A comparison of perceived quality in business relationships in Norway and Sweden Similarities and differences Go ¨ran Svensson Oslo School of Management, Oslo, Norway Svante Andersson Halmstad University, Halmstad, Sweden Tore Mysen Oslo School of Management, Oslo, Norway, and Gabriel Baffour Awuah Halmstad University, Halmstad, Sweden Abstract Purpose – The purpose of this paper is to compare similarities and differences in perceived quality of business relationships in Norway and Sweden. Design/methodology/approach – The Norwegian and Swedish sampling frames consisted of 600 small- and medium-sized firms in each country. A response rate of 36.5 percent was achieved in Norway and 21 percent in Sweden. Leading executives from both countries were used as key informants because they are the primary decision-makers most knowledgeable about their firm’s interactions with suppliers. Findings – The findings indicate that there are a series of significant differences and associations between the perceived quality of business relationships in small and medium-sized firms in Norway and Sweden, though both countries resemble each other in both socio-economic indicators and cultural dimensions. Research limitations/implications – One suggestion for further research is to replicate the study in other industries, business relationships, and countries. Another is to undertake a longitudinal approach of the focal areas of “perceived quality” and “supplier criteria”. Practical implications – This study is of managerial interest, as the framework may be applied by firms to monitor and evaluate ongoing supplier relationships and, in extension, their current customer relationships. It would be of interest to see if similarities exist amongst other cultures of the focal areas, and/or if there are differences across other countries that are decidedly different from those in Norway and Sweden. Originality/value – This paper makes a contribution to inter-organizational theory since it outlines a conceptual framework of focal areas of “perceived quality” and “supplier criteria” for examining business relationships across industries and countries for the benefit of other researchers. Keywords Quality, Business policy, Trust, Norway, Sweden Paper type Research paper Introduction Alderson (1965) pointed out a long time ago the importance of the interface between organizations, and pronounced the quest for theory development in this area. The current issue and full text archive of this journal is available at www.emeraldinsight.com/1746-5265.htm Quality in business relationships 7 Received March 2008 Revised June 2008 Accepted September 2008 Baltic Journal of Management Vol. 4 No. 1, 2009 pp. 7-33 q Emerald Group Publishing Limited 1746-5265 DOI 10.1108/17465260910930421
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A comparison of perceivedquality in business relationships
in Norway and SwedenSimilarities and differences
Goran SvenssonOslo School of Management, Oslo, Norway
Svante AnderssonHalmstad University, Halmstad, Sweden
Tore MysenOslo School of Management, Oslo, Norway, and
Gabriel Baffour AwuahHalmstad University, Halmstad, Sweden
Abstract
Purpose – The purpose of this paper is to compare similarities and differences in perceived quality ofbusiness relationships in Norway and Sweden.
Design/methodology/approach – The Norwegian and Swedish sampling frames consisted of 600small- and medium-sized firms in each country. A response rate of 36.5 percent was achieved inNorway and 21 percent in Sweden. Leading executives from both countries were used as keyinformants because they are the primary decision-makers most knowledgeable about their firm’sinteractions with suppliers.
Findings – The findings indicate that there are a series of significant differences and associationsbetween the perceived quality of business relationships in small and medium-sized firms in Norwayand Sweden, though both countries resemble each other in both socio-economic indicators and culturaldimensions.
Research limitations/implications – One suggestion for further research is to replicate the studyin other industries, business relationships, and countries. Another is to undertake a longitudinalapproach of the focal areas of “perceived quality” and “supplier criteria”.
Practical implications – This study is of managerial interest, as the framework may be applied byfirms to monitor and evaluate ongoing supplier relationships and, in extension, their current customerrelationships. It would be of interest to see if similarities exist amongst other cultures of the focal areas,and/or if there are differences across other countries that are decidedly different from those in Norwayand Sweden.
Originality/value – This paper makes a contribution to inter-organizational theory since it outlinesa conceptual framework of focal areas of “perceived quality” and “supplier criteria” for examiningbusiness relationships across industries and countries for the benefit of other researchers.
Keywords Quality, Business policy, Trust, Norway, Sweden
Paper type Research paper
IntroductionAlderson (1965) pointed out a long time ago the importance of the interface betweenorganizations, and pronounced the quest for theory development in this area.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1746-5265.htm
Qualityin business
relationships
7
Received March 2008Revised June 2008
Accepted September 2008
Baltic Journal of ManagementVol. 4 No. 1, 2009
pp. 7-33q Emerald Group Publishing Limited
1746-5265DOI 10.1108/17465260910930421
Different research streams have included different aspects of organizations workingtogether in their models and/or empirical studies, such as channel behaviors (Andersonand Narus, 1990), relational exchanges (Dwyer et al., 1987; Tzokas and Saren, 2004),transaction cost economics (Heide, 1994; Heide and John, 1990), interaction andnetworks (Hakansson, 1982; Hakansson and Snehota, 1995) and relationship quality(Dwyer et al., 1987; Lages et al., 2004).
In studies about firms’ internationalization, Norway and Denmark were notunnaturally identified as the countries that were most similar to Sweden (Johanson andVahlne, 1977, 1990). The internationalization process is seen as a causal cycle(Andersen, 1993) with the firm’s knowledge as the explanatory variable (Johanson andVahlne, 1990). Their model suggests that the average firm enters foreign markets thatrepresent close psychic distance. The psychic distance concept may be defined by:factors preventing or disturbing the flows of information between firm and market.Examples of such factors are differences in language, culture, political systems, levelof education, level of industrial development, etc. (Johanson and Wiedersheim-Paul,1975, p. 308).
However, the above studies are not up to date and have not focused on quality inbuyer-seller relationships. Hence, there seems to be a need to get a betterunderstanding of whether or not there are similarities and differences in buyer-sellerrelationships in two countries that are regarded as psychic close to each other [1].Several contributors have pointed to the influence of relationship quality on customerloyalty and market success (Rauyruen and Miller, 2007). However, in contrast of theimportance of relationship quality in business-to-business, there is still no consensus ofwhich factors that build or decrease the quality in business relationships (Naude andButtle, 2000; Huntley, 2006). This study aims to add to the description of relationshipquality in business-to-business contexts in close psychic distant markets.
This study focuses on aspects that may affect the interface of perceived quality inbusiness relationships. Previous research has addressed the interface in businessrelationships from the perspective of the buyer (Dwyer et al., 1987). Others haveapproached it from the perspective of the seller (Lages et al., 2004). Other specificrelationships have been addressed, such as the travel agency-tourist perspective(Callarisa et al., 2007) and supplier-distributor perspective (Payan and Svensson, 2007).This particular study focuses on the buying firms’ perspectives in businessrelationships with their suppliers. Furthermore, it addresses two different nationalcontexts, which is an approach rarely undertaken in inter-organizational research,namely samples of business relationships in Norway and Sweden.
Literature reviewA review of the literature shows that different variables associated with organizationsworking together may affect the perceived quality in business relationships, namely:
. commitment (Anderson and Weitz, 1992; Bonner et al., 2007; Fullerton, 2003;Morgan and Hunt, 1994);
. competitive intensity (Fynes et al., 2005);
. cooperation (Gummesson, 2002; Hakansson, 1982; Morgan and Hunt, 1994);
. coordination (Alter and Hage, 1993; Anderson et al., 1994);
. market turbulence (Anderson, 1985; Skarmeas et al., 2008);
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. satisfaction (Aksoy et al., 2007; Duarte and Davies, 2004; Skinner et al., 1992);
. specific assets (Rindfleisch and Heide, 1997; Weiss and Anderson, 1992); and
. trust (Geyskens and Steenkamp, 1995; Razzaque and Boon, 2003).
Although they are frequently included in inter-organizational research, all eight focalconstructs have not, to our knowledge, been included and compared in the sameempirical study of perceived quality in business relationships. Our objective, therefore,is to compare similarities and differences in perceived quality of business relationships inNorway and Sweden.
The rest of the paper is organized as follows:
(1) the frame of reference is first described;
(2) the methodology is then outlined and described;
(3) the findings and implications of the study are presented; and
(4) conclusions and suggestions for further research are provided at the end of thepaper.
Frame of referenceIn this section, we discuss the focal constructs of this study, all of which we considerimportant when comparing the perceived quality in business relationships in across-cultural setting.
Cooperation and coordinationThis study includes both cooperation and coordination, two terms which are notusually used in the same study of perceived quality in business relationships. Onereason may be because they are often viewed as one construct or merely synonymous(Alter and Hage, 1993; Anderson et al., 1994; McNeilly and Russ, 1992; Morgan andHunt, 1994; Mulford and Rogers, 1982). Yet other researchers conceptually outlinepotential differences between cooperation and coordination based on:
. time frame perspectives (Dabholkar et al., 1994);
. normative vs outcome orientations (Day and Klein, 1987);
. attitude/behavior orientations (Alter and Hage, 1993; McNeilly and Russ, 1992); and
. goal orientations/decision rules (Mulford and Rogers, 1982).
Most of these theoretical distinctions describe cooperation as more norm-related, moreof an attitude, and more goal-related than coordination; in other words, cooperation is abroader and more all-embracing construct than coordination. Cooperation is about theorientation of one organization’s working with another’s, and in contrast to the broaderconstruct of cooperation is often described as a specific structure, process, or outcomebetween organizations (McNeilly and Russ, 1992). The predominant approach inmarketing studies is a focus on coordination as an outcome (specific joint activities)rather than as a coordinating structure or process. The establishment of a structure ora process between organizations is in itself a coordinative outcome, because it entails ajoint action between organizations in order to establish the structure or to establish theprocess.
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From the perspective of cooperation as a broad working orientation, andcoordination as specific joint activities, evidence of coordination is not always causedby a spirit of cooperation. Day and Klein (1987) note that coordination can occurwithout cooperation:
. if coordination happened during an earlier era of goodwill; or
. if the coordination was imposed through the exercise of power.
In other words, coordination has many other related constructs (e.g. power) that mayoperate independently from the influence of cooperative orientations. As a result of thediscussion above, this study supports there being a value in considering separate focalconstructs of cooperation (i.e. as a working orientation) and coordination (i.e. as specificjoint activities) in the comparison of perceived quality in business relationships.
Specific assetsSpecific assets are rarely included with cooperation and coordination in the same study(Payan and Svensson, 2007). However, occasionally joint action and specific assets areincluded in the same study (Heide and John, 1990; Joshi and Stump, 1999). Furthermore,only one of these three constructs (cooperation on specific activities) was included inone of the most comprehensive inter-organizational models in the literature, the keymediating variable (KMV) model (Morgan and Hunt, 1994).
On occasions, coordinated activities and specific assets (also labelled specificinvestments or idiosyncratic investments) are viewed similarly when specific assetsare interpreted as dedicated activities and resources are employed jointly betweenorganizations (Anderson et al., 1994). Specific assets are a key variable used intransaction cost analysis (TCA) models (Anderson, 1985, 1988; Heide and John, 1988,1990, 1992; John and Weitz, 1989; Klein, 1989; Weiss and Anderson, 1992), andrepresent assets with a high amount of specificity that have little value outside of aparticular exchange relationship (Rindfleisch and Heide, 1997).
There are four predominant types of specific assets:
(1) physical locations;
(2) specific physical assets;
(3) specific dedicated assets; and
(4) specific human assets.
Although all four of these types of assets may entail some joint activity to implement,human assets are the most important in regard to potentially ongoing joint activities(Day and Klein, 1987). Examples of specific human assets include:
. services predicated on customized professional know-how and skills (Erramilliand Rao, 1993);
. customized knowledge and working relationships built up over time (Andersonand Coughlan, 1987);
. employees trained specifically for the product line of a particular exchangepartner (Heide and John, 1988); and
. a tailored delivery routine to meet the particular needs of a buyer (Sriram et al.,1992).
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This study takes the position that both coordination and specific assets are jointactivities, and may be related. However, because specific assets connote a high degreeof customization between organizations compared to coordination, specific assets arepredicted to be distinct from coordination in terms of relationship patterns with otherinter-organizational constructs of interest in the comparison of perceived quality inbusiness relationships, where both focal constructs are seen as important.
TrustTrust is the expectation that another business can be relied on to fulfill obligations andwill act and negotiate fairly when the possibility for opportunism is present (Zaheeret al., 1998). Geyskens and Steenkamp (1995) suggest that trust reduces uncertainty ina relationship; if an organization trusts another, it will attribute co-operative intentionsto the trusted organization. From another perspective, Andaleeb (1995) suggests thattrust provides reasonable assurances that desired goals and outcomes will be achieved,and that it should lead to a greater inclination to cooperate. Some studies have foundthat inter-organizational trust leads to a cooperative orientation between organizations(Andaleeb, 1995; Duarte and Davies, 2004; Razzaque and Boon, 2003).
Empirical research shows that trust and joint activities between organizations areassociated, though the direction of causality has been controversial (Wilson andNielson, 2000; Weitz and Jap, 1995; Wiertz et al., 2004). Based on a cross-culturalmethodology, this study takes the position of those researchers who suggest that trustis necessary in inter-organizational joint activities (Deutsch, 1962; Duarte and Davies,2004; Morgan and Hunt, 1994; Smith and Barclay, 1999; Pruitt, 1981; Wiertz et al.,2004). Boersma et al. (2003) point out that competence-based trust can start simplyfrom public information (knowledge of a partner’s previous history and/or reputation)and can be the basis of a coordinative activity with another organization. From anotherperspective, Wiertz et al. (2004) explain that any joint activity entails at least someincreased vulnerability, and organizations will not accept this increased vulnerabilitywithout believing in the integrity of each other. In discussing the TCA perspective,Young and Wilkinson (1989, p. 111) state. When exchanges take place in anatmosphere of trust and common purpose, transactions are less costly to complete.According to Chiles and McMackin (1996), this happens because trust reduces theperception of opportunism, therefore lowering its associated transaction costs. Thisstudy considers trust as an essential focal construct in the comparisons of perceivedquality in business relationships.
CommitmentThis study defines commitment as an enduring desire to maintain a relationship.According to Anderson and Weitz (1992), commitment to a relationship will result in adesire to develop a stable relationship and a willingness to make sacrifices to maintainthat relationship. The willingness to make sacrifices is linked to a cooperativeorientation (or a spirit of willingness to work with another organization). When partiesin an exchange relationship find the relationship to be mutually meaningful theybecome committed to the relationship (Gummesson, 2002). Hence, cooperation in therelationship assumes importance for the parties. The KMV model reasons thatcommitment also leads to coordination because a committed counterpart willparticipate in joint activities out of a desire to make the relationship work. According toDieke and Karamustafa (2000), organization commitment is also hypothesized to affect
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strategic response based on the knowledge that a committed organization is likelyto spend more time and effort on developing effective strategies and environmentalscanning (as cited by Dickinson and Ramaseshan, 2004, p. 74). The relationshipbetween commitment and coordinative activities is supported in empirical research(Dickinson and Ramaseshan, 2004; Evangelista, 1994; Faulkner, 1995; Morgan andHunt, 1994), in consequence of which this study positions commitment as an importantfocal construct in the comparison of perceived quality in business relationships.
SatisfactionThe KMV model does not directly measure satisfaction and only alludes to it as arelationship benefit. Geyskens et al. (1999) define satisfaction as the positive effectivestate resulting from the appraisal of all aspects of an organization’s workingrelationship with another, Satisfaction is typically positioned as an importantconstruct in inter-organizational research (Duarte and Davies, 2004). This is supportedin empirical research (Duarte and Davies, 2004; Skinner et al., 1992). Similarly,McNeilly and Russ (1992) suggest that as organizations experience success withcoordinated joint activities, over time, they will subsequently experience satisfaction,in part because of perceptions of compatibility between organizations (Anderson andNarus, 1990). In their study of the travel agency – tourist relationship quality, Callarisaet al. (2007) found out that satisfaction with the agency is a determining factor in atourist’s trust. Satisfaction in this study is also considered to be an important focalconstruct in the comparison of the perceived quality in business relationships.
Market turbulence and competitive intensityMarket turbulence refers to the unpredictable variations in customer demand asexperienced by parties in a supply chain (Fynes et al., 2004). Competitive intensity ischaracterized by aggressive competitors, short product life cycles, cost reductions,consistent high quality and customization (Fynes et al., 2005). Market turbulence andcompetitive intensity are encompassed by the higher order construct of “environmentaluncertainty”, and it is suggested by the political economy paradigm that businessrelationships are a function of not only the contract, but also of the environmentalconditions in which the manufacturers, distributors and the suppliers interact (Sternand Reve, 1980).
However, proposed theoretical underpinnings and empirical results in previousresearch reveal that there is still a need for further examination of how environmentaluncertainty affects the quality of relationships. Supply chain relationships that areembraced by environmental uncertainty may experience reduced relationship qualitybecause external uncertainty allows information asymmetry to develop, entailingpassive or active opportunistic behavior by either the manufacturer, the distributor, orthe supplier (Wathne and Heide, 2000). Environmental volatility, given boundedrationality, may inspire parties in a relationship to distort information, shirkresponsibilities and/or break promises. Increased information asymmetry increasesdifficulties in assessing the other party’s performance, thus raising the temptationtowards seeking self-interest with guile (Williamson, 1985). Moreover, environmentaluncertainty may generate a reluctance to invest additional time and resources in theworking relationship (Hedaa, 1993).
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On the other hand, market turbulence and/or competitive intensity can inspireparties in the supply chain to build strong relationships, developing and usingsupplementary resources (Fynes et al., 2005). Market turbulence and competitiveintensity imply an uncertainty of both demand and timing that in turn may lead to aforecasting error and either excess inventory or shortages. Such shortcomings reducerelationship performance, and invite manufacturers, distributors and suppliers toestablish strong relationships, allowing the manufacturer and supplier to drawnecessary resources from the partner to sustain performance (Fynes et al., 2005).
Empirical results do not show consistent results in how market turbulence andcompetitive intensity influence relationship quality. For example, Leonidou et al. (2006)found that relationships characterized by high external uncertainty showed lowrelationship quality, and a low degree of adaptation in particular. They stated thatfirms felt less sure about making adjustments on matters of structure, process, or otherissues (Leonidou et al., 2006, p. 582). In contrast, positioning environmental uncertaintyas market turbulence, the investigation by Skarmeas et al. (2008) yielded results thatdid not support the hypothesis that relationships surrounded by high marketturbulence would necessarily be of low quality. Market turbulence did not have anysignificant influence on relationship quality. On the other hand, Fynes et al. (2005)found that growing competitive intensity improved the influence of relationshipquality on performance in their original equipment manufacturer sample. Hence, thisstudy considers market turbulence and competitive intensity as essential constructs incomparing relationship quality in supply chain relationships.
Final remarksConsequently, not only does this study incorporate KMV’s key focal constructs (Morganand Hunt, 1994), it also adds a number of others in the comparison of perceived quality inbusiness relationships. Thus, we pose that commitment, competitive intensity,cooperation, coordination, market turbulence, satisfaction, specific assets, and trust areall essential focal constructs in relationships where organizations are working with otherorganizations. The previous frame of reference is reflected in the following definitions:
. Commitment refers to an enduring desire to maintain a relationship.
. Competitive intensity refers to aggressive competitors, short life-cycles andcustomization.
. Cooperation refers to an orientation that reflects a spirit of willingness of oneorganization to work with another organization.
. Coordination refers to general joint activities that take place betweenorganizations.
. Market turbulence refers to unpredictable variations in customer demand asexperienced by the manufacturer.
. Satisfaction refers to the positive effective state resulting from the appraisal of allaspects of an organization’s working relationship with another organization.
. Specific assets refers to the dedicated activities that are tailored for use betweenspecific organizations.
. Trust refers to the expectation that another business can be relied upon to fulfillits obligations.
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Socio-economic indicators: Norway and Sweden[2]The Norwegian economy is an interesting example of welfare capitalism thatmaintains a combination of free market activity and government intervention. Thegovernment controls essential areas of the society and the marketplace (e.g. thepetroleum sector, through large-scale government-owned businesses). The country hasa variety of natural resources (e.g. petroleum, hydropower, fish, forests, and minerals)and is taking advantage of its oil production and international oil prices, with oil andgas accounting for one-third of its exports. Norway is not a member of the EuropeanUnion (EU) – a decision taken after a referendum in the mid-1990s, but it is anintegrated member of the European marketplace. In fact, Norway contributes to theeconomy of the EU. The state imposed initiatives of privatization. Norwegian oilproduction has stabilized, but natural gas production is increasing. Norwegians haveforeseen that once their offshore production of petroleum products ends the countrywill confront decreasing income from oil and gas. The country has, therefore, beenallocating its revenues from oil and gas into a fund, which is invested abroad and isnow valued at more than $250 billion. After a dip of growth of less than 1 percent in2002-2003, gross domestic product (GDP) growth picked up to 3-5 percent in 2004-2007,partly due to higher oil prices. Norway’s economy remains excellent. The domesticeconomy is, and will be, the main cause of growth, supported by high consumerexpectations and strong investment spending in the offshore oil and gas industry.Norway’s strong financial position and low unemployment in 2007 illustrate thestrength of its economic position going into 2008. In sum, Norwegian businessrelationships appear to have a prosperous future ahead, though inclined to rely on thedomestic market.
Sweden, on the other hand, having been out of war and neutral for a long time, hasmanaged to achieve a standard of living under a combination of capitalism and welfarebenefits. The country has an efficient distribution system, recent technology in internaland external communications, and a knowledgeable labor force. Timber, hydropower,and iron constitute the resource base of an economy heavily oriented towards export toother countries. The private sector corresponds to about 90 percent of industrialoutput, of which the engineering sector accounts for about half of the country’s outputand exports. Agriculture corresponds to only 1 percent of GDP and 2 percent ofemployment. Sweden is in an era of sound economic development due to domesticdemand and competitiveness in export. This and solid state finances have made itpossible for the government to implement reform programs aimed at increasingemployment, reducing welfare dependence, and streamlining the state’s role in theeconomy. The current government plans to sell assets during the next few years tofurther stimulate growth, raise state income and reduce federal debt. Sweden ismember of EU since 1995 but in 2003, a Swedish referendum disagreed to entering theEuropean Monetary Union system, mostly because of the feared impact on the nationaleconomy, and on the country’s financial independence. In sum, Swedish businessrelationships appear to have an attractive market situation and the tradition ofinternational experiences.
The economies of both countries (Table I) are well developed (CIA, 2008). Forexample, the GDP in Norway and Sweden are, respectively, US $257 billion and US $331billion (Table I). In both countries, the services sector generates the majority of the GDP.In Sweden the services sector generates 69 percent of the GDP, and in Norway 54 percent.
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The labor force in both countries is largely situated in the services sector (Sweden:74 percent; Norway: 74 percent). There is a substantial difference in the GDP percapita for each country (Sweden US $36,900 and Norway US $55,600). In 2007, theinflation rate also differed. In Norway it was 0.4 percent, and in Sweden 2 percent(Table I).
The similarities and differences between both countries are brought about by anumber of factors. First, both economies are well developed (OECD members).Secondly, Norway and Sweden are small players in their regional marketplaces,surrounded by larger economic entities. Thirdly, historically, Sweden has had toexpand its horizons outside its home markets in order to survive and forge economicgrowth, while Norway has depended mostly upon its oil and gas-production.Fourthly, whereas the financial situation in Sweden is deemed to be satisfactory, thatin Norway is excellent. Fifthly, since 1995 Sweden has been a member of EU, butNorway has not, and still is not. (However, via the EES-agreement Norwegiancompanies can act on the EU market as EU companies with the exception ofcompanies in the agriculture and food sector). One would expect that the historic andcurrent differences of both countries may affect ongoing business relationships. Forexample, one might expect that some of the focal construct examined in this studymay differ between the two countries. It is possible that the dependence on export inSwedish firms compared to Norwegian ones may be affecting their views on the focalareas (i.e. “perceived quality” and “supplier criteria[rdquo ],; p. 8) of this cross-culturalstudy. It may also be the opposite, that the Norwegian firms are benefiting from theboost of the domestic economy and may invest more resources than do the Swedishones.
National culture: Norway and SwedenNorway and Sweden were among the countries studied by Hofstede in developing hisdimensions of national culture. In that seminal study, he identified the following fourdimensions of national culture:
(1) individualism vs collectivism (IC);
(2) large or small power distance (PD);
Socio-economic indicator(s) Norway Sweden
EconomyGDP (purchasing power parity – US$) $257 billion (2007 est.) $331 billion (2007 est.)GDP real growth rate 4.9 percent (2007 est.) 3.4 percent (2007 est.)GDP/capita (purchasing power parity – US$) $55,600 (2007 est.) $36,900 (2007 est.)Inflation rate 0.4 percent (2007 est.) 2.0 percent (2007 est.)PopulationPopulation 4,627,926 (July 2007 est.) 9,031,088 (July 2007 est.)Population growth rate 0.36 percent (2007 est.) 0.16 percent (2007 est.)Life expectancy 79.67 years 80.63 yearsLiteracy 100 percent 99 percent
Source: CIA World Fact Book (2008)
Table I.Norway and Sweden:
comparative economicand population statistics
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(3) strong or weak uncertainty avoidance (UA); and
(4) masculinity vs femininity (MF) – (Hoftstede, 1983a, p. 78).
Hofstede’s research, involving a data bank of 40 countries and 116,000 questionnaires,allowed him to assign an index value (between 0 and about 100) on each of the fourdimensions. Scores on these dimensions for Norway and Sweden are shown in Table II.
On IC, a measure of the relationship between an individual and his fellowindividuals, Sweden (71) is the slightly stronger country of the two (Norway: 69). OnPD, a measure of the unequal distribution of power in society, Norway (31) and Sweden(31) have an equal level on this measure. UA, which is a measure of how a society dealswith uncertainty, is related to the propensity of a culture to establish laws and formalrules. Societies strong on UA are more likely to establish formal rules to deal withunpredictability. On the UA index, Norway (50) has a significantly higher value thanSweden (29): the implication being that the Norwegian society is more likely than theSwedish one to establish formal rules to create security. The final measurement inHofstede’s dimensions of national culture, MF, is a measure of the division of rolesbetween the sexes in society. The score for Norway (8) is slightly higher than Sweden’s(5). In fact, Norway and Sweden were the most feminine of the countries studied byHofstede, meaning that it puts relationships with people before money, minding thequality of life and the preservation of the environment, helping others, in particular theweak, and “small is beautiful” (Hofstede, 1983a, p. 85).
A point of interest is that each one of these countries has entered into theinternational marketplace with gusto and therefore may well have had their culturesmodified by such an involvement. When Hofstede (1983a, b) carried out his study, thedegree of internationalization by these countries would have been much less than itwas at the time this present study was administered a couple of decades later.Furthermore, the Norwegian oil and gas revuenue was much less at the time and thetoday’s revenues may have changed the mindset of firms, whereas Swedish firmsappears to be fairly oriented towards the international marketplace.
In sum, we do not argue that Norway and Sweden are identical, but they appear tobe similar in some aspects when it comes to socio-economic indicators, and very similarin relation to their national cultures. The question is whether this resemblence alsoapplies to the focal constructs that may affect the perceived quality in businessrelationships in Norway and Sweden. We contend that this is a topic of great interest,as Hofstede’s estimates of the different dimensions of national cultures may besomewhat out of date, based as they are upon domestic data almost three decades ago.Therefore, we have formulated two hypotheses as follows:
H1. There are no differences between “perceived quality” in businessrelationships in Norway and Sweden.
Country IC PD UA MF
Norway 69 31 50 8Sweden 71 31 29 5
Source: Adapted from Hofstede (1983b, p. 52)
Table II.Dimensions of nationalculture
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H2. There are no associations between “perceived quality” and “supplier criteria”in business relationships of either Norway or Sweden.
By “perceived quality” we refer to focal constructs such as:. commitment;. competitive intensity;. cooperation;. coordination;. market turbulence;. satisfaction;. specific assets; and. trust.
By “supplier criteria” we refer to:. how long the firm has been working with the supplier in focus;. what percentage of the firm’s sales does the supplier in focus account for;. what percentage of the firm’s profit does the supplier in focus account for; and. with respect to sales volumes, how large is the firm relative to the supplier in
focus.
MethodologyIt has been shown in the previous sections that there are similarities and differencesbetween Norway and Sweden based upon the socio-economic indicators and thedimensions of national cultures. Therefore, the cross-cultural approach in this studyprovides an unusual context to make the comparison of perceived quality betweenfirms’ business relationships in two neighboring countries.
Research context and sampleThe Norwegian sampling frame (Kompass, Norway) consisted of a random sample of600 small- and medium-sized firms. Nineteen governmental firms were excluded fromthe list. Consequently, a total of 581 surveys were mailed to respondents. Two hundredand twelve useable surveys were returned, a response rate of 36.5 percent. StatisticsSweden (SCB) supplied the names and addresses of 600 Swedish small- andmedium-sized firms. One hundred twenty-four usable surveys were returned from theSwedish survey, a response rate of 21 percent. Leading executives from both countrieswere used as key informants because they were the primary decision-makers mostknowledgeable about their firm’s interactions with suppliers.
As suggested by Campbell (1955), two items were included in the survey asinformant competency checks. The two items asked (Appendix, Table AI):
(1) how much the informant knew about his/her firm’s perspective of the studytopics; and
(2) how much the informant knew about specific experiences with this supplier.
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A full 99.0 percent of the informants had knowledge of their firm’s perspective and99.5 percent also had knowledge regarding experiences with this supplier.
MeasuresSubjects responded to five-point Likert-type scales for all focal constructs. These scaleswere anchored at (5) agree very strongly and (1) disagree very strongly (see Table I fordetails of all scale items). The source for each item of the comparison of perceivedquality in business relationships was as follows:
. Commitment – items were borrowed and modified from Morgan and Hunt (1994)and Anderson and Weitz (1992).
. Competitive intensity – items were borrowed and modified from Fynes et al. (2005).
. Cooperation – items were borrowed and modified from Skinner et al. (1992).
. Coordination – items were borrowed and modified from Guiltinan et al. (1980)and Heide and John (1990).
. Market turbulence – items were borrowed and modified from Anderson (1985)and Skarmeas et al. (2008).
. Satisfaction – items were borrowed and modified from Andaleeb (1996).
. Specific assets – items were borrowed and modified from Heide and John (1990).
. Trust – items were borrowed and modified from Zaheer et al. (1998).
It should be noted that all items (Appendix) belonging to each focal construct havebeen summarized (i.e. no items have been excluded from the used questionnaire) andthe average score for each focal construct has been calculated and used in the statisticalanalyses shown in Tables III-V that follows in the next main paragraph.
Empirical findings and the analysis thereofDifferences and similaritiesThe differences and similarities between perceived quality in business relationships inNorway and Sweden in this study were tested by using the independent-samples t-test(Norusis, 1993). The findings are shown in Table III.
As shown in Table III, there are a number of both differences and similarities in theperceived quality in business relationships as follows:
“Country”Norway Sweden t-test (two-tailed)
Focal area of “perceived quality” N Mean SD N Mean SD Value df Sig.
Commitment 212 4.01 0.87 121 3.91 0.82 -1.03 331 0.30Competitive intensity 207 3.80 0.81 120 3.18 0.53 -7.58 325 0.00 * *
Cooperation 211 3.98 0.69 121 3.77 0.89 -2.36 330 0.01 *
Coordination 208 3.53 0.82 120 3.22 1.03 -3.00 326 0.00 * *
Market turbulence 212 3.00 0.77 120 3.07 0.62 0.89 330 0.37Satisfaction 212 3.82 0.84 121 3.80 0.78 -0.20 331 0.85Specific assets 208 2.25 0.97 121 2.84 1.09 5.13 327 0.00 * *
Trust 210 4.03 0.75 120 3.99 0.79 -0.47 328 0.64
Notes: * and * * Significant at the 0.05 and 0.01 levels, respectively
Table III.Differences andsimilarities in businessrelationships in Norwayand Sweden
BJM4,1
18
“Su
pp
lier
crit
eria
”N
um
ber
ofy
ears
assu
pp
lier
Su
pp
lier
’sco
ntr
ibu
tion
tosa
les
Su
pp
lier
’sco
ntr
ibu
tion
top
rofi
tS
izes
offi
rmv
ssu
pp
lier
Foc
alar
eaof
“per
ceiv
edq
ual
ity
”C
orr.
1S
ig.
NC
orr.
1S
ig.
NC
orr.
1S
ig.
NC
orr.
2S
ig.
N
Com
mit
men
t0.
170
0.01
4*
209
0.12
80.
082
187
0.17
20.
020
*18
22
0.02
50.
715
210
Com
pet
itiv
ein
ten
sity
0.16
80.
016
*20
40.
064
0.38
918
30.
049
0.51
517
82
0.03
90.
579
205
Coo
per
atio
n0.
095
0.17
120
80.
070
0.34
618
60.
118
0.11
318
20.
103
0.13
720
9C
oord
inat
ion
0.10
40.
136
205
0.08
40.
260
183
0.16
10.
032
*17
90.
082
0.24
320
6M
ark
ettu
rbu
len
ce2
0.07
60.
277
209
0.01
10.
883
187
20.
072
0.33
318
22
0.08
30.
228
210
Sat
isfa
ctio
n0.
051
0.46
020
92
0.02
90.
697
187
0.08
50.
253
182
0.18
70.
007
**
210
Sp
ecifi
cas
sets
0.21
10.
002
**
205
0.20
40.
006
**
183
0.12
10.
108
178
20.
224
0.00
1*
*20
6T
rust
0.00
30.
968
207
0.03
10.
676
185
0.04
00.
592
180
0.16
20.
020
*20
8N
um
ber
ofy
ears
assu
pp
lier
0.33
30.
000
**
186
0.20
70.
005
**
181
0.21
20.
004
**
181
Su
pp
lier
’sco
ntr
ibu
tion
tosa
les
0.70
30.
000
**
181
20.
264
0.00
0*
*18
1S
up
pli
er’s
con
trib
uti
onto
pro
fit
0.77
80.
000
**
181
Notes:
corr
.1–
Pea
rson
/par
amet
ric
corr
elat
ion
;cor
r.2
–S
pea
rman
’srh
o/n
on-p
aram
etri
cco
rrel
atio
n;s
ig.
–si
gn
ifica
nce
lev
el(t
wo-
tail
ed)
–* 5
per
cen
tor
less
;*
* 1p
erce
nt
orle
ss;N
–n
um
ber
ofp
aire
dre
spon
ses
Table IV.Associations between
focal areas of “perceivedquality” and “supplier
criteria” in businessrelationships in Norway
Qualityin business
relationships
19
“Su
pp
lier
crit
eria
”N
um
ber
ofy
ears
assu
pp
lier
Su
pp
lier
’sco
ntr
ibu
tion
tosa
les
Su
pp
lier
’sco
ntr
ibu
tion
top
rofi
tS
izes
offi
rmv
ssu
pp
lier
Foc
alar
eaof
“per
ceiv
edq
ual
ity
”C
orr.
1S
ig.
NC
orr.
1S
ig.
NC
orr.
1S
ig.
NC
orr.
2S
ig.
N
Com
mit
men
t0.
062
0.50
211
90.
339
0.00
0*
*12
00.
320
0.00
0*
*11
72
0.02
20.
812
121
Com
pet
itiv
ein
ten
sity
0.02
40.
797
118
20.
113
0.22
011
92
0.07
40.
430
116
0.09
90.
284
120
Coo
per
atio
n0.
043
0.64
611
90.
200
0.02
9*
120
0.18
70.
044
*11
72
0.06
90.
450
121
Coo
rdin
atio
n0.
106
0.25
411
80.
367
0.00
0*
*11
90.
344
0.00
0*
*11
60.
078
0.39
612
0M
ark
ettu
rbu
len
ce2
0.06
00.
521
118
0.03
60.
694
119
0.02
80.
765
116
20.
004
0.96
312
0S
atis
fact
ion
0.00
20.
980
119
0.14
70.
108
120
0.15
60.
092
117
20.
096
0.29
712
1S
pec
ific
asse
ts0.
049
0.59
511
90.
576
0.00
0*
*12
00.
550
0.00
0*
*11
72
0.09
10.
322
121
Tru
st2
0.06
40.
490
118
0.18
10.
049
*11
90.
242
0.00
9*
*11
62
0.16
00.
081
120
Nu
mb
erof
yea
rsas
sup
pli
er0.
097
0.29
711
80.
072
0.44
111
50.
113
0.23
011
3S
up
pli
er’s
con
trib
uti
onto
sale
s0.
957
0.00
0*
*11
72
0.22
00.
017
*11
7S
up
pli
er’s
con
trib
uti
onto
pro
fit
0.91
20.
000
**
117
Notes:
corr
.1–
Pea
rson
/par
amet
ric
corr
elat
ion
;cor
r.2
–S
pea
rman
’srh
o/n
on-p
aram
etri
cco
rrel
atio
n;s
ig.
–si
gn
ifica
nce
lev
el(t
wo-
tail
ed)
–* 5
per
cen
tor
less
;*
* 1p
erce
nt
orle
ss;N
–n
um
ber
ofp
aire
dre
spon
ses
Table V.Associations betweenfocal areas of “perceivedquality” and “suppliercriteria” in businessrelationships in Sweden
BJM4,1
20
. The level of “competitive intensity” is perceived to be significantly higher inNorway when compared to Sweden.
. The levels of “cooperation” and “coordination” are also perceived as significantlyhigher in Norway than in Sweden.
. The level of “specific assets” are perceived to be significantly higher in Swedenthan in Norway.
. The levels of “commitment”, “market turbulence”, “satisfaction”, and “trust” areperceived as fairly similar in both countries.
There are a number of possible reasons why these differences and similarities mayhave appeared in the comparison of perceived quality in business relationships inNorway and Sweden. For example, the levels of “competitive intensity” are most likelyhigher in Norway due to the current domestic economic situation (stronger than that inSweden), which may be characterized by economic growth, high purchasing power andlow redundancy rates. In other words, the financial wheels in Norway are spinning atfull pace. Moreover, 99.7 percent of Norwegian firms have less than 250 employees. Itseems as though Sweden’s membership in the EU has had a lower effect on competitiveintensity than the boost that oil production and higher oil prices have given theNorwegian economy. That is somewhat surprising, since in the debate in the twocountries in connection with the referenda, competitive intensity was one of theimportant factors that were put forward as an argument for joining the EU. Comparedto Sweden, Norway has a considerably larger number of small firms, and fewermultinationals. The results in a study by Moen (2002) indicate that these firms areengaging in internationalization at an increasing rate. The firms included in the studyare establishing a global orientation much faster than previously, thus entering highlycompetitive markets. In a Swedish study, Andersson and Wictor (2003) had difficultiesin finding new small firms with a global orientation right from inception (BornGlobals). Their interpretation was that most small manufacturing companies inSweden were suppliers to the large Swedish multinational companies (e.g. Volvo,Ericsson, Scania, and Electrolux). Swedish and Norwegian companies compete ininternational markets, but compared to Sweden’s larger firms, the small Norwegiancompanies probably experience more competitive intensity because of their smallersize. When it comes to the levels of “commitment” it may have become an essential partof business in both countries – in Norway due to the intense economic boostdomestically, and in Sweden due to a dependence upon the international marketplace.Norwegian firms may have been forced to “cooperate” and “coordinate” their businessrelationships to a larger extent in order to maintain their market position. In Sweden,firms have been dedicated to this for many years and it has therefore become a naturalingredient of business relationships.
As reported in Konjunkturinstitut (2005), the Swedish economy is in a period of highexpansion and is even expected, parallel with the growth in the world economy, to doso well into 2008. This is supposed to lead to an expansion in the development ofSwedish exports, which are very much dependent on global markets and their growth.The economic growth may have attracted foreign and competing firms to enter themarketplace. By tradition, Swedish firms are more recipient and used to adapting theirbusiness relationships in terms of “specific assets” than the Norwegian ones whichhistorically have focused on the domestic marketplace. It is of interest that there are no
Qualityin business
relationships
21
differences when it comes to perceived “market turbulence”, nor in their levels of“trust”, and “satisfaction” in the studied business relationships. It is not surprising thatfirms in both countries perceive “market turbulence” today as, since their respectivemarketplaces are now open and exposed to keen international competition. It is alsoappealing that executive managers in both countries perceive high levels of“satisfaction” and “trust” in studied business relationships. Understandably, thecurrent economic situation in both countries keeps everybody pleased and worries aresomewhat distant at the moment. There is no evident need for actions that affect thelevels of satisfaction, or that may be perceived as distrustful.
Associations between “perceived quality” and “supplier criteria”The associations are tested by the aid of two different correlation tests (Norusis, 1993).One parametric test is applied, namely Pearson correlation coefficient. In addition, onenon-parametric test is applied, namely Spearman rank correlation coefficient. Theoutcome is shown in Tables IV (Norway) and V (Sweden). There are both evidentdifferences and similarities across focal areas of “perceived quality” in the studiedbusiness relationships and “supplier criteria”.
Business relationships in Norway. As shown in Table IV, there are some significantassociations of the focal areas of perceived quality in the studied business relationshipsin Norway. For example, there are associations between the length of the businessrelationships and the levels of commitment and specific assets as well as the perceivedcompetitive intensity. It appears that the relationships become more committed, as wellas the specific assets dedicated to them, increase over time. A reason may be thecompetitive intensity that is perceived to surround relationships in Norway.
There are also associations between the suppliers’ contributions to the firms’ salesand the “specific assets” assigned to the relationships. In other words, more resourcesare invested in the supplier-relationships that are valuable to the firm. Furthermore,there are associations between suppliers’ contributions to the firms’ profits and thelevels of “commitment” and “coordination” in studied business relationships.
It is of interest that as regards the length of the business relationship, the suppliers’contribution to firms’ sales and profits appear to go hand in hand. This indicates anincreasing financial value of the studied relationships over time. Relatively larger firmsindicate themselves to be more satisfied with their suppliers, as well as having moretrust and investing more specific assets in them.
The relative size between the firms in studied business relationships is associatedwith the length of the relationships, and their contribution to sales and profits. Forexample, the increasing relative size of the firms in relation to the suppliers appears tobe more dedicated to long-term relationships. It appears to increase the suppliers’importance to the firms’ profits, but not sales.
Business relationships in Sweden. As shown in Table V, there are some significantassociations of the focal areas of perceived quality in the studied business relationshipsin Sweden. For example, it is rather unexpected to find no associations between thelength of the business relationship and the focal areas of this study. One would expectthat some of them would be related to the length of the business relationship. However,the Swedish business environment has become more volatile and demanding in recentyears, where suppliers are continuously evaluated and, should performance beunsatisfactory, substituted by others. This change can be connected with
BJM4,1
22
environmental changes such as Sweden’s membership in EU and that some of thelargest Swedish companies are nowadays owned and controlled by foreign companies,a fact that has changed and internationalized the structure in many industries. Asargued elsewhere (Ford et al., 2003; Dubois et al., 2003), business relationships whichare normally associated with stability and longevity, when faced with new tasksand/or new supplier situations, can experience a break in relationship. This isespecially true when new situations lead to the knowledge that the parties are nolonger making any significant impact on each other’s performances in the face ofintense competition in our integrated markets. For Hakansson and Snehota (1995, p. 7),a long-term relationship between any business parties will be characterized byextensive use of the relationship by the involved parties, and also by mutuallymanaging to match the rapid changes and developments which intense competitionand market turbulence require. Hence, it is of little surprise that in the present studythe length of relationships has not been a key parameter in these relationships.
On the other hand, there are numerous significant associations between thesuppliers’ contributions to the firms’ sales and the levels of commitment, cooperation,coordination of specific assets and trust involved in the studied relationship. This ismarkedly different from the Norwegian business relationships.
There are also the same significant associations between the suppliers’contributions to the firms’ profits and the level of commitment, cooperation,coordination of specific assets, and trust involved in the studied relationship. This isalso notably more pronounced than in the Norwegian business relationships.Furthermore, the relative size between firms in studied business relationships is notassociated with the focal areas of this study.
It is of interest that the length of the business relationship, the suppliers’contributions to firms’ sales and profits, and the relative sizes are not associated to thesame extent in the Swedish study as opposed to the Norwegian one. Probably, it fallsback to the volatile and demanding environment in Sweden. It may indicate thatsuppliers may be easily replaced by others.
The relative size between the firms in studied business relationships is associatedwith their contribution to sales and profits. For example, the increasing relative size ofthe firms in relation to the suppliers appears to increase the suppliers’ importance tothe firms’ profits, but not sales. Based on the empirical results and the analyses thereof,a number of conclusions can be drawn from the present study, some of which areprovided below.
ConclusionsOur findings indicate that there is a series of significant differences and associationsbetween the perceived quality of business relationships in small and medium-sizedfirms in Norway and Sweden, though both countries resemble each other in bothsocio-economic indicators and cultural dimensions. With regards to Norway, there areassociations (Table IV) between the length of the business relationships and the levelsof commitment and specific assets as well as the perceived competitive intensity.Apparently, the relationships become more committed, as well as the specific assetsdedicated to them, the longer the relationship. A reason may be the competitiveintensity that is perceived to surround relationships in Norway. In Sweden, on theother hand, there are also some significant associations (Table V) of the focal areas of
Qualityin business
relationships
23
perceived quality. However, quite unexpectedly, there were no associations betweenthe length of the business relationship and the focal areas of this study. This iscontrary to what was found in the Norwegian example. Comparing Norway andSweden, the analysis yields:
. significantly, the suppliers chosen by the Swedish manufacturers prove tocontribute positively to sales and profits. In contrast, the Norwegian suppliers donot; and
. the Norwegian manufacturer-supplier relationships show significantly morecooperation and coordination.
These two results indicate that, even when considering the relationships less importantthan the Swedish manufacturers, the Norwegian manufacturers seem to apply moreresources into relationship building and maintenance through cooperation andcoordination. This result ties well in with Hofstede’s national culture clusters. Norwayis by Hofstede considered more uncertainty avoiding – implicating that Norwegianmanufacturers more easily engage in formal rules [cooperation/coordination] to createsecurity. It may support the assumption that business relationships are unique(Gummesson, 2002). The differences between Norway and Sweden on this pointsuggest that managers building relationships with partners in Sweden and Norwayshould consider more emphasis on cooperation and coordination with Norwegianpartners than with Swedish; even in the case of small and non-significant partners.Consequently, the formulated hypotheses may, in part, be rejected depending upon thefocal area of “perceived quality” and “supplier criteria” in focus.
Some theoretical and practical implicationsFor various reasons we are confident that this study makes a contribution to theoryand practice in the field of inter-organizational research. For example, it makes acontribution to inter-organizational theory as it outlines a conceptual framework offocal areas of “perceived quality” and “supplier criteria” to examine businessrelationships across industries and countries for the benefit of other researchers. It isalso of managerial interest, as the framework may be applied by firms to monitor andevaluate ongoing supplier relationships and, in extension, current customerrelationships. Furthermore, the items may be used as a foundation to adapt them todifferent kinds of business relationships, industries and countries. Making use of theitems and the focal areas of “perceived quality” may, we believe, lead to an enhancedcorporate monitoring and management of business relationships.
Taken together, our study shows that even if Norway and Sweden show a lot ofsimilarities there are also a number of differences. Therefore, managers in both thestudied countries and elsewhere need to be aware of these differences if they want tosuccessfully handle relationships that include actors from both Norway and Sweden.Objective market knowledge, as portrayed elsewhere (Johanson andWiedersheim-Paul, 1975; Johanson and Vahlne, 1990) about the close psychicdistance between Sweden and Norway, can be tempting for a manager to handle, forexample, supposing business relationships in Sweden to be exactly the same as theywill be in Norway. Our study cautions against this generalization and insteadrecommends that managers be alert to specific circumstances that influence businessrelationships in any market.
BJM4,1
24
Suggestions for further studiesThis study has examined differences and similarities between a selection of focal areasof “perceived quality” and “supplier criteria” in business relationships in Norway andSweden. We believe that there are some fruitful suggestions for further research whichmay provide guidance to stress some research limitations. For example, one suggestionis to replicate the study in other industries, and in other business relationships andcountries. Another one is to undertake a longitudinal approach of the focal areas of“perceived quality” and “supplier criteria”. Furthermore, it would be valuable toincorporate additional focal areas of “perceived quality”, such as:
. formalization;
. dependence;
. opportunism;
. continuity;
. competitive intensity; and
. market turbulence.
Finally, an adapted replication of the study from the perspective of suppliers“perceived quality” and “buyer criteria” would provide different angles of insight intobusiness relationships.
In sum, it would be valuable to examine the studied focal areas of “perceivedquality” and “supplier criteria” in other countries and cultures that differ from and/orare similar to the two countries surveyed in this cross-country research effort. For thispurpose, Hofstede (1983a) dimensions of national cultures may be used to targetdifferent national corporate samples. It would be of interest to see if there aresimilarities amongst other cultures of the focal areas and/or if there are differencesacross other countries that are decidedly different from the two countries under studyin this paper.
Notes
1. As a contrast to the anticipated close psychic distance between Norway and Sweden, someincidents in past [merger] negotiations between large companies, for example the NorwegianTeleNor and the Swedish TeliaSonera, indicate that there might exist underestimateddifferences concerning factors constituting relationship quality when comparing theanticipated close countries.
2. This paragraph is based upon CIA Factbook (2008).
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Appendix
Items of focal areas of perceived quality, supplier criteria and overall, knowledge in businessrelationships
CommitmentWe are committed to doing business with this supplier.We’d like to continue our work with this supplier.We have a high level of commitment to this supplier.We intend to do business with this supplier well into the future.We are dedicated to continuing to do business with this supplier.We are resolute about future intent to do business with this supplier.Competitive IntensityCompetition in our industry is aggressive.Anything that one competitor can offer – others can match readily.One hears of a new competitive move almost every day.Price competition is a hallmark of our industry.Overall, our industry competition is moderate.
CooperationOur relationship with this supplier is cooperative.There is a cooperative attitude between my firm and this supplier.My firm prefers to cooperate with this supplier.My firm prefers to get along with this supplier.My firm’s cooperation with this supplier is a priority.
CoordinationWe work jointly with this supplier.Our implementation plans are formed jointly with this supplier.We work jointly with this supplier on issues that affect both firms.Our processes and/or procedures are coordinated with those of this supplier.Our activities are coordinated with the activities of this supplier.We attempt to conduct business in unison with this supplier.
SatisfactionOur firm is comfortable about its relationship with this supplier.The relationship between the two firms is positive.Our relationship with this supplier reflects a happy situation.Our firm is content about its relationship with this supplier.The relationship between our firms is trouble-free.
Market turbulenceCustomer preferences change quite a bit over time in our industry.Our customers tend to look for new products all the time.We are witnessing demand for our products and services from customers who never bought thembefore.New customers tend to have product-related needs that are different from those of our existingcustomers.We cater too many of the same customers that we used to in the past.
Specific assetsMy firm has made significant investments in resources that are useful only to this supplier.We have customized a consequential portion of our business in dealing with this supplier.We have tailored major parts of our business to accommodate the needs of this supplier.
We have aligned a major part of our marketing activities with those of this supplier.
(continued ) Table AI.
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About the authorsGoran Svensson is Professor at Oslo School of Management, Norway. He is also Professor atHalmstad University, Sweden and Honorary Professor at Deakin University, Australia. He isregular Guest Professor at National Chung Hsing University in Tai Chung, Taiwan. He holds aPhD at the School of Economics and Commercial Law, Goteborg University, Sweden.Furthermore, he is a committed member of the international research community as journaleditor, numerous editorial boards and scholarly/research networks. He is a frequent author ofinternational journal articles and international conference contributions and engaged as a bookauthor. His research agenda consist of various research subjects and has published in areas suchas: business ethics, leadership, logistics, marketing, public sector management, and qualitymanagement. Goran Svensson is the corresponding author and can be contacted at: [email protected]
Svante Andersson is a Professor in Business Administration at Halmstad University. Heholds a PhD at Linkoping University, Sweden. He is a frequent author of international journalarticles and international conference contributions and engaged as a book author. His currentresearch interests include international entrepreneurship, managerial behavior and the smallfirms’ internationalization, international marketing, industrial marketing management, andhigh-growth firms.
Tore Mysen is Associate Professor at Oslo School of Management, Norway. He holds aDr Oecon (PhD) at Norwegian School of Management. His research agenda consists of varioussubjects within inter-firm relationships, such as: governance of foreign collaborative partners,co-ordination and cooperation, relationship management, relationship quality, and relationshipclimate. Furthermore, he is a member of editorial boards and is committed as track chair atconferences.
Items of focal areas of perceived quality, supplier criteria and overall, knowledge in businessrelationships
My firm invests a significant amount of time acquiring knowledge about the unique aspects of theproducts (and/or service support) we carry (and/or provide) for this supplier.My firm has made significant investments in resources that are useful only to this supplier.
TrustThis supplier has always been fair in its negotiations with us.This supplier does not use opportunities that arise to profit at my firm’s expense.We can rely on this supplier to keep promises made to us.We are not hesitant to do business with this supplier when the situation is vague.This supplier is trustworthy.
Supplier criteriaHow long has your company been working with this supplier?______yearsWith respect to sales volume last year, how large is your firm relative to your supplier?AMuch smaller ASmaller ARoughly equal ALarger AMuch largerApproximately, what percentage of your firm’s sales does your supplier account for?_____percentApproximately, what percentage of your firm’s profits does your supplier account for?_____percent
Overall, knowledgePlease consider how knowledgeable you are concerning your business and your business dealingswith this supplier. Please tick the number that best reflects your knowledge level.My firm’s perspective. I do not have any knowledge 1 2 3 4 5 I do
have a lot of knowledgeExperiences with this supplier. I do not have any knowledge 1 2 3 4 5 I do
have a lot of knowledgeTable AI.
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Gabriel Baffour Awuah is Associate Professor of Marketing at the University of Halmstad,Sweden. He holds a PhD from the Department of Business Studies, Uppsala University, Sweden.He is an active member of professional associations such as the European Institute for AdvancedStudies in Management, the Academy of International Business, and the Centre for Innovation,Entrepreneurship, and Learning at the Halmstad University. He has been active in reviewingarticles for some International Journals of Marketing and Management. He conducts activeresearch in the field of marketing. For the most part, his research has been focused in areas suchas competence development of firms, internationalisation processes of firms, and strategicalliances. He has published in a number of good International Marketing Journals.
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