KMV Model

The Commitment-Trust Theory of Relationship Marketing
Author(s): Robert M. Morgan and Shelby D. Hunt

Source: The Journal of Marketing, Vol. 58, No. 3 (Jul., 1994), pp. 20-38
Published by: American Marketing Association
Stable URL: http://www.jstor.org/stable/1252308 .
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Robert M.
Morgan
&
Shelby
D. Hunt
T he Commitment-T rust
T heory
of
Relationship Marketing
Relationshipmarketing-establishing, developing,
and
maintaining
successf ul relational
exchanges-constitutes
a
major
shif t in
marketing theory
and
practice.
Af ter
conceptualizing relationshipmarketing
and
discussing
itsten
f orms,
the authors
(1)
theorize that successf ul
relationshipmarketing requiresrelationship
commitment and
trust,
(2)
model
relationship
commitment and trust as
key mediating variables, (3)
test this
key mediating
variable model
using
data f romautomobile tire
retailers,
and
(4) compare
their model with a rival that doesnot allow
relationship
commitment and trust to f unction as
mediating
variables. Given the f avorable test resultsf or the
key mediating
var-
iable
model, suggestions
f or f urther
explicating
and
testing
it are of f ered.
T he
cooperative aspect
of economic behavior hasbeen rela-
tively neglected.
Economists
speak
of
competitive theory,
of
pure
and
perf ect competition.
T here isno
correspond-
ing development
of
cooperative theory,
of
pure
and
per-
f ect
cooperation (Alderson 1965, p. 239).
One of the most salient f actorsin the ef f ectivenessof our
present complex
social
organization
isthe
willingness
of
one or more individualsin a social unit to trust others.
T he
ef f iciency, adjustment,
and even survival of
any
so-
cial
groupdependsupon
the
presence
or absence of such
trust
(Rotter 1967, p. 651).
T he past decade haswitnessed the inception of a major di-
rectional
change
in both
marketing theory
and
prac-
tice. Considered
by
Webster
(1992, p. 1)
to
represent
a "f un-
damental
reshaping
of the f ield" and
by
othersto be a
gen-
uine
paradigm
shif t
(Kotler 1991;
Parvatiyar, Sheth,
and
Whittington 1992),
the turn istoward
relationship
market-
ing,
a
concept
that
encompasses
relational
contracting (Mac-
Neil
1980),
relational
marketing (Dwyer, Schurr,
and Oh
1987), working partnerships(Anderson
and Narus
1990),
symbiotic marketing (Varadarajan
and
Rajaratnam1986),
strategic
alliances
(Day 1990), co-marketing
alliances
(Buck-
lin and
Sengupta 1993),
and internal
marketing (Arndt
1983; Berry
and Parasuraman
1991). Relationship
market-
ing
is
part
of the
developing
"network
paradigm,"
which
recognizes
that
global competition
occurs
increasingly
be-
tween networksof f irms
(T horelli1986, p. 47). Indeed,
Achrol
(1991, p. 78, 89)
f orecaststhe rise of "true market-
ing companies"
within networksof
f unctionally special-
ized
organizations
whose
interrelationships, being
norm
Robert M.
Morgan
isan Assistant Prof essor of
Marketing, University
of Al-
abama.
Shelby
D. Hunt isthe Paul Whitf ield HomProf essor of
Marketing,
T exasT ech
University.
T he authors thankJamesB.
Wilcox,
J. G. Hunt,
Anil Menon,
Larry Austin, and John R.
Sparks (all of T exasT ech Univer-
sity)
f or their assistance in thisresearch. T he
helpf ul,comments
of Ron
Dulek
(University
of
Alabama),
the
editor,
and three
anonymous
reviewers
on earlier draf ts of thisarticle also are
acknowledged.
20 / Journal of
Marketing, July
1994
driven,
are "held
together
and coordinated
by
market
driven f ocal
organizations" by
meansof "normsof
sharing
and commitment based on trust." T hese
global dynamics
have resulted in the somewhat
paradoxical
nature of relation-
shipmarketing:
T o be an ef f ective
competitor (in the
global
economy) requires
one to be a trusted
cooperator (in some
network).
As
McKinsey
& Co.
strategistsput
it
(Bleeke
and
Ernst
1993, p. 1),
"For most
global businesses,
the
days
of
f lat-out, predatory competition
are over.... In
place
of
preda-
tion, many
multinational
companies
are
learning
that
they
must collaborate to
compete."
Businessethicistsalso stress
that
competition requirescooperation (Solomon 1992, p.
26):
However
competitive
a
particular industry may be,
it al-
ways
restson a f oundation of shared interestsand mutu-
ally agreed-upon
rulesof
conduct, and the
competition
takes
place
not in a
jungle
but in a
society
that it
presum-
ably
both servesand
dependsupon.
Business
lif e, unlike
lif e in the
mythological jungle,
isf irst of all f undamen-
tally cooperative.
It is
only
with the boundsof
mutually
shared concernsthat
competition
is
possible.
And
quite
the
contrary
to the
'everyone
f or himself
metaphor,
busi-
nessalmost
always
involves
large cooperative
and mutu-
ally trusting groups,
not
only corporations
themselvesbut
networksof
suppliers,
service
people, customers,
and in-
vestors.
(Emphasis
in
original.)
We
explore
the nature of
relationshipmarketing
and
two
key
characteristics
posited
to be associated with the
ef f ective
cooperation
that is
required
f or
relationship
market-
ing
success.
First,
we examine the nature of
relationship
mar-
keting
and
suggest
how thisconstruct should be
conceptu-
alized.
Second,
we theorize that successf ul
relationship
mar-
keting requiresrelationship
commitment and trust.
T hird,
we model themas
key mediating
variables.
Fourth,
we test
this
key mediating
variable model
using
data f romauto-
mobile tire retailers.
Finally,
we
compare
our model with a
rival that doesnot allow
relationship
commitment and trust
to f unction as
mediating
variables.
Journal of
Marketing
Vol. 58
(July 1994),
20-38
FIGURE 1
T he Relational
Exchanges
in RelationshipMarketing
T he Nature of
Relationship
Marketing
Understanding relationshipmarketing requiresdistinguish-
ing
between the discrete
transaction,
which hasa "distinct
beginning,
short
duration,
and
sharpending by perf or-
mance,"
and relational
exchange,
which "tracesto
previ-
ous
agreements[and]
... is
longer
in
duration, ref lecting
an
ongoing process" (Dwyer, Schurr,
and Oh
1987, p. 13).
Cat-
egorized
with ref erence to a f ocal f irmand itsrelational ex-
changes
in
supplier, lateral, buyer,
and internal
partner-
ships, Figure
1 showsten discrete f ormsof
relationship
mar-
keting: (1)
the
partnering
involved in relational
exchanges
between manuf acturersand their
goods' suppliers,
asin
"just-in-time" procurement
and "total
quality manage-
ment"
(Frazier, Spekman,
and O'Neal
1988;
O'Neal
1989);
(2)
relational
exchangesinvolving
service
providers,
asbe-
tween
advertising
or
marketing
research
agencies
and their
respective
clients
(Beltramini
and Pitta
1991; Moorman,
Zaltman,
and
Deshpande 1992); (3) strategic
alliancesbe-
tween f irmsand their
competitors,
asin
technology
alli-
ances
(Nueno
and Oosterveld
1988); co-marketing
alliances
(Bucklin
and
Sengupta 1993);
and
global strategic
alliances
(Ohmae 1989); (4)
alliancesbetween a f irmand
nonprof it
or-
ganizations,
asin
public purpose partnerships(Steckel
and
Simons
1992); (5) partnerships
f or
joint
research and devel-
opment,
asbetween f irmsand
local, state,
or national
gov-
ernments
(Comer, O'Keef e,
and Chilenskas
1980); (6) long-
term
exchanges
between f irmsand ultimate
customers,
as
particularly
recommended in the services
marketing
area
(Berry 1983); (7)
relational
exchanges
of
working partner-
ships,
asin channelsof distribution
(Anderson
and Narus
1990); (8) exchangesinvolving
f unctional
departments
(Ruekert
and Walker
1987); (9) exchanges
between a f irm
and its
employees,
asin internal
marketing (Arndt 1983;
Berry
and Parasuraman
1991);
and
(10)
within-f irmrela-
tional
exchangesinvolving
such businessunitsassubsidiar-
ies, divisions,
or
strategic
businessunits
(Porter 1987).
T hough adequately conceptualizing relationship
market-
ing requires
a def inition that accommodatesall f ormsof re-
lational
exchanges,
extant def initionscover some kindsbut
not others. For
example,
in the services
marketing area,
Berry (1983, p. 25) states, "Relationshipmarketing
isattract-
ing, maintaining
and-in multi-service
organizations-
enhancing
customer
relationships"
and
Berry
and Para-
suraman
(1991, p. 133) propose
that
"relationship
market-
ing
concerns
attracting, developing,
and
retaining
customer
relationships."
In industrial
marketing,
Jackson
(1985, p. 2)
ref ersto
as
"marketing
oriented to-
ward
strong, lasting relationships
with individual ac-
counts." Paul
(1988) adopts
Jackson'sview in the health
care
marketing area,
asdoesO'Neal
(1989)
in hisdiscus-
T heory
/ 21
FIGURE 2
T he KMV Model of
sionsof "JIT
procurement." Doyle
and Roth
(1992, p. 59)
indicate that "the
goal
of
relationshipselling
isto earn the
position
of
pref erred supplier by developing
trust in
key
ac-
countsover a
period
of time." Def initionssimilar to the
pre-
ceding
can be f ound in the areasof bank
marketing,
adver-
tising,
and business
strategy (Beltramini
and Pitta
1991;
Prince
1989; Spekman
and Johnston
1986). Conspicuously
missing
f romall extant def initionsof
relationship
market-
ing
isthe
specif ic recognition
that
many
instancesof rela-
tionshipmarketing
do not have a "customer" asone of the
exchange participants. Strictly speaking,
in
strategic
alli-
ancesbetween
competitors, partnerships
between f irmsand
government
in
public-purpose partnerships,
and internal mar-
keting,
there are neither
"buyers," "sellers,"
"custom-
ers,"
nor
"key accounts"-only partnersexchanging
re-
sources.
T heref ore,
to cover all f ormsof relational ex-
change
and f ocuson the
process
of
relationshipmarketing,
asstressed
by Dwyer, Schurr,
and Oh
(1987),
we
propose
the
f ollowing: Relationshipmarketing
ref ersto all market-
ing
activitiesdirected toward
establishing, developing,
and
maintaining
successf ul relational
exchanges.
T heory
Drawing
on the
political economy paradigm,
T horelli
(1986, p. 38) maintains,
"Power isthe central
concept
in net-
work
analysis"
because its"mere existence" can "condi-
tion others." In
contrast, keeping
in mind that
roughly
one-
third of such venturesas
strategic
alliancesare
outright
f ail-
ures
(Sherman 1992),
we
argue
that what should be central
to
understanding relationshipmarketing
iswhatever distin-
guishesproductive,
ef f ective,
relational
exchanges
f rom
those that are
unproductive
and inef f ective-that
is,
what-
ever
producesrelationshipmarketing
successesinstead of
f ailures.
T hough
there are no doubt
many
contextual f actors
that contribute to the successor f ailure of
specif ic
relation-
shipmarketing
ef f orts,
we theorize that the
presence
of re-
lationship
commitment and trust iscentral to successf ul re-
lationshipmarketing,
not
power
and its
ability
to "condi-
tion others." Commitment and trust are
"key"
because
they encourage
marketersto
(1)
workat
preserving
relation-
ship
investments
by cooperating
with
exchange partners,
(2)
resist attractive short-termalternativesin f avor of the ex-
pected long-term
benef itsof
staying
with
existing partners,
and
(3)
view
potentially high-risk
actionsas
being prudent
because of the belief that their
partners
will not act
oppor-
tunistically. T heref ore,
when both commitment and trust-
not
just
one or the other-are
present, they produce
out-
comesthat
promote ef f iciency, productivity,
and ef f ective-
ness. In
short,
commitment and trust lead
directly
to
coop-
erative behaviorsthat are conducive to
relationship
market-
ing
success.
Our
theory implies
what we label the
key mediating
var-
iable
(KMV)
model of
relationshipmarketing (Figure 2),
which f ocuseson one
party
in the relational
exchange
and
that
party'srelationship
commitment and trust. Because we
hypothesize
that
relationship
commitment and trust are
key
22 / Journal of
Marketing, July
1994
constructs, we
position
themas
mediating
variablesbe-
tween f ive
important
antecedents
(i.e., relationshiptermina-
tion
costs, relationshipbenef its,
shared
values, communica-
tion,
and
opportunistic behavior)
and f ive outcomes
(i.e., ac-
quiescence, propensity
to
leave, cooperation,
f unctional con-
f lict,
and
decision-making uncertainty).
Relationship
Commitment
Drawing
on the
conceptualizations
of commitment in social
exchange (Cook
and Emerson
1978), marriage (T hompson
and
Spanier 1983),
and
organizations(Meyer
and Allen
1984),
we def ine
relationship
commitment asan
exchange
partner believing
that an
ongoing relationship
with another
isso
important
asto warrant maximumef f ortsat maintain-
ing it;
that
is,
the committed
party
believesthe
relationship
isworth
working
on to ensure that it endures
indef initely.
Our def inition
corresponds
almost
exactly
with that devel-
oped by Moorman, Zaltman,
and
Deshpande (1992, p.
316):
"Commitment to the
relationship
isdef ined asan en-
during
desire to maintain a valued
relationship."
T heir "val-
ued
relationship" corresponds
with our belief that relation-
ship
commitment exists
only
when the
relationship
iscon-
sidered
important. Similarly,
their
"enduring
desire to main-
tain"
corresponds
with our view that a committed
partner
wantsthe
relationship
to endure
indef initely
and is
willing
to workat
maintaining
it.
We
propose
that
relationship
commitment iscentral to re-
lationshipmarketing. T hough f airly
new in discussionsof in-
terorganizational relationships,
commitment
long
hasbeen
central in the social
exchange
literature
(Blau 1964;
T hibaut
and
Kelley 1959).
Cookand Emerson
(1978, p. 728)
char-
acterize commitment as"a variable we believe to be central
in
distinguishing
social f romeconomic
exchange."
More
specif ically,
in the
marriage literature, McDonald
(1981, p.
836) concludes,
"Clearly,
the
major
dif f erentiation of these
exchange relationshiptypes
... isthe mutual social trust and
the resultant commitment on the
part
of the individualsto es-
tablish and maintain
exchange relationships."
Commitment also isviewed ascritical in the literatures
of
organizational
and
buyer
behavior.
Organizational
com-
mitment-one
type
of
relationship
commitment that iscrit-
ical to the f irmin itsinternal
relationships-isamong
the
oldest
(Becker 1960)
and most studied
(Reichers1985)
var-
iablesin
organizational
behavior
theory.
In this
context,
com-
mitment isseen ascentral because it not
only
leadsto such
important
outcomesasdecreased turnover
(Porter
et al.
1974), higher
motivation
(Farrell
and Rusbult
1981),
and in-
creased
organizational citizenship
behaviors
(Williams
and
Anderson
1991),
but it also resultsf romsuch
things
that
can be inf luenced
by
the f irmas
recruiting
and
training prac-
tices
(Caldwell, Chatman,
and
O'Reilly 1990), job equity
(Williams
and Hazer
1986),
and
organizational support (Eis-
enberger, Fasolo,
and Davis-LaMastro
1990).
In the services
area,
Berry
and
Parasuraman
(1991, p. 139)
maintain that
"Relationships
are built on the f oundation of mutual commitment." Simi-
larly,
the
processthrough
which consumersbecome
loyal
to
specif ic
brandshasbeen
widely
discussed.
Initially, loy-
alty
wasviewed as
simply repeat buying. However,
asthe
f ield of consumer behavior matured, researcherscame to re-
alize that
"repurchase
isnot suf f icient evidence of brand
loy-
alty" (Newman
and Werbel 1973, p. 404) and that such
measuresas
purchase patterns
included much
"spuriousloy-
alty" (Day 1970).
Asbrand attitude becomescentral to the
repurchase
decision in relational
exchange,
brand
loyalty
be-
comes
increasingly
similar to our
conceptualization
of com-
mitment. In
f act, Assael
(1987, p. 665)
def inesbrand
loy-
alty
as"commitment to a certain brand"
arising
f romcer-
tain
positive
attitudes. Manuf acturerssee brand
loyalty
as
key
to
superior perf ormance
and make ef f ortsto build it
through providing superior benef its,
promoting
the f irm's
values
(e.g, "green marketing," corporate philanthropy),
and
establishing
an
image
asa
trustworthy
manuf acturer.
A common theme
emerges
f romthe variousliteratures
on
relationships:
Parties
identif y
commitment
among
ex-
change partners
as
key
to
achieving
valuable outcomesf or
themselves,
and
they
endeavor to
develop
and maintain this
precious
attribute in their
relationships. T heref ore, we theo-
rize that commitment iscentral to all the relational ex-
changes
between the f irmand itsvarious
partners
in
Figure
1.
T rust
We
conceptualize
trust as
existing
when one
party
hascon-
f idence in an
exchange partner'sreliability
and
integrity.
Again,
our def inition
parallels
that of
Moorman, Desh-
pande,
and Zaltman
(1993, p. 82):
"T rust isdef ined asa
willingness
to
rely
on an
exchange partner
in whomone has
conf idence." Both def initionsdraw on Rotter's
(1967, p.
651)
classic view that trust is"a
generalized expectancy
held
by
an individual that the word of another ... can be re-
lied on." Both def initionsalso
highlight
the
importance
of
conf idence. T he literature on trust
suggests
that conf idence
on the
part
of the
trusting party
resultsf romthe f irmbelief
that the
trustworthy party
isreliable and has
high integrity,
which are associated with such
qualities
as
consistent, com-
petent, honest, f air, responsible, helpf ul,
and benevolent
(Altman
and
T aylor 1973; Dwyer
and LaGace
1986; Larzel-
ere and Huston
1980; Rotter
1971).
Anderson and Narus
(1990, p. 45)
f ocuson the
perceived
outcomesof trust
when
they
def ine it as"the f irm'sbelief that another com-
pany
will
perf orm
actionsthat will result in
positive
out-
comesf or the f irmaswell asnot take
unexpected
actions
that result in
negative
outcomes."
Indeed,
we would
expect
such outcomesf roma
partner
on whose
integrity
one can
rely conf idently.
Absent f romour def inition of trust isthe behavioral in-
tention of
"willingness" incorporated by Moorman,
Desh-
pande,
and Zaltman.
T hey argue
that thisbehavioral inten-
tion isa critical f acet of trust's
conceptualization
because
"if one believesthat a
partner
is
trustworthy
without
being
willing
to
rely
on that
partner,
trust islimited"
(p. 315).
We
argue
that
willingness
to act is
implicit
in the
conceptualiza-
tion of trust
and, theref ore,
one could not label a
trading part-
ner as
"trustworthy"
if one were not
willing to take actions
that otherwise would entail risk. More
simply, genuine
con-
f idence that a
partner
can
rely
on another indeed will
imply
the behavioral intention to
rely.
If one is
conf ident, then
T heory
/ 23
one would be
willing;
if one isnot
willing,
then one isnot
genuinely
conf ident. We believe
that, though
it
certainly
would be
appropriate
to have items
incorporating
"stated
willingness"
in a measure of trust, willingness
isunneces-
sary
or redundant in itsdef inition.
T hus, just
asbehavioral
intention isbest viewed asan outcome of attitude and not
as
part
of itsdef inition
(Fishbein
and
Ajzen 1975), "will-
ingness
to
rely"
should be viewed asan outcome
(or,
alter-
natively,
a
potential indicator)
of trust and not asa
part
of
how one def inesit.
Like
commitment,
trust also hasbeen studied
widely
in
the social
exchange
literature
(Fox 1974;
Scanzoni
1979)
and others. For
example,
in
organizational behavior, the
study
of "normsof trust" isconsidered a characteristic dis-
tinguishing management theory
f rom
organizational
econom-
ics
(Barney 1990;
Donaldson
1990a).
In
communications, a
key
construct hasbeen source
credibility, originally
def ined
by Hovland, Janis,
and
Kelley (1953)
astrust of the
speaker
by
the listener. In services
marketing, Berry
and Para-
suraman
(1991, p. 144)
f ind that
"customer-company
rela-
tionshipsrequire
trust."
Indeed, they
contend
(p. 107),
"Ef -
f ective services
marketing depends
on the
management
of
trust because the customer
typically
must
buy
a service be-
f ore
experiencing
it." In
strategic alliances,
Sherman
(1992, p. 78)
concludesthat "the
biggest stumbling
block
to the successof alliancesisthe lackof trust." In
retailing,
Berry (1993, p. 1)
stressesthat "trust isthe basisf or
loy-
alty."
In automobile
marketing,
Saturn stresses
"partner-
ships
in which
everyone
shared risksand
rewards,"
which
emphasizes
"win-win role
playing gamesstressing
mutual
trust"
(Advertising Age 1992, p. 13),
and
competing
with
Japanese automakers, says
Ford Motor
Company, requires
relationships
with its
suppliers
in which "there'sa
spirit
of
trust"
(Business
Week
1992, p. 27).
In
buyer-seller bargain-
ing situations,
Schurr and Ozanne
(1985)
f ind trust to be cen-
tral to the
process
of
achieving cooperative problemsolving
and constructive
dialogue.
Asin the
organizational
context
mentioned
previously, they
also f ind trust to lead to
higher
levelsof
loyalty (i.e., commitment)
to the
bargaining part-
ner.
Finally,
trust isviewed ascentral in studiesconducted
by
the Industrial
Marketing
and
Purchasing Group(Ford
1990 and Hakansson
1982). T heref ore,
we theorize that
trust iscentral to all relational
exchanges
in
Figure
1.
T rust Inf luences
Relationship
Commitment
T rust isso
important
to relational
exchange
that
Spekman
(1988, p. 79) postulates
it to be "the cornerstone of the stra-
tegic partnership." Why?
Because
relationships
character-
ized
by
trust are so
highly
valued that
parties
will desire to
commit themselvesto such
relationships(Hrebiniak1974).
Indeed,
because commitment entails
vulnerability, parties
will seek
only trustworthy partners.
Social
exchange theory
explains
thiscausal
relationshipthrough
the
principle
of
gen-
eralized
reciprocity,
which holdsthat "mistrust breedsmis-
trust and assuch would also serve to decrease commitment
in the
relationship
and shif t the transaction to one of more
direct short-term
exchanges" (McDonald 1981, p. 834).
T heref ore,
we
posit,
asdoesAchrol
(1991),
that trust isa
major
determinant of
relationship
commitment. Corroborat-
ing
our
hypothesis, Moorman, Zaltman, and
Deshpande
(1992)
f ind that trust
by marketing
research usersin their re-
search
providerssignif icantly
af f ected user commitment to
the research
relationship.
Precursors of
Relationship
Commitment and T rust
Drawing
on two decadesof
theory
and
empirical
research
on commitment in
organization
behavior
(see reviews
by
Reichers
1986; Mathieu and
Zajac 1990)
and the
recently
de-
veloping
commitment and trust literature in
marketing,
we
identif y
f ive
major precursors
of
relationship
commitment
and trust.
Specif ically,
asshown in
Figure 2, we
posit
that
(1) relationship
termination costsand
relationship
benef its
directly
inf luence
commitment, (2)
shared values
directly
in-
f luence both commitment and
trust,
and
(3)
communication
and
opportunistic
behavior
directly
inf luence trust
(and,
through trust,
indirectly
inf luence
commitment).
Relationship
termination costs. A common
assumption
in the
literature isthat a terminated
party
will seekan alternative
relationship
and have "switch-
ing costs," which lead to
dependence (Heide
and John
1988; Jackson
1985).
Such costsare exacerbated
by idiosyn-
cratic
investments, that is, investmentsthat are dif f icult to
switch to another
relationship(Heide
and John
1988).
Dwyer, Schurr,
and Oh
(1987, p. 14) propose
that "the
buyer'santicipation
of
high switching
costs
gives
rise to
the
buyer's
interest in
maintaining
a
quality relationship."
However,
it is
certainly possible
that no "switch" would
occur af ter the
relationship
dissolves. For
example,
a termi-
nated distributor or retailer
might
decide
(willingly
or unwill-
ingly)
to discontinue
carrying
an entire line of merchandise.
Even
though
no alternative
relationship
isestablished
(and
no switch is
made),
there neverthelesswill be costsincurred
f romtermination. T ermination costs
are, theref ore,
all ex-
pected
lossesf romtermination and result f romthe
per-
ceived lackof
comparable potential
alternative
partners,
re-
lationship
dissolution
expenses,
and/or substantial switch-
ing
costs. T hese
expected
termination costslead to an
ongo-
ing relationshipbeing
viewed as
important,
thus
generating
commitment to the
relationship.
T he
"expected"
in our
conceptualization emphasizes
that
many
businessrelation-
ships
are characterized
by great uncertainty. Indeed,
f acing
termination coststhat are
actually very high,
a
partner may
be
blissf ully
unaware of thisf act and not be committed to
the
trading partner. Conversely, f acing
total coststhat are ac-
tually very low, a
partner unf oundedly may
f ear
being
termi-
nated and be committed.
T hus,
it isthe
expectation
of total
coststhat
produces
commitment.
Relationshipbenef its.
Competition-particularly
in the
global marketplace-requires
that f irms
continually
seek
out
products, processes,
and
technologies
that add value to
their own
of f erings. Relationshipmarketing theory suggests
that
partner
selection
may
be a critical element in
competi-
tive
strategy.
AsWebster
(1991, p. 28)
notesf or industrial
marketers, "the f irm's
procurement strategy may
be the
most
important ingredient
in its
ability
to deliver
superior
value to itscustomers"
(emphasis
in
original).
Because
part-
nersthat deliver
superior
benef itswill be
highly valued,
f irmswill commit themselvesto
24 / Journal of
Marketing, July
1994
and
maintaining relationships
with such
partners.
Malcolm
Baldrige
Award winner Motorola
recognizes
the
"two-way
street" characteristic of relational
exchange
and conducts
quarterly
conf idential
surveys
of
major suppliers
to trackits
own
perf ormance
at
providing
benef itsto its
exchange part-
ners
(Moody 1992). T heref ore,
we
posit
that f irmsthat re-
ceive
superior
benef itsf romtheir
partnership-relative
to
other
options-on
such dimensionsas
product prof itability,
customer
satisf action,
and
product perf ormance,
will be com-
mitted to the
relationship.
Shared values. Shared
values,
the
only concept
that we
posit
as
being
a direct
precursor
of both
relationship
commit-
ment and
trust,
isthe extent to which
partners
have belief s
in common about what
behaviors, goals,
and
policies
are im-
portant
or
unimportant, appropriate
or
inappropriate,
and
right
or
wrong.
For
example,
Heide and John's
(1992)
"norms,"
because
they
ref er to
"appropriate actions," are
shared values.
Similarly, Dwyer, Schurr,
and Oh
(1987, p.
21)
theorize that shared valuescontribute to the
develop-
ment of commitment and trust.
Valuesare f undamental to def initionsof
organizational
culture
(Enz 1988;
Weiner
1988).
Schein
(1990, p. 111)
holdsthat we can
"distinguish
three f undamental levelsat
which culture manif estsitself :
(a)
observable
artif acts, (b)
values,
and
(c)
basic
underlying assumptions."
Valuesre-
f lect culture when
they
are
widely
and
strongly
held
(Schein 1990;
Weiner
1988).
Because it
provides
what
many
believe to be the best measure of
person-organization
f it in
employment settings(Caldwell
and
O'Reilly 1990;
Chatman
1991),
shared valueshasbecome a variable of
great
interest to
organizational researchers,
especially
in the
organizational
commitment literature
(Chatman 1991).
Kel-
man's
(1961)
seminal work
hypothesized
that
people's
atti-
tudesand behaviorsresult f rom
(1)
rewardsor
punish-
ments,
or
"compliance"; (2)
the desire to be associated
with another
person
or
group,
or
"identif ication";
or
(3)
hav-
ing
the same valuesasanother
person
or
group,
or "interal-
ization."
Hence,
the
organizational
commitment literature
of ten
distinguishes
between two kindsof commitment:
(1)
that
brought
about
by
a
person sharing, identif ying with,
or
internalizing
the valuesof the
organization
and
(2)
that
brought
about
by
a
cognitive
evaluation of the instrumental
worth of a continued
relationship
with the
organization,
that
is,
by adding up
the
gains
and
losses, pluses
and
minuses,
or rewardsand
punishments.
Consistent with the
organiza-
tional behavior
literature,
we
posit
that when
exchange part-
nersshare
values, they
indeed will be more committed to
their
relationships,
but our def inition of commitment isneu-
tral to whether it is
brought
about
by
instrumental or identi-
f ication/interalization f actors.
Communication. A
major precursor
of trust iscommuni-
cation, which "can be def ined
broadly
asthe f ormal aswell
asinf ormal
sharing
of
meaningf ul
and
timely
inf ormation be-
tween f irms"
(Anderson
and Narus
1990, p. 44).
Commu-
nication,
especially timely
communication
(Moorman,
Desh-
pande,
and Zaltman
1993),
f osterstrust
by assisting
in re-
solving disputes
and
aligning perceptions
and
expectations
(Etgar 1979).
Anderson and Narus
(1990)
note that
past
com-
munication isan antecedent of
trust,
but "In
subsequent pe-
riods... thisaccumulation of trust leadsto better communi-
cation"
(p. 45).
Because we, like Anderson and Narus, test
our model at a
specif ic point
in time, we
posit
that a
part-
ner's
perception
that
past
communicationsf romanother
party
have been
f requent
and of
high quality-that is, rele-
vant, timely,
and reliable-thiswill result in
greater
trust. Al-
though
"communication can be described asthe
glue
that
holds
together
a channel of
distribution, ...
empirical
re-
search on channel communication is
sparse" (Mohr
and
Nevin
1990, p. 36). Nonetheless, Anderson and Narus
(1990)
f ind
that,
f romboth the manuf acturer'sand distribu-
tor's
perspectives, past
communication was
positively
re-
lated to trust. Anderson and Weitz
(1989)
also f ind that com-
munication was
positively
related to trust in channels.
Opportunistic
behavior. T he
concept
of
opportunistic
be-
havior f romthe transaction cost
analysis
literature isde-
f ined as"self -interest
seeking
with
guile" (Williamson
1975, p. 6).
As
such, "the essence of
opportunistic
behav-
ior isdeceit-oriented violation of
implicit
or
explicit prom-
isesabout one's
appropriate
or
required
role behavior"
(John 1984, p. 279).
Because
opportunistic
behavior in or-
ganization
economics"isassumed in the f undamental axi-
oms, rather than treated
contingently
... thisis
guilt by
axiom"
(Donaldson 1990b, p. 373).
Even
though guilef ul,
self -interest maximization isaxiomatic in transaction cost
analysis, empirical
research indicatesthat human behavior
may
not be so Machiavellian af ter
all, especially
not behav-
ior in
long-run relationships(Bonoma 1976;
John
1984).
As
originally suggested by Dwyer, Schurr,
and Oh
(1987),
incorporating
trust in modelsof distribution channel relation-
shipsprovides
a
unique vantage point
f or
treating opportun-
ismasan
explanatory
variable.
Accordingly,
we
posit
that
when a
party
believesthat a
partner engages
in
opportunis-
tic
behavior, such
perceptions
will lead to decreased trust.
Rather than
positing
a direct ef f ect f rom
opportunistic
behav-
ior to
relationshipcommitment,
we
postulate
that such be-
havior resultsin decreased
relationship
commitment be-
cause
partners
believe
they
can no
longer
trust their
partners.
Outcomes of
Relationship
Commitment and T rust
Although,
as
components
of the
relationshipdevelopment
process, relationship
are, per se,
highly
desirable
"qualitative
outcomes"
(Mohr
and Nevin
1990),
we
posit
f ive additional
qualitative
outcomes.
First,
acquiescence
and
propensity
to leave
directly
f low f romre-
lationship
commitment.
Second,
f unctional conf lict and un-
certainty
are the direct resultsof trust.
T hird, and most im-
portantly,
we
propose
that
cooperation
arises
directly
f rom
both
relationship
commitment and trust. We theorize that
these
outcomes,
especially
the crucial f actor of
cooperation,
promote relationshipmarketing
success. Because we model
and test these outcomesat a
single point
in
time,
we ref er to
the
partner'sperceptions
about these f uture outcomeswhen
commitment and trust are
present.
Acquiescence
and
propensity
to leave.
Drawing
on the
organizational
behavior literature
(Steers1977),
we def ine
acquiescence
asthe
degree
to which a
partner accepts
or ad-
heresto another's
specif ic requests
or
policies,
and we
posit
T heory
/ 25
that
relationship
commitment
positively
inf luences
acquies-
cence,
whereastrust inf luences
acquiescence only through re-
lationship
commitment.
Conceptually, acquiescence paral-
lelsthe
perf ormance
outcome of
compliance,
asdiscussed
by Kumar, Stem,
and Achrol
(1992). Propensity
to leave is
the
perceived
likelihood that a
partner
will terminate the re-
lationship
in the
(reasonably)
near f uture
(Bluedor 1982).
We
posit
that the
strong negative relationship
between
organ-
izational commitment and
propensity
to leave the
organiza-
tion
(Mathieu
and
Zajac 1990)
also will hold at the inter-
organizational
level. Just asexcessive
employee
turnover is
costly
f or
employers, partnershipinstability
is
costly.
T here-
f ore,
"stability"
isa desirable
perf ormance
outcome
(Kumar, Stern,
and Achrol
1992)
that we
posit
can be
achieved
through f ostering
commitment.
Cooperation. Cooperation,
f romthe Latin
co,
meaning
"together,"
and
operari,
"to
work,"
ref ersto situationsin
which
parties
work
together
to achieve mutual
goals(Ander-
son and Narus
1990).
Even
though coordination,
which im-
pliescooperation,
hasbeen known to be essential in such
areasaschannelsof distribution f or
decades,
the
marketing
literature on
relationships
hasf ocused
disproportionately
on
power
and conf lict asf ocal constructs. For
example,
Ster
and
El-Ansary (1992, p. 312) point
out that a "central
theme" of channelsof distribution
theory
and research is
that
"interorganizational
coordination is
required
within a
marketing
channel." But
they go
on to maintain that it is
the exercise of
power
that iscrucial f or much coordination:
"Power
generally
must be used in a
marketing
channel to
... gain
cooperation
and induce
satisf actory
role
perf or-
mance."
Why
the f ocuson
power? Because,
asthe
epi-
graph quote
f romAlderson reminds
us, marketershave
long
noted the absence of a
theory
that
explainscoopera-
tion. T he commitment-trust
theory
contributesto that
long-
sought goal.
Harking
backto the
paradox
of
ef f ective
cooperation
within a network
promotes
ef f ective
competition among
networks.
T heref ore,
cooperation pro-
motes
success. Because conf lictual
behaviorscan coexist
temporally
with
cooperative actions,
cooperation
isnot
simply
the absence of conf lict
(Frazier
1983).
For
example, partners
can have
ongoing disputes
about
goals
but continue to
cooperate
because both
parties'
relationship
termination costsare
high.
Nor is
cooperation
the same
thing
as
acquiescence. Cooperation
is
proactive;
ac-
quiescence
isreactive.
Passively agreeing
to advertise a
part-
ner's
product
is
acquiescence; proactively suggesting
better
advertisementsis
cooperation.
Cooperation
isthe
only
outcome
posited
to be inf lu-
enced
directly by
both
relationship
A
partner
committed to the
relationship
will
cooperate
with
another member because of a desire to make the relation-
ship
work. Both
theory
and
empirical
evidence indicate that
trust also leadsto
cooperation.
Deutsch's
(1960) f indings,
using prisoner's
dilemma
experiments, suggest
that the ini-
tiation of
cooperation requirestrust,
and Pruitt
(1981) sug-
gests
that a
party
will undertake
high-risk,
coordinated be-
haviorsif trust exists.
Similarly,
Anderson and Narus
(1990, p. 45) state, "Once trust is
established,
f irmslearn
that
coordinated, joint
ef f ortswill lead to outcomesthat ex-
ceed what the f irmwould achieve if it acted
solely in its
own best interests."
Functional
conf lict.
T here
always
will be
disagreements
or "conf lict" in relational
exchanges(Dwyer, Schurr, and
Oh
1987).
T he
hostility
and bitterness
resulting
f romdis-
agreements
not
being
resolved
amicably
can lead to such
pa-
thological consequences
as
relationship
dissolution. How-
ever,
when
disputes
are resolved
amicably,
such
disagree-
mentscan be ref erred to as"f unctional
conf lict," because
they prevent stagnation,
stimulate interest and
curiosity,
and
provide
a "medium
through
which
problems
can be
aired and solutionsarrived at"
(Deutsch 1969, p. 19).
Func-
tional
conf lict, theref ore,
may
increase
productivity
in rela-
tionshipmarketing
and be viewed as
"just
another
part
of
doing
business"
(Anderson
and Narus
1990, p. 45).
Several
workseither
propose
or f ind that communication and
past
co-
operative
behaviorslead to the
perception
that conf lict is
f unctional
(Anderson
and Narus
1990; Deutsch
1969).
How-
ever,
we
posit
that it istrust that leadsa
partner
to
perceive
that f uture conf lictual
episodes
will be f unctional. Past co-
operation
and
communication,
we
propose,
result in in-
creased
f unctionality
of conf lict asa result of
increasing
trust.
Decision-making uncertainty. Uncertainty
in decision
making
ref ersto the extent to which a
partner (1)
has
enough
inf ormation to make
key decisions, (2)
can
predict
the
consequences
of those
decisions,
and
(3)
hasconf idence
in those decisions
(Achrol
and Stern
1988).
We
posit
that
trust decreasesa
partner'sdecision-making uncertainty
be-
cause the
trusting partner
hasconf idence that the trustwor-
thy party
can be relied on.
Hypotheses
Stated in f ormal
f ashion,
our
study
tests13
hypotheses:
Hi:
T here isa
positive relationship
between
relationship
termination costsand
relationship
commitment.
H2:
T here isa
between
relationship
ben-
ef itsand
relationship
commitment.
H3:
T here isa
between shared values
and
relationship
commitment.
H4: T here isa
between shared values
and trust.
H5:
T here isa
between communication
and trust.
H6: T here isa
negative relationship
between
opportunistic
be-
havior and trust.
H7: T here isa
between
relationship
com-
mitment and
acquiescence.
H8: T here isa
between
relationship
com-
mitment and
propensity
to leave.
Hg:
T here isa
between
relationship
com-
mitment and
cooperation.
Hlo: T here isa
between trust and relation-
ship
commitment.
H11:
T here isa
between trust and
cooperation.
H12:
T here isa
between trust and f unc-
tional conf lict.
26 / Journal of
Marketing, July
1994
FIGURE 3
A Rival Model of
H13:
T here isa
between trust and
uncertainty.
A Rival Model
An
emerging
consensusin structural
equationsmodeling
is
that researchersshould
compare
rival
models,
not
just
test a
proposed
model
(Bollen
and
Long 1992). What, then,
would be a rival model? Note that our model
posits
that re-
lationship
termination
shared val-
ues, communication,
and
opportunistic
behavior-all of
which have been associated with
important
outcomesin
past
research-inf luence their outcomes
only through
the
key mediating
variablesof
relationship
commitment and
trust. Because our
extremely parsimonious
model
permits
no direct
path
f rom
any
of the f ive variablesto
any
out-
come,
it
implies
a central
nomological
statusf or relation-
ship
commitment and trust. A
nonparsimonious
rival view
that is
equally
extreme would be one
positing only
direct
paths
f romeach of the
precursors
to the
outcomes, thereby
making relationship
nomologically
similar to the f ive antecedents. T he rival model
(see Figure
3), theref ore,
allowsno indirect
ef f ects;
in other
words,
re-
lationship
commitment and trust are not allowed to mediate
any
of the
relationships. Although
no one hastheorized the
rival
model,
it is
implied by
the numerousdiscussionsand
empirical
studiesthat consider
relationship
termination
shared
values, communication,
and
opportunistic
behavior to be
"independent
variables" di-
rectly inf luencing
outcomes.
Examples
include communica-
tion and
cooperation (Assael 1969); opportunism
and uncer-
tainty (Williamson 1985, p. 58);
communication and rela-
tionship"continuity,"
which
conceptually parallels"pro-
pensity
to leave"
(Anderson
and Weitz
1989);
shared val-
ues
leading
to decreased
propensity
to leave
(Chatman
1991);
and
relationship
termination costs
leading
to
cooper-
ation and/or decreased
propensity
to leave
(Schermerhor
1975; Skinner, Gassenheimer,
and
Kelley 1992; Spekman
and Salmond
1992).
Method
Research
Design
Asthe research
setting,
we used a national
sample
of inde-
pendent
automobile tire retailers.
Although
this
industry
haselementsof vertical
integration,
it still has
independent
dealers. Because most tire retailers
carry
a small number of
tire
lines,
their
relationships
with
suppliers
are
potentially
important enough
f or the research issuesto be
meaningf ul.
Restricting
the
sample
to thissomewhat
homogeneous
population
minimized extraneoussourcesof variation
(a
plus),
and the
relatively large
number of
producers
and ex-
treme
competitive pressures
due to
overcapacity
at the time
T heory
/ 27
of research increased the likelihood of there
being large var-
iance to be
explained (a large plus).
Preliminary investigation.
T he
study began by explora-
tory
f ield workthat included
soliciting
the assistance of
local
chapters
of the National T ire Dealersand Retreaders
Association
(NT DRA). In-depth,
on-site interviewswith of -
f icersof nine tire retailersin a medium-sized Southwestern
city explored
issuesrelated to tire manuf acturer/dealer rela-
tionships.
Fromthese interviews
(and the literature review
discussed
previously),
a draf t
questionnaire
wasconstructed
and
pretested
on site with the same nine tire retailers. Re-
spondents
were
encouraged
to
identif y
unclear
items, com-
ment on the
importance
of the research
issues,
and
suggest
changes.
Af ter
making
the
required modif ications,
the local
NT DRA
chapter
assisted in
mailing questionnaires
to a re-
gional sample
of tire retailersto determine if
respondents
could/would
complete
the
questionnaire
in the absence of a
researcher. No
problems
were
presented during
this
stage,
and the f inal draf t of the
questionnaire
was
developed.
Data Collection
Data were collected
using
a self -administered
questionnaire
sent to member f irmsof the NT DRA in two
phases. During
the
f irst, multiple copies
of
questionnaires
were mailed to
the
presidents
of the seven
largest
U.S.
chapters
of
NT DRA,
all of whomhad
agreed
to
participate.
We ex-
pected that,
like
Goolsby
and Hunt
(1992), using
local
chap-
tersof the trade association would
yield
a
higher response
rate than a mass
mailing.
Association
presidents
distributed
a total of 341
packets
of
questionnaires, introductory letters,
and business
reply envelopes
to membersat their
monthly
chapter meetings.
Af ter membersreturned
only
49
(14.37%),
it wasdecided that a mass
mailing
not
only
would allow f or direct researcher control over
questionnaire
distribution but also would be asef f ective asthe continued
use of local
chapters.
In
phase two, theref ore,
1000
packets
were mailed to
independent
NT DRA members
(new
tire
dealers
only)
chosen at randomf romthe most recent mem-
bershipdirectory-af ter excluding
all those in
metropolitan
areas
previously surveyed.
Returned
questionnaires
totaled
129,
f or a
response
rate of 12.9% and an overall
sample
size of 204 and
response
rate of 14.6%
(204/1394)1.
T hough sample generalizability
isa common concern in so-
cial science
research,
especially
when
response
ratesare
small,
it is
important
to note that at this
point
we are
provid-
ing
an initial test of a theoretical model in a
particular
con-
text. T he
important
issueshere are
(1)
whether our
sample
isan
appropriate
context f or
testing
our
theory
and
(2)
whether our
sample
of
respondents
hasvariance to be ex-
plained.
Because we are not
attempting
to
generalize
an es-
tablished model to a new
population
or
project
a
descriptive
statistic f roma
sample
to some
larger population,
the
possi-
bility
of
nonresponse
biasisa nonissue in research such as
ours
(Hunt 1990).
'T hisincludesthe nine
responsesacquired during
the initial
pretest
with
the nine local retailers
interviewed, aswell asthe 17 (out of a
sample
of
44, f or a 38.6%
response rate) responses
received af ter the mail
pretest
to
the
regional sample.
Sample
characteristics. Our
sampling
method suc-
ceeded in
providing respondents
who varied
greatly
on per-
sonal and f irmcharacteristics.
Respondents
varied
widely
in
age (<
35
years
of
age, 13.3%; 36-45
years
of
age,
29.1%;
46-55
years
of
age, 31.6%;
>
56
years
of
age, 26%;
x = 48
years
of
age,
s.d. =
10.8), education
(< high
school
diploma, 15.3%; some
college, 34.0%; college degree,
38.6%;
and
graduate work, 12.2%),
and
years
of businessex-
perience (<
10
years, 6.6%; 11-20
years, 26.5%; 21-30
years, 33.7%; and > 30
years, 33.1%; = 26.5
years,
s.d. =
10.2), though
the
sample
wasmade
up
almost
entirely
of
males
(98.4%).
T he f irms
represented
in the
sample
varied
in
size,
asmeasured
by
annual sales
(< $500,000, 11.3%;
$500,001-$1 million, 29.0%; $1-$2 million, 26.9%; $2-$5
million, 19.4%;
and > $5 million, 13.4%; x= $2.8 million,
s.d. = $4.4
million)
or
employees(< 10, 38.2%; 10-19,
26.6%; 20-49, 23.1%;
and >
50, 12.0%). Finally,
the aver-
age respondent purchased
54%
(range
=
10-100%, s.d. =
24.2)
of their tire
inventory
f romthe
supplier they
identi-
f ied astheir
"major supplier."
Measures
All measureswere
analyzed
f or
validity
and
reliability
f ol-
lowing
the
guidelines
of f ered
by
Anderson and
Gerbing
(1988)
and
Joreskog
and S6rbom
(1989).
T he
resulting
measurement model
X2(406)
was588.33
(p
=
.000). Appen-
dix A containsmeasure characteristicsand
sample
measure-
ment items.
Here,
we
brief ly
discussthe
origin
of the meas-
uresused.
Focal constructs. Given our
conceptualization
of rela-
tionshipcommitment,
it wasessential that itsmeasure
should
capture
both the
importance
of the
relationship
to re-
spondents
and their belief sabout
working
to maintain the re-
lationship. T hough
no scale existed at the
inception
of our
study
f or
measuring
commitment to an
interorganizational
relationship, eight
itemsin the
organizational
commitment
scalesof
Meyer
and Allen
(1984)
and
Mowday, Steers,
and
Porter
(1979)
ref lected our def inition. T hese
eight
were mod-
if ied to ref lect
relationship,
rather than
organizational,
com-
mitment. Because the
Dyadic
T rust Scale of Larzelere and
Huston
(1980) taps
the
major
f acetsof
trust,
that
is,
reliabil-
ity, integrity,
and
conf idence,
itsnine itemswere
adapted
to
measure
interorganizational
trust.
Antecedents
of relationship
commitment and trust. Sev-
eral of the itemsin the
Meyer
and Allen
(1984)
continuance
commitment scale f ocuson
employment
termination costs
at the
organizational
level. We modif ied nine of itsitemsto
measure
relationship
termination costs. T o measure relative
relationshipbenef its,
we
adapted
itemsf romtwo scales
used
by
Anderson and Narus
(1990)
that measure "out-
comes
given comparison
levels" and
"comparison
levels
given
alternatives." Communication wasmeasured
using
a
scale
developed by Anderson, Lodish,
and Weitz
(1987).
T he
opportunistic
behavior scale wasderived f romJohn
(1984).
For shared
values,
we used Enz's
(1988)
two-
staged procedure.
T hat
is,
we asked
respondents(1)
the de-
gree
to which
they
would
agree
and
(2)
the
degree
to which
they
believed their
major supplier
would
agree
with state-
ments
regarding
the
corporate
ethical valuesin
Hunt,
28 / Journal of
Marketing, July
1994
T ABLE 1
Correlation/Covariance Matrix
Composite
Mean S.D.
Reliability
RT CRB SV CM OB RC T R AQ PL CP FCUN
Relationship
termination
costs
Relationship
benef its
Shared values
Communication
Opportunistic
behavior
Relationship
commitment
T rust
Acquiescence
Propensity
to leave
Cooperation
Functional conf lict
Uncertainty
4.028
4.537
6.232
4.392
3.762
5.165
4.137
4.581
4.267
4.874
4.313
3.094
1.719
1.097
1.018
1.279
1.814
1.299
1.669
1.661
3.046
1.239
1.420
1.195
.895 2.954
.427
.871 -.015
.260
.216
.895 .690
.949 -.052
.817
-.821
-.120
.193
.299
.222
1.204
.297
.581
-.838
.452
.778
.565
-1.164
.552
.476
-.236
-.009
.273
1.037
.323
-.851
.556
.875
.601
-.657
.454
.316
-.233
.118 .069
.417 -.419
.257 -.465
1.635 -.588
-1.337 3.290
.788 -1.167
1.219 -2.303
.806 -1.130
-1.175 2.100
.761 -1.335
.671 -.823
-.370 .715
.314
.316
.435
.471
-.501
1.688
1.182
.994
-1.849
.800
.565
-.185
-.018 .293
.425 .310
.519 .361
.589 .383
-.759 -.374
.549 .470
2.786 .451
1.257 2.759
-2.026 -1.897
1.220 .835
.964 .743
-.557 -.289
-.158
-.346
-.217
-.303
.379
-.468
-.396
-.382
9.276
-1.667
-1.191
.737
-.056
.402
.370
.481
-.591
.494
.586
.403
-.436
1.535
.514
-.692
.080
.309
.219
.375
-.318
.304
.406
.314
-.275
.294
2.017
-.254
.144
-.179
-.192
-.241
.331
-.121
-.279
-.146
.200
-.463
-.149
1.427
Correlationsare above the
diagonal,
varianceson the
diagonal,
and covariancesbelow the
diagonal.
Correlations> .121 are
signif icant
at the
p
< .05 level and correlations> .191 are
signif icant
at the
p
< .01 level. n = 204.
Wood,
and Chonko
(1989).
Shared valuesthen were calcu-
lated asthe dif f erence between the two
responses
sub-
tracted f rom7
(to
make
high
numbersindicate
high
shared
values).
Items
ref lecting
ethical valueswere chosen because
such valuesare
thought
to be f oundational in relational ex-
changes(Gundlach
and
Murphy 1993)
and because
Hunt,
Wood,
and Chonko
(1989, p. 86)
f ind shared ethical values
to be "a
signif icant
and substantive
predictor
of
organiza-
tional commitment" in
marketing.
Consequencesof relationship
commitment and trust. T o
measure
cooperation,
we
adapted
the scale
developed by
Brown
(1979).
No scalesexist f or
measuring
the
buyer'sper-
ception
of f uture
acquiescence
to the
supplier'spolicies.
Be-
cause measuresof
self -reported
intentionsto
perf ormspe-
cif ic behaviors
(e.g., voting
f or a
given candidate)
com-
monly employ single items,
a
single
itemmeasure wasused
f or intended
acquiescent
behavior. T he
propensity
to leave
measure was
adapted
f romBluedom's
(1982)
measure of
employees' propensity
to leave the
organization.
We devel-
oped
a two-itemscale that measures
perceptions
of f uture
f unctional conf lict. T he
uncertainty
measure was
adapted
f romAchrol and Stem's
(1988)
scalesf or
adequacy
of avail-
able inf ormation
(UINFO)
and the
degree
of conf idence of
the decision maker when
making
these decisions
(UCONF).
Results
T able 1 shows
means,
standard
deviations,
intercorrela-
tions, variances,
and covariancesf or the summatesof all re-
search variables. Note that the standard deviationsf or the
11 scales
range
f rom1.018 to 1.814
(mean
=
1.401),
indicat-
ing
a substantial amount of variance in the
responses.
Most
importantly,
standard deviationsf or the seven
endogenous
variablesindicated
high
variance to be
explained (mean
=
1.647).
Of the 12 scales'
means,
5 are within one-half scale
point
(and 9 within one scale
point)
of
4,
the center of the
scales. T hisabsence of
skewness,
when combined with the
standard
deviations, suggests
that our
sample
contained
both ef f ective and inef f ective
relationships,
at least on the
qualitative
dimensionsstudied.
T he correlationsin T able 1
provide
an initial test of the
13
hypotheses.
All 13 of the
hypothesized relationships
are
supported
at the
p
< .01 level. T he absolute valuesof the cor-
relations
range
f rom.279 to
.759,
the
average being
.476.
For a much
stronger
test of the
hypotheses,
we now test the
proposed
model
using LISREL, thereby holding
constant
all 43
nonspecif ied
structural
relationships
and
accounting
f or measurement error.
T esting
the KMV Model
T he KMV model wastested
using
LISREL VII and the co-
variance matrix shown in T able 1. Each
single-indicant
load-
ing
wasf ixed at .950 f or the f ormative measure summates
and at each scale'scoef f icient
alpha
f or ref lective measure
summates. T he
exogenous
constructswere allowed to corre-
late
by f reeing
the (I matrix. T he
results,
shown in T able
2,
indicate
support (p
<
.01)
f or 12 of the 13
hypothesized
paths
of the
model,
and 24 of 27 indirect
paths.
T he
pro-
posed
structural model's
comparative
f it
index,
CFI
(Bentler 1990),
of .890 indicatesa
good f it, especially
f or a
model with such a
large
number of constructs.
Overall,
the
KMV model
perf orms
well.
Building relationship
commitment and trust. With the ex-
ception
of
relationship
benef its->
relationship
commit-
ment,
all
hypothesized paths
f romthe antecedentsto relation-
ship
commitment and trust were
supported. Furthermore,
the
squared multiple
correlations
(SMCs)
f or the structural
equations
f or
relationship
commitment and trust were
high.
Over half of the variance
(SMC
=
.552)
in
relationship
com-
mitment was
explained by
the direct ef f ectsof
relationship
termination
costs,
shared
values,
and
trust,
and the indirect
ef f ectsof shared
values, communication,
and
opportunistic
behavior. For
trust,
even more of the variance wasex-
plained (SMC
=
.743) by
the direct ef f ectsof shared
values,
communication,
and
opportunistic
behavior.
Outcomes
of developing relationship
commitment and
trust. All the
pathsleading
to the f ive outcomeswere
signif -
icant at the
p
< .001 level. T he standardized estimatesf or
the six
hypothesized pathsranged
f rom.252 to .561
(mean
=
.442), suggesting
that
relationship
T heory
/ 29
T ABLE 2
Analysis
of
Competing
Structural Models
Proposed
Model Rival Model
Path Estimate Path Estimate
Direct Ef f ects Direct Ef f ects
Relationship
termination costs->
Relationship
commitment .367c Relationship
termination costs-> Acquiescence
.242b
Relationship
benef its->
Relationship
commitment -.006
Relationship
termination costs
-
Propensity
to leave .004
Shared Values->
Relationship
commitment .1 89b Relationship
termination costs--Cooperation
-.209b
Shared Values- T rust .192C Relationship
benef its- Acquiescence
.029
Communications-+ T rust .184b Relationship
benef its-> Propensity
to leave -.213b
Opportunistic
behavior -> T rust -.618C Relationship
benef its-, Cooperation
.193b
Relationship
commitment -
Acquiescence
.561C Shared values-> Acquiescence
.150a
Relationship
commitment -
Propensity
to leave -.550c Shared values->
Propensity
to leave .132
Relationship
commitment ->
Cooperation
.252C Shared values-
Cooperation
-.029
T rust ->
Relationship
commitment .531c Shared values- Functional conf lict .037
T rust ->
Cooperation
.507c Shared values-
Uncertainty
-.031
T rust -> Functional conf lict .448C Communication
-
Acquiescence
.102
T rust ->
Uncertainty
-.331c Communication
-
Propensity
to leave .104
Indirect Ef f ectsd Communication -
Cooperation
.069
Relationship
termination costs-
Acquiescence
.206C Communication
- Functional conf lict .262b
Relationship
termination costs-
Propensity
to leave -.202C Communication -
Uncertainty
-.047
Relationship
termination costs->
Cooperation
.093b
Opportunistic
behavior -
Acquiescence
.007
Shared values
-
Relationship
commitment .102C
Opportunistic
behavior ->
Propensity
to leave .143
Shared values->
Acquiescence
.163C
Opportunistic
behavior -
Cooperation
-.273a
Shared values->
Propensity
to leave -. 160C
Opportunistic
behavior -> Functional conf lict .133
Shared values-
Cooperation
.171C
Opportunistic
behavior -
Uncertainty
.400b
Shared values
-
Functional conf lict .086b
Relationship
commitment -
Acquiescence
.165
Shared values->
Uncertainty
-.064b
Relationship
commitment ->
Propensity
to leave -.438c
Communication ->
Relationship
commitment .097b
Relationship
commitment -
Cooperation
.338c
Communication -
Acquiescence
.055b T rust
-
Acquiescence
.246a
Communication -, Propensity
to leave -.054b T rust -, Propensity
to leave -.100
Communication -
Cooperation
.118b T rust -
Cooperation
.096
Communication - Functional conf lict .082b T rust -> Functional conf lict .371a
Communication -
Uncertainty
-.061b T rust ->
Uncertainty
.070
Opportunistic
behavior ->
Relationship
commitment -.327C
Opportunistic
behavior ->
Acquiescence
-. 184C
Opportunistic
behavior ->
Propensity
to leave .180C
Opportunistic
behavior --
Cooperation
-.396c
Opportunistic
behavior - Functional conf lict -.277c
Opportunistic
behavior -
Uncertainty
.204C
T rust
-
Acquiescence
.299c
T rust --
Propensity
to leave -.292C
T rust ->
Cooperation
.134b
X2(43)
=
140.26 GFI =
.892 CFI
=
.890 PNFI = .555
X2(16)
= 52.64 GFI =
.957 CFI
=
.959 PNFI
=
.228
ap
< .05
bp
< .01
cp
< .001
dOnly
those indirect ef f ectsthat were
signif icant
at the
p
< .05 level or better are shown
n = 204
have considerable inf luence on variablesthat are theorized
to be
important
f or
success.
Indeed,
the model
explains
a substantial amount of the variance of
each
outcome,
asthe SMCsreveal:
acquiescence
=
.315, pro-
pensity
to leave
=
.302, cooperation
=
.481,
f unctional con-
f lict =
.201,
and
uncertainty
=
.109. T he total coef f icient of
determination f or the structural
equations
is.810.
T esting
the Rival Model
We
compare (see
T able
2)
the
proposed
model with itsrival
on the
f ollowing
criteria:
(1)
overall f it of the model-im-
plied
covariance matrix to the
sample
covariance
matrix,
as
measured
by CFI; (2) percentage
of the models'
hypothe-
sized
parameters
that are
statistically signif icant; (3) ability
to
explain
the variance in the outcomesof
interest,
asmeas-
ured
by squared multiple
correlationsof the f ocal and out-
come
variables;
and
(4) parsimony,
asmeasured
by
the
par-
simoniousnormed f it index
(PNFI) (James, Mulaik,
and
Brett
1982).
T hough
the CFI f or the rival model is
slightly higher
(CFI
=
.959 versus
.890), only
11 of 29
(37.9%)
of its
hy-
pothesized paths
are
supported
at the
p
< .05 level
(includ-
ing only
7 of 29
(24.1%) supported
at
p
<
.01).
In
contrast,
12 of 13
hypothesized paths(92.3%)
in the KMV model
are
supported
at the
p
< .01 level.
Importantly,
9 of the
11
signif icant
direct ef f ectsin the rival are
signif icant
direct or
indirect ef f ectsin the KMV model
(the exceptions
are
relationship
benef its
--
propensity
to leave and
relationship
benef its->
cooperation). Moreover, little,
if
any,
additional
explanatory power
is
gained
f romthe additional 16
paths.
T he rival'sSMCsare
acquiescence
=
.395, propensity
to
leave
=
.352, cooperation
=
.561,
f unctional conf lict
=
.235,
and
uncertainty
=
.153. T he
largest
increment to SMCwas
.080
(f or acquiescence)
and the mean increment
only
.058.
30 / Journal of
Marketing, July
1994
T he total coef f icient of determination f or the rival isactu-
ally
lessthan that of the KMV model
(.805
versus
.810).
Asisobviousf rom
Figures
2 and
3,
there isa
great
dif -
f erence in
parsimony
between the KMV and rival models
(13
versus29
paths).
Because CFI doesnot account f or
par-
simony dif f erences, we
compare
the two models
using
PNFI. Because PNFI isinf ormed
by
both the
goodness
of
f it of the model and its
parsimony,
one
commonly
f inds
that
goodness
of f it indicesin the .90stranslate to
parsimo-
niousf it indiceslessthan .60
(Mulaik
et al.
1989). T he
KMV model'sPNFI of .555 exceedsthe rival's.228. Al-
though
no
guidelines
exist f or
determining
what isa
signif -
icant dif f erence in PNFI
values,
we note that to
accomplish
a 7.8%
improvement
in CFI
(f rom
.890 to
.959),
one sacri-
f ices41.1% in PNFI
(f rom
.555 to
.228).
Such a
sacrif ice, it
would
seem,
istoo
great.
Stated
conversely,
we
accomplish
a
great improvement
in
parsimony (f rom
29
paths
to 13
paths) by sacrif icing only
7.8% in CFI-a sacrif ice seem-
ingly
worth
making
f or the sake of
parsimony.
Discussion
We f irst addressthe
signif icance
of
conceptualizing
relation-
ship
commitment and trust asmediatorsof
important
rela-
tional variables. T hen we discussdirectionsf or f urther
research.
Relationship
Commitment and T rust as
Key
Mediating
Constructs
In
what are the rolesof commit-
ment and trust? Are
relationship
just
two more
"independent"
variablesthat inf luence outcomes
or are
they
somehow central to
suc-
cess?
T heorizing
that commitment and trust are
key
varia-
blesthat mediate successf ul
we de-
velop
a causal model
containing
13
hypotheses
that we test
in the context of automobile tire
relationships.
Correlation
analysissupported
all 13
hypotheses
and structural
equa-
tion
modeling,
a more
powerf ul test,
supports
12 of the 13
hypotheses.
Not
only
do our
hypothesized
antecedentsex-
plain
over half the variance in
relationship
commitment and
trust, they
also
explain
a substantial amount of the vari-
ancesin f ive
outcomes,
including
almost half of the vari-
ance of the crucial
variable, cooperation.
If
cooperative
re-
lationships
are
required
f or
relationshipmarketing success,
our results
suggest
that commitment and trust
are, indeed,
key.
Recognizing
that our model isboth
parsimonious(13
paths)
and extreme
(only
indirect
paths
are allowed f rom
the f ive
exogenous
to the f ive outcome
variables),
we com-
pare
it with a rival that is
nonparsimonious(29 paths),
but
equally
extreme
(no
indirect
paths
are
allowed). Although
customary goodness
of f it measuresshow
acceptable
f it f or
both
models,
parsimony clearly
f avorsthe
key mediating
var-
iable view. Even
though
the rival hasover twice the
paths
(29
versus
13),
the extra 16
paths
f romthe
"independent"
variables
explain only
a
marginal
amount of additional var-
iance.
Examining
the
paths
not
supported
in the rival also
suggests
that the KMV model best
representsreality. Surpris-
ingly,
not a
single
antecedent in the rival is
signif icantly
re-
lated to more than two outcomes-even
though
all these an-
tecedent variableshave been
widely recognized
as
impor-
tant in
exchange relationships.
T he KMV model
explains
this
surprising f inding by showing
that the antecedentsdo af -
f ect these outcomes
signif icantly,
but
only through
the
key
mediating
variablesof
relationship
commitment and trust. In-
deed,
all 18 of the indirect ef f ectsof the antecedentson the
outcomesare
supported (p
<
.01).
Finally,
when corrected f or
parsimony,
the overall f it of
the rival model islessthan half that of the KMV model. Phi-
losophically, parsimony
isa characteristic of theoriesthat
science hascherished since at least the 14th
century,
when
Williamof Ockham
developed
the
principle
now known as
Ockham'srazor.
Philosophers
of science
long
have
argued
that the
objective
of science isnot
only
to
explain, predict,
and understand the world in which we
live, but to do so in
asef f icient a manner as
possible.
Lambert and Brittan
(1970, p. 69),
discussthe reasonsthat
parsimony,
or "sim-
plicity,"
hasbeen so
important
in science:
"Certainly
of
two
hypotheses
equally satisf actory
in other
respects,
we ha-
bitually
choose the
simpler.
Reasonsare not hard to f ind.
T he
simpler hypothesis
is
usually
the more
elegant,
more
convenient to work
with,
more
easily understood, remem-
bered, and communicated." T he
emphasis
on
parsimony
in
the structural
equationsmodeling
literature is
f ully
in ac-
cord with
philosophy
of science
(Bentler
and
Mooijaart
1989). T heref ore,
if the
job
of
marketing
science
is, when-
ever
possible,
to
explain marketing phenomena parsimoni-
ously,
our results
clearly support
the
theory
that commit-
ment and trust are
key mediating
variablesthat contribute
to
success.
Relationshipmarketing success,
in all its
contexts,
re-
quirescooperative
behaviors.
Indeed,
asVan de Ven
(1976,
p. 25) putsit, "the end
objective
of
organizations
involved
in an
[interorganizational relationship]
isthe attainment of
goals
that are unachievable
by organizationsindepend-
ently."
In the rival
model, only relationship
benef itsand
op-
portunistic
behavior were f ound to af f ect
cooperation signif -
icantly.
In the KMV
model, however,
all antecedents
(ex-
cept relationshipbenef its)
were f ound to af f ect
cooperation
signif icantly,
and similar resultswere f ound f or the other im-
portant
outcomesaswell. T hese
f indingsimply
that relation-
ship
commitment and trust are not
only important
variables
in
marketing relationships,
as
proposed by
other researchers
(Achrol 1991;
Becker
1960;
Dwyer, Schurr,
and Oh
1987),
but also are
key mediating
variablesin these
relationships.
Identif ying
commitment and trust as
key mediating
var-
iablesiscritical to the
study
and
management
of relation-
shipmarketing.
T o the
researcher,
if
relationship
commit-
ment and trust were
merely
two more
independent
antece-
dentsof
important relationshipoutcomes,
f ailing
to include
their ef f ectsin studiesof
relationshipmarketing processes
simply
would result in lessvariance
explained among
the
outcomes.
However, as
key mediating variables,
f ailing
to in-
clude their ef f ectsin such studieswould result in f lawed con-
clusions
regarding
not
only
the direct
impact
of
relationship
commitment and trust on
important outcomes,
but the im-
pact
of other antecedentsaswell. T o the
manager,
under-
standing
of the
process
of
making relationships
workissu-
T heory
/ 31
perior
to
developing simply
a
"laundry
list" of antecedents
of
important
outcomes-and our results
imply
that commit-
ment and trust are
key
to
understanding
the
relationship
de-
velopment process.
Directionsf or Further Research
Alternative
approaches
to construct measurement. Al-
though
our measures
perf ormed well,
it is
certainly possible
that better
(or
at least
dif f erent)
measurescould be con-
structed f or several of the constructs. For
example,
relation-
ship
termination costs
appear
to increase
relationship
com-
mitment. Further research could
explore types
of termina-
tion costsother than the economic costsstudied here. None-
conomic
costs, including
the lossof "social satisf action
f romthe association"
(Dwyer, Schurr,
and Oh
1987, p. 14),
aswell assuch
sociopsychological
costsas
worry, aggrava-
tion,
and
perceived
lossof
reputation
or
"f ace,"
also could
contribute to the
development
of
relationship
commitment.
T he
hypothesized
ef f ect of
relationship
benef itson rela-
tionship
commitment was
unsupported-even though
the
simple
correlation
(r
=
.316)
was
positive
and
signif icant.
(Such surprising f indings
asthisshow the value of struc-
tural
equationsmodeling.)
One
possible
measurement-
related
explanation
f or this
f inding
isthat
relationship
ben-
ef itswere measured asan evaluation of the
supplier
on the
f acetsof
grossprof it,
customer
satisf action,
and
product per-
f ormance. In the
f uture,
researcherscould addressother
po-
tential benef its. Note that we measure
relationship
benef its
in a
comparative sense,
that
is, benef itsof the
supplier
com-
pared
with those of a
likely
alternative
supplier. Perhaps
many respondents
lacked inf ormation asto the characteris-
ticsof alternative
suppliers,
or
they
had a
tendency
to f ocus
on the absolute level of
benef its,
not the relative benef its. It
isworth
noting
that the variance in
relationship
benef its
wasone of the smallest of all studied variables
(s.d.
=
1.097).
In the
f uture, researcherscould
try measuring
satis-
f action with absolute levelsof benef its.
By measuring
shared valuesin termsof shared ethical
values, they
contributed
signif icantly
to the
development
of
both
relationship
However,
other
types
of shared values-f or
example, relating
to
product
quality, promotion tactics,
or customer service-also could
f urther the
development
of commitment and trust in rela-
tional
exchanges.
For
example,
researcherscould f ocuson
the "norms"
investigated by
Heide and John
(1992).
Finally,
lessthan 11% of the variance in
uncertainty
was
explained by
our model-the lowest f or
any
outcome.
Given the wide
range
of
idiosyncratic
environmental f ac-
torsthat
undoubtedly
af f ect each
respondent'suncertainty,
such low
explained
variance is
unsurprising. However,
it is
also
possible
that the
types
of decisionsthat the measure ad-
dressed-that
is,
adequacy
of inf ormation and conf idence
in decisionsf or
promotion
ef f ortsand
inventory-may
not
be as
heavily
inf luenced
by
trust in the
trading partner
as
are others. In the
f uture, researcherscould
explore
other f ac-
etsof the
business, such asthe
provision
of
warranty
ser-
vice, investment in
relationship-specif ic assets,
or
searching
f or alternative
trading partners.
For
example,
we would ex-
pect
that marketerswho trust their
trading partners
should
f eel more sure-that is, lessuncertain-about
excluding po-
tential alternate
suppliers
f romconsideration.
Further
developing
the KMV model.
Although
our tests
of the two
competing
models
suggest
that the KMV model
better
conceptualizes
the rolesof commitment and trust, al-
lowing
f or direct ef f ectsf or some antecedentsis
suggested.
Of the f ive antecedents
studied, opportunistic
behavior dis-
played
the
largest ef f ects, both direct and indirect. T he sizes
of the rival model'sdirect
paths
f rom
opportunistic
behav-
ior to the outcomes
suggest
that
opportunistic
behavior also
may
inf luence one or more outcomes
directly. Indeed,
the
LISREL modif ication indices
suggest paths
f rom
opportun-
istic behavior to
cooperation
and
uncertainty. T heref ore,
we
urge
researchersto evaluate an "extended" KMV model
that allowsf or both direct and indirect
paths
f rom
opportun-
istic behavior to these variables.
Our resultsindicate that trust inf luencesthe
way
in
which
disagreements
and
arguments
are
perceived by
ex-
change partners.
When trust is
present, parties
will view
such conf lict asf unctional.
T heref ore, they
can discuss
prob-
lems
openly
because
they
do not f ear malevolent actions
by
their
partners.
Both the modif ication indicesf or the
pro-
posed
model and the resultsof the rival model
suggest
that
communication also can lead
directly
to conf lict
being per-
ceived asf unctional
(independent
of the indirect
path
through trust).
T his"dual
path" possibility
would lend
sup-
port
to Mohr and Nevin's
(1990)
view that ef f ective commu-
nication iscrucial f or
obtaining high perf ormance.
Further
research
investigating
the extended KMV model should de-
termine whether this"dual
path"
holdselsewhere.
Our test f ailed to
support
a
path
f rom
relationship
bene-
f itsto
relationship
commitment.
Although
thisf ailure
may
be related to the measurement issues
previously discussed,
structural
explanations
also
may
exist. One would
expect
that the level of benef itsreceived f romthe
relationship
would be related
strongly
to both satisf action with those ben-
ef itsand satisf action with the overall
relationship.
Global sat-
isf action
customarily
showsa
strong relationship
with all
f ormsof commitment
(Williams
and Hazer
1986)-which
may explain
our
positive (simple)
correlation of benef itsto
commitment.
However,
one also would
expect strong
asso-
ciationsbetween
global
satisf action and our other ex-
ogenous
variables
(e.g., communication). T heref ore,
there
may
be a
global
satisf action "halo ef f ect" that resultsin
the
apparent relationship
between benef itsand commitment
disappearing
when all
exogenous
variablesare included in
the
analysis.
Researchers
may
need to include thishalo ef -
f ect
explicitly
in their models.
Interestingly, though
our resultsindicate that both com-
mitment and trust are
important
f or
achieving cooperation,
the
parameter
values
suggest
that trust hasthe
strongest
ef -
f ect. Our measure of
cooperation
included
cooperation
acrossf ive dif f erent f acetsof the business. Would thisf ind-
ing
hold f or other f ormsof
cooperation? Furthermore,
what
f ormsof
cooperation
are most conducive to success? T he or-
ganizational
behavior literature
highlights
the role of
organ-
izational
citizenship
behaviorsin success
(Organ 1988).
Are there
specif ic
network
citizenship
behaviorsthat contrib-
32 / Journal of
Marketing, July
1994
FIGURE 4
An Extended KMV Model of
09
sm
"o
w
t+
- -
-
- -
--
+
ute to
success? T hese
questions
war-
rant f urther research.
Among
the
important
outcomeswe
study
here is
acqui-
escence.
Why
do f irms
acquiesce
to or
comply
with the de-
siresof others?
Marketing's
traditional answer hasbeen
that
compliance
resultsf romthe exercise
(or
one'sf ear of
the
exercise)
of
power, which,
since Hunt and Nevin
(1974), customarily
hasbeen divided into two
types,
coer-
cive and noncoercive.
However,
to
many academics,
as
well asto most
practitioners,
the term
power implies,
or at
least
strongly connotes, coercion,
that
is,
"do thisor else!"
If one doesnot have the
ability
to f orce
compliance,
then
one
may
be said to have some
degree
of
inf luence,
but not
genuine power.
For these academicsand
practitioners,
non-
coercive
power
isat best a non
sequitur
and at worst an ox-
ymoron.
In thisvein,
Young
and Wilkinson
(1989, p. 109)
argue
that
marketing'semphasis
on
power
and conf lict as
key concepts
f or
studying
channelshas"distorted the under-
standing
of how channelsf unctioned. T he
emphasis
wason
sickrather than
healthy relationships."
Instead of
acquiescence resulting
f romthe exercise of
power,
asin sick
relationships,
our results
support
the view
that in
"healthy" relationshipspartnersacquiesce
because
of their commitment to the
relationship.
In
short,
whereas
the exercise of coercive
power yieldscompliance
because
f irmsare
compelled
to do
so,
f irmscommitted to the rela-
tionshipacquiesce
because
they
want to do so.
Long-run
re-
lationshipsuccess,
we
argue,
ismore
likely
to be associated
with the absence of the exercise of coercive
power
and the
presence
of commitment and trust. T he
preceding
notwith-
standing,
the commitment-trust
theory
of
relationship
mar-
keting
doesnot
deny
the
importance
of
understanding
power.
Just asmedical science should understand both sick-
nessand
health, marketing
science should understand both
f unctional and
dysf unctional relationships.
Just asthe KMV
model
incorporatesopportunistic
behavior and its
dysf unc-
tional
consequences,
so also can an extended KMV model
incorporate power.
Everyone acknowledges
that
power-here implying
the
ability
to
compel compliance-indeed
can result f romde-
pendence. Furthermore, dependence
varies
directly
with the
value received f roma
partner
and
inversely
with the availa-
bility
of alternative
trading partners(Cook
and Emerson
1978).
In our
terms, f eelings
of
dependence
can result f rom
relationship
benef itsand
relationship
termination costs. We
also
acknowledge
that the exercise of
power (based
on de-
pendence)
in
specif ic episodes
can lead to a
partner'sacqui-
escence.
However,
the
continuing
exercise of
power
to
gain
acquiescence
also
destroys
trust and
commitment,
which de-
creases
cooperation
and inhibits
long-term
success. As
pre-
viousresearch
supports(Lusch 1976),
the use of
power
also
will result in conf lict
(of
the
dysf unctional kind).
In sum-
mary,
asshown in the extended KMV model
(Figure 4),
we
hypothesize
that
power (1)
resultsf rom
relationship
termina-
T heory
/ 33
0-010
0-00
040
tion costsand
relationshipbenef its, (2) positively
af f ectsac-
quiescence
and
conf lict,
and
(3) negatively
af f ectsrelation-
ship
commitment and trust. T he
negative
ef f ect on relation-
ship
commitment and trust over the
long
termwill decrease
cooperation
and diminish overall
relationship
success.
Power, then,
like
opportunistic behavior, helps
usto under-
stand
f ailures. If
marketing
science
should turn toward
explaining relationshipmarketing
suc-
cess-and we believe it
should-power
cannot be the cen-
tral construct.
Limitations
T he f irst limitation isthe cross-sectional
design employed.
In
any
model in which
causality
is
suggested, longitudinal
studies
provide
f or
stronger
inf erences.
T hus,
the model de-
veloped
and tested here could benef it f rom
being
tested in
a
longitudinal design.
Second,
the context of our
study,
automobile tire retail-
ers,
limitsits
potential generalizability.
On
average, respon-
dentsin our
sample purchased roughly
half
(54%)
of their
tire
inventory
f romthe
supplier they
identif ied astheir
"major supplier." Certainly,
some f irmsin other industries
would
purchase
more of their inventoriesf romtheir
major
suppliers(e.g., f ranchising operations
such asautomobile
dealerships),
and f irms
of f ering
a broader assortment of
goods
or services
(e.g.,
mass
merchandisers, supermarkets)
would
purchase
much lessf roma
single supplier. Perhaps
in industriesin which the
percentage
of retailers' total
pur-
chasesf rom
single suppliers
dif f ers
markedly
f romthe
range
in our
sample,
the structure of
relationshipsmight
be
dif f erent.
T heref ore,
not
only
would strict
replication using
automobile tire retailersbe
usef ul,
but
extending
the
study
to other
partnerships
is
def initely required.
Because we the-
orize that commitment and trust are
key mediating
varia-
blesin all ten f ormsof
relationshipmarketing, testing
our
baseline model in such areasas
strategic alliances,
total
qual-
ity management ef f orts,
public-purpose partnerships,
and
"internal
marketing" programs
is
required.
Our
reading
of
the literature in all f ormsof
leadsus
to believe that the commitment-trust
theory underlying
the
KMV model should
apply
f or all relational
exchanges-but
only
f urther
empirical
workcan conf irmor disconf irmthis.
Conclusion
We
explore
the nature of
its
concep-
tualization, f orms, and
requisites
f or success.
Relationship
marketing,
we
propose,
ref ersto all
marketing
activitiesdi-
rected toward
and
maintaining
suc-
cessf ul relational
exchanges.
With
regard
to
any f irm, there
are ten f ormsof
which can be
grouped
into the relational
exchangesinvolving suppliers,
lateral
organizations, customers, or one'sown
employees
or
businessunits. T he need f or
stems
f romthe
changing dynamics
of the
global marketplace
and
the
changing requirements
f or
competitive
success. Some-
what
paradoxically,
to be an ef f ective
competitor
in
today's
global marketplace requires
one to be an ef f ective
coopera-
tor in some networkof
organizations.
If
being
an ef f ective
cooperator
in some networkisa
prerequisite
to
being
a suc-
cessf ul
competitor,
what are the
requisites
f or
being
a suc-
cessf ul
cooperator?
T he commitment-trust
theory
maintains
that those networkscharacterized
by relationship
commit-
ment and trust
engender cooperation
(in addition to
acquies-
cence, a reduced
tendency
to leave the
network,
the belief
that conf lict will be
f unctional,
and reduced
uncertainty).
All these
"qualitative
outcomes" contribute to overall net-
work
perf ormance.
If commitment and trust are
key,
how
can such characteristicsbe nurtured? We
posit
that relation-
ship
develop
when f irmsattend to re-
lationshipsby (1) providing resources, opportunities,
and
benef itsthat are
superior
to the
of f erings
of alternative
part-
ners; (2) maintaining high
standardsof
corporate
values
and
allying
oneself with
exchange partnershaving
similar
values; (3) communicating
valuable
inf ormation,
including
expectations,
market
intelligence,
and evaluationsof the
part-
ner's
perf ormance;
and
(4) avoiding malevolently taking
ad-
vantage
of their
exchange partners.
Such actionswill enable
f irmsand their networksto
enjoy
sustainable
competitive
advantages
over their rivalsand their networksin the
global
marketplace.
Our initial test of the KMV model of relation-
ship
commitment and trust in the context of a channel of
distribution hasbeen
encouraging. However,
much more
workmust be done. Our
theory
and the model need f urther
explication, replication, extension,
application,
and critical
evaluation. We of f er themto the
marketing discipline
and
marketing practice
f or all these
purposes.
APPENDIX A
Measures
0 _ _ _, - . -. so . . .
.onstructa
Relationship
benef itsf
(4 items)
Relationship
termination costsr
(5 items)
reliabilityd
=
.895
a =
.893
VEE =
.634
X =
.790
Sample
Items
If
you
could not
buy your
stockf rom
your present major supplier, you
would
likely
be
pur-
chasing
f romsome other
major supplier (we'll
call thisthe "alternate
supplier").
Please com-
pare your major supplier
with thisalternate
supplier concerning
the
f ollowing
items:
(an-
chors: Present
supplier
ismuch better/Present
supplier
ismuch
worse)
1. Gross
prof it provided by
a
product
line common to both
suppliers.
2. Product
perf ormance provided by
a
product
line common to both
suppliers.
(anchors: Strongly agree/Strongly disagree)
34 / Journal of
Marketing, July
1994
APPENDIX A
Continued
Sample
Items
Shared valuesr
(5 items)
reliability
= .871
a = .868
VEE = .577
= .756
Communicationf
(4 items)
Opportunistic
behaviorf
(3 items)
Relationship
commitmentr
(7 items)
reliability
= .895
a = .895
VEE = .626
X = .736
T rustr
(7 items)
reliability
= .949
a = .947
VEE = .729
k= .849
Acquiescencef
(1 item)
Cooperationf
(5 items)
Propensity
to leavef
(3 items)
Functional conf lictf
(2 items)
Uncertaintyf
(10 items)
Please indicate the
degree
to which
you
believe that
(1) your supplier
would
agree
with the
f ollowing statements, and
(2) you
would
agree
with the
f ollowing statements: (two part ques-
tion, anchors:
Strongly agree/Strongly disagree)
1. T o succeed in this
business,
it isof ten
necessary
to
compromise
one'sethics.
2. If an
employee
isdiscovered to have
engaged
in unethical behavior that results
pri-
marily
in
personal gain (rather
than
corporate gain),
he or she should be
promptly rep-
rimanded.
In our
relationship, my major supplier (anchors: Strongly agree/Strongly disagree)
1.
...keeps
usinf ormed of new
developments.
2. ...communicateswell his
expectations
f or our f irm's
perf ormance.
T o
accomplish
hisown
objectives,
sometimes
my supplier (anchors: Strongly agree/
Strongly disagree)
1. ...altersthe f acts
slightly.
2.
...promises
to do
things
without
actually doing
themlater.
T he
relationship
that
my
f irmhaswith
my major supplier (anchors: Strongly agree/Strongly
disagree)
1. ..is
something
we are
very
committed to.
2. ..is
something my
f irmintendsto maintain
indef initely.
3. ...deservesour f irm'smaximumef f ort to maintain.
In our
relationship, my major supplier (anchors: Strongly agree/Strongly disagree)
1. ...cannot be trusted at times.
2. ...can be counted on to do what is
right.
3. ...has
high integrity.
(anchors: Strongly disagree/Strongly agree)
1. In the
f uture, my
f irmwill
likely comply
with the
policies
that this
supplier
establishesf or
the
marketing
of its
productsby
itsdistributors.
How would
you
characterize the
cooperation
between
you
and
your supplier regarding
the
f ollowing
activities?
(anchors:
Not at all
cooperativeNery cooperative)
1.
Local/Regional Cooperative Advertising
2.
Inventory
levels
What do
you
thinkare the chancesof
your
f irm
terminating
this
relationship... (anchors:
Very highNery low)
(a)
...within the next six months?
(b)
...within the next one
year?
(c)
...within the next two
years?
(anchors: Strongly agree/Strongly disagree)
1. In the
f uture, dif f erencesof
opinion
between
my supplier
and me will
probably
be
viewed as
"just
a
part
of
doing
business" and will
likely
result in benef itsto both of us.
T o what extent do
you
now have
adequate
inf ormation f or
making
f uture decisionsre-
garding (inf ormation
is
very adequate/inf ormation
is
very inadequate)
1. T he amount
you
should
spend
on local sales
promotions
and
advertising?
How conf ident are
you
in
your ability
to make f uture decisions
regarding (I
have
complete
conf idence/I have no
conf idence)
1. Which
products
or brandsto
carry
in stock?
aAll measures
employ 7-point
scales.
bltemwasreverse-scored.
cT he
Propensity
to leave indicator isa summate of the three
weighted
items. Item
(a)
is
weighted
f our timesthe reverse-scored
response.
Item
(b)
is
weighted
twice the reverse-scored
response.
Item
(c)
is
simply
the reverse scored
response.
dComposite reliability,
Cronbach'sa, variance extracted estimate, and
average
item
loading.
f Formative scale
rRef lective scale
T heory
/ 35
Constructa
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The Commitment-Trust Theory of Relationship Marketing

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