Strategic collaboration management between Indian oil marketing and auto-service companies

Abstract

Purpose – The downstream oil marketing companies (OMCs) have an opportunity to compensate their huge under-recovery by increasing non-fuel revenues through strategic planning for collaboration with organized companies (OCs) of auto-servicing sector, who are experiencing a surge in the demand for auto-servicing. The purpose of this paper is to explore the business need for strategic collaboration and empirically validate the building mechanism for collaborative capacities between the two sectors (OMCs and OCs). Design/methodology/approach – The paper is designed to explore the implementation of collaboration using needs analysis, exploratory factor analysis and structural equation modelling process for building collaborative capacities between the two sectors. Findings – Although alignment is a necessary condition before allowing for a valid collaboration between the two sectors, the external alignment process is highly significant for implementing collaboration unlike the internal alignment process. Research limitations/implications – Methodological limitations include the use of convenience sampling and anonymous survey-based research. Practical implications – Selecting the “right” identified factors for collaboration is unquestionably one of the most important topics in the collaboration literature, which holds vast practical implications. Originality/value – This study provides practical and theoretical insights for implementing collaboration based on empirical results.