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Paper info: A contingency model for the company's use of relationship building

Title


A contingency model for the company's use of relationship building

Authors


Niels Jørgensen

Place of Publication


The paper was published at the 17th IMP-conference in Oslo, Norway in 2001.

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Abstract


Literature shows that relationship orientation, relationship marketing and relationship managementhave become a must when an industrial company wants to establish a lasting competitiveadvantage. The strong interest in relations between industrial companies has resulted in the idea ofrelationship and relationship building being spread to other areas such as distribution, service andconsumers. Now one must also build relations to middlemen, service suppliers and end consumers.This paper analyses whether or not relationship orientation and relationship marketing actually is amust to all companies ? no matter their position in the value chain, their size, their product range,and their degree of internationalisation etc. In other words, under what conditions shall a companyseek to build relations and under what conditions is a traditional marketing called for. The problemsuggests that a contingency model is developed because it deals with what strategy to use ? andwhen.To analyse all the factors relevant to a company's decision on whether or not to pursue arelationship strategy will be too extensive in a paper, and therefore this paper focuses on thesituation factor: The company's position in the value chain. A specific analysis of the distribution ofgroceries in Western Europe illuminates the importance of the situation factor in question. Theanalysis shows that relationship orientation is not equally relevant for companies at different levelsin the value chain. This also applies to large and small companies at the different levels andcompanies that produce different types of products. Consequently, the conclusion is that thecompany's position in the value chain is considered to be an important situation factor.