing the
trade literature, a list of ten activities or functions involving
wholesalers marketing policies was developed. These policy areas
related to wholesalers of product line, pricing policies, inventory
levels, sales promotion policies, product mix, addition of new
products, in-bound transportation decisions, product deletion,
order size, and overall operation. For each of these areas, the
food broker and food wholesaler may not reach a consensus regarding
who should have primary influence, both feeling that their position
or expertise should allow them to influence the policy.
To assess whether dissensus was present in these areas, dyad
members responded to a 5-point rating scale regarding their
relative influence in each area. A Wilcoxon Matched Pairs Test
allowed an evaluation of differences between the broker and
wholesalers position, and indicated in which of the ten policy
areas significant differences existed between brokers and
wholesalers. At the .05 significance level, dissensus was found in
the following areas: pricing policies, product mix, order size,
product deletion, and overall operations. In each case brokers felt
they should have more influence than wholesalers were willing to
grant.
Domain dissensus scale scores were constructed by summing
together the absolute values of the differences in these five areas
for each dyad. Thus in a particular wholesaler-broker dyad, a
higher domain dissensus score would result if there is considerable
disagreement as to who has the major influence on each of the five
domain dissensus areas.
The domain dissensus scale has content validity since the domain
areas were obtained through field discussions with wholesalers and
brokers and from the trade literature. Additionally, the scale was
limited to areas in which there was consensus between the members
of the dyad. Criterion validity was assessed by testing hypotheses
one and three in which the domain dissensus scale was correlated
with the conflict and the cooperation scales. Although no
relationship was found between domain
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Marketing Channel 243
dissensus and conflict, a significant negative relationship was
found with cooperation. Control validity, or the degree to which a
concept is manipulatable and capable of influencing other variables
[31, p. 441, also is present. This is the case because the areas
(pricing, product mix, order size, and the like) that we refer to
in the domain dissensus scale have direct empirical referents that
management can understand and effect, and therefore control.
Finally, reliability was assessed by computing coeficient alpha for
the Sitem domain dissensus scale. The alpha level was .67, which is
generally considered adequate for basic research. Perceptual
Incongruity. Perceptual incongruity in a channel exists when each
party to the dyad views a particular event, phenomenon, or aspect
of the channels internal or external environment differently. In
the broker-wholesaler dyad one critical aspect of the relationship
is the extent to which brokers provide wholesalers with assistance.
In deciding which assistances to provide and emphasize, brokers
must know how important the various assistances are to wholesalers.
In so doing brokers will develop perceptions of which assistances
are most important. At the same time, food wholesalers also have
perceptions of the importance of these assistances. To the extent
that these entities differ in their evaluation of the importance of
these assistances, perceptual incon- gruities will be present.
In developing the list of assistances a variety of sources were
consulted, including Daniel Padbergs [14] book on the role of food
brokers in the distribution cycle, as well as a study by
Progressive Grocer [ 181 on the tasks performed by salespeople in
the grocery industry. An initial list of over 40 assistances were
reduced to 24 after
Table 1: Correlations between Perceptual Incongruities and
Domain Dissensus and Channel Conflict and Cooperation
Dependent Variables
Independent Variables Conflict Scale Cooperation Scale
Domain dissensus scale 76 = 0.05 TV = -0.26 Q! = 0.30 01 =
0.007
Perceptual incongruity scale 76 = 0.01 7* = -0.25 01 = 0.45 01 =
0.007
Nofe: ~b refers to Kendalls tau measure of correlation and o
refers to the significance
level.
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244 Robert H. Ross and Robert F. Lusch
discussions with food brokers and food wholesalers. The final
set of 24 assistances is provided in the Appendix.
Both wholesalers and brokers rated the importance of these as-
sistances to the wholesalers on a 9-point scale. A nonapplicable
category was provided to allow respondents to indicate assistances
that were not provided. Each party was told to evaluate only the
other member of his or her dyad. A Wilcoxon Matched Pairs Test was
performed on wholesalers and brokers responses to each of the 24
assistances. The results, at the .05 level, showed significant
differences in importance ratings on five of the asistances: 1)
describing requirements necessary for payments of advertising,
display, or trade allowance; 2) describing advertising ideas
successfully used elsewhere; 3) arranging for dis- position of
damaged merchandise; 4) resetting sections within retail outlets;
and 5) providing coordination with transportation or ware- housing
intermediaries.
To construct the perceptual incongruities scale, the absolute
values of the difference scores for each of these five assistances
were summed for each dyad. As an example, in a specific dyad, if
the wholesaler rates an assistance of low importance but the broker
rates it high, this dyad would be characterized by a high score on
the perceptual incongruities scale.
The perceptual incongruities scale has content validity since it
was drawn from discussions with industry representatives and a
trade journal study. The final scale included only the five
assistances on which brokers and wholesalers had incongruent
perceptions. The criterion validity of the scale was assessed
through testing hypotheses two and four, thus revealing that the
perceptual incongruities scale correlates with the cooperation but
not the conflict scale. As was true of the domain dissensus scale,
the perceptual incongruities scale has control validity. There
exists a direct empirical referent for the scale in terms of the
broker assistances. If there are perceptual incongruities regarding
the im- portance of these assistances, the broker and wholesaler
can in principle rectify the situation and thus control the degree
of perceptual in- congruity. Finally, the perceptual incongruity
scale is reliable as evidenced by the computed coefficient alpha of
.78.
Results
Table I provides a summary of the results of testing hypotheses
1 through 4.
To test hypothesis one, that the greater the domain dissensus,
the greater the level of felt conflict, r, was computed between the
domain dissensus and conflict scales. The obtained r6 of .05 was
not statistically significant at the .05 level. Although no
relationship can be dem-
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Marketing Channel 245
onstrated, the sign of the correlation coefficient was in the
expected positive direction.
The second hypothesis, that the greater the perceptual
incongruity, the greater the level of felt conflict, was tested by
measuring the correlation between the perceptual incongruity scale
and the conflict scale. The positive rb of .Ol was again in the
direction hypothesized but was not statistically significant at the
.05 level.
The third hypothesis, that the greater the dyads domain
dissensus, the lower the level of cooperation, was empirically
investigated by cor- relating the domain dissensus scale with the
cooperation scale. A negative correlation was expected, indicating
low levels of domain dissensus should be related to high levels of
cooperation. The TV was - .26 and significant statistically at the
,007 level.
The final hypothesis, that the greater the dyads perceptual in-
congruities, the lower the level of cooperation, was addressed by
correlating the perceptual incongruity scale with the cooperation
scale. The expectation was a negative correlation that would
suggest low levels of perceptual incongruity being tied to high
levels of cooperation. The results supported this expectation. A rb
of - .25 was obtained that was statistically significant at the
.OO7 level.
In summary, the statistical analysis provided evidence that
perceptual incongruities and domain dissensus among members in a
channel dyad are inversely related to cooperation in the dyad. On
the other hand, perceptual incongruities and domain dissensus were
not found to be related to conflict in the channel dyad.
Discussion
Although the results are probably not generalizable to all
channel types and/or systems, they do suggest that at least certain
premises and propositions in the channel theory literature be
questioned and carefully scrutinized.
At least four possible conclusions can be drawn from the finding
that domain dissensus and perceptual incongruity are not related to
felt channel conflict. The first is that there existed a problem in
the research design and/or measurements. Although this is a
possibility, the authors believe all proper precautions were taken
in the survey research design and in the construction of the
measurement instruments.
Second, perhaps the domain dissensus and perceptual incongruity
that existed in the channel was not as yet perceived. Conflict
might still be in a latent stage, not affecting the feelings one
number had about the other. This is not very probable since the
average wholesaler-broker dyad inthe
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246 Robert H. Ross and Robert F. Lusch
study had been dealing with each other for 20 years and domain
dissensus and perceptual incongruity should have already
surfaced.
Third, response bias may have been operative, in that only the
more cooperative dyads may have completed their questionnaires.
Although the response rate is high enough to minimize this concern,
if more conflicting dyads had been included as respondents, it
might have been possible to demonstrate a more significant
relationship between conflict and perceptual incongruities and/or
domain dissensus.
Fourth, domain dissensus and perceptual incongruity may have
been perceived but had not resulted in any feelings of stress,
tension, or hostility (i.e., felt conflict). We believe this fourth
possible explanation to be the most likely one. Significant
dissensus was found in only five of the ten domain areas
investigated. Similarly, 24 areas were investigated for perceptual
incongruity and in only 5 were perceptions significantly different
between broker and wholesaler. A rather cooperative set of brokers
and wholesalers was selected, which is somewhat surprising since
exploratory interviews with brokers and wholesalers in Kansas and
Oklahoma indicated that the potential for considerable domain
dissensus and perceptual incongruity existed.
Surprisingly, although not found to be related to conflict,
domain dissensus and perceptual incongruity were related to
cooperation. Domain dissensus and perceptual incongruity could have
been expected to be related to conflict and nor cooperation, since
the conflict literature identifies them as causes of conflict,
while the cooperation literature does not directly identify them as
causes of cooperation.
A possile explanation of this finding is that by reducing domain
dissensus and perceptual incongruity, cooperation in the channel
can be fostered because members of the channel become more able to
coordinate their activities when they agree on domains and the
importance of assistances. But the opposite does not necessarily
hold. When they do not agree on domains or the importance of
assistances, they may not feel conflict or behave in a conflictual
way because they may not get frustrated. They may view some
(probably low) level of domain dissensus and perceptual incongruity
as healthy since their diversity of opinion may help the dyad make
better channel decisions. This could be especially true in this
research setting since relatively little domain dissensus and
perceptual incongruity was present in the broker and wholesaler
dyad.
Conclusions
The results of this study seem to provide support for
Schermerhoms [24] observation that conflict and cooperation have
common roots, with the
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Marketing Channel 247
outcome in a particular episode determined by the situation.
This conclusion is based on our results, which show that clearly
specified domains and congruent perceptions of reality are
associated with higher levels of cooperation. Managerially, this
suggests the need for con- centrated attention to establishing
mutually agreedto domains as well as congruent perceptions of
reality. As Stem and Haskett [27] suggest, these functions can be
successfully accomplished through a bargaining process enhanced by
the presence of an agreed upon power structure to govern the
channel. Therefore it appears important for channel managers to
focus on strategies to develop such a structure.
An important question remaining to be answered regards the
direction of the relationship between domain consensus, perceptual
congruity, and cooperation. For example, in this dyad, was the
presence of a cooperative orientation the cause of congruent
perception and domain consensus, or did these phenomena create the
cooperative orientation noted? There appears to be intuitive
support for each position, particularly when one considers that
food brokers success is enhanced by their ability to maintain
cooperative relations with a diverse group of wholesalers.
Because of the small number of empirical studies of cooperation
in channels, it is difficult to draw conclusions based on this
research for channels in which specialized intermediaries (such as
food brokers) are not present. Future research needs to deal with
the relationship between causes of conflict and the levels of
cooperation and conflict in other types of channel dyads, as well
as with potential contributors to the climate of cooperation in a
channel. Additionally, further techniqaues should be developed to
measure empirically the consequences of various levels of
cooperation on the effectiveness and efficiency of a channel.
Appendix: Assistances and Services the Food Broker Provides the
Food Wholesaler
1. Communicate with wholesaler as to the content as well as the
timing of upcoming promotional plans.
2. Inform wholesaler of the existence of new products. 3.
Provide descriptions of unique qualities or selling features of
new
products. 4. Suggest retail pricing. 5. Schedule the arrival of
in-bound shipments. 6. Provide information concerning changes in
the competitive
environment for products handled.
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248 Robert H. Ross and Robert F. I,usch
7.
8.
5. 10.
11. 12. 13. 14.
1.5. 16.
17. 18.
15.
20. 21. 22.
Advise as to events causing potential fluctuations in the
expected order cycle time for the product (including order
processing time, order handling time, and transit time). Provide
information regarding sales variations that may be expected owing
to seasonality or changes in the competitive environment. Advise
when manufacturer is out or nearly out of stock. Describe
requirements necessary for payment of advertising, display, or
other forms of trade allowance. Report competitive retail pricing.
Arrange for disposition of damaged merchandise. Provide adequate
retail store coverage. Provide logistical coordination for the
introduction of new products, as to start-ship dates, handling
characteristics, and so forth. Recommend order quantities on new
products. Present manufacturer or broker research on new products
as to specific needs/requirements of local customers. Reset
sections within retail outlets. Offer economies of time by
presenting offerings of multiple manufacturers on one call. Provide
coordination with various transportation or warehousing
intermediaries. Communicate manufacturers sales policies. Describe
merchandising ideas successfully used elsewhere. Provide logistical
coordination for upcoming promotional events, assuring that
adequate product is on hand to support projected sales levels.
23.
24.
Offer suggestions to facilitate ease in storage and handling and
minimize damage in the sale of products. Describe advertising ideas
successfully used elsewhere.
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