Relationship quality: Rules of exchange

One of the central tenets of SET is that relationships evolve over time into mutual commitments and satisfaction (Coyle-Shapiro & Conway, Reference Coyle-Shapiro and Conway2004). Relationship quality indicates ‘the atmosphere present in a buyer-supplier relationship’ (Liu, Li, & Zhang, Reference Liu, Li and Zhang2010: 3). The presence of that ‘atmosphere’, accompanied with quality in a supplier–buyer relationship, will be influential when the concerned supplier makes decisions about development and maintenance of a longer-term relationship with this buyer (Walter, Müller, Helfert, & Ritter, Reference Walter, Müller, Helfert and Ritter2003).

Under SET, relationship quality is considered as a higher-order construct comprised of satisfaction and commitment (Dwyer, Schurr, & Oh, Reference Dwyer, Schurr and Oh1987; Crosby, Evans, & Cowles, Reference Crosby, Evans and Cowles1990; Dorsch, Swanson, & Kelly, Reference Dorsch, Swanson and Kelley1998; Hennig-Thurau, Gwinner, & Gremler, Reference Hennig-Thurau, Gwinner and Gremler2002; Palmatier, Dant, Grewel, & Evans, Reference Palmatier, Dant, Grewal and Evans2006; Palmatier, Reference Palmatier2008). Previous research has shown that the success of supplier–buyer relationships is associated with supplier satisfaction and commitment (Andaleeb, Reference Andaleeb1996; Wong, Reference Wong2000).

In this regard, rules and norms of exchange between suppliers and buyers form the basis for exchange processes. While the reciprocity assumptions of SET are based on reciprocity as a moral norm and reciprocity as a folk belief (Gouldner, Reference Gouldner1960; de Ruyter & Wetzels, 2000), we argue that the quality of relationships between suppliers and buyers is built on reciprocity as a transactional pattern of interdependent exchanges. This reciprocity implies contingent transactions between suppliers and buyers. Sustaining this transactional pattern in the longer term is positively associated with reciprocity in relations (Macneil, Reference Macneil1980; Dwyer, Schurr, & Oh, Reference Dwyer, Schurr and Oh1987). Put in practical terms, as satisfaction and commitment levels of partners in a network improves, performance in terms of product quality, operational support, service quality, delivery performance and responsiveness also improves (Benton & Maloni, Reference Benton and Maloni2005; Essig & Amann, Reference Essig and Amann2009). Thus, it is to the benefit of buyers to increase and maintain the satisfaction and commitment of those in their supply networks.

Perceived benefits from supplier–buyer exchange relationship: Resources exchanged

Key insights on the nature of SET resources originated from Foa and Foa’s (1974, Reference Foa and Foa1980) argument that resources within the organisational sciences usually collapse into two forms: economic and socio-emotional. Economic resources or benefits are tangible, while socio-emotional outcomes address one’s social and esteem needs (and are usually symbolic and particularistic). Such use of socio-emotional resources sends the message that the other party is valued and trusted (Shore, Tetrick, & Barksdale, 2001). In supplier–buyer relationships, suppliers are economically motivated to gain benefits from the buyers that are important for them. In return, buyers are also interested in obtaining benefits from their suppliers as the products and services that they will obtain from those suppliers are needed to create value that will contribute to their competitiveness. Beyond this transactional pattern of interdependent exchange relationships, supplier–buyer exchange relationships are also built on socio-emotional needs. Therefore, they are relationally oriented (Hennig-Thurau, Gwinner, & Gremler, Reference Hennig-Thurau, Gwinner and Gremler2002). Hennig-Thurau, Gwinner, and Gremler (Reference Hennig-Thurau, Gwinner and Gremler2002) argue that relational benefits are most likely to result from long-term relations built on mutual trust. The buyer may ask for an unexpected delivery, or redesign of a product, which may pressure suppliers to work overtime. In response, focal suppliers may expect learning and development opportunities such as buyer-led innovation programmes that are aimed at sustaining longer-term relationships. Relational benefits are discussed in the extant literature as special treatment benefits, confidence benefits and social benefits (Gwinner, Gremler, & Bitner, Reference Gwinner, Gremler and Bitner1998; Hennig-Thurau, Gwinner, & Gremler, Reference Hennig-Thurau, Gwinner and Gremler2002). There are other benefit categories such as product, service and relationship benefits, as presented by Lapierre (Reference Lapierre2000) and Ulaga (Reference Ulaga2003). Walter et al. (Reference Walter, Müller, Helfert and Ritter2003) use direct and indirect functions to classify the benefits offered in a supplier–buyer relationship. Li (2011) classifies benefits as special treatment benefits, value-added benefits and collaborative benefits.

Our conceptualisation and arguments for perceived benefits from supplier–buyer exchange relationships are in line with a social exchange paradigm, according to which, parties engage in voluntary behaviours that will mutually benefit them (Blau, Reference Blau1964). This paradigm does not rest on specified obligations and formal agreements but on ‘feelings of personal obligation, gratitude, and trust’ (Blau, Reference Blau1964: 92). One party does a favour for the other party and, although there is an expectation of a future return, the terms of the return are not specified, but are left to the preference of the receiver of the favour.

In social exchange, a resource is any item that can be transacted between the parties in a relationship (Foa & Foa, Reference Foa and Foa1980). A resource can be tangible, such as money, goods and services, or intangible, such as affection, approval, information, status, expressions of respect and friendship. In supplier–buyer relationships, organisations, parts of organisations or their representatives (contact persons) may engage in role behaviours beyond those demanded by their roles, and may provide resources or favours to indicate their sense of obligation to the other party in exchange for resources they have received from them (Organ & Konovsky, Reference Organ and Konovsky1989; Chen & Chiu, Reference Chen and Chiu2008; Karriker & Williams, Reference Karriker and Williams2009).

Supplier resilience

The literature offers two distinct but related perspectives on organisational resilience. According to one view (Horne, Reference Horne1997; Robb, Reference Robb2000; Balu, Reference Balu2001; Rudolph & Repenning, Reference Rudolph and Repenning2002; Sutcliffe & Vogus, Reference Sutcliffe and Vogus2003; Gittell et al., Reference Gittell, Cameron, Lim and Rivas2006), organisational resilience represents the ability to rebound from unexpected, stressful and adverse situations. A second perspective on organisational resilience evaluates the construct beyond restoration to encompass the development of new capabilities and abilities to keep up with changing dynamics (Layne, Reference Layne2001; Coutu, Reference Coutu2002; Guidimann, Reference Guidimann2002; Freeman, Hirschhorn, & Maltz, Reference Freeman, Hirschhorn and Maltz2004; Jamrog et al., Reference Jamrog, McCann, Lee, Morrison, Selsky and Vickers2006; Lengnick-Hall & Beck, Reference Lengnick-Hall and Beck2009). This second view is of organisational resilience thriving because the organisation leverages its resources and capabilities, not only back to established benchmarks, but also towards exploitation of opportunities for sustainable performance.

Combining the two perspectives, we argue that supplier resilience represents the focal firm’s ability to absorb, and develop context-specific responses to and gradually engage in transformative reactions to disruptive threats (Coutu, Reference Coutu2002; Guidimann, Reference Guidimann2002; Hamel & Valikangas, Reference Hamel and Valikangas2003; Freeman, Hirschhorn, & Maltz, Reference Freeman, Hirschhorn and Maltz2004; McCann, Reference McCann2004; Jamrog et al., Reference Jamrog, McCann, Lee, Morrison, Selsky and Vickers2006; Lengnick-Hall & Beck, Reference Lengnick-Hall and Beck2009; Kantur & Iseri-Say, Reference Kantur and Iseri-Say2012).

While organisational resilience shares many common aspects with such organisational constructs as robustness, flexibility, agility and adaptability, there are important distinguishing elements. Resilience manifests itself in unexpected and disturbing conditions, while flexibility and agility constitute the strategic stance of an organisation and enhance its overall manoeuverability in the longer term (Ghemawat & del Sol, Reference Ghemawat and del Sol1998; McCann, Reference McCann2004). Second, as argued by Kantur and Iseri-Say (Reference Kantur and Iseri-Say2012), organisational resilience is an inside-out construct that builds on renewal and transformation. Adaptability, on the other hand, reflects the need for environmental fit from an outside-in perspective. Third, characteristics such as robustness, flexibility, agility and adaptability, while they contribute to and constitute the construct of resilience, cannot singularly represent organisational resilience.

As there is little consensus on the definition and operationalisation of supplier resilience, we build on the theoretical discussions of Christopher and Peck (Reference Christopher and Peck2004) and, for our research purposes, we adopt the scale developed by Glassop (Reference Glassop2007). Thus, we have focused on a definition and classification in which firms having structural reliance (redundancy), organisational capability (requisite variety) and processual continuity (resources) are considered resilient. Glassop (Reference Glassop2007) proposes that systems with structural reliance have technical, social and economic redundancy built on know-how in order not to be overly dependent on any single person, machine or functional role. Technical redundancy includes know-how related to organisational procedures and process maps, maintenance programmes and disaster contingency plans. Social redundancy involves know-how related to personnel’s job roles and skills and succession planning. Sufficient operational fund provision and financial capacity must be developed if economic redundancy is to be achieved. A hypothetical system that has made provision in each of these areas for every contingency would able be to continue to function in the face of any disturbance.

Glassop (Reference Glassop2007) suggests that systems having organisational capability have technical (market), social (productive) and economic (risk) capability. Market capability ensures that a firm is not dependent on a few customers and/or products. Productive capability is when a firm has a willing, flexible and diverse workforce. Risk capability involves ensuring that a firm has a low financial risk profile. Such systems can respond well to perturbations when they occur.

Processual continuity involves continuous flow of a system’s technical, social and economic resources (Glassop, Reference Glassop2007). Technical resources are raw materials, technology and information. In order to ensure continuous flow of technical resources, a firm should reduce its dependence on the suppliers that provide those resources. Social resource continuity depends on processes that guarantee the hire, development and retention of skilled labour. Economic resource continuity ensures business continuity through access to funding and by strategic planning.

These dimensions of resilience must be put in place to ensure a system’s appropriate reaction to perturbations in its environment. These definitions imply a restorative emphasis to restore and a return to the original structure. However, a proactive and adaptive system will have capacity to learn, change and create in all three dimensions. Therefore, adaptability and change potential must be built into all three dimensions to ensure the kind of resilience that is the focus of this study.

Perceived benefits from supplier–buyer exchange relations affecting relationship quality

Every day, companies make decisions about whether to act as givers or takers. When they give, they contribute assistance, sharing knowledge, providing development opportunities to others and make valuable contributions. Adam Grant (Reference Grant2013a), in his recent book Give and take, emphasised that organisations have strong interests in fostering giving behaviours. Similarly, since Foa and Foa’s (1974, Reference Foa and Foa1980) seminal study on socio-emotional resources, scholars have devoted considerable attention to intangible, development-based, social and emotional resources that are characterised by a focus on giving. Previous research has established that collaboration and trust-based relations with suppliers related positively with innovation, quality improvement and service excellence (Sonnentag & Grant, Reference Sonnentag and Grant2012; Grant, Reference Grant2013a, 2013b). Chaudhry, Coyle-Shapiro, and Wayne (Reference Chaudhry, Coyle-Shapiro and Wayne2011) investigated the impact of organisational change on the relational and transactional (economic) nature of psychological contracts. They found that trust and confidence in exchange relations are fundamental drivers for long-term partnerships. Similarly, Dulac, Coyle-Shapiro, Henderson, and Wayne (Reference Dulac, Coyle-Shapiro, Henderson and Wayne2008), in their longitudinal study, examined the social exchange processes from the perspective of relational and intangible benefits shared. As in previous research (Shore & Coyle-Shapiro, Reference Shore and Coyle-Shapiro2003; Coyle-Shapiro, Morrow, & Kessler, Reference Coyle-Shapiro, Morrow and Kessler2006), they found that benefits and aspects of exchange relations that accrue to confidence, trust, development opportunities and emotional exchanges act as preliminary and central drivers for long-term sustained relations.

At the buyer–supplier relationship level, Benton and Maloni (Reference Benton and Maloni2005: 16) found that the ‘buyer-supplier relationship serves as a fundamental driver of supplier satisfaction’. Similarly, Walter et al. (Reference Walter, Müller, Helfert and Ritter2003) argued that providing relational benefits to the other party can be seen as an investment and antecedent for the long-term existence of exchange relations. In line with the reciprocity principle of SET (Blau, Reference Blau1964), the party receiving the benefits shows more willingness to maintain a long-term relationship by making sacrifices in the short term. Walter et al. (Reference Walter, Müller, Helfert and Ritter2003) also indicated that benefits exchanged between buyers and suppliers will give rise to longer-term relations characterised by satisfaction and commitment. On similar grounds, Ghijsen, Semeijn, and Ernston (Reference Ghijsen, Semeijn and Ernstson2010) identified that both human-specific supplier development (advice, knowledge exchange) and capital-specific supplier development opportunities positively influence supplier commitment. Receiving relational benefits influences willingness to form and maintain a positive long-term relationship with party offering the benefits (Gwinner, Gremler, & Bitner, Reference Gwinner, Gremler and Bitner1998). Patterson and Smith (Reference Patterson and Smith2001) proposed that relational benefits are also positively associated with satisfaction. Research revealed that special treatment benefits positively influence supplier satisfaction (Gwinner, Gremler, & Bitner, Reference Gwinner, Gremler and Bitner1998). For example, perceptions of relational benefits in logistics services are shown to have positive effects on satisfaction (Su, Li, & Qui, Reference Su, Li and Cui2009). Hennig-Thurau, Gwinner, and Gremler (Reference Hennig-Thurau, Gwinner and Gremler2002) demonstrated a significant and strong influence of confidence benefits on satisfaction. Li (2011) confirmed that relational benefits influence satisfaction positively. Li et al. (2011) demonstrated that relational benefits lead to positive outcomes, which in turn result in commitment. Hennig-Thurau (2002) finds strong impacts of special treatment and social benefits on commitment.

Social, trust-based and special treatment benefits emerge and are shared between suppliers and buyers via the people whose roles cross the boundaries between the firms (Walter et al., Reference Walter, Müller, Helfert and Ritter2003; Ghijsen, Semeijn, & Ernston, Reference Ghijsen, Semeijn and Ernstson2010). Thus, the buyer’s purchasing personnel and the supplier’s selling personnel especially act across these boundaries. As argued by Morgeson and Hofmann (Reference Morgeson and Hofmann1999: 253), collective constructs, which usually stand for organisational strategies and directions, are embedded in certain employees’ skills, experience and knowledge. Therefore, satisfaction and commitment outcomes in buyer–supplier relationships significantly depend on identification and engagement of employees who hold boundary spanning roles in these organisations. Quality of the relationships with such critically relevant employees of the organisations should be based on mutual trust, loyalty and reciprocity, just as it would be in other high-quality relationships (e.g., leader–member exchange relations) (Graen & Uhl-Bien, Reference Graen and Uhl-Bien1995). Achieving such relationships between suppliers and buyers will be a key factor for sustenance of supplier satisfaction and commitment in the longer term.

In the context of a reciprocity framework (Walter et al., Reference Walter, Müller, Helfert and Ritter2003; Coyle-Shapiro, Morrow, & Kessler, Reference Coyle-Shapiro, Morrow and Kessler2006; Ghijsen, Semeijn, & Ernston, Reference Ghijsen, Semeijn and Ernstson2010; Chaudhry, Coyle-Shapiro, & Wayne, Reference Chaudhry, Coyle-Shapiro and Wayne2011; Grant, Reference Grant2013b), we argue that special, social and trust-based benefits shared within supplier–buyer relations will subsequently affect supplier satisfaction in positive ways. Similarly, it is conceivable that supplier satisfaction and supplier commitment will positively affect benefits received from the supplier–buyer relationship. The principle of reciprocity is based on this (Blau, Reference Blau1964). However, we argue that initial trust developed between supplier and buyers, and special social benefits received from such relations act as preliminary instruments necessary for sustained relationships (Cropanzano & Mitchell, Reference Cropanzano and Mitchell2005; Coyle-Shapiro, Morrow, & Kessler, Reference Coyle-Shapiro, Morrow and Kessler2006). In their longitudinal study, Chaudhry, Coyle-Shapiro, and Wayne (Reference Chaudhry, Coyle-Shapiro and Wayne2011) tested a reciprocity-based relationship, using a construct very similar to the supplier–buyer benefits and relationship quality constructs of the present research. They found that the explanatory power of the initial relationship was stronger compared with the longitudinal and lagged effect of the reverse relationship. The nature of this longitudinal relationship is also prone to confounding variables that might distort the original effects (Dulac et al., Reference Dulac, Coyle-Shapiro, Henderson and Wayne2008). Moreover, satisfaction and commitment represent important attitude-based outcome variables in organisation studies. Previous research has almost exclusively treated these two constructs as central outcome variables (Campbell, Reference Campbell1997; Carr, Kaynak, Hartley, & Ross, Reference Carr, Kaynak, Hartley and Ross2008; Praxmarer-Carus, Sucky, & Durst, Reference Praxmarer-Carus, Sucky and Durst2013).

Hence, we hypothesise that alternative suppliers’ perceptions regarding the benefits they receive from their relationship with the buyers will have a positive impact on supplier relationship quality. In line with above arguments, we form our hypotheses as below.

Supplier resilience influencing relation quality

Although relationship quality is related to important outcome variables in a supplier–buyer relationship, it is increasingly accepted that non-uniform relationships exist, with the recognition that there is differential treatment in supplier–buyer relationships (Petroni & Panciroli, Reference Petroni and Panciroli2002; Goffin, Lemke, & Szwejczewski, Reference Goffin, Lemke and Szwejczewski2006). While some enjoy being the lead suppliers and take a central role, others face and bear the conditions of alternative suppliers. When buyer firms make use of multiple or parallel sourcing to access to higher innovation and higher effectiveness, they do so via competition, cooperation and co-opetition among a list of alternative suppliers (Wu, Choi, & Rungtusanatham, Reference Wu, Choi and Rungtusanatham2009). Such sourcing behaviour may cause even the lead suppliers feel the pressure of having several competitors that could overtake them. With limited time and resources, buyers find it extremely difficult to interact uniformly with all suppliers. Thus, some suppliers are able to receive differential treatment and establish high beneficiary relationships, whereas others might receive only limited attention and resources from the buyer.

As Liu, Leach, and Bernhard (Reference Lai, Cheng and Yeung2005: 567) stated, ‘established norms, learned procedures, personal relationships and other transaction-specific investments’ accumulate and hinder to switching even in the case of multiple sourcing. Buyer firms may need time to fully appreciate supplier firms in terms of product and service quality (Essig & Amann, Reference Essig and Amann2009). As it takes time for a buyer to provide an increase in its input to the relationship in order to reciprocate an alternative supplier’s input (Hald, Cordon, & Vollman, Reference Hald, Cordon and Vollmann2009), the supplier needs to be able to stay in the game and survive that time. An alternative supplier must withstand these conditions to attain the benefits of a long-term relationship.

We argue that supplier resilience is a strong predictor of supplier satisfaction and supplier commitment for several reasons. Resilience (Freeman, Hirschhorn, & Maltz, Reference Freeman, Hirschhorn and Maltz2004; Jamrog et al., Reference Jamrog, McCann, Lee, Morrison, Selsky and Vickers2006) enables a supplier to survive and sustain as it develops structural redundancy, organisational capabilities and process continuity without being overly dependent on other stakeholders. Thus, supplier resilience might be treated as an enduring characteristic of a system (Kantur & Iseri-Say, Reference Kantur and Iseri-Say2012), which is separate from the relations prevailing in the networks. As the satisfaction and commitment level of an alternative supplier in a supplier–buyer relationship increases over time (owing to increased benefits enjoyed), the alternative supplier may become more attached to and even overly dependent on the buyer. As a result, the supplier might have little incentive to develop in terms of structure, capabilities and the process continuity requirements of the buyer. As resilience involves being not overly dependent on any person, machine, functional role, customer, supplier, resource and product (Glassop, Reference Glassop2007; Lengnick-Hall & Beck, Reference Lengnick-Hall and Beck2009) increased satisfaction and commitment levels (increased relationship quality) therefore may not necessarily lead to an alternative supplier becoming more resilient over time.

We also base our argument that supplier resilience is a strong predictor of relation quality on previous research (Guidimann, Reference Guidimann2002; Gittell et al., Reference Gittell, Cameron, Lim and Rivas2006). Research shows that higher levels of resilience result in more effective behaviour in fuzzy circumstances (Block & Kremen, Reference Block and Kremen1996). Resilient suppliers are designed to act quickly and proactively having built flexibility and redundancy into their structures, capabilities and resources. Thus, resilient suppliers know their flexible potential to answer the changing demands of the buyers and their ability to survive disruptions to the environment. Drawing from SCT, it can be stated that if an organisation believes in its capacity to affect its environment and to achieve desired outcomes, it demonstrates coping behaviours (Bandura, Reference Bandura1982). According to Locke and Latham’s (Reference Locke and Latham1990) high performance cycle, when organisational members face a high challenge or difficult goals, high performance can be achieved if they have confidence and adequate ability. In turn, this high performance leads to satisfaction and commitment. As Stajkovic and Luthans (Reference Stajkovic and Luthans2002: 128) state ‘under social cognitive theory, organizational participants would at the same time be both products and producers of their own motivation, their respective environments and their behaviors’. Resilient suppliers believe in their potential capacity to improve and to achieve more benefits, resulting in a better quality relationship. Studies have shown that hope, optimism and resilience are positively related to organisational commitment and job satisfaction (Youssef & Luthans, Reference Youssef and Luthans2007; Çetin, Reference Çetin2011). As supplier satisfaction is based on the fulfilment of needs and, as the possibility of increased benefits in their supplier–buyer relationships is among the needs of the alternative suppliers, supplier resilience has a positive influence on need fulfilment and satisfaction of those suppliers.

According to the central tenets of SCT (Bandura, Reference Bandura1982), self-efficacy and self-evaluation are among the important processes of goal realisation (Redmond, Reference Redmond2010). In this context, supplier resilience has a positive influence over supplier satisfaction through positive self-evaluation and self-efficacy regarding the achievement of improved supplier–buyer relationships. For supplier commitment, which is based on willingness to make short-term sacrifices to maintain the relationship and confidence in its stability (Anderson & Weitz, Reference Anderson and Weitz1992), resilient suppliers’ commitments will build on belief in their capacity to influence endurance of their relationships with the buyers and to derive long-term benefits from them (Griffith, Harvey, & Lusch, Reference Griffith, Harvey and Lusch2006). They come adapt to the buyer’s changing demands as they have the resources for flexibility. These suppliers tolerate short-term inequities, as they believe that in time they achieve positive balances in these relationships (Ganesan, Reference Ganesan1994).

Overall, previous research argues that resilience leads to better performance (Luthans, Reference Luthans2002). It is also suggested that resilience is a strong factor strongly promoting effective relationships (Mallak, Reference Mallak1999). In cases of differential treatment and the resulting difficulties in relationships, resilient suppliers react positively by engaging in self-improvement and other constructive behaviours. Resilient suppliers invest more in the relationship, resulting in increased commitment. They also endure difficult times and develop their capabilities to improve relationships with buyers and possibilities of increased benefits, thus increasing satisfaction. Therefore, it is expected that resilience will enable alternative suppliers to survive uncertain and unfair processes in their relationships with buyer firms. Taking together these various explanatory lines concerning supplier resilience, we argue that an alternative supplier’s resilience leads to higher relationship quality in terms of supplier satisfaction and supplier commitment.

In our hypothesised model given in Figure 1, supplier resilience and perceived benefits from supplier–buyer exchange relationship are presented as influencing relationship quality, particularly supplier satisfaction and commitment.

Figure 1

Proposed research model

Research settings and data collection

The survey was administered to a wide range of multinational companies operating in Turkey. Industries represented include various sectors, such as ready-to-wear, food, pharmacy, heating and cooling (please refer to Table 1 for further details of sectors represented). We attempted to include a wide range of industries to be representative of an overall economic outlook. This insight is especially important within an emerging economy, where sectors follow huge growth trends. Such a wide variety of sectors will also enable us to draw more sound generalisations. Moreover, contributions of these sectors account for majority of GDP generated in last decade for this economy (OECD, 2011). Regarding selection criteria for buyers, we selected companies with the largest market shares in their respective industries. We wanted to ensure buyer attractiveness in the eyes of the alternative suppliers. Multinational companies were also favoured, as their subsidiaries provide more resources and opportunities for administration of survey studies. We communicated with our contact people from the targeted companies and briefed them about the content of the study. After receiving their approvals, we sent our translated surveys to those contact people for pre-approval of purchasing managers’ participation in the study. Ten companies were contacted. Eight of them willingly agreed to participate. Our contact people handed the surveys to the purchasing managers.

Table 1

Demographic characteristics of participant supplier firms

Note. N=97.

Our survey was administered to two different sets of samples. The first set of respondents was composed of multinational buyer firms. Purchasing managers from participating buyer firms were asked to identify a list of suppliers they considered to be alternative suppliers and with whom they have considerable length of relationship. Following this step, responsible buyers completed the surveys regarding their reflections of supplier satisfaction and commitment. As a last step, our survey, which included items representing resilience, benefits from supplier–buyer relations, supplier satisfaction and commitment were filled in by the selected suppliers of the participating buyer companies. Hence, data from our participants included two interdependent but different perspectives.

As our constructs are collective in terms of functions and outcomes, we follow the recommendation of Morgeson and Hofmann (Reference Morgeson and Hofmann1999) in operationalising them. They argued that collective constructs that represent overall organisational functions, strategies or processes are embedded in a set of knowledge, skills and abilities held by particular individuals. In this context, supplier resilience, perceived benefits from supplier–buyer relations, and relationship quality in terms of supplier satisfaction and supplier commitment represented the shared organisational routines, processes, outcomes and strategies that guide the focal firm and that are commonly embedded in individual employees. As our constructs represent phenomena that ‘emerge, are transmitted and persist’ across organisations, we used data from salient and related participants as representative of their focal companies. This approach was used in previous research relevant to our study objectives (Coyle-Shapiro & Neuman, Reference Coyle-Shapiro and Neuman2004; Lengnick-Hall & Beck, Reference Lengnick-Hall and Beck2009). Levinson, Price, Munden, Mandl, and Solley (Reference Levinson, Price, Munden, Mandl and Solley1962) argued that employees view actions of managers as actions taken by the organisation itself. This idea of attributing human qualities to organisations – anthropomorphisation – has been applied with scrutiny in social exchange-related studies (Coyle-Shapiro & Neuman, Reference Coyle-Shapiro and Neuman2004; Conway & Briner, Reference Conway and Briner2005). Therefore, we treated the responses of our participants as representing their focal organisations. We built this reasoning on the recommendations of Morgeson and Hofmann (Reference Morgeson and Hofmann1999) and via drawing on anthropomorphisation idea of Levinson et al. (Reference Levinson, Price, Munden, Mandl and Solley1962).

Out of 10 buyers we contacted, eight of them provided full support and participation. Out of 106 questionnaires that reflected responses from suppliers and buyers, 97 were returned completed in a manner that allowed satisfactory data analysis, an effective response rate of 92%. Only nine of the surveys were not fully completed, so they were not used in the data analysis. The two buyer firms that were not willing to participate were operating in retail market and food industries. We took data from other companies operating in those sectors. The reasons for the non-participation of these companies were related to procedural approvals and lack of time at managerial levels. Table 1 represents the profiles of the responding companies.

Construct measurement

In order to test the proposed model a survey was designed. In the process of crafting the survey instrument, original scales were borrowed from existing literature and they were back-to-back translated to match the Turkish context. Necessary modifications were made to existing scales to ensure that they were salient to the context of this investigation. The content of the survey was pre-tested with professional employees from selected industries. Following this pre-testing process, only minor changes in wording of sentences were necessary. As suggested by Yin (Reference Yin2003), translation of surveys is a very critical step for clarity and understanding. The survey included items assessing supplier resilience, supplier perceived benefits from supplier–buyer exchange relations, supplier commitment and satisfaction. Furthermore, we controlled for the effects of age and number of employees of participant suppliers before testing the hypotheses.

Measures

All questions were anchored on a 5-point Likert scale (1=‘strongly disagree’ 5=‘strongly agree’). Questions measuring different constructs were mixed in order to reduce method bias impact (Podsakoff, Mackenzie, Lee, & Podsakoff, Reference Podsakoff, MacKenzie, Lee and Podsakoff2003).

Validity

We tested validity of our measurement theory with respect to reliability, convergent, discriminant and nomological validity (Hair, Black, Banin, & Anderson, Reference Hair, Black, Babin and Anderson2010). Internal reliability values (Cronbach’s α) were above the cut-off values suggested by Hair et al. (Reference Hair, Black, Babin and Anderson2010). An important indicator of convergent validity is the average percentage of variance extracted from a set of construct items. Average percentage of variance extracted of 0.50 or higher suggests adequate convergence (Hair et al., Reference Hair, Black, Babin and Anderson2010). Our findings offer sufficient evidence for convergent validity (refer to Appendix B in Supplementary Material).

Discriminant validity is assessed by comparing each factor’s average percentage variance extracted with the square of the correlation estimate between that factor and other factors (Fornell & Larcker, Reference Fornell and Larcker1981). As seen in Appendix C (in Supplementary Material), for all the constructs, the average percentage of variance extracted values are higher than the squared correlation estimates between others. This provides good evidence for discriminant validity.

Nomological validity is assessed by examining whether the correlations among the constructs in the measurement theory make sense (Hair et al., Reference Hair, Black, Babin and Anderson2010). Table 2 shows the matrix of construct correlations. Strong correlations exist between supplier resilience and perceived benefits from supplier–buyer relations in line with previous research. This provides supportive evidence for nomological validity.

Table 2

Means, standard deviations and two-way correlations of study constructs

Note. N=97. Diagonal values stand for Cronbach’s α of each construct.

^a Control variable.

PBSB=perceived benefits from supplier–buyer relations; SA=supplier age; SC=supplier commitment; SE=supplier number of employees; SR=supplier resilience; SS=supplier satisfaction.

*p<.05; **p<.01.

Common method bias

Under the context and objectives of this investigation, our core aim was to examine how suppliers perceive benefits from mutual dyads and how resilient they perceive themselves to be in the conduct of these relationships. Accordingly, both constructs of perceived benefits from supplier–buyer relations and degree of resilience mirror self-reflections about internal states and feelings of suppliers. The nature of these measures necessitates use of a self-report questionnaire. For our dependent variables of supplier satisfaction and commitment, we calculated and used a composite measure that included reflections of suppliers and buyers. Therefore, we tried to rule out common method bias by consulting two different sets of parties (Maunu, Reference Maunu2003).

However, as with all studies using self-reported data, our study may have suffered from common method biases. There might also be some social desirability effects (Podsakoff & Organ, Reference Podsakoff and Organ1986; Podsakoff et al., Reference Podsakoff, MacKenzie, Lee and Podsakoff2003). In line with the procedure followed by Podsakoff and Organ (Reference Podsakoff and Organ1986), we tried to ensure that our participants responded to surveys based on factual experience and company data, in addition to their personal perceptions, which cannot be avoided in self-report-driven investigations. We implemented the Harmon-one-factor test, for all study constructs (Podsakoff & Organ, Reference Podsakoff and Organ1986), to examine the existence and explanatory structure of constructs. Our findings supported a view that there were four conceptually critical and theory-driven constructs, including supplier resilience, benefits from supplier–buyer relations, supplier commitment and supplier satisfaction. Results showed that the maximum covariance explained was 24.12%, meaning that common method biases did not pose significant deviation effects. Given this finding and the inclusion of two different sources for criteria and predictor variables, we find that method-driven bias was not a major problem in the current study.

Measurement of the model with exploratory factor analyses

Before hypothesis testing, a principal components factor analysis was conducted using the varimax rotation. Measurement of sampling adequacy (0.88) was performed using Barlett’s test of sphericity (χ²=3,750, p<.000), which offered evidence favouring use of exploratory factor analyses. The communality values of all measures were above 0.50, indicating that the measures fit well with the other measures in the relevant construct (Nunnally & Bernstein, Reference Nunnally and Bernstein1994). All factors loaded in their respective factors with cut-off values above 0.50 (Nunnally & Bernstein, Reference Nunnally and Bernstein1994). The overall variance explained by the rotated factors is 56%. Cronbach’s α values for all the multi-item constructs were also calculated and were found to be above 0.70 (Nunnally & Bernstein, Reference Nunnally and Bernstein1994).

Measurement of the model with confirmatory factor analyses

Confirmatory factor analysis was conducted using a maximum likelihood estimation procedure in M-Plus. The measurement model included perceived benefits from supplier–buyer relations, resilience, supplier satisfaction and supplier commitment. The items of all the constructs were restricted to load on their prior extracted factors and all the constructs were allowed to correlate with each other in the measurement model.

In terms of fitness indices, we used a χ² differences test for comparing competing models that are not prone to samples size effects, standardised root mean square residual value, which is an absolute fit index (Hu & Bentler, Reference Hu and Bentler1995, Reference Hu and Bentler1999), which is required to be smaller than 0.06, root mean square error of approximation, which should be as small as possible (<0.06) along with the related 90% confidence interval indicators. Regarding the comparative indices, the Tucker Lewis index and the comparative fit index were used. Last, but not least, for comparison, we made use of χ²/df, which should be below 2, 3 or 5; Akaike’s information criterion and Bayesian information criterion, which should be small (Hair et al., Reference Hair, Black, Babin and Anderson2010). Except for the RMSEA value, the rest of the fit indices provided support for the validity of fit with our model. The comparative fit indices are above the cut-off values, most importantly χ²/df, which is a sample free indicator of fit. Therefore, we proceeded to test the hypotheses using a hierarchical multiple regression modelling approach.

Theoretical implications

Resilience is a concept predominantly developed in developmental psychology and environmental systems literatures (Coutu, Reference Coutu2002; Freeman, Hirschhorn, & Maltz, Reference Freeman, Hirschhorn and Maltz2004). However, although the concept has a long history, there is no consensus on the definition of resilience (Fernandez-Perez, Del Mar Fuentes-Fuentes, & Bojica, Reference Fernandez-Perez, Del Mar Fuentes-Fuentes and Bojica2012; Kantur & Iseri-Say, Reference Kantur and Iseri-Say2012). In this study, the concept of resilience is adapted, in the context of supplier–buyer relationships, to understand the effect of supplier resilience on relationship quality.

This study attempted to contribute to knowledge of relationships between alternative supplier perceptions regarding benefits from supplier–buyer exchange relationships and relationship quality. In explaining these relationships, we heavily drew on SET and on the psychological contracts framework (Rousseau, Reference Rousseau2004; Coyle-Shapiro & Conway, Reference Coyle-Shapiro and Conway2005; Coyle-Shapiro, Morrow, & Kessler, Reference Coyle-Shapiro, Morrow and Kessler2006; Dulac et al., Reference Dulac, Coyle-Shapiro, Henderson and Wayne2008). This study confirmed that perceived benefits from the relationships between supplier and buyer firms shape supplier commitment and satisfaction in positive ways. Similar findings were achieved with respect to supplier resilience, where the impact of supplier resilience on commitment was much stronger, compared with its influence on supplier satisfaction. We investigated some of the misconceptions in SET (Cropanzano & Mitchell, Reference Cropanzano and Mitchell2005; Coyle-Shapiro, Morrow, & Kessler, Reference Coyle-Shapiro, Morrow and Kessler2006) by reviewing rules and norms of exchange in supplier–buyer relations, resources exchanged and the relationships that tend towards relational psychological contracts. We found support for the notion that socio-emotional resources (Foa & Foa, 1974, Reference Foa and Foa1980) shape relations between suppliers–buyers. Our findings also demonstrated that relational contracts, similar to Rousseau’s (Reference Rousseau2004) relational psychological contract taxonomy, dominate relations between suppliers and buyers. Benefits perceived as received from supplier–buyer relations included social, special treatment and trust-based resources, all of which involve relational and non-transactional contracts (Rousseau, Reference Rousseau2004). This finding also supports our prediction that trust and other relational elements that constitute supplier–buyer relationships are primary drivers for long-term supplier satisfaction and commitment.

Buyers may face difficulties in providing similar levels of benefits for all of their suppliers (Petroni & Panciroli, Reference Petroni and Panciroli2002; Goffin, Lemke, & Szwejczewski, Reference Goffin, Lemke and Szwejczewski2006), as time is a significant caveat for the improvement of such mutual relations. In such circumstances, where lead suppliers have already received high benefits and where the buyer firm has already invested differential resources to those suppliers, there will most likely be alternative suppliers who perceive and receive low benefits, which in turn lead to lower supplier satisfaction and commitment levels.

As another antecedent of relationship quality, we found that supplier resilience plays a significant role in characterising and sustaining supplier satisfaction and supplier commitment. We tried to conceptualise and theoretically support supplier resilience by drawing on SCT (Bandura, Reference Bandura1982; Locke & Latham, Reference Locke and Latham1990; Stajkovic & Luthan, Reference Stajkovic and Luthans2002) and positive organisational psychology perspectives (Luthans, Reference Luthans2002). We built our understanding of resilience’s influence on relationship quality (satisfaction and commitment), on resilient suppliers’ beliefs in their capacity to influence their relationships with buyers to derive benefits and ensure endurance of the relationship. Sutcliffe and Vogus (Reference Sutcliffe and Vogus2003) suggest that longer-term adaptability and the ability to stand against disturbances during times of uncertainty are considered to constitute resilience. More resilient alternative suppliers who appreciate their own potentials and have confidence about their capacities will seek to obtain long-term benefits. Building self-reliance and self-confidence, (Bandura, Reference Bandura1982; Luthans & Youssef, Reference Luthans and Youssef2007) these alternative suppliers develop more positive cognitive sets and behaviours that ultimately yield high-quality relationships defined by supplier satisfaction and commitment.

As the satisfaction levels of partners in the network improve, their performance in the network increases in terms of product quality, operational support, service quality, delivery performance and responsiveness (Benton & Maloni, Reference Benton and Maloni2005; Essig & Amann, Reference Essig and Amann2009; Waard, Volberda, & Soeters, Reference Waard, Volberda and Soeters2012). In addition, positive satisfaction and commitment levels in the network of relationships reduce opportunistic behaviours (Zhang et al., 2008). The findings of this study contribute to understanding how the alternative suppliers develop cooperative and positive behaviours in the network of supplier–buyer relationships. To do so we drew on SET and psychological contracts perspectives. This study also emphasised the significance of supplier resilience as an antecedent to relationship quality. We drew on and extended SCT and positive organisational behaviour to investigate the resilience construct in the context of supplier–buyer networks. We showed that supplier resilience is an organisational characteristic separate from supplier relationships. Thus, we brought supplier resilience to the fore, as it enables a supplier to survive and sustain itself owing to its structural redundancy, organisational capabilities and process continuity, without being overly dependent on anything. On the other hand, increased levels of quality of relationship (satisfaction and commitment) with a buyer may limit a supplier’s improvement and development efforts, in terms of structure, capabilities and process continuity, to the requirements of that particular buyer. As resilience involves being not overly dependent on any person, machine, functional role, customer, supplier, resource and product, increased satisfaction and commitment levels (increased relationship quality) may not lead to that alternative supplier’s becoming more resilient over time. Hence this research adds to our understanding of how business networks survive and evolve.

Managerial implications

In order to have a satisfied and committed supplier base, managers of the buyer firms should attach importance to assessing their alternative suppliers’ perceptions of the benefits they receive from the relationship. Further, results of this study reveal that managers should pay attention to selecting resilient suppliers who have the potential for reinvention, learning and adaptation. Including resilient suppliers in networks would contribute to sustenance of longer-term business relationships.

Buyer firms may need time to fully appreciate alternative supplier firms in terms of product and service quality (Liu, Leach, & Bernhardt, Reference Liu, Leach and Bernhardt2005; Essig & Amann, Reference Essig and Amann2009) and to increase their benefit distribution accordingly. Resilience helps these suppliers to endure the waiting period during which the buyer firms carry out their assessments. Buyer firms may have already established high-quality relationships with some of their suppliers and see other supplier firms as alternative choices in case of need for extra capacity or of production problems in their lead suppliers. Some buyer firms may think that the supplier should improve in aspects that are vital for their potential selection as a beneficial relationship partner. While achieving a high-benefit relationship with a buyer firm brings such benefits as increased training and development opportunities, shared plans and forecasts, predetermined orders, better quotas than those of competitor suppliers’, it is difficult for alternative suppliers in low-benefit relationships with targeted buyer firms to bear not being the first alternative and not having predetermined orders or forecasts. Resilient alternative suppliers, knowing and trusting their potential, will be long-distance runners and look to their eventual success. They have strong beliefs in their capacities to learn, to change and to adapt. Thus, they treat suggestions for improvement from buyers as important and valuable contributions to their success in the end.

We have shown that resilient alternative supplier firms have more satisfaction and commitment than non-resilient ones, who might receive similar benefits. By emphasising the resilience of selected suppliers, firms ensure increased supplier dedication to improving relations, which may take longer than expected. As resilient suppliers feel more satisfied and are more committed than non-resilient ones, firms ensure increased levels of performance by selecting resilient suppliers. Managers also need to try to improve resilience of their existing supplier bases through collaboration, and not only by selecting suppliers that have demonstrated resilience.

In addition, managers of alternative supplier firms need work to improve their firms’ resilience by improving their capacity to learn, change and adapt. By increasing their resilience, supplier firms will be more responsive to their target buyer firms’ requirements and are also likely to develop higher levels of satisfaction and commitment. This study points to possibilities for improvement of a supplier’s resilience by targeting improvements in structural reliance (redundancy), organisational capability (requisite variety) and processual continuity (resources) dimensions.