Customer-supplier Interaction Research Articles

Conceptualizing customer value in data-driven services and smart PSS

In the age of the industrial internet, manufacturers of industrial equipment compete through the offering of digital product-service solutions. These are built integrating smart connected products (SCP) and data-driven services, such as remote control, data analytics, diagnostic and predictive maintenance services. These services strongly influence the value created in the customer context and, consequently, the attractiveness of the integrated offering. A great issue remains about how these services should be designed by manufacturers of industrial equipment. Through integrative literature review over multiple domains, this paper provides a conceptual model that shows: i) which benefits can be created from smart product-service systems offerings at both business and individual level, in the customer organization; ii) how these benefits are linked to the choices about design and delivery of data-driven services. In respect to the second point, this study merges service science theory and data management to show how the data autonomously collected by SCP can be transformed into insights that deliver value, as far as the customer and the supplier interact, share resources and apply their specialized competences. Applying these concepts, we elaborate four exemplary archetypes of data-driven services that differ in respect to the kind of customer-supplier interactions along this data life cycle, bringing these options to different kind of customer value co-creation. Linking the mechanisms of value co-creation to design options of data-driven services, this paper has therefore notably implications for the research on servitization and smart product-service systems.

Quality perception throughout the table egg supply chain

Purpose:This research shows how the perception of quality differs through the table egg chain and highlights the main quality characteristics for each studied chain participant (farm, retail, consumer).Design/methodology/approach:Observing the change in perception starts from the farm, through retail to the end consumer using the customer–supplier interaction, while looking back from the consumer to the farm, the application of the quality function deployment (QFD) was used. The study included 30 farms, 50 retail stores, 1,000 customers and 300 households.Findings:The farm–retail comparison highlights the type of production as the dominant factor affecting egg quality for both of these participants, followed by hen diet and the type of laying hen hybrid from the farmer's point of view, while retail focuses on packaging and egg damage. Egg quality aspects from the retail–household perspective emphasize the shell appearance and the origin of the eggs, while shelf life and egg class are equally important characteristics for both participants. The application of the QFD throughout the entire egg chain emphasizes quality vs price as the most important characteristic.Originality/value:This study could serve to food policy makers as an introduction to further research and production orientation in relation to the set of quality requirements associated with the egg supply chain.

Dynamic roles of suppliers in the specification of business services

The service sector, in particular business services, has become increasingly important in developed economies. The increasing complexity of the supply market combined with customers’ limited knowledge in specifying services has contributed to a more active role of suppliers in those processes. Service specifications can go through stabilization and destabilization cycles over time in the context of customer-supplier interactions. We aim to study the evolution of supplier roles in specification processes over time. We conduct a longitudinal study that involves two professional service providers and six customers. We find that buying services may involve the explicit recognition of uncertainties regarding their specifications. The very process of interacting may help to change the initial specifications of an offer over time and to change the supplier's role and the customer's perceived uncertainty in the (de)stabilization process.

Perspective-taking and cooperation in customer–supplier relationships

PurposePerspective-taking is an overlooked relational competence that matters to interaction, problem-solving and cooperation in inter-organizational buyer–seller relationships. This paper aims to distinguish perspective-taking from empathy with which it has often been associated. It uses aptitude theory to propose a conceptualization of perspective-taking consisting of perspective-taking ability and motivation components that are used to explore the scope of perspective-taking in customer–supplier relationships.Design/methodology/approachAn experiment and survey, are conducted among customer managers to apply and test measures to capture the ability and motivation components of the perspective-taking aptitude. The two perspective-taking components are used to propose a 2 × 2 matrix that provides a four-type typology, labelled: “talented”, “ineffectual”, “fervent” and “indifferent”. Data are collected from a sample of senior managers of manufacturing firms responsible for the dyadic relationship with a business support agency.FindingsThe data supports the presence and distribution of the four typologies among customers in business relationships and regression analysis confirms the impact of the proposed perspective-taking typology types on customer–supplier cooperation. The different combinations of the perspective-taking dimensions of ability and motivation that make up the perspective-taking aptitude type result in different dispositions to cooperate. “Talented” and “ineffectual” members with high and low perspective-taking ability and motivation scores, respectively, provide the highest and lowest cooperation dispositions. “Fervent” and “indifferent” members occupy an intermediate perspective-taking aptitude on the typology, with the former impacting cooperation moderately and the latter not found to be significant.Practical implicationsUnderstanding counterparts, inferring their motives and anticipating reactions, is a critical capacity for mutual dyadic adjustments in customer–supplier relationships in business markets. Such an understanding of perspective-taking can prove useful to effective interaction, solution development and relationship building, as interacting managers belonging to different typology types exhibit different levels of cooperation. In addition, an understanding of perspective-taking can prove useful to identify the right talent that can foster effective interaction and solution development in customer–supplier relationships. It also raises the issue as to how best sellers can interact to influence the perspective-taking of buyers in their quest to achieve better solutions and cooperation.Originality/valueProvides a useful supplement to theory by bringing perspective-taking, grounded in aptitude theory, as an essential relational competence in business marketing that can provide an additional explanation to cooperation and joint problem-solving in inter-organizational business relationships. The paper develops and proposes a typology of perspective-taking that brings together ability and motivation dimensions, operationalizes and assessed their measures and tests the impact of the proposed perspective-taking typology types on cooperation in customer–supplier interaction.

Telling stories that sell: The role of storytelling and big data analytics in smart service sales

The emergence of digitally connected products and big data analytics (BDA) in industrial marketing has attracted academic and managerial interest in smart services. However, suppliers' provision of smart services and customers' adoption of these services have received scarce attention in the literature, demonstrating the need to address the changing nature of customer-supplier interactions in the digital era. Responding to prior research calls, this study utilizes ethnographic research and a storytelling lens to advance our knowledge of how stories and BDA can enhance customers' attitudes toward suppliers' smart services, their behavioral intentions and their actual adoption of smart services. The study's findings demonstrate that storytelling is a collective sensemaking and sensegiving process that occurs in interactions between customers and suppliers in which both parties contribute to the story development. The use of BDA in storytelling enhances customer sensemaking of smart services by highlighting the business value extracted from the digitized data of a reference customer. By synthesizing insights from servitization, storytelling, BDA and the customer reference literature, this study offers managers practical guidance regarding how to increase smart service sales. An example of a story used to facilitate customer adoption of a supplier's smart services in the manufacturing sector is provided.

Differentiation strategies for the wine and nursery sector: empirical evidence from an Italy region

The aim of the paper is to analyze how the dynamic capabilities of the wine industry actors, involved in searching for biodiversity, influence and are influenced by the dyadic buyer–supplier relationship. In particular, the study aims at analyzing how the organizational culture, the strategic and relational approach, adopted in the customer-supplier interactions, affect the inter-organizational learning and the value-creating process. For this purpose, an explorative study has been carried out in the wine supply chain of Basilicata region (in southern Italy). Data are collected by submitting a semi-structured interview to the complete population of wineries and grape growers in the abovementioned area. By means of Principal Component Analysis and a Spearman’s rank correlation analysis, the paper investigates if the relational approach adopted by the winery toward the grape grower affects positively the dynamic capabilities for wine differentiation strategies.Results show the grape grower are positively influenced by an organizational culture of winemakers based on flexibility and not standardized transformation processes then facilitating the planting choices and assuring the health of cuttings.

Stock Return Dependence and Product Market Linkages

We model the immediate responses of firms’ daily idiosyncratic stock returns to the idiosyncratic returns of the firms’ rivals and major customers, using spatial econometric techniques. We show that ignoring firms’ response to rivals results in non-negligible overestimation of firms’ response to major customers while ignoring customer-supplier interactions leads to overestimation of response to rivals. We relate the immediate price comovement to several firm and industry characteristics. Contagion effect of rivals dominates competition effect and the net effect is larger when firms respond to negative return shocks of rival firms than to positive ones. The net effect is strong for firms in product markets with low concentration and high product market fluidity. Suppliers with lower product uniqueness and higher customer concentration are more sensitive to the shocks from their customers.

Resource heterogeneity and its effects on interaction and integration in customer-supplier relationships

Purpose – The purpose of this paper is to study the phenomenon of customer-supplier interaction and integration from a resource perspective. In economic terms, a fish may be seen as a more or less homogeneous resource. If the herring is seen as a homogeneous resource, a market should be the best way to handle the selling and buying. However, if the herring is seen as a heterogeneous resource, a more extensive type of interaction is needed. One interesting aspect with herring is that different business actors apparently see this resource in different ways. Thus, the authors will have a mixed situation, creating possible difficulties for the actors involved. Design/methodology/approach – The authors start this study in Germany, one of the most important export markets for Norwegian herring. Today, Norwegian legislation hinders the possibility of vertical integration and cooperation at the supply side of the network. However, the industry sees opportunities for growth and integration on the marketing side. To examine this issue, the study uses a qualitative design methodology, incorporating personal in-depth interviews with selected respondents in Norway and Germany. Secondary data is also used. To analyse the data, the authors introduce five interaction and integration patterns termed pure exchange – no integration; limited interaction and integration; extensive interaction and developed integration and; indirect interaction and structural integration; and full integration. Findings – The findings suggest that there is a link between how the actors perceive herring as a resource and how they interact with counterparts. The authors find that the actors who see the resource as homogeneous have limited interaction and little or no integration, whereas the actors who see the resource as heterogeneous have a much more extensive interaction and closer ties. Originality/value – The paper is an investigation of the link between the resource heterogeneity and the patterns of customer-supplier integration.

Collaborative innovation: the decade that radically changed drilling performance

This article sheds light on key factors associated with innovations that are mainly based on experiential learning. The history of a company engaged in the offshore oil and gas industry exemplifies the points: Hitec started out as a small company with limited financial resources, but over a 10-year period, its innovations and improvements radically transformed offshore oil and gas drilling operations. An evolutionary methodological approach is balanced by theoretically informed analysis. A main finding is that customer–supplier interaction was crucial. Hitec's success, crowned by its eventual acquisition by American capital, can be attributed in part to the know-how and technology provided by one of its suppliers and partners during the early phase. However, it has also depended on a series of other factors: a flexible, motivated and creative organisation; targeting of the right know-how; being part of a cluster and thus enjoying easy access to important customers and suppliers as well as easy, informal flow of ideas and information; developers and entrepreneurs prepared to take risks; being in the right place at the right time; a good measure of luck; the underdeveloped state of American drilling control technology; Norwegian oil and gas policies supportive of domestic technological companies; and proximity to research labs which were conducting full-scale tests of drilling operations. An invention made by regional researchers can also be linked to Hitec's innovation of a drilling control system. The relevance of the article is its contribution to a better understanding of the complexity involved in the implementation of major practice-based innovations – a process which includes identifying and creating ideas; finding a market/customer and putting the ideas into practice.

Collaborative Markets in B2B Relationships

Since about 2000, relationships among firms within the supply chain have been changing in order to face new threats and opportunities that have arisen from web-based technologies. In the literature, two trends are emerging: market mechanisms are emphasized through electronic catalogs, auctions, and exchanges; at the same time, web technologies support collaboration among partners within the supply chain. This divergence opens up space for the emergence of a particular typology of relationship, which can be defined as a collaborative market. In such a relationship, the flexibility of new technologies reduces costs and resources needed to communicate and coordinate with suppliers, thus allowing companies to collaborate over a short-term horizon.The aim of this research is to analyze and understand the main implications of Internet adoption in the relationships across the supply chain and to test its influence on the customer-supplier interaction. Evidence is based on a survey administered to 162 U.S. companies that investigates customer-supplier relationships before and after Internet adoption.

Creating and appropriating value in collaborative relationships

Business relationships provide means for creating and appropriating superior value in the marketplace. To date, research pertains almost exclusively to the value after relationship creation and sharing among exchange partners. Consequently, the interaction between value creation and value appropriation remains relatively unknown in collaborative relationships. Drawing on equity theory, this study proposes a conceptual model that positions value creation and value appropriation as focal variables within the nomological net of business relationships. Data collected from industrial customer–supplier projects reveal that value appropriation is the strongest driver of project satisfaction. Customer firms perceive value creation as positive only if they appropriate a larger slice of the bigger value pie. Information exchange moderates customer firms' evaluations of value creation and appropriation efforts. In contrast to the highly competitive nature at the project level, embedding the supplier project in an ongoing sourcing relationship reveals cooperative elements in the customer–supplier interaction. Greater relational satisfaction favors less aggressive value appropriation efforts. These insights help bridge the gap between managerial metrics that focus on successful value appropriation and academic models that attend to variables that capture the quality of ongoing relationships.

Centrality of customer and supplier interaction in innovation

This article evaluates the assumption that interaction within customer–supplier relationships is always the pivotal point for innovation. The article proposes that the relevance of customer and supplier relationships depends on the nature and maturity of the technology being developed, thus exploring the potential variation in customer–supplier interactions during different phases of the innovation life cycle. The article commences with a brief introduction to the literature and then uses the findings from a survey to illustrate the premise of the article. The article concludes with a discussion of the implications of the findings and outlines the plans for the next stage of the research.

Requirements for a Brain Transplant for the New 1B Processor

Generating the system requirements for the 1B processor, the new “brain” of the 4ESS™ switch, was a critical step in the front-end process. The set of requirements, prepared by cross-functional teams, was used both to specify hardware and software development and to guide verification. To shorten the overall cycle time, the production of these specifications also overlapped the hardware and software development processes. This paper describes the customer-supplier interaction model used, the approach chosen to facilitate productivity during requirements production, a high-level perspective of the requirements, the process used to generate these requirements, the challenges encountered, and the teamwork solutions via process optimization that helped make this project a success.

The art of benchmarking: using customer feedback to establish a performance gap

Benchmarking is the art of establishing superior performance by identifying gaps in performance and emulating the best practices which help close them. Benchmarking is a natural development from the implementation of total quality management. It provides business organizations with the opportunity of taking an outward look at competitiveness by measuring true performance. This paper discusses various aspects of benchmarking such as its meaning, the different types of benchmarking, its implementation approaches and reported criteria facilitating its successful implementation. Since one of the difficulties of practising benchmarking is the obtainment of information, the paper discusses the merits of customer feedback in assessing current performance. As an example to highlight the importance of customer feedback, some data on customer–supplier interactions in the context of advanced manufacturing technology (AMT) have been used. The data refer on the one hand to suppliers' own assessment on the levels of su...