Value In Business Relationships Research Articles

B to B Sellers’ Skill Level in Sales Performance – Frameworks and Findings

Purpose This study focuses on a framework of sales performance drivers, considering four areas of seller skills, and seven dimensions that the literature generally recognizes as affecting sales performance in B2B settings. The four areas and seven dimension of seller skill level are as follows: (i) interpersonal abilities, including communication as well as presentation skills; (ii) degree of adaptiveness, considering seller ability to modify both the sales approach and the sales behavior; (iii) selling-related knowledge, covering product and market-knowledge skills; and (iv) sellers’ use of technology.As a whole, assuming a pivotal role played by seller skills, the research objective is to empirically verify a conceptual framework based on B2B seller skills in the context of sales performance. This study responds to a recent call to use meta-analyses to increase research-based knowledge in the sales domain. This study offers an empirical testing of a research framework for the identification and understanding of those skills that sellers need to embrace handling and increasing value in business relationships with customers in B2B settings of tangible products.The methodology relies on a questionnaire survey using a deductive approach. A total of 315 companies were ultimately selected to take part in the study, so as to represent a range of companies from different industries and corporate sizes within the product-oriented business sector of Norway (i.e. services-oriented companies are not included). The companies were identified from the Standard Industrial Classification (SIC 2007). A total of 236 questionnaires out of 315 were returned, generating a response rate of 74.9%. Methodology/Approach An exploratory factor analysis was undertaken to falsify or confirm the seven-dimensional framework of skill level. The initial factor analysis consisted of 21 items with three per dimension. The principal component method was applied to reveal the pattern in the factor solution. An orthogonal approach (varimax rotation) was applied to rotate the factor solution. The multi-item measures of each dimension were selected and modified from various sources.The empirical findings provide a foundation for further studies on sales performance. In particular, the findings can be used to assess the relationship between seller skill dimensions on sellers’ objective and subjective performance in B2B sales settings. The findings can also be used to assess the relationship between these skill-level indicators on sellers’ economic and non-economic satisfaction. FindingsCompanies could use the reported findings to organize and structure the process of B2B seller planification. This study offers seven verified categories of seller skill level. Companies should focus on each category in relation to their specific industry, so as to optimize sales performance.Seller skills become relevant with respect to taking into consideration the context of sales performance in areas such as planning and organization, recruiting and screening, training, remuneration and motivation, and evaluation and control. Note that companies need to consider the reported seven categories of skill level across all areas of sales performance. Companies should evaluate their sellers in relation to each category of skill level, and offer continuous training that is appropriate to each category.It is evident that training is fundamental to acquiring seller skills. The recruitment and screening of sellers are also important for acquiring sellers with an appropriate level of each category of skill levels. Furthermore, companies need to evaluate the training results of sellers, and offer economic compensation in accordance with the skill level reached in each of the seven categories.This study contributes to creat a B2B framework of seller skills in the context of sales performance. Accordingly, the tested and reported seven-dimensional framework provides a foundation for structuring the skill level dimensions in B2B sales settings. A further opportunity in B2B settings is to assess the structural properties of how the seven dimensions of seller skills are associated with and related to the other sales performance indicators (i.e. seller role perceptions, motivations and aptitude, as well as the influence of organizational and environmental aspects on sellers). One such research opportunity is to assess to what extent there are any moderating and mediating effects between skill level, role perception, motivation, aptitude and organizational/environmental, or whether they all relate only to sales performance in B2B settings.We conclude that the seven-dimensional framework of B2B seller skills in the context of sales performance verified in this study offers satisfactory validity and reliability. We therefore argue that the reported dimensions of B2B seller skills – i.e. interpersonal presentation and communication skills, degree of adaptiveness regarding abilities to modify sales approach and sales behavior, selling-related knowledge about customers and product/technology knowledge, and sales technology use – offer a sound foundation for assessing and following up on sales performance.This study contributes to existing theory and previous studies, thus providing a foundation for framing relevant indicators of sales performance regarding B2B seller skills. The seven-dimensional framework therefore provides a foundation on which to structure the assessment of sales performance in B2B settings.

A multidimensional approach to the outcomes of perceived value in business relationships

PurposeThis study aims to explore the relationships, direct and indirect, between business customers’ perceived value, satisfaction and loyalty.Design/methodology/approachThe study was set in the business banking industry, with data collected from 381 micro-enterprise business customers of a large South African bank by means of a self-administered, internet-based questionnaire.FindingsThe results reveal that business customers’ perception of value results in both economic and non-economic satisfaction. The results further indicate that non-economic satisfaction mediates the relationship between economic satisfaction and behavioural loyalty.Research limitations/implicationsThe study contributes to business services marketing literature by taking a multidimensional approach to the traditional value-satisfaction-loyalty chain.Practical implicationsThe study contributes to business services marketing literature by emphasising the importance of perceived value in driving both economic and social outcomes, which, in turn, drives behavioural outcomes. By providing evidence of the outcomes associated with higher perceived value, service providers gain insights into the importance of focussing on value creation and the building of personal connections with micro-sized businesses to ensure future repurchase behaviour.Originality/valueThis research expands on current value research by positioning economic and non-economic satisfaction and attitudinal and behavioural loyalty as outcomes of business customers’ perceived value. This is possibly the first study to investigate satisfaction and loyalty as outcomes of perceived value where both comprise two distinct dimensions.

Value co-destruction and its effects on value appropriation

ABSTRACTThe importance of the fair appropriation of co-created value in business relationships has been widely emphasised in the literature. However, in business relationships, value can be both co-created and co-destructed, but what happens to value appropriation when value is co-destructed? Previous studies have focused on what causes value co-destruction, rather than its effects. The question posed is relevant because some actors experience higher diminutions in value appropriation, generating perceptions of inequities, dissatisfaction, and tensions. By analysing data from 39 qualitative interviews with companies that have experienced value co-destruction, this paper attempts to identify the reasons for the unbalanced relationship between value co-destruction and value appropriation. Two higher-level dimensions – awareness of value and awareness of context – are identified and used to generate four clusters of reasons for disproportionate value co-destruction effects. The paper also pinpoints specific actions for managing unfairness from value co-destruction.

Perceived price and service quality as mediators between price fairness and perceived value in business banking relationships

PurposeThe purpose of this paper is to test perceived price and service quality as mediators between price fairness and perceived value in service encounters between micro-enterprises and their banks.Design/methodology/approachThe study is based on a self-administered and internet-based questionnaire conducted in the banking industry. The sample consists of 381 micro-enterprises in South Africa that employ one or two staff members.FindingsThe findings of this paper provide evidence for both theory and practice that perceived price and service quality influence the relationship between business banking customers’ perception of price fairness and the value of the service offered.Research limitations/implicationsThe measurement and structural properties reported are satisfactory. This paper confirms the hypothesized relationships in the tested research model, and rejects a tested rival model. Limitations are reported, and suggestions for further research are provided.Practical implicationsThis paper offers banking executives guidance in managing the pricing structure of their services, and highlights the value of offering greater transparency with regards to service charges and interest rates.Originality/valueThis paper contributes to insights into the mediating effects of perceived price and service quality between price fairness and perceived value in business relationships between micro-enterprises and their banks.

Total value in business relationships: exploring the link between power and value appropriation

PurposeThe purpose of this paper is to consider how value can be better defined and to understand the drivers of value appropriation in business relationships. In doing so, the authors explore the role that power plays in determining the sharing of value in those relationships.Design/methodology/approachThis paper contains a conceptual discussion about value and the appropriation of value in business relationships, which leads to the development of a methodology for assessing the sharing of value.FindingsIn this paper, the authors have developed a view of total value in supply chain relationships. They argue that the value of the relationship is the sum of the customer and supplier value, including both tangible and intangible benefits and sacrifices. In addition, they maintain that the appropriation of value in a business relationship is reliant upon: the power both parties possess; the direct and tangible value each party has to offer; and the indirect and intangible value that each has to offer. They also provide a methodology, which can be used to determine the sharing of value between two actors within a business exchange.Research limitations/implicationsIn arriving at the conceptualisation of total value and in the discussion of value appropriation in business relationships, the authors drew upon extant literature. However, a limitation is that they were unable to fully consider all the academic discourse centred on value and value appropriation.Originality/valueThe discussion brings together the issues of customer value and supplier value to the concept of “total value”. Thereafter, it links the contentious issue of buyer and supplier power, so as to better understand the appropriation of value in business relationships.

Network knowledge and business-relationship value in the foreign market

Based on the key assumptions that firms are opportunity seeking and that they gain critical knowledge operating in a network of relationships, this paper focuses on early expansion in foreign market networks. In particular, the paper examines the relation between experience and business-relationship value in a foreign market. While experience and experiential knowledge are central concepts in international business, little has been written about their effects on the value of business relationships. The paper formulates a set of interrelated hypotheses on the effects of international experience, experiential network knowledge and importance of customer and competitor knowledge on the value of business relationships in a foreign market. They are combined in a structural model, which is tested on a sample through LISREL. The main conclusion drawn from the study is that experiential network knowledge and knowledge about the importance of customers and competitors in the network influence the value of business relationships in a foreign market in different ways.

Creating value in business relationships: The role of sales

Understanding the creation of value in business relationships has been a long-standing goal of researchers and managers alike. By adopting a relational perspective, recent research on business relationships has made much progress in understanding value-creating processes. As the sales function is thought to be a pivotal part of the value-creating processes in business relationships, the evolving view on creating relationship value clearly has implications for our understanding of the role of sales in these processes. In contrast to its importance, the question of how the sales function contributes to creating value in business relationships has been largely neglected in extant literature. The objective of our paper is to answer this question by systematically linking the relational value creating process to the sales function's content. Interpreting value creation as interaction process, we identify four features of value-creating processes in business relationships suggested in recent research (i.e., jointness, balanced initiative, interacted value, and socio-cognitive construction) and, based on these, outline a framework that is used to define a set of tasks that are key to creating value in business relationships and hence become critical for sales in its hitherto neglected role as co-creator of relationship value. We illustrate the various tasks of this new role of sales with data from 43 interviews with sales managers and salespeople. Along with related normative recommendations in extant literature, the interviews provide support for the validity and relevance of our framework for understanding the role of sales in creating relationship value. This framework puts forward a much-needed first effort towards a theory of sales' role in creating relationship value and offers several opportunities for future research.

Adopting a service logic in manufacturing

PurposeThe purpose of this paper is to create a framework for measuring mutually created value in business relationships in the manufacturing sector, which also enables suppliers and customers to share this value between themselves.Design/methodology/approachThe starting point is that manufacturing firms adopt a service perspective or logic for their entire business. The framework created includes a conceptual foundation for understanding the process of mutual value creation as well as theoretical basis and metrics for calculating mutually created value, joint productivity gains (JPGs) and value sharing. The framework for mutual value creation is created conceptually. The theoretical basis for the metrics used for the calculations and the development of the metrics are empirically grounded in a longitudinal case study.FindingsBy matching supplier and customer practices and thereby aligning corresponding processes, resources and competencies, suppliers can support their customers' business more effectively and thus enable the customers and also themselves to create incremental value which can be shared between the business partners. It is showed that the metrics for calculating JPGs and for sharing these gains in the form of additional value for the business partners, through a price mechanism, can be created and used.Practical implicationsFindings of the paper suggest an alternative way of creating value which is geared towards the demands of a service logic applied in business relationships. Productivity can be created jointly and not separately by the supplier and the customer, and an incremental value in the form of a JPG calculated and shared. To be able to do this, the business partners must have access to accounting data, and the customer and the supplier must be willing to open up their books and engage in mutual practice matching. This demands that a service logic is adopted for the entire manufacturing business, not separately for industrial service activities only, which is the traditional approach to studying service in manufacturing.Originality/valueTraditionally, value is viewed as an outcome, not as a process of mutual value creation, the outcome of which can be calculated. Productivity as a joint concept and jointly created productivity gains enable firms to share the gains created through mutual value creation. In the literature so far, productivity and value creation have not been studied as mutual concepts. In addition, approaching the entire manufacturing business from a service logic point of view is also novel.

Capturing value creation in business relationships: A customer perspective

Collaborative relationships in business markets are of growing importance to customers and suppliers alike. Customers need to decide whether to invest in a new supplier relationship, to maintain and develop a valued relationship, or to divest from a low-value relationship. Suppliers, in turn, face growing commoditization of products and seek to differentiate themselves through relationships. The measurement of value creation in buyer–seller relationships is still in its infancy, and a sound understanding of how firms create and deliver value in business relationships is needed. Emerging studies investigate relationship value based on dimensions derived from theory and lack a managerial perspective. Therefore, the present research explored relationship value from a grounded theory perspective. In-depth interviews with purchasing managers identified eight value drivers in manufacturer–supplier relationships. Implications for the measurement of the concept are discussed, and directions for further research are suggested.

Managing Business Relationships by Analyzing the Effects and Value of Different Actions

Both business marketers and their customers are deeply concerned with the “value” that is provided by the market offerings exchanged between them. Managers also commonly talk about the “value” to them of their relationships with customers and suppliers. Value is a concept that is commonly used by both practitioners and academics, but it is often unclear what exactly they mean by it. This lack of clarity causes major problems to companies that try to build a coherent relationship strategy. The first aim of this article is to clarify the different aspects of value in business relationships. The article then focuses on a particular way of thinking about value that appears to be useful for managers in their relationship decision making. This is the value that managers assign to the effects of their decisions and actions. The article then includes an analysis of the value that managers assign to the effects of a number of different actions in several case studies. Conclusions are then drawn about how suitable for practicing managers is this way of analyzing value in relationships.

Pairing Relationship Value and Marketing

Relationship value has importance outside the marketing domain. It is suggested ‘marketing’ be banished from our relationship vocabulary and emphasis be given to the term ‘business relationship value’. A simple bibliometric study indicates ‘relationship marketing’ has no primacy, with other fields and domains recording more progress. There is significant support from the literature for using a transaction cost approach to understand relationship value. We consider that potency and relationship exchange explain the basis of relationship value, a market-based asset, leading to value creation for shareholders and customers. Relationship management is reliant upon information, the glue of organisations, for determining the best allocation of resources and adaptations that should be used when designing, managing and maintaining a relationship. Questions important to knowledge development of marketing, and managing business relationships are outlined.