Is dependent what we want to be? effects of incongruency

Is Dependent What We Want To Be? Effects of Incongruency

JULE B. GASSENHEIMER University of Kentucky

J. CHARLENE DAVIS Trinity University

ROBERT DAHLSTROM University of Kentucky

A paradigm shift within marketing has focused attention on the relational end of the exchange continuum where dependence justifies relationship behavior and drives outcomes. Previous research, however, ignores the possibility that attitudes toward dependence might also be responsible for relational and economic outcomes. We propose that the impact of adverse attitudes might be partially responsible for previous empirical results, contradicting the notion that parties respond favorably toward relationships and experience positive outcomes. Building on dependency theory, transactional cost analysis (TCA), and congruency theory, this study examines the influence attitudes toward dependence have on the ability of a channel member to work effectively under conditions where dependence exists. Results indicate that when dependence exists adverse attitudes toward dependence moderate the relationships between dependence and dealer satisfaction, and dependence and revenue generated from the relationship, but not necessarily in a negative fashion or under all dependent conditions.

INTRODUCTION

Independent or dependent, what do organizations want to be? A stream of research spurred by work in contract law suggests that most organizations strive for positions toward the

Jule B. Gassenheimer, Department of Marketing, College of Business and Economics, University of Kentucky, Lexington, Kentucky 40506-0034.

Journal of Retailing, Volume 74(2), pp. 247-271, ISSN: 0022-4359 Copyright © 1998 by New York University. All rights of reproduction in any form reserved.

247

248 Journal of Retailing Vol. 74, No. 2 1998

relational end of the spectrum where interdependency prevails (Dwyer, Schurr, and Oh, 1987; Gundlach and Murphy, 1993; Morgan and Hunt, 1994). This contemporary research, in conjunction with dependency theory, assumes that interactions at the relational end of the spectrum are voluntary, resulting in a positive experience (Dwyer, Schurr, and Oh, 1987; Thibaut and Kelley, 1959). Institutional economics warns, however, that self-interest motives, rather than the desire for relationships, often guide exchange decisions. This makes parties vulnerable to their own dependence and pressured to maintain rigid exchange patterns to protect their investments (Williamson, 1979, 1991). Inconsistencies between the theoretical underpinnings of exchange motives and these streams of research challenge our understanding of forces driving relationships and relationship outcomes.

The popular trade press provides numerous examples where self-interest motives and adverse attitudes toward dependence clash with relational principles. For instance, the potential economic benefits and desire to reduce its dependence motivated Jenn-Air to remove itself from relationships with several distributors by selling direct. As a result several small distribution businesses, once thought to be long-term partners, no longer had access to critical resources needed to survive (Tannenbaum, 1992).

In another case, AC&R's long-standing relationship with Estee Lauder and financial future were threatened when Estee Lauder decided to reduce its dependence on AC&R by soliciting competing ad agencies to bid on its $75 million advertising account (Goldman, 1994). While in each of these cases the primary intent was not to harm the other party, relationships were strained or destroyed by self-interest motives and the desire to reduce dependence with little concern for their partner's dependent position. Such encounters suggest that our understanding of forces guiding relations may need further investigation if we are to offer managers advice based on sound marketing and management principles.

The purpose of our study is to investigate the dependence-relationship arena by address- ing forces previously not explored in prior research. While much has been done to further our understanding of relational exchanges, empirical research has overlooked the affect attitudes toward dependence have on the ability of channel members to work effectively under dependent conditions. This dearth of attention may obscure our understanding of relationships and the rationale for buying decisions. In light of new insights in relational marketing and suggestions for future research (Heide, 1994; Kumar, Scheer, and Steen- kamp, 1995; Morgan and Hunt, 1994), we borrow from the dependence, transactional costs analysis, and congruency literatures to establish a conceptual framework for our concerns. Following this discussion are our research hypotheses, methodology, results, and findings. We conclude with implications and future research directions.

INTEGRATION OF THEORETICAL FRAMEWORKS

Drawing from transaction cost analysis (TCA), dependency, and congruency research, we find that parties driven by self-interest motives and seeking independence often experience relational conflict when faced with restricted exchange options and limited autonomy. While Thibaut and Kelley's (1959) explanation of dependency focuses primarily on the goal compatibility of exchange partners and the alternatives available to

Is Dependent What We Want To Be? 249

achieve these goals, Heide and John (1988) provide additional meaning to dependency situations by emphasizing potential sources of conflict that accompany transaction cost principles.

Of particular importance is asset specificity, "the big locomotive to which transaction cost economics owes much of its predictive content" (Williamson 1985, p. 56). Although specific assets generate revenue and contribute to the buyer's financial success, Heide and John (1988) found that dependency, as a direct consequence of the immobility of assets specific to the dyadic relationship, creates hostage situations and serves as a source of resentment. As a result buyers tolerate the demands of suppliers and relinquish control, but they also show their dissatisfaction by pursuing alternative compensatory investments from outside the relationship.

We suggest that congruency theory may be particularly helpful in explaining relational and economic responses to dependency. Congruency (congruity) theory is a cognitive consistency theory explaining similar and dissimilar attitudes and behaviors (Hinde, 1979; Schewe, 1973). The central tenet of congruency theory is that individuals strive to hold attitudes (towards objects, others, and concepts) that are compatible with other attitudes (Osgood and Tannenbaum, 1955). When attitudes are incongruent, individuals experience internal pressure and seek to resolve these conflicting feelings. Abelson (1959), Osgood and Tannenbaum (1955), and Schewe (1973) suggest that parties adapt their attitudes or behavior to be consistent with desired behavior. Secord and Backman (1964) add that parties also seek relationships with alternative partners whose attitudes and behaviors are the same or require a minimum change from previously congruent interpersonal situations.

While recognizing the potential for conflict when parties experience incongruency between their attitude toward autonomy and their dependence position, we should also note that not all parties value autonomy. Some parties adapt to their dependence and become socialized by the process, welcoming the advice and guidance of others (Bonoma, 1976; Douglas, 1990; Etzioni, 1961; Kasulis and Spekman, 1980). Anand and Stern (1985) found that parties with a low desire for autonomy attribute their success to their partners and reciprocate efforts by willingly responding to their partners' directions. Parties agreeable to the guidance of others should, therefore, value special training and reciprocate by investing their own resources (e.g., time, personnel, customers) into making these programs a success. Specific investments by both partners increase interdependence and the potential for a mutually rewarding relationship (Anderson and Weitz, 1992; Morgan and Hunt, 1994).

This conceptualization is consistent with Kelly and Thibaut's (1978) explanation of behavioral control where controlling parties vary their behavior to benefit their partner in anticipation of receiving a similar and mutually beneficial response. Lawler and Yoon (1996) also found that parties reciprocating with their partners through their own contribu- tions received an "emotional buzz" (p. 90) that fosters feelings of satisfaction. The present study addresses both positive and negative forms of these relationships. We place a particular emphasis on the impact of incongruency when attitudes remain the same, but behavior changes to conform to the attitudes of others.


RESEARCH HYPOTHESES

"Among the most significant consequences that theorists have attributed to the establish- ment of interorganizational relationships is a loss of organization decision-making autonomy" (Oliver 1991, p. 943). Autonomy has been conceptualized as "the tendency toward self-determination," striving toward mastering one's environment (Schaefer and Burnett, 1987). In a pragmatic sense, autonomous resolutions are credited to decisions made by the individual while decisions resulting from dependence are determined by the environment or others (Anand and Stern, 1985; Schaefer and Burnett, 1987). Low autonomy suggests parties invest in relationships and relinquish control to others. The need for high autonomy suggests that parties prefer to remain independent and seek relationships that allow them to make decisions without the influence of others.

Figure 1 represents our theoretical assertion that different autonomy-reducing forms of dependence (bilateral interdependence, asymmetrical dependence, control relinquished) affect the outcome of channel relationships (Thibaut and Kelley, 1959; Secord and Back- man, 1964). We next provide support for these proposed relationships before extending our model to include attitudes toward autonomy in determining relational outcomes.

Dependency (Loss of Autonomy) and Outcomes

As found by Palay (1984), organizations often assess the nature of their dependence before adjusting relationships to enhance economic and relational outcomes. Since TCA

Bilateral Interdependence

Asymmetric Dependence

Control Relinquished

+/- Outcomes

FIGURE 1

Model of the Effects of Dependent Behaviors On Outcomes


focuses primarily on specific asset investments as economic incentives (Williamson, 1985) and a form of relational dependence (Heide and John 1988), we use specific assets as a basis for dependence and a force important in shaping economic and relational outcomes. To gain a better understanding of the nature and impact of specific asset dependence, we partition specific assets into bilateral and asymmetric indicators.

Bilateral specific assets create mutual interdependence through jointly contributed investments, resulting in a shared interest in maintaining the relationship (Kumar, Scheer, and Steenkamp, 1995; Oliver, 1991). Bilateral interdependence evolves between dealers and suppliers in the form of "special-purpose knowledge and working relationships which arise in a learning by doing fashion" (Anderson, 1985, p. 238). For example, suppliers often invest time, effort, and financial resources in support programs to train dealers in sell: ing, servicing, and managing their product lines. Better equipping dealers to communicate benefits, and adapt the line to a specific customer's needs, enhances both the supplier's and dealer's competitive position, generates sales revenue, and reinforces dealer commitment toward future purchase allocations.

Should the supplier-dealer relationship dissolve, the value of the special training (e.g., product expertise) and attention (e.g., help in customizing the supplier's systems line) provided by the supplier and received by the dealer would be lost. The dealer would have little use for supplier specific knowledge after losing the line; thus devaluing the return on the supplier's investment. The dealer would also experience a negative return as both time allocated toward educating employees, and customer accounts which had adopted the supplier's incompatible systems product line, would be lost.

One can view bilateral specific assets as a means of promoting mutual benefits and solid- ifying relationships (Deci and Ryan, 1986; Oliver, 1991), especially in the absence of a perceived need to respond to control problems (Stump and Heide, 1996). Williamson (1985) and Heide and John (1988) find, however, that bilateral investments in specific assets can lead to hostage situations and post-contractual opportunism that adversely affects relationships. For example Heide and Miner (1992) found that bilateral specific assets weakened the benefits of interdependence and reduced satisfaction. Suppliers reported that specific investments binding both parties to the relationship negatively affected intentions to extend the relationship.

Buyers and sellers sustained relationships longer when assets were general and alternatives were available, rather than when they were confined to the specificity of the relationship. These results suggest that bilateral specific assets can contribute positively or negatively to the relationship's outcomes.

Oliver (1991) suggests that not all specific assets involve mutual investments and mutual benefits. The investment in asymmetrical specific assets creates disproportionate dependence within the relationship (Heide and John, 1988). TCA's economic interest and endorsement of efficient resource use suggest parties forge relationships in support of their investments (Williamson, 1985). This behavioral response to dependence parallels the rea- soning of Anderson, Lodish, and Weitz (1987). They find that channel partners allocate resources toward suppliers perceived as having power, with the primary basis of power being the agency's (dealer's) dependence. Anderson (1985) and Heide and John (1988) also find that a positive association exists, not only between asymmetric specific assets and commitment to the relationship, but also economic performance.


Although work in TCA finds that asymmetric specific assets serve as a force to encour- age dependent parties to maintain relationships, the threat of opportunism and potential hostage situations can increase conflict and reduce the quality of the relationship. In the office furniture/systems industry, for example, dealers generally depend on their major suppliers for critical resources to a greater extent than their major suppliers depend on them. The threat of dealers losing customers, should the relationship dissolve, makes dealers vulnerable to their primary suppliers' demands and threatened by the potential violation of promises. That is, once dealers elect to invest their customers' loyalty by selling a line of systems products incompatible with other lines, customer loyalty ultimately turns to suppliers rather than dealers for filling their needs. Should dealers lose the line, not only would the value of dealer training depreciate, but also their valued customer base as customers turn to alternative dealers carrying the line for their systems needs.

The consequence is that when asymmetrical asset investments create the perception of hostage situations, rather than a framework of solidarity, relationship quality declines. Consis- tent with this assertion, Anderson, Lodish, and Weitz (1987) and Heide and Stump (1995) found an inverse relationship between asymmetric dependence and relationship quality. These, and similar conflicting results, suggest that asymmetrical specific assets, as a motivational force, can contribute both positively and adversely to the quality of relationships.

Although the connection between asset specific investments and channel outcomes has received substantial empirical support in the literature, only indirectly has research sug- gested that parties use the loss of control as an adaptive mechanism for evaluating relations (cf. Bucklin, 1973; Pondy, 1967; Raven and Kruglanski, 1970). Hunt, Mentzer, and Dane (1987), for example, viewed the loss of control as a position of vulnerability and a threat to the legitimate fight to make decisions. In response, the loss of control reduced the quality of the relationship. Anderson and Narns' (1990) study indirectly addresses this issue, finding that parties viewing the loss of control as an infringement on their autonomy were less satisfied with the relationship than firms retaining control. Anand and Stern (1985) also found that parties viewing the loss of control as a threat to their legitimate right to make decisions counterbalanced by attributing success to themselves and by devaluing the worth of the relationship.

Anand and Stern (1985) show, however, that not all parties value their autonomy, realizing the benefits of relinquishing control. These dealers not only view the relationship as stable, but also attribute their success to the ability and guidance of others. In response, we would expect these dependent parties to be loyal to their partners. In light of limited empirical research, however, existing results indicate that the loss of control can contribute positively or negatively to the relationship's outcomes. While previous research supports the argument that dependence effects outcomes of relationships, the literature appears incon- clusive as to the direction of the effect.

Attitudes and Outcomes

Using Table 1 in conjunction with Figure 2, we extend our framework and propose that attitudes toward autonomy affect the impact of dependence on the relationship's outcomes.

Is Dependent What We Want To Be?

TABLE 1

Independent Constructs Desire for Autonomy

Low High

253

High Degree of Control Relinquished Congruent Incongruent (H: relationship Outcomes > 01(H: relationship outcomes< 0)

High Degree of Dependence upon Supplier Congruent Incongruent (H: relationship Outcomes > 0) (H: relationship outcomes< O)

D e p e n d e n t Behaviors

Bilateral I n t e r d e p e n d e n c e

Asymmet r i c D e p e n d e n t

Contro l Rel inquished

Adve rse A t t i tudes Toward D e p e n d e n c e

(-)

,k C h a n n e l

O u t c o m e s

Sat is fact ion

Business A l loca t ion

Revenue G e n e r a t e d

FIGURE 2

Model of Attitude--Behavioral Comparisons on Outcomes

Table 1 depicts both congruent and incongruent attitudes based on the compatibility of attitudes toward autonomy and dependent behaviors (investing in specific assets and relinquishing control). Congruency represents compatible attitudes and behaviors as parties hold a low desire for autonomy and experience satisfaction from deferring control to outside parties. In incongruent situations parties have a strong desire for autonomy, but because of their heavy investment in relationships (asset specific investments), relinquish control to protect their financial future (cf., Deci and Ryan, 1987). While congruent/incongruent situations exist where (1) desire for autonomy is high and control relinquished and dependence are low, and (2) desire for autonomy is low and dependence is low, we limit our focus to highly dependent relationships. These classifications best exemplify attitudes and behaviors that have emerged as most relevant in previous channel research (e.g., Fra- zier, Gill, and Kale, 1989; Kumar, Scheer, and Steenkamp, 1995)

In conjunction with Figure 2 and our theoretical foundation, TCA principles suggest that economic efficiency serves as the basis for decisions regardless of attitude/behavior incongruency. Congruency theory, and Thibaut and Kelley' s (1959) interpretation of dependency, however, argue that adverse attitudes toward dependence reduce the motivation to sustain


the quality of the relationship. We summarize from these adverse opposing views the general hypothesis that:

Adverse attitudes toward dependence, when dependence exists, reduce the effect dependence has on the relationship's outcomes.

Next, we empirically test this assertion by using bilateral interdependence, asymmetric dependence, and loss of control as measures of dependence to assess three previously used channel outcomes--dealer satisfaction (e.g., Anderson and Narns, 1990, 1984; Frazier, Gill, and Kale, 1989), dealer business allocation (e.g., Anderson, Lodish, and Weitz, 1989; Stump, 1995), and dealer revenue generated from the relationship (e.g., Heide and Stump, 1995).

HI: Adverse attitudes dealers hold toward their dependence, when dependence exists, reduce the effect bilateral interdependence, asymmetric dependence, and loss of control have on dealer satisfaction.

H2: Adverse attitudes dealers hold toward their dependence, when dependence exists, reduce the effect bilateral interdependence, asymmetric dependence, and loss of control have on the amount of business dealers allocate to that supplier.

H3: Adverse attitudes dealers hold toward their dependence, when dependence exists, reduce the effect bilateral interdependence, asymmetric dependence, and loss of control have on the revenue generated from the supplier relationship.

METHODOLOGY

Sample and Data Collection

The office systems and furniture industry offers an appropriate setting for testing the proposed relationships. Although dealers' access to over a hundred suppliers provides a wide range of dealer supply options, industry changes over the last two decades have increased the demand for systems products and efficient operations, encouraging dealers to limit their supply sources to a chosen few (NOPA, 1989). The supplier's contribution to dealer success relative to alternative suppliers serves as the basis for dealers' comparisons. Deal- ers' dependency on their suppliers involve not only their investment in specific assets, but also the expertise needed in selling, installing, and servicing the specialized offerings. The end users' (customers') reliance on dealers for their systems/furniture selections allows dealers to serve as an authority and influencer in the initial brand decision. Suppliers' formal programs supporting their product lines provide dealers the product and brand knowl-


edge demanded by their customers, allowing dealers and suppliers to better compete in the marketplace. The long-term future of the dealer and customer relationship, however, rests with dealers' ability to maintain their supply sources and assure product continuity for their customers.

With few exclusive territories and a 90-day contract clause, office systems and furniture dealers lack contractual protection, thus becoming hostage to suppliers' systems product lines and vulnerable to supplier control once the end-user adopts a particular brand. Deal- ers' dependence on any one supplier, however, is tempered by alternative sources of revenue. In the office systems/furniture industry, a significant portion of revenue is generated from the sale of traditional furniture,where the initial selection of a brand plays a less critical role in subsequent purchase decisions. Dealers, if held hostage by systems' suppliers, can reduce overall dependence by supplementing their assortment with traditional furniture from alternative sources.

Eighteen in-depth, pretest interviews were conducted with dealers in the industry to provide content and face validity for our measures. These unstructured discussions helped identify organizational concerns and perceptions of the dealer' s role, and also revealed key issues relevant in framing meaningful questions to assess organizational attitudes and behaviors. Realizing that respondents' predisposition could reduce the validity of the findings by misrepresenting organizational concepts and thus, biasing the data and attenuating error variance (Phillips and Bagozzi, 1986; Podsakoff and Dalton, 1987), key informants were selected based on their knowledge of the organization and the relevant issues pertain- ing to building and maintaining relationships. The pretest interviews revealed that the responsibility for assessing, selecting, and retaining vendors frequently fell to a single member of top management within the dealer organization. As informants these individuals provided responses representing the interest of the firm (Anderson, 1987).

Following the recommendation of Phillips (1981) respondents were chosen carefully. First, to ensure that the person completing the questionnaire was the individual primarily responsible for, and most knowledgeable about the organization and supplier relationships, companies were contacted in advance by telephone to identify or confirm the appropriate key informant. Subsequently, up to five telephone calls were made to each sampled dealer to identify and speak with this specific individual. For the 21 percent not reached, a questionnaire was addressed to the owner or president.

Questionnaires were mailed to 939 office systems and furniture dealers across the United States. After telephone contact, dealers received an initial questionnaire. Because we did not identify respondents in order to guarantee their anonymity, all dealers were sent a reminder card and a second questionnaire in the mail. Of the sample, 324 dealers com- pleted and returned the questionnaires, representing a 34.5 percent response rate. Dealers assessed their relationships with each of their top three suppliers. Several dealers were unable to evaluate three suppliers because their office systems and furniture purchases were limited to one or two supply sources. Of the possible 972 suppliers (324 responses x 3 suppliers), dealers evaluated 905 suppliers in total.

After collecting the data, we further validated the appropriateness of the informant to assure that dealers in the industry were sufficiently represented. Approximately 90 percent of informants reported their job title as president, vice-president, owner, chief executive officer, or general manager; thus confirming the pretest assertion that the appropriate


respondent is typically from upper management. Then, job titles were grouped into four classifications: (1) president, owner, and chief executive officer, (2) vice president, (3) general manager and marketing/sales/contract manager, and (4) other. One-way analysis of variance (ANOVA) calculations were performed on each respondent group for the survey questions to determine if there was a statistically significant difference (p < .05) between the respondent's position in the organization and his/her responses. Only the question ask- ing "the dealer's desire to independently solicit new accounts" significantly differed in mean responses between groups.

We then compared data reported by NOPA (1989) to the information collected in the survey to assess the representativeness of the sample relative to conditions characteristic of the industry. NOPA (1989) reported a 4 percent increase in gross sales for the office systems/furniture industry for the 1986-1988 period. The informants on average reported a 3.7 percent increase for the same time period. We also found that the percentage of the sample responding from each region of the country was within 5 percent of the number of dealers sampled from that region.

The last wave method was used to compare the first 75 percent of respondents returning the questionnaire with the last 25 percent responding to identify non-responsive sample bias (Armstrong and Overton, 1977). No significant differences existed between early and late respondents' assessments of items measuring bilateral interdependence, desire for autonomy, control relinquished, and satisfaction. T-tests indicated that none of the major organizational characteristics (i.e., annual sales volume, average rate of growth, number of full time employees, and percent of major on-going accounts) reported by early respondents differed significantly from those of late respondents. Based on this analysis we feel that the sampled informants represent office systems/furniture dealers in general and their evaluations reflect those of their respective organizations rather than the predisposition of the individual.

Measures: Dependent Variables

Satisfaction

As an outcome variable, satisfaction reflects an affective appraisal of all aspects of the working relationship (Anderson and Narus, 1990). A review of the literature and pre-test interviews identified nine issues reflecting dealers' attitude toward the treatment received and the value gained from their supplier relationships (cf. Anderson and Narus, 1984; Frazier, Gill, and Kale, 1989; Gaski and Nevin, 1985). Dealers were asked to respond to their level of satisfaction with nine global outcomes resulting from the relationship with each of their top three suppliers (Table 2). Satisfaction levels ranged from 1 (very dissatisfied) to 7 (very satisfied). The sum of nine items provided a global satisfaction assessment.

Is Dependent What We Want To Be?

TABLE 2

Scale I t e m s a n d Rel iabi l i t ies

257

Dealer Satisfaction (Alpha = .89) 1 = Very Dissatisfied 7 = Very Satisfied

_ _ Profits generated from manufacturer's product lines. _ _ Overall manner treated by manfacturer's regional office or headquarters. _ _ Overall "sales support" / relationship with manufacturer's local sales representitive. _ _ New product market opportunit ies manufacturer provides. _ _ Sales growth potential from carrying manufacturer's product lines. _ _ Overall fairness and honesty of manufacturer. _ _ Interest and concern manufacturer displays in helping to accomplish goals and objectives. _ _ Manufacturer's commitment to continuing overall marketing programs. _ _ Overall customer service levels provided by manufacturer.

Bilateral Specific Assets (Alpha = .72) 1 = Poor Performance 7 = Excellent Performance

_ _ Formal training programs in the area of facility management. _ _ Inventory management counseling and assistance. _ _ Formal sales training programs for dealer sales people.

Desire for Autonomy (Alpha = .77) 1 = Not Important to Make Your Own Decision 7 = Very Important to Make Your Own Decision

_ _ Margins on sales to dealer customers. _ _ Annual min imum volume quotas. _ _ Selection and breadth manufacturer's product line. _ _ Acceptance and adopt ion of new products / lines developed / acquire by manufacturer. _ _ Degree of independent / unsolicited participation by manufacturer. _ _ Size, investment, and appearance of dealer showroom (the lines displayed). _ _ Abil i ty / f reedom to select product lines from compet ing manufacturers. _ _ Procedures and techniques used to develop selling skills and account mangement for dealer sales people. _ _ Ability / freedom to sell a manufacturer's products outside the dealer's implied / authorized sales territory.

*Control Relinquished (Alpha = .86) 1 = Mfr. Has Complete Control 7 = Dealer Has Complete Control

_ _ Margins on sales to dealer customers. _ _ Annual min imum volume quotas. _ _ Selection and breadth of manufacturer's product line. _ _ Acceptance and adopt ion of new products / lines developed / acquired by manufacturer. _ _ Degree of independence / unsolicited participation by manufacturer in selling new large accounts. _ _ Size, investment, and appearance of dealer showroom (the lines displayed). _ _ Abil i ty / f reedom to select product lines from competing manufacturers. _ _ Procedures and techniques used to develop selling skills and account mangement for dealer sales people. _ _ Ability / freedom to sell a manufacturer's products outside the dealer's implied / authorized sales territory.

Business Dealers Supply Sources Allocation

The objective measure, the amount of business dealers allocate to their supply sources, was used to assess the effect bilateral interdependence, asymmetric dependence, and control relinquished had on purchase behavior. A similar measure was used by Stump (1995) to assess the impact of specific assets on resource concentration. The allocation measure requested dealers to indicate their purchasing arrangements with respect to the entire range


of their office furniture and systems supply choices. This measure is especially relevant to our study because specific assets (systems products and training), while serving as only one basis for achieving goals, represent an important motivational investment. Business allocation also captures the response to availability of alternatives and the impact of specific asset dependence and control on purchase decisions. In the office systems and furniture industry, dealers have several alternative brands of systems in which to choose. The original purchase decision is based, in part, on the support and service provided by suppliers. Customer adoption of a specific systems brand forces dealers to allocate additional business to support their customers' needs and requests. To obtain this behavioral response, each dealer was asked to indicate "the percent that each manufacturer (each dealer's three major suppliers) currently represents of your annual purchases of office systems/furniture." Potential responses for business allocation ranged from 0 to 100 percent.

Revenue Generated

The amount of business allocated to each supplier could be viewed as a behavioral measure of supplier dependence, a behavioral response to dealer dependence, a source for generating dealer revenue (Frazier, Gill, and Kale, 1989), and a means for achieving supplier and dealer goals (Pfeffer and Salancik, 1978). To obtain the amount of business allocated to each supplier the percent of business allocated to each of its top three office systems and furniture suppliers, the percent of business the dealer generates from office systems and furniture, and the dealer's annual sales revenue were multiplied. The log of this number was then taken to lessen the impact that a small number of unusually large dealers would have on results. For instance, the dealers sampled had a median office system/furniture sales score of $2 million with only 10 percent of the sample recording sales above $12 million (top score -- $53 million).

Measures: Independent Variables

Bilateral Interdependence (Bilateral specific assets (BSA))

Heide and John (1988) note that specific assets create interorganizational dependence through their reduced value outside the relationship. Bilateral specific assets (BSA) represent specific assets that each party has a shared interest in maintaining and indicate the con- text of the relationship (Deci and Ryan, 1987; Oliver, 1991). Table 2 contains the items comprising the BSA scale. Items include specialized programs and assistance suppliers often provide to help dealers promote, service, market, and manage their brand of products. These involve the investment in time and effort of supplier personnel. Similarly, dealers invest resources in the relationship by sending employees to training sessions to learn specialized skills. For example, suppliers often invest resources in training dealers to tailor computer software and other computer technology to enhance facility management for streamlining the ordering and delivery process and selling and servicing their specialized


product line (NOPA, 1989). In return, dealers invest employee time and effort to become knowledgeable about computer interfacing and product features specific to the supplier's line. Special training programs are particularly important when relationships involve systems products because of the specific knowledge required in selling, designing, ordering, installing, and servicing these products. The investment in specialized training by both parties, however, has little value outside the relationship.

Each dealer was asked to rate the performance of its top three suppliers on a scale of 1 (poor) to 7 (excellent) regarding the quality of formal training programs offered in the area of facility management, inventory management counseling, and formal sales training. The items were summed to provide a scale reflecting bilateral specific assets (BSA).

Asymmetric Dependence (Asymmetric Specific Assets (ASA))

Asymmetric specific assets refer to investments that create dependence asymmetry by generating high switching costs for one party (Jackson, 1985). This state is particularly prevalent in the office systems/furniture industry where systems product design and com- ponent parts are incompatible among suppliers. Once end users purchase a particular supplier line of systems products, changing suppliers is much more disruptive than simply changing dealers. The threat that customer loyalty may shift from dealers to a specific supplier's product line creates disproportionate dependence in the relationship between dealers and suppliers.

The construct, asymmetric specific assets, was configured as a dichotomous variable. Respondents indicated whether they limited their purchases to traditional furniture (e.g., desks, chairs) or purchased systems furniture (e.g., panels and connected work surfaces) from the supplier. (To be considered a systems user, dealers could also include traditional furniture in their orders.) We chose to use the dichotomous measure (absence or presence of systems products) because selling part or all of a specific line of system products to customers places dealers in an asymmetric hostage situation with the supplier.

Dealers were asked to indicate whether or not they purchased systems furniture from each of their three major suppliers. Responses were coded 0 or 1 to reflect the absence or presence of system purchases, respectively. Of the 905 supplier evaluations, at least some systems products were purchased from 515 suppliers (responses = 1), while dealers limited their purchases to traditional office furniture (e.g., desks, chairs) in their relationships with 390 suppliers (response = 0).

Control Relinquished (CPO

Control relinquished has been described in the literature as "exercised power" or the "actual alteration of another's behavior" or "outcome" (Gaski, 1984, p. 24). To assess control relinquished, dealers were asked to attribute their actions to either themselves or their supplier. Specifically dealers were asked "who had the most influence or leverage (the manufacturer or yourself) over the actual decision made," concerning nine controversial marketing issues affecting the dealer's dependency on the supplier (Table 2). The scale


ranged from 1 (manufacturer has complete control) to 7 (dealer has complete control). Responses were then reversed to reflect control relinquished.

Moderator Variables

Desire for Autonomy

Desire for autonomy has been defined as the "desire to operate within the current domain of decision making without outside interference" (Hunt, Mentzer, and Dane, 1987, p. 380). Desire for autonomy was chosen based on the (in)congruency between the attitude toward desiring autonomy and being dependent and relinquishing control. The same nine issues selected for the control relinquished scale were used to measure the desire for autonomy. Dealers were asked to indicate "how important is it to you to make your own decisions free of the influence of the manufacturer" on a scale of 1 (not important) to 7 (very important). The nine summed items created the desire for autonomy scale.

The scales representing satisfaction, bilateral dependence, control relinquished, and desire for autonomy consisted of the domain of items considered by dealers to be the essential issues confronted when evaluating their position with respect to each construct. Because of the formative nature of the items in the scales, the appropriateness of coeffi- cient alpha for assessing internal consistency is questionable. The alphas of .89, .72, .77, and .86 suggest, however, that the items are homogeneous with respect to their domain (cf. Bollen and Lennox, 1991). Table 3 contains the summary statistics for the measures reported in our study.

Congruency/ Incongruency

Because attitudes and behaviors often conflict, causing incongruency within relationships, the desire for autonomy scale was used to subdivide the sample into two relatively equal parts (high and low) based on a median split. A median split was chosen in order to assess the strength of the relationship (Sharma, Durand, and Gur-Arie, 1981) while still retaining the entire sample for analyses, thus reducing the probability of sampling error (Hunter, Schmidt, and Jackson, 1982).

Marketing studies have also used difference scores to assess incongruency within channel relationships (See Peter, Churchill, and Brown, 1993 for an excellent discussion). We chose not to use this method of analysis for several reasons. First, creating difference scores can jeopardize the integrity of the underlying constructs (i.e., desire for autonomy, control relinquished, bilateral interdependence, and asymmetric dependence) by creating a new construct (incongruency). Second, our study assessed congruency/incongruency between attitudes toward desire for autonomy and several behavioral measures (i.e., control relinquished, bilateral interdependence, and asymmetric dependence). Creating difference scores for the various incongruent behaviors could cause multicollinearity problems

TABL

E 3

Mea

ns, S

tand

ard

Dev

iatio

ns a

nd C

orre

latio

ns

r~

f~

Cor

rela

tion

Mat

rix

Var

iabl

es

Full

Sam

ple

(N =

905

)

Mea

ns

S. D

. 1

2 3

4 5

6 7

1.

Sat

isfa

ctio

n 4.

85

1.19

1.

00

2.

Bus

ines

s Allo

cate

d 22

.84

24.1

.2

6 1.

00

3.

Rev

enue

Gen

erat

ed

12.8

5 1.

65

.08

.51

1.00

4.

B

ilate

ral

Inte

rdep

ende

nce

2.95

1.

90

.37

.49

.36

1.00

.4

6 5.

A

sym

met

ric D

epen

denc

e a

.57

.50

.10

.38

.42

.52

1.00

6.

C

ontr

ol R

elin

quis

hed

4,34

1.

60

-.01

-.

17

-.

09

-.

16

.4

6 1.

00

7.

Des

ire f

or A

uton

omy

5.28

1.

04

.15

.14

.14

.21

.16

.04

Low

Des

ire f

or

Hig

h D

esire

for

V

aria

bles

A

uton

omy

(N =

427

) A

uton

omy

(N =

478

) *C

orre

latio

n M

atrix

Mea

ns

S. D

. M

eans

5.

D.

1 2

3 4

5 6

1.

Sat

isfa

ctio

n 4.

71

1.12

4.

98

1.24

1.

00

.24

.13

.32

.13

.06

2.

Bus

ines

s Allo

cate

d 25

.25

22.4

3 30

.92

25.0

8 .2

6 1.

00

.46

.45

.36

-.1

6

3.

Rev

enue

Gen

erat

ed

12.6

8 1.

58

13.0

0 1.

70

.03

.55

1.00

.3

0 .3

4 -.

11

4.

Bila

tera

l In

terd

epen

denc

e 2.

72

1,85

3.

16

1.93

.3

9 .5

1 .3

9 1.

00

.53

-.1

7

5.

Asy

mm

etric

Dep

ende

nce a

.5

2 .5

0 .6

1 .4

9 .0

4 .3

8 .4

8 .4

5 1.

00

-.4

8

6.

Con

trol

Rel

inqu

ishe

d 4.

32

1.68

4.

35

1.53

-.

03

-.19

-.

08

-.

16

.4

4 1.

00

1.00

Oa

.,xa

Not

es:

a.

Bis

eria

l cor

rela

tions

; *C

orre

latio

ns a

bove

dia

gona

l are

low

des

ire f

or a

uton

omy

subs

, am

ple,

bel

ow d

iago

nal a

re h

igh

desi

re f

or a

uton

omy.


TABLE 4

Sca le I t e m s a n d Factor L o a d i n g s

Variables Factors

Satisfaction 1 2 3 4 5

Profits generated from manufacturer Manufacturer treatment Sales support New product opportunities Sales growth potential Fairness and honesty of manufacturer Display of interest and concern Commitment to continuing programs Customer service levels

Eigenvalue = 5.63 Explained Variance = 18.8%

Control Relinquished 1 Margins on sales -.084 Minimum volume quotas -.055 Selection and breadth of product line -.031 Adoption of new products -.028 Unsolicited manufacturer participation in selling new accounts -.012 Products displayed in showroom -.012 Freedom to select products from competing manufacturers .033 Selling skills and account management techniques .069 Freedom to sell manufacturer's product outside the authorized sales territory .038


Desire for Autonomy Margins on sales Minimum volume quotas Selection and breadth of product line Adoption of new products Unsolicited manufacturer participation in selling new accounts Products displayed in showroom Freedom to select products from competing manufacturers Selling skills and account management techniques


Bilateral Interdependence 1 Formal facility management .255 Inventory management counseling .085 Formal sales training programs .281


*Freedom to sell manufacturer's product outside the authorized sales territory -.047


.549 -.033 -.018 -.382 -.039

.774 -.039 .016 -.117 .092

.755 -.018 .070 .097 .011

.701 .123 .079 .225 -.037

.713 -.022 . 1 5 3 .186 -.032

.765 -.071 .019 -.118 .019

.810 .042 . 0 3 5 .216 -.002

.696 -.041 . 1 1 1 .335 -.098

.711 -.018 .046 .283 -.041

2 3 4 5

.637 -.033 .122 .068

.609 -.005 .147 -.100

.694 .081 -.141 -.425

.661 .107 -.176 -.442

.690 .004 .116 .231

.721 .021 -.032 .334

.751 .050 -.018 -.057

.754 .130 -.082 -.055

.736 . 0 4 5 .034 .130

1 2

.018 .045 -.O27 -.030

.065 .018

.088 .054

.001 .067

.144 .043 -.025 .059

.172 -.012

3 4 5

.526 .047 .112

.541 .231 -.122

.701 .039 -.165

.716 -.026 --.028

.618 .133 .078

.595 -.053 .228

.633 -.143 .110

.572 .104 -.017

2 3 4 5

.084 .128 .807 -.042

.017 .000 .535 .169

.024 .166 .795 -.087

.124 .327 .021 .510

Note: *Included in the Desire for Autonomy Scale.


in the regression analyses. Third, the consistently higher scores for desire for autonomy (5.28) compared to bilateral interdependence (2.95) and the dichotomous values of asymmetric dependence (0 = only traditional furniture; 1 = systems furniture or systems and traditional furniture) could restrict the variance and produce erroneous conclusions.

To avoid these potential problems, we chose to assess the incongruency between attitudes and behaviors by splitting desire for autonomy into high and low groups and employ- ing regression analysis with regard to the original constructs (See Table 2). We then compared beta differences between group results to assess the impact of incongruency on relational and economic outcomes.

Prior to testing the hypothesized relationships a principal components factor analysis with varimax rotation was performed on all scale items. As indicated in Table 4, all items except one loaded on their respected factor reconfirming the underlying structure of the data, the discriminant validity between scale items, and the convergent validity among scale items. We chose to retain the one ill-fitting item, "your desire to make your own decision concerning your ability/freedom to sell a manufacturer's products outside your implied/authorized sales territory," to maintain the consistency between activities assessing control relinquished and activities assessing desire for autonomy. Although dimension- ality is not essential when creating formative scales (Bollen and Lennox, 1991), a separate analysis evaluating the individual desire for autonomy factor structure supported a single dimension despite the inclusion of the item.

We also assessed the discriminant validity of the measures by running a model with all measures set to load on the appropriate traits and allowing the traits to correlate. This model was compared with a series of models in which inter-trait correlation was set to unity (c.f. Heide and John, 1990). In each case discriminability was evidenced by the statistically significant ~2 difference between the models. For example, the test of discrimina- tion between revenue generated and bilateral interdependence is statistically significant (Z 2 (2) = 8.129, p < .001). Results suggest that these measures represent separate constructs and not indicators of overall dependence.

RESULTS AND DISCUSSION

To test the hypotheses, we followed Sharma, Durand and Gur-Arie's (1981) recommendation to split the sample into subgroups based on a third variable. As shown in Table 5, we divided the sample into two relatively equal parts based on a median split of the informants' (dealers') desire for autonomy. A median split allowed us to determine high and low assessments of desire for autonomy relative to the views of dealers in our sample while using the entire sample for analyses. A t-test was then conducted to insure that the desire for autonomy means differed between the two groups (p = .000). High desire for autonomy (n = 478) serves as a surrogate for incongruency in that dealers, although desiring independence, deepen their relationships through specific assets and relinquishing control. Low desire for autonomy (n = 427) represents attitude/behavior congruency as dealers with a low desire for autonomy behave consistently with their desires by increasing dependence through specific asset investments and relinquishing control.

264

TABLE 5

Journal of Retailing Vol. 74, No. 2 1998

M u l t i p l e Regress ion Results

,4.

Desire Low High Moderator Model for Desire for Desire for (Significance of

Autonomy Autonomy Autonomy Difference) Dependent Variable Dealer Satisfaction

Independent Variables (n = 855) (n = 427) (n = 428)

Constant 4.047*** 3.967*** 4.184"** p _< .01 Bilateral Specific Assets (BSA) .448*** .352*** .516"** p _< .01 Asymmetric Specific Assets (ASA) - .129"** -.034 - .219"** p < .01 Control Relinquished (CR) .051 .071 .033 ns Multiple R .391 .331 .438 Adjusted R Squared .150 .103 .186 Chow Test a F = 3.95

(p_ .01)

B. Dependent Variable Business Allocation Independent Variables (n = 785) (n = 378) (n = 377)

Constant 13.575"** 12.269"** 16.370"** Bilateral Specific Assets (BSA) .353*** .323*** .365*** Asymmetric Specific Assets (ASA) .247*** .228*** .268*** Control Relinquished (CR) -.081 ** -.054 -.115** Multiple R .548 .497 .584 Adjusted R Squared .298 .241 .335 Chow Testa

C. Dependent Variable Business Allocation Independent Variables (n = 755) (n = 378) (n = 377)

Constant 11.829'** 12.037"** 11.662"** Bilateral Specific Assets (BSA) .185*** .163*** .185*** Asymmetric Specific Assets (ASA) .323 * * * .252 * ** .392" * * Control Relinquished (CR) -.010 -.038 .012 Multiple R .451 .374 .514 Adjusted R Squared .200 .133 .258 Chow Test a

p < .O5 ns

ns

ns

F = 2.85 go < .05)

ns

ns p < .01

ns

F = 2.67 (p < .05)

Notes: *p <- .05; **p -< .01; ***p < .001 a. Critical F Value (p = .01) = 3.32; (p = .05) = 2.37.

A Chow test was then used to describe the congruent/incongruent effects of attitudes and behaviors on each of the three outcomes (satisfaction, business allocation, revenue generated). Sharma, Durand, and Gur-Arie (1981) suggest using the Chow test for assessing equality between regression coefficients in identically specified equations for different populations. As shown in Table 5, a series of multiple regressions were used for each Chow test. The first regression analysis assessed dealer satisfaction in relationships characterized by congruency. The three independent variables BSA, ASA, and CR in the low desire for autonomy group were entered simultaneously to determine the effect positive attitudes toward dependence had on satisfaction. The second regression analysis assessed dealer sat-


isfaction in relationships characterized by incongruency using the same independent and dependent variables (BSA, ASA, CR, and satisfaction) as in the first regression equation, but under adverse attitude (high desire for autonomy) conditions. The Chow test revealed statistically significant results (p < .01). We conclude that differences in attitudes toward dependence under conditions of dependence significantly affect dealer satisfaction.

Because the Chow test is a global test of significant differences across sub-samples, further analyses are needed to identify the source and direction of these differences. To obtain the source and direction of influence on dealer satisfaction, the three independent variables (BSA, ASA, and CR), the moderator variable (desire for autonomy), and the interaction residuals between each independent variable and the moderator were entered into a regression equation. Using interaction residuals, rather than the interaction terms, allowed us to minimize potential multicollinearity problems caused by high correlation between cross- product and main effect terms (Lance, 1988).

Table 5 shows the best fitting model for assessing the moderating effect of desire for autonomy. Results suggest that desire for autonomy has: (1) a significant positive moderating effect, increasing the impact of bilateral specific assets on dealer satisfaction; (2) a significant negative moderating effect, reducing the impact of asymmetrical specific assets on dealer satisfaction; and (3) no significant moderating effect on the impact of control relinquished on dealer satisfaction. Our results, therefore, only partially support H1 which proposed that adverse attitudes dealers hold toward their dependence reduce the effect of dependence on dealer satisfaction. Although not formally hypothesized, we also found that satisfaction significantly differed between low and high desire for autonomy dealer subgroups (p < .01). Dealers holding a high desire for autonomy indicated a greater satisfaction with their major suppliers than dealers holding a lower desire for autonomy.

The next set of multiple regression equations assesses dealer business allocations using the same three independent variables (BSA, ASA, and CR) and the same positive and adverse attitude subgroups. The Chow test also revealed statistically significant results (p < .05). To obtain the source and direction of influence, we ran a similar regression analysis as before, but with business allocation as the dependent variable. As shown in Table 5, desire for autonomy has: (1) no significant moderating effect on the impact of BSA on business allocation; (2) no significant moderating effect on the impact of ASA on business allocation; and (3) no significant moderating effect on the impact of CR on business allocation. H2, which proposed that adverse attitudes dealers hold toward their dependence reduce the effect of dependence on business allocations, was not supported. We did find, however, that business allocation significantly differed between low and high desire for autonomy subgroups (p < .05). Dealers holding a higher desire for autonomy allocated a greater share of their business to their major suppliers than the low desire for autonomy dealers.

The final Chow test assessed economic outcomes (revenue generated from the relationship), using the same independent variables as in the previous two analyses (BSA, ASA, and CR). Again desire for autonomy was used to split the sample into positive attitude and adverse attitude subgroups. The Chow test also revealed significant results (p < .05) for the two subgroups for revenue generated from the relationship. Multiple regression was also used to identify the source and direction of influence desire for autonomy has on the effect dependence has on revenue generated from the relationship. Results suggest that desire for


autonomy has (1) no significant moderating effect on the impact of BSA on revenue generated; (2) a significant positive moderating effect, increasing the impact of ASA on revenue generated; and (3) no significant moderating effect on the impact of CR on revenue generated. H3, which proposed that adverse attitudes dealers hold toward their dependence reduce the effect of dependence on revenue generated from the relationship, was not supported. The results also revealed that the revenue generated from the relationship did not significantly differ between subgroups.

CONCLUSIONS

Prompted by a paucity of research directed toward understanding inconsistencies between dependence and channel outcomes, this study considered the role of congruency when discrepancies existed between attitudes toward dependence and dependent situations. Consis- tent with previous research, we found that asset specific dependence, both asymmetric and bilateral, influences relational and economic outcomes (satisfaction, business allocation, and revenue generated).

Our results, however, challenge the arguments of congruency theory and the social exchange perspective of dependency theory. Congruency theory suggests that adverse attitudes toward dependence, under conditions of dependence, negatively affect the ability of a channel member to work effectively in building relationships and should be counter pro- ductive in generating revenue. The social exchange perspective of dependency theory parallels congruency theory by arguing negative attitudes toward dependence, when dependence exists, decreases the value of the relationship (Thibaut and Kelley, 1959). We found only partial support for these contention. Our results suggest that attitude/behavior discrepancies play a significant adverse moderating role in relationships between dependence and outcomes in select dependent situations. We found that the desire for autonomy had a negative moderating effect only when dependence involves asymmetric specific investments and satisfaction represents the outcome of interest.

Contrary to the hypothesized relationship, desire for autonomy had a positive moderating effect on asymmetric specific investments' impact on revenue generated. While chal- lenging the foundation of congruency theory, this finding suggests that adversity may be functional when economic interests are at stake. Partners experiencing self-serving, independent desires in the presence of asymmetric dependence appear to use adversity as a motivating force for generating additional revenue. Dealers may also realize that forgoing autonomy in the short term increases revenue and enhances economic power, reducing their dependence in the future (Little, 1970).

Principles of congruency theory were also challenged by our findings. When bilateral specific assets served as the basis for dependence, and satisfaction represented the outcome variable, the desire for autonomy had a positive, rather than an adverse, moderating effect. Supportive of this view, Anand and Stern (1985) found adversity can influence outcomes positively when parties credit a portion of their success to themselves. Respondents, therefore, may view their partner' s share of bilateral dependence as an indication of their own


contribution to the success of the relationship. As a result, dealers may feel less vulnerable and more satisfied with the relationship.

We also found that adverse attitudes toward dependence, when dependence exists, was not always responsible for shifts in outcomes. While TCA supporters might argue that parties place little value on their desires when economic gains are at stake, another viable explanation resides in the tolerance underlying the character of relationships (cf. Bucklin, 1973). Parties may view the relationship as a means to an end, choosing to tolerate adversity rather than respond to their dependent positions.

Our analyses also revealed differences between low and high autonomy dealer subgroups. High desire for autonomy dealers displayed greater satisfaction and rewarded their major suppliers a larger share of their business allocations than low desire for autonomy dealers. The presence of a positive direct effect on satisfaction and business allocation again contradicts the rationale of social exchange theory that emphasizes the importance of favorable emotions in motivating positive relational outcomes (Thibaut and Kelley, 1959). Our findings, however, lend support to the recent conflict literature that maintains that conflict can be functional within limits.

As we revisit the question "Is dependent what we want to be?" we find that dealers should not necessarily want to be dependent on others, but dependence should not be dreaded as some research suggests (c.f., Frazier, Gill, and Kale, 1989; Heide and John, 1988). Rather, dependence should continue to be viewed as a state of affairs that contrib- utes toward organizational goals if handled diplomatically. Future research, however, should not ignore congruency/incongruency as a motivating force in business relationships as we look for explanations for discrepancies in previous research. As our results suggest, desire for autonomy when dependence exists may increase, decrease, or have little effect on relational and economic outcomes. Desire for autonomy, when isolated from other influences, seems to impact relational (satisfaction and business allocations) but not economic outcomes (revenue generated).

Conclusions regarding the results of the study should be tempered by the following lim- itations, while providing direction for future research. First, a single industry served as the basis for our arguments, analyses, and conclusions. While this limits the generalizability of the findings, we believe other industries struggle to solve similar problems (cf. Frazier, Gill, and Kale, 1989). Second, although numerous studies use dealer perceptions of interdependence (e.g., Anderson and Weitz, 1989; Heide, 1994), responses from one side of the dyad (dealer) provide a limited perspective of the viability of the relationship. Also of value would be quantitative as well as qualitative measures of bilateral specific assets. This addition would provide the opportunity to validate the underlying financial and social contribution of bilateral specific assets.

Future research might also consider the causal effects proposed in our model. The possibility exists that specific assets first increase business allocations. As business allocations increase so should dependence and the desire for autonomy. If our results hold, rather than dealers' attitudes and behaviors shifting to reflect their need to reduce vulnerability, as found by Hunt, Mentzer, and Dane (1987) and Ring and Van de Ven (1994), dealers may experience deeper ties regardless of adversity. The positive link found between specific assets and financial performance could also be due to an inverse relationship. Dealers may form relationships with the strongest suppliers because of their ability to generate the best


results (Little, 1970). Dependence in this situation would be a consequence of financial performance rather than a motivating factor driving the relationship.

Although the present study investigates existing relationships, future research should address the effect of adverse attitudes on relationships that failed. Analyzing dysfunctional relationships might provide a better understanding of the negative impact adverse attitudes and the lack of tolerance have on relationships.

We also must caution readers that our survey questions, such as those comprising the bilateral specific assets scale, may be misconstrued as general investments rather than assets specific to the relationship. We hesitate to rule out such alternative interpretations. Industry observations and presumed self-interest motives of suppliers suggest that suppliers' investments in sales training programs and facility management reflect supplier poli- cies and objectives that provide both dealers and suppliers a competitive advantage rather than promoting the interest of the office furniture industry in general. For example, a pro- gram suppliers offer to support facility management involves computer aided design and planning software (NOPA, 1989). These tools increase efficiency and link dealers and manufacturers.

We also would like to mention the potential problem of response bias when pooling the data across dealers. We could not be sure that this bias would be negligible before collecting the data. We felt, however, that including a major portion of the organizational set (three top suppliers) was important in realistically assessing the effect adverse attitudes toward dependence would have on the effect dependence has on the relationship's outcomes. We could have minimized this particular problem by standardizing the data, but a transformation could have presented an additional problem by altering the meaning of the actual responses (c.f., Anderson, Lodish, and Weitz, 1987). We address, however, the potential multicollinearity problem in part by using interaction residuals, rather than the interaction terms in our regression analyses (Lance, 1988).

Finally, potential problems associated with the use of single key informants could be reduced by using multiple reports and comparing the affect of attitudes on the evaluation of channel outcomes. Multiple informants would further validate our attempt to assess the views of the organization rather than the predisposition of the individual.

Acknowledgment: The authors thank the current editor, Charles Ingene, Rod Davis, Nirmalya Kumar, Catherine McCabe, and the three reviewers for their helpful comments.

REFERENCES

Abelson, Robert P. (1959). "Modes of Resolution of Belief Dilemma," Journal of Conflict Resolu- tion, 3(4): 343-352.

Anand, Punam and Louis W. Stern. (1985). "A Sociopsychological Explanation for Why Marketing Channel Members Relinquish Control," Journal of Marketing Research, 22 (November): 365- 376.

Anderson, Erin. (1985). "The Salesperson as Outside Agent or Employee: A Transaction Cost Anal- ysis," Marketing Science, 4 (Summer): 234-254.


Anderson, Erin, Leonard M. Lodish, and Barton A. Weitz. (1987). "Resource Allocation Behavior in Distribution Channels," Journal of Marketing Research, 24 (February): 254-262.

Anderson, Erin and Barton A. Weitz. (1989). "Determinants of Continuity in Conventional Industrial Channel Dyads," Marketing Science, 8 (Fall): 310-323.

. (1992). "The Use of Pledges to Build and Sustain Commitment in Distribution Channels," Journal of Marketing Research, 24 (February): 18-34.

Anderson, James C. (1987). "An Approach for Confirmatory Measurement and Structural Equation Modeling of Organizational Properties," Management Science, 33 (April): 525-541.

Anderson, James C. and James A. Narus. (1984). "A Model of the Distribution--Manufacturer Working Relationship," Journal of Marketing, 48 (Fall): 62-74.

. (1990). "A Model of Distributor Firm Working Partnerships," Journal of Marketing, 54 (January): 42-58.

Armstrong, Scott J. and Terry S. Overton. (1977). "Estimating Nonresponse in Mail Surveys," Jour- nal of Marketing Research, 18 (August): 396-402.

Bollen, Kenneth A. and Richard Lennox. (1991). "Conventional Wisdom on Measurement: A Struc- tural Equation Perspective," Psychological Bulletin, 110 (2): 305-314.

Bonoma, Thomas V. (1976). "Conflict, Cooperation and Trust in Three Power Systems," Behavioral Science, 21 (November): 499-514.

Bucklin, Louis P. (1973). "A Theory of Channel Control," Journal of Marketing, 37 (January): 39- 47.

Deci, Edward L. and Richard M. Ryan. (1987). "The Support of Autonomy and the Control of Behav- ior," Journal of Personality and Social Psychology, 56 (6): 1024-1037.

Douglas, Mary. (1990). "Converging on Autonomy: Anthropology & Institutional Economics." Pp. 98-115 in Oliver E. Williamson (Ed.), Organizational Theory from Chester Barnard to the Present and Beyond. New York: Oxford University Press.

Dwyer, F. Robert, Paul H. Schurr, and Sejo Oh. (1987). "Developing Buyer-Seller Relationships," Journal of Marketing, 52 (April): 21-34.

Etzioni, A. (1961 ). A Comparative Analysis of Complex Organizations. New York: Free Press of Glencoe.

Frazier, Gary L., James D. Gill, and Sudhir H. Kale. (1989). "Dealer Dependence Levels and Recip- rocal Actions in a Channel of Distribution in a Developing Country," Journal of Marketing, 53 (January): 50-69.

Gaski, John F. (1984). "The Theory of Power and Conflict in Channels of Distribution," Journal of Marketing, 48 (Summer): 9-29.

Gaski, John F. and John R. Nevin. (1985). "The Differential Effects of Exercised and Unexercised Power Sources in a Marketing Channel," Journal of Marketing Research, 22 (May): 130-142.

Goldman, Kevin. (1994). "At AC&R, It' s One Thing After Another," Wall Street Journal (May l 0), BS.

Gundlach, Gregory T. and Patrick E. Murphy. (1993). "Ethical and Legal Foundations of Relational Marketing Exchanges," Journal of Marketing, 57 (October): 35-46.

Heide, Jan B. (1994). "Interorganizational Governance in Marketing Channels," Journal of Market- ing, 58 (January): 71-85.

Heide, Jan B. and George John. (1988). "The Role of Dependence Balancing in Safeguarding Trans- action-Specific Assets in Conventional Channels," Journal of Marketing, 52 (January): 20-35.

. (1990). "Alliances in Industrial Purchasing: The Determinants of Joint Action in Buyer- Supplier Relationships," Journal of Marketing Research, 27 (February): 24-36.

Heide, Jan B. and Anne S. Miner. (1992). "The Shadow of the Future: Effects of Anticipated Inter- action and Frequency of Contact on Buyer-Seller Cooperation," Academy of Management Journal, 35(2): 265-291.


Heide, Jan B. and Rodney L. Stump. (1995). "Performance Implications of Buyer-Supplier Relation- ships in Industrial Markets," Journal of Business Research, 32 (January): 57-66.

Hinde, Robert A. (1979). Towards Understanding Relationships. New York: Academic Press. Hunt, Kenneth A., John T. Mentzer, and Jeffrey E. Dane. (1987). "The Effect of Power Sources on

Compliance in a Channel of Distribution: A Causal Model," Journal of Business Research, 11 (May): 186-193.

Hunter, John E., Frank L. Schmidt, and Gregg B. Jackson. (1982). Cumulating Research Findings Across Studies. Beverly Hills, CA: Sage Publications.

Jackson, Barbara B. (1985). "Build Customer Relationships That Last," Harvard Business Review, 63: 120-128.

Kasulis, Jack J. and Robert E. Spekman. (1980). "A Framework for the Use of Power," European Journal of Marketing, 14 (4): 180-191.

Kelley, Harold, H. and John W. Thibaut. (1978). Interpersonal Relations: A Theory of Interdepen- dence. New York: John Wiley & Son. Inc.

Kumar, Nirmalya, Lisa K. Scheer, and Jan-Benedict E. M. Steenkamp. (1995). "The Effects of Per- ceived Interdependence on Dealer Attitudes," Journal of Marketing Research, 32 (August): 348- 356.

Lance, Charles E. (1988). "Residual Centering, Exploratory and Confirmatory Moderator Analysis, and Decomposition of Effects in Path Models Containing Interactions," Applied Psychological Measurement, 12 (June): 163-175.

Lawler, Edward J. and Jeongkoo Yoon. (1996). "Commitment in Exchange Relations: Test of a The- ory of Relational Cohesion," American Sociological Review, 61 (February): 89-108.

Little, Robert W. (1970). "The Marketing Channel: Who Should Lead This Extra-Corporate Enter- prise," Journal of Marketing, 34 (January): 31-38.

Morgan, Robert M. and Shelby D. Hunt. (1994). "The Commitment-Trust Theory of Relationship Marketing," Journal of Marketing, 58 (July): 20--38.

National Office Products Association (NOPA) (1989). Winning Strategies for the 1990s: Profitable Options for Contract Furniture Dealers. Philadelphia: Wharton Center for Applied Research.

Oliver, Christine. (1991). "Network Relations and Loss of Organizational Autonomy," Human Rela- tions, 44 (9): 943-961.

Osgood, Charles K. and Perry H. Tannenbaum. (1955). "The Principle of Congruity in the Prediction of Attitude Ch~' gc," The Psychological Review, 62 (January): 42-55.

Palay, Thomas ~:. (1984). "Comparative Institutional Economics: The Governance of Rail Freight Contracting," The Journal of Legal Studies, 13: 265-287.

Peter, J. Paul, Gilbert A. Churchill, Jr., and Tom J. Brown. (1993). "Caution in the Use of Difference Scores in Consumer Research," Journal of Consumer Research, 19 (March): 655-662.

Pfeffer, Jeffrey and Gerald R. Salancik. (1978). The External Control of Organizations. New York: Harper and Row.

Phillips, Lynn W. (1981). "Assessing Measurement Error in Key Informant Reports: A Methodolog- ical Note on Organizational Analysis in Marketing," Journal of Marketing Research, 18 (Novem- ber): 395-349.

Phillips, Lynn W. and Richard Bagozzi. (1986). "On Measuring Organizational Properties of Distri- bution Channels: Methodological Issues in the Use of Key Information." Pp. 313-369 in J.N. Sheth (Ed.), Research in Marketing, Vol. 8. Greenwich, CT: JAI Press.

Podsakoff, Phillip M. and Dennis R. Dalton. (1987). "Research Methodology in Organizational Stud- ies," Journal of Management, 13 (June): 410---441.

Pondy, Louis R. (1967). "Organizational Conflict: Concepts and Models," Administrative Science Quarterly, 7 (September): 296-320.


Raven, Bertram and Ari Kruglanski. (1970). "Conflict and Power." Pp. 270-311 in Paul Swingle (Ed.), The Structure of Conflict. New York: Academic Press.

Ring, Peter S. and Andrew H. Van de Ven. (1994). "Developmental Processes of Cooperative Inter- organizational Relationships," Academy of Management Review, 19 (January): 90-118.

Schaefer, Earl S. and Charles K. Burnett. (1987). "Stability and Predictability of Quality of Women's Marital Relationships and Demoralization," Journal of Personality and Social Psychology, 53 (December): 1129-1136.

Schewe, Charles D. (1973). "Selected Social Psychological Models for Analyzing Buyers," Journal of Marketing, 37 (July): 31-39.

Secord, Paul F. and Carl W. Backman. (1964). Social Psychology. New York: McGraw-Hill. Sharma, Subhash, Richard M. Durand, and Oded Gur-Aire. (1981). "Identification and Analysis of

Moderator Variables," Journal of Marketing Research, 28 (August): 291-300. Stump, Rodney L. (1995). "Antecedents of Purchasing Concentration: A Transaction Cost Explana-

tion," Journal of Business Research, 34 (October): 145-157. Stump, Rodney L. and Jan B. Heide. (1996). "Controlling Supplier Opportunism in Industrial Rela-

tionships," Journal of Marketing Research, 33 (November): 431-441. Tannenbaum, Jeffrey A. (1992). "Distributors' Links to Producers Grow More Fragile," Wall Street

Journal, (October 28): B2. Thibaut, John W. and Harold H. Kelley. (1959). The Social Psychology of Groups. New York: John

Wiley & Sons. Williamson, Oliver E. (1979). "Transaction-Cost Economics: The Governance of Contractual Rela-

tions," Journal of Law Economics, 22 (October): 3-61. . (1985). The Economic Institutions of Capitalism. New York: The Free Press. . (1991). "Comparative Economic Organization: The Analysis of Discrete Structural Alterna-

tives," Administrative Science Quarterly, 36 (June): 269-296.

Is dependent what we want to be? effects of incongruency

Documents

Transcript of Is dependent what we want to be? effects of incongruency