Coping with inter-organizational conflicts: Efficient interaction strategies for buyer and seller organization

Abstract

The author analyzes how buyer and seller organization can cope effectively with their inter-organizational conflicts. A general efficiency hypothesis is deducted proposing an inverted u-shaped relation between conflict handling intensity and efficiency. It is argued that the seller will reach a maximum efficiency at a quite low level of conflict handling intensity whereas the buyer will reach a maximum efficiency at a quite high level of conflict handling intensity. To test these propositions a concept to measure the transactional efficiency of buyer and seller organization and a typology of conflict handling interaction strategies are developed and applied to 195 interaction processes in which computers were bought or leased for the first time. The empirical findings confirm both hypotheses. They show that buyer and seller should neither smooth over existing conflicts nor let them escalate. They should either renounce at conflict handling activities and strive for a modest solution which can be implemented soon and improved in further transaction processes, or they should consciously fight out their conflicts in an open manner and restrict these activities to the decision stage. The first strategy seems sufficient for a solution with a low level of aspiration, the second is appropriate when a solution with a high level of aspiration is intended. Therefore, both parties should first agree upon the level of aspiration of their innovative solution and then choose an interaction strategy which corresponds to this goal.