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Journal of Business & Industrial Marketing The effects of the salesperson’s characteristics on buyer-seller relationships Yonghoon Choi Ying Huang Brenda Sternquist

Article information: To cite this document: Yonghoon Choi Ying Huang Brenda Sternquist , (2015),"The effects of the salesperson’s characteristics on buyer-seller relationships", Journal of Business & Industrial Marketing, Vol. 30 Iss 5 pp. 616 - 625 Permanent link to this document: http://dx.doi.org/10.1108/JBIM-03-2012-0037

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The effects of the salesperson’s characteristics on buyer-seller relationships Yonghoon Choi Faculty of Commerce, Doshisha University, Kyoto, Japan

Ying Huang Manning School of Business, University of Massachusetts, Lowell, Massachusetts, USA, and

Brenda Sternquist

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Department of Advertising, Public Relations and Retailing, Michigan State University, East Lansing, Michigan, USA Abstract Purpose – This paper aims to examine the influence of the salesperson’s characteristics (organizational commitment [OC] and disposition to innovate) on buyer’s behaviors in buyer – supplier relationships. A model is proposed depicting the effects of the salesperson’s OC and disposition to innovate on buyer’s long-term orientation and opportunism through partner-specific value to the buyer. Design/methodology/approach – Data were collected from 155 sales professionals of Japanese manufacturers. Structural equation modeling was used to analyze the data. Findings – As predicted, the salesperson’s OC and disposition to innovate enhance buyer’s long-term orientation through providing partner-specific value to the buyer, and in turn, buyer’s long-term orientation mitigates opportunism. Practical implications – The salesperson plays an important role for developing and maintaining Buyer-seller relationships. Based on authors’ results, firms should promote salespeople’s OC because a highly committed salesperson is likely to be more innovative when managing the relationship with the buyer and, in turn, increase the relationship-specific value to the buyer. Originality/value – This study makes two contributions to Buyer-seller relationship literature. First, previous studies on the salesperson focus on the social aspects in the relationship. This study, however, examines the salesperson characteristics in the exchange, and the results reveal the importance of including the salesperson characteristics in studying Buyer-seller relationships. Second, this study proposes the salesperson’s partner-specific value as a key boundary-spanning aspect mediating the salesperson characteristics and buyer’s behaviors in Buyer-seller relationships. The results confirm the argument, thus providing impetus for further studying different types and dimensions of transaction-specific assets in Buyer-seller relationships. Keywords Buyer-seller relationships, Salesforce Paper type Research paper

1. Introduction

interpersonal trust (Bettencourt et al., 2005; Kaufman et al., 2006; Lee and Dawes, 2005). The salesperson’s characteristics and their role in inducing value in a Buyer-seller relationship are relatively less understood. Over years, the salesperson in many industries has evolved from an order taker to a customer relationship manager or relationship promoter (Steward et al., 2009; Ledingham et al., 2006; Walter, 1999). Indeed, the salesperson can significantly influence the buyer’s assessment of the exchange performance in terms of service quality, satisfaction and advocacy behavior (Parasuraman et al., 1985). However, the mechanism through which the salesperson creates specific value to the buyer in a Buyer-seller relationship remains largely unknown (Haytko, 2004; Nicholson et al., 2001; Osborn and Hagedoorn, 1997). Second, among different theories adopted by researchers to explain governance mechanisms in Buyer-seller relationships, transaction cost economics (TCE) assumes that firms are opportunistic and that opportunism causes safeguarding

Governing Buyer-seller relationships is critical for firms in business exchanges (Dwyer et al., 1987; Ganesan, 1994; Palmatier et al., 2007). Over the past three decades, research studies on Buyer-seller relationships have been abundant and fruitful. However, two issues can be readily observed in this area. First, the Buyer-seller interface has become more complex today, with customers increasingly demanding integrated cross-functional solutions to business problems (Tuli et al., 2007). Although researchers have recognized the role of the salesperson as a boundary spanner in the Buyer-seller interface (Parasuraman et al., 1985; Ferguson et al., 2005), most of the studies focus on the social aspects between boundary spanners, such as social ties and

The current issue and full text archive of this journal is available on Emerald Insight at: www.emeraldinsight.com/0885-8624.htm

Received 5 March 2012 Revised 10 January 2013 12 September 2013 22 January 2014 Accepted 22 January 2014

Journal of Business & Industrial Marketing 30/5 (2015) 616 –625 © Emerald Group Publishing Limited [ISSN 0885-8624] [DOI 10.1108/JBIM-03-2012-0037]

616

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Effects of the salesperson’s characteristics

Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

problems for exchange partners (Williamson, 1975, 1985). Following this assumption, researchers presume explicitly or implicitly that transaction-specific assets (TSAs) give rise to exploitation and, therefore, result in partner’s opportunistic behaviors (Klein et al., 1978). The association between TSA and opportunism, however, is not always attested, and results from empirical studies have been mixed. While some studies (Heide and John, 1988, 1992; Stump and Heide, 1996) support the positive relationship between TSA and partner opportunism, others find TSA induces partner’s commitment and cooperation (Anderson and Weitz, 1992; Jap, 1999; Joshi and Stump, 1999a; Lui et al., 2009). The divergent findings may be because previous studies treated TSA as a single-dimension construct and have ignored that in effect, the concept has multiple dimensions, including specificity, magnitude, importance, value, visibility, durability and risk (Lohtia et al., 1994). Considering the multidimensionality of the TSA concept, one can reasonably speculate that the relationship between each specific dimension of TSA and opportunism may vary (Lohtia et al., 1994). In responding to the above two observations, this study strives to make two contributions to Buyer-seller relationships research and boundary spanner research. First, we examine how the salesperson characteristics may help induce TSAs for the buyer in a Buyer-seller relationship. Particularly, we study two characteristics of the salesperson – OC and disposition to innovate – because previous studies have shown that the salesperson’s OC (MacKenzie et al., 1998) and innovative behaviors (Kanai, 1991) are positively related to the salesperson’s job performance. Second, we focus on one specific dimension of TSA – value to the other party, that is, the specific value of salesperson to the partner (partner specific value hereafter) – as the mediator in this study. In other words, we examine the effects of the salesperson’s OC and disposition to innovate on buyer’s long-term orientation and opportunism through partner-specific value. In so doing, we further the buyer-seller relationship literature by connecting the salesperson’s characteristics with one special type of TSA in managing partner’s relationships. Drawing on OC, TCE and resource dependence theory, we present the conceptual model in the next section.

building support for partner-specific adaptation, developing structural and social bonds, cultivating cooperative norms, shaping demands of customers and coordinating tasks with others in both the buyer and the seller firms (Walter, 1999). 2.1 Partner-specific value of the salesperson as human-specific assets TCE (Williamson, 1975, 1985) assumes that a firm chooses different governance structures in an effort to minimize transaction costs. In a Buyer-seller relationship, transaction costs may include ex ante costs such as drafting and negotiating contracts and ex post costs such as monitoring and enforcing agreements. According to TCE, the presence of opportunism and asset specificity causes the safeguarding problem. Asset specificity refers to the limited transferability of specific assets outside of a given transaction. Assets with a high degree of specificity represent sunk costs that have little value outside of a particular exchange relationship (Rindfleisch and Heide, 1997). Accordingly, TCE posits that a high level of asset specificity leads to greater transaction costs. Williamson (1991) has identified six types of asset specificity: 1 site specificity; 2 physical asset specificity; 3 human asset specificity; 4 brand name specificity; 5 dedicated asset specificity; and 6 temporal specificity (Williamson, 1991 for detail). Aside from these six types, Lohtia et al. (1994), through a content analysis of prior studies, have distinguished six dimensions of TSA: specificity, magnitude, importance, value to the other party, visibility, durability and risk assumed by investor. They further argue that, in different contexts, the relative importance of different dimensions and types of asset specificity may be different. Combining the main premises of this research, the authors submit that, in a Buyer-seller relationship, the salesperson’s dedicated skills, knowledge and capabilities to the buyer (i.e. partner-specific value) constitute the value dimension of human asset specificity – a salient function of the salesperson in boundary-spanning activities (Anderson, 1988). Accordingly, we propose partner-specific value as a key aspect of TSA mediating the salesperson’s characteristics (i.e. OC and disposition to innovate) and buyer’s behaviors (i.e. opportunism and long-term orientation) in a Buyer-seller relationship. The salesperson’s OC and disposition to innovate are chosen because these two characteristics predict the salesperson’s superior job performance (Kanai, 1991; MacKenzie et al., 1998), while the buyer’s long-term orientation and opportunism are key aspects in maintaining (or dissolving) a Buyer-seller relationship.

2. Theoretical framework and hypotheses development Boundary spanners are personnel representing their respective firm contractually to achieve specific goals in interfirm exchanges (Bettencourt et al., 2005; Haytko, 2004). Firms often evaluate their exchange partners through an evaluation of the boundary spanner. As such, boundary spanners’ characteristics and competence may influence the exchange partner’s evaluation of the exchange. In a Buyer-seller relationship, the salesperson assumes the role of boundary spanners, representing the seller and interacting with the buyer. The bundle of skills, capabilities and knowledge about the products and the buyer that the salesperson acquired over time can constitute a value to the buyer, particularly when they are tailored specifically to the buyer (Rindfleisch and Heide, 1997). Further, the role of boundary spanners has shifted from the reactive order facilitator to proactive relationship management, including responsibilities such as

2.2 OC and disposition to innovate OC is defined as an attitude or an orientation toward the organization which links or attaches the identity of the person to the organization (Sheldon, 1971). In the field of organizational behavior, the concept of OC has received substantial attention, and researchers have found that a high degree of OC is associated with outcomes such as low 617

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Effects of the salesperson’s characteristics

Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

turnover, limited absenteeism, high satisfaction, high job performance, high loyalty and, in turn, high organizational performance (Hunt et al., 1985; Luthans et al., 1985). According to OC literature, OC has three primary components: 1 a strong belief in and an acceptance of the organization’s goals and values; 2 a willingness to exert considerable effort on behalf of the organization; and 3 a strong desire to remain with the organization (Luthans et al., 1985).

Acquiring necessary skills and knowledge for generating innovative ideas is a time-consuming process. Salespersons with a low level of OC are not likely to dedicate extra time and efforts to their organization and customers, because learning is a long-term investment that cannot be paid-off within a short period (Gavin, 1993). Therefore, one might expect only highly committed salespersons to take extra efforts in trying to provide innovative solutions in exchange activities. As such, the salesperson with a high degree of OC is willing to be more innovative: H2.

The salesperson has a principal – agency relationship with his firm (i.e. the seller). Thus, the point to which he feels a sense of belonging and loyalty to his firm is critical in managing effective relationships with the customer when representing his organization. The concept of OC encompasses a willingness to make great effort in achieving the firm’s goals (Luthans et al., 1985). In a Buyer-seller relationship, a highly committed salesperson will be more motivated to invest time and effort in acquiring skills and knowledge (Mathieu and Zajac, 1990). Specialized skills and knowledge provided by the salesperson, tailored to a certain buyer firm, are considered as a specific human asset (Anderson, 1988). Those who are committed to the organization are willing to sacrifice personal welfare to contribute to the organization’s well-being (Mowday et al., 1982). A highly committed salesperson provides meaningful and beneficial information and knowledge to the buyer, and they are more committed to maintaining long-term relationships with important buying firms (Ganesan, 1994). Montes et al. (2003) empirically confirm that customer perceptions about service quality are explained by the service provider’s commitment to its firms. According to their study, customers evaluate service quality provided by employees with a low level of OC as defective. Thus, a highly committed boundary spanner, who likely will make great effort in acquiring skills and knowledge to meet the buyer’s needs, is assumed to provide a high value specific to the buyer. Thus, we predict: H1.

The stronger the salesperson’s OC, the stronger the salesperson’s disposition to innovate.

Further, a salesperson’s disposition to innovate influences the quality of information and knowledge provided to the buyer. Sujan et al. (1994), in their study of the salesperson’s learning orientation, examine the salesperson’s motivational orientation to improve his abilities and skills. This concept of learning orientation is similar to the innovation concept in our study. A learning orientation stems from one’s intrinsic interests such as “a preference for challenging work, a view of oneself as being curious or a search for opportunities that permit independent attempts to master material” (Sujan et al. 1994, p. 39). Thus, learning orientation could motivate the salesperson to work smart and to work hard and, finally, to improve the performance of sales activities. A salesperson with the disposition to innovate, in our study, is expected to willingly and spontaneously try to acquire knowledge or skills and propose new ideas proactively without adhering to extant practices. This kind of disposition is not from an extrinsic interest (e.g. the desire to achieve assigned sales volume), but from an intrinsic motivation with which learning is regarded as an investment with long-term rather than short-term payoffs (Gavin, 1993). Therefore, a salesperson’s performance can be related to the level of innovative behaviors one demonstrates (Kanai, 1991). A highly innovative salesperson who furnishes novel ideas and creative proposals presents a highly desirable value to the buyer. Thus, we posit: H3.

The stronger the salesperson’s OC, the greater the partner-specific value of the salesperson to the buyer.

The salesperson’s disposition to innovate is positively related to partner-specific value.

2.3 Buyer’s long-term orientation and opportunism Long-term orientation refers to one party’s desire to maintain a valued relationship with another. Exchange partners with long-term relationships can achieve a competitive advantage because firms work together for the betterment of both parties (Ganesan, 1994). Stable relationships with partners are seen as a source of firm competencies (Ploetner and Ehret, 2006). From the perspective of a buyer firm, long-term relationships with suppliers enable the buyer firm to be more efficient in procurement and more effective in reducing transaction costs (Sheth and Sharma, 1997). Therefore, buyer’s long-term orientation can be taken as a signal of Buyer-seller relationship quality (Ganesan, 1994; Nicholson et al., 2001). As such, it is not unusual for the seller to invest in assets that are uniquely dedicated to the buyer to win over buyer’s long-term orientation. For example, the seller invests in training its salespersons (i.e. human assets) to support a particular buyer (Ganesan, 1994). However, whether specific investments will lead to buyer’s long-term orientation is uncertain. According

A high level of OC can have an impact on a salesperson’ desire to be more innovative in solving issues encountered in exchange activities. Matsuo (2002) perceives the concept of innovativeness as a willingness to acquire knowledge and argues that highly innovative firms are superior at acquiring knowledge, which can give rise to new ideas and actions. Applying the concept to the individual level, in this study, we use the term “disposition to innovate” to reflect the salesperson’s desire to be innovative. MacKenzie et al. (1998), in their study of the relationship between salesperson’s attitudes and performance, have clarified that the salesperson’s OC has a significant positive effect on their extra-role performance such as pro-social or spontaneous behavior, which is distinguished from intra-role performance such as sales volume. Extra-role performance means that superior performance could be achieved by spontaneous, voluntary and creative actions (MacKenzie et al., 1998; Brown and Peterson, 1993). 618

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Effects of the salesperson’s characteristics

Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

to TCE, due to asset specificity (Williamson, 1975), idiosyncratic assets are potential triggers for partner opportunism. The argument is that, because asset specificity creates a lock-in situation for the investor (Heide and John, 1988, 1990), the investee could opportunistically exploit or expropriate the idiosyncratic assets. However, while some empirical studies have confirmed this argument (e.g. Heide and John, 1988, 1990), others have shown that TSA may actually discourage partner opportunism (Jap and Ganesan, 2000, Ghosh and John, 1999). Lohtia et al. (1994) have added an interesting perspective by proposing that the effects of TSA are dependent on the individual dimensions of TSA. While asset specificity encourages opportunism, another dimension – value to the partner – may discourage opportunism and predict partner’s long-term orientation as outcomes, according to the logic of resource dependence theory (Pfeffer and Salancik, 1978). For example, when the distributor decides to provide customized distribution services to a particular manufacturer, the manufacturer is more likely to sustain the cooperative relationship with the distributor because such customized services are valuable (Ono and Kubo, 2009). Such value perceived by the partner will be more likely to generate satisfaction with the relationship and further intention for future collaboration. Inter-firm relationships accompanied by relationship-specific investments facilitate joint planning between parties and lead to a superior performance (Liu et al., 2005). The logic is that if the specific assets create valuable, critical and hard-to-replace resources for the partner, then the partner would not behave opportunistically due to high switching cost, that is, the difficulties of finding an alternative partner who can provide the same value (Pfeffer and Salancik, 1978). In a Buyer-seller relationship, human assets of the salesperson can provide such a valuable resource for the buyer. If the specific skills and knowledge of the salesperson are valuable to the buyer, the buyer would remain in the relationship with the seller. Thus, the salesperson’s partnerspecific value induces buyer’s long-term orientation:

(Axelrod, 1984, p. 124) can curb the buyer’s actions in the present (Joshi and Stump, 1999b). Heide and John (1990) note that future interactions between exchange partners provide an opportunity to reward good behavior and punish opportunism. At the same time, they find that the length of the prior relationship has a negative impact on the likelihood of ending the relationship, which implies that long-term orientation has a positive impact on extending a relationship (Weiss and Kurland, 1997). As such, a buyer with long-term orientation will restrain from taking opportunistic behavior for a one-shot profit. Consequently, we propose:

H4.

H5.

The higher the buyer’s long-term orientation, the lower the buyer opportunism (Figure 1).

3. Method 3.1 Survey development We first conducted five in-depth interviews with two sales managers (one from a large processed food manufacturer and the other from a middle-scale apparel manufacturer) and three buyers from three national retailers. Each interview took about 2 to 3 hours. During these preliminary interviews, we asked the sales managers about their salespersons’ routine activities and relationships with their major buyer firm. Also, they reported on how their salespeople’s loyalty and feeling of belongings to the organization stimulate their spontaneity on engaging in identifying relevant resources and searching new solutions for the customer. During the interviews with three buyers, we asked about how they define the delivered value by the salespersons and their characteristics. From these interviews, it is clear that salespersons with high levels of OC and disposition to innovate tend to spend more time with their customers, and they frequently communicate with their counterparts to find out new needs and to propose solutions. The interviews with sales managers and the validation from the buyers helped refine research questions and understand the salesperson’s roles as a boundary spanner in a buyer-seller relationship. Then, based on a review of the relevant literatures, we developed a survey questionnaire for this study. All measures were derived from previous studies except partner-specific value for which items were developed from both Lohtia et al. (1994) and our field interviews. Partner-specific value refers to the degree of the value to the buyer as to the assets dedicated by the salesperson in the specific relationship. Based on the conceptualization of TSA in Lohtia et al.’s (1994) exploratory study, the construct is composed of two dimensions: partner-specific knowledge and irreplaceability. Four items measuring the salesperson’s OC

The greater the salesperson’s partner-specific value, the higher the buyer’s long-term orientation.

Finally, the positive effect of the salesperson’s partner-specific value on buyer’ long-term orientation will, in turn, reduce buyer opportunism. Opportunism is defined as the pursuit of self-interest seeking with guile (Williamson, 1985). If the buyer expects its relationship with the seller to endure for a long period, opportunism certainly has the potential to generate short-term windfalls. This “shadow of the future” Figure 1 The conceptual model Salesperson organizational commitment

+ Partner-specific value

+ Salesperson disposition to innovate

+

+ 619

Buyer long-term orientation

̄

Buyer opportunism

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Effects of the salesperson’s characteristics

Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

were adapted from Meyer and Allen (1997), which indicates that an attitude or an orientation of a salesperson toward his or her organization. Three items measuring the salesperson’s disposition to innovate which refers to the degree of the salesperson’s inclination for adopting new ideas or acquiring new skills were from Kanai (1991). Long-term orientation and opportunism are both well-established constructs in marketing channel literature. Three items of long-term orientations were adapted from Ganesan (1994) and four items of opportunism from Anderson (1988) and Brown et al. (2000). Through back-translation, all of the measures were translated from English to Japanese except the disposition to innovate construct from Kanai (1991), which was originally in Japanese. In addition, all items were measured on a five-point Likert scale (1 ⫽ strongly disagree, 5 ⫽ strongly agree). Finally, the questionnaire was pretested with six sales managers using personal interviews. Based on the pretest

results, we further modified the wording of some of the items. See Table I for the measures of constructs with factor loading, reliability and average variance extracted (AVE).

3.2 Data collection We selected Japanese manufacturers in a variety of industries as the research setting for this study because our study focuses on Buyer-seller relationships in interfirm exchanges. After having randomly selected 799 manufacturing firms listed on the Tokyo Stock Exchange, two research assistants were trained, and they called each firm and requested that the firm provide the name and address of the sales manager. The authors then mailed questionnaires, along with a cover letter highlighting the study’s objectives and asked the sales manager to answer questions related to a major buyer. Japanese sales managers are engaged in sales activities and, typically, handle

Table I Items and measurement validity assessment Confirmatory factor analysis Factor loading CR

Construct measures (Cronbach’s alpha)

Organizational commitment (␣ ⴝ 0.85) Meyer and Allen (1997) 1. I would be happy to spend the rest of my career with my company 2. I feel like “part of the family” at my company 3. This company means a great deal to me 4. I feel a strong sense of belonging to my company

0.85

0.82

0.70

0.80

0.57

0.83

0.54

0.549 0.751

0.631 0.681 0.855

Opportunism (␣ ⴝ 0.85) Anderson (1988), Brown et al. (2000) 1. Our partner sometimes makes promises without actually doing them 2. Sometimes our partner alters the facts slightly in order to get what they need 3. Our partner often does not respect the agreement in the contract 4. Our partner sometimes does unanticipated things in order to get concessions from us

GFI 0.88

620

0.94

0.739 0.721

Long-term orientation (␣ ⴝ 0.76) Ganesan (1994) 1. Our partner shares the same long-term goals with our company 2. Our partner expects the relationship with us to last for a long time 3. Our partner regards the relationship with us as a close partnership

Note: Partner refers to the buyer firm

0.65

0.894 0.822 0.834

Partner-specific value (␣ ⴝ 0.62) Partner-specific knowledge 1. Our partner firm feels that I am knowledgeable 2. My knowledge of products is beneficial to our partner Irreplaceability 1. Our partner could not easily get the information and services what I am providing from another supplier 2. If I turn over, it would interfere with our partner firm’s operations

RMSEA 0.056

0.88 0.792 0.713 0.864 0.745

Disposition to Innovate (␣ ⴝ 0.89) Kanai (1991) 1. I am willing to propose new ideas for solving problems 2. I am practicing my own ideas actively 3. I am trying new way of doing without sticking to the old way of doing things

Goodness-of-fit statistics (overall measurement model) df ␹2/df ␹2 182.166 123 1.481

AVE

0.843 0.821 0.670 0.723

CFI 0.95

NNFI 0.94

IFI 0.95

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Effects of the salesperson’s characteristics

Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

key customers, so selecting sales managers as key informants for our study is appropriate. The mail survey resulted in 155 usable questionnaires (a response rate of 19.4 per cent) from industries such as electronics, mechanical and transportation. Our sample consists of manufacturers with less than 1,000 employees (41.3 per cent), 1,000-2,999(35.5 per cent), 3,000-4,999 (9.7 per cent), 5,000-9,999 (4.5 per cent), 10,000- 29,999 (3.2 per cent), to over 30,000 employees (1.3 per cent). On average, the respondents are 47-year old and have spent 25.8 years with their companies and 17.6 years in a sales position. Among the respondents, 79 per cent are sales managers and 21 per cent are assistant sales managers. Because of the respondents’ tenure and positions, our respondents have sufficient knowledge and are qualified to answer questions about their firm’s relationships with the partner firm.

each path loading is greater than twice its standard error, which provides evidence of convergent validity among our measures. Discriminant validity is further confirmed by a series of nested confirmatory analyses (Bagozzi et al., 1991) fixing one, two, three, four, and all five of the possible covariances among the five latent factors (phi matrix) at 1.00. In all cases, the ␹2 of the unconstrained models are significantly lower than that of the constrained models, providing evidence of discriminant validity between the constructs. The measurement model is further assessed by evaluating the fit indices. Even though the ␹2 is significant, the overall statistics indicate good fit of the data to the model (␹2 ⫽ 182.166, df ⫽ 123, ␹2/df ⫽ 1.481, p ⫽ 0.00, CFI⫽ 0.95; RMSEA⫽ 0.056; NNFI ⫽ 0.94). As with any self-report single-informant data, there is the potential for common method bias. We checked for this with the Harman one-factor test. We identified six factors with eigenvalues greater than 1.4. These six factors accounted for 73.4 per cent of the total variance and the largest factor accounted for 27.8 per cent of the total variance. As more than one factor emerged in the test and the largest factor did not explain the majority of the total variance, we deem that common method bias does not seem to be a pervasive problem in this study.

3.3 Measure assessment Correlation coefficients and descriptive statistics are reported in Table II. We conducted exploratory factor analysis for partner-specific value and the results clearly showed two dimensions as revealed from the interviews. Therefore, in the confirmatory factor analysis, partner-specific value was treated as a second order factor with two dimensions, partner-specific knowledge and irreplaceability. The Cronbach’s alpha of each construct ranges from 0.62 to 0.89, indicating acceptable reliability of the scales. Hair et al. (1998) state that the scale is reliable with a Cronbach’s alpha greater than 0.6 when the scale has less than six items. In addition, composite reliability ranges from 0.80 to 0.94, and average variance extracted ranges from 0.54 to 0.85. Confirmatory factor analysis is used to assess the measurement model. All of the factor loadings and measurement errors are in acceptable ranges. Each item-factor loading is significant and larger than 0.60 and

4. Results We used structural equation modeling to test the hypotheses. The proposed model fits the data well. Table III shows the estimation results. The overall chi-square value for the model is 208.691 (p ⫽ 0.00, df ⫽ 132, ␹2/df ⫽ 1.581; CFI ⫽ 0.93, RMSEA ⫽ 0.061, and NNFI ⫽ 0.92). Although the chi-square is significant, all other parameter estimates have appropriate signs and are significant (p ⬍ 0.01).

Table II Descriptive statistics and Pearson’s correlation matrix (N ⫽ 155) Construct 1. 2. 3. 4. 5.

Organizational commitment Disposition to innovate Partner-specific value Long-term orientation Opportunism

Notes:

ⴱⴱ

Mean

SD

1

2

3

4

5

3.7 4.0 3.6 3.6 2.7

0.77 0.61 0.73 0.76 0.91

1.00 0.40ⴱⴱ 0.34ⴱⴱ 0.30ⴱⴱ ⫺0.23ⴱⴱ

1.00 0.29ⴱⴱ 0.13 ⫺0.12

1.00 0.27ⴱⴱ ⫺0.17ⴱ

1.00 ⫺0.32ⴱⴱ

1.00

p ⬍ 0.01; ⴱ p ⬍ 0.05; two-tailed test

Table III Results of structural equation model Hypothesis

Path (expected sign)

H1 H2 H3 H4 H5

Salesperson organizational commitment ¡ partner-specific value (⫹) Salesperson organizational commitment ¡ salesperson disposition to innovate (⫹) Salesperson disposition to innovate ¡ partner-specific value (⫹) Partner-specific value ¡ buyer long-term orientation (⫹) Buyer long-term orientation ¡ buyer opportunism (⫺)

Goodness-of-fit statistics ␹2 df 208.691 132 Notes:

ⴱⴱ

␹2/df 1.581

RMSEA 0.061

GFI 0.87

p ⬍ 0.01; ⴱ p ⬍ 0.05; two-tailed test

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t-value

Hypothesis test

0.19 0.46 0.14 0.58 ⫺0.35

2.68ⴱⴱ 4.99ⴱⴱ 2.03ⴱ 3.26ⴱⴱ ⫺3.49ⴱⴱ

Supported Supported Supported Supported Supported

CFI 0.93

NNFI 0.92

IFI 0.93

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Effects of the salesperson’s characteristics

Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

H1 posits that a high degree of salesperson’s OC leads to a greater partner-specific value. The results show that salesperson’s OC has a positive and significant effect on partner-specific value (â ⫽ 0.19, p ⬍ 0.01), which supports H1. H2 predicts that a high degree of salesperson’s OC is associated with a higher level of salesperson disposition to innovate. The results show that salesperson’s OC has a positive and significant effect on disposition to innovate (â ⫽ 0.46, p ⬍ 0.01), which supports H2. H3 suggests that a higher level of salesperson disposition to innovate leads to greater partner-specific value to the buyer. The results demonstrate a positive and significant effect (â ⫽ 0.14, p ⬍ 0.05), which supports H3. H4, which posits that partner-specific value has a positive effect on buyer’s long-term orientation, is also supported as indicated by a positive and significant beta (â ⫽ 0.58, p ⬍ 0.01). Finally, H5 hypothesizes that buyer’s long-term orientation reduces buyer opportunism. The results also confirm the hypothesis (â ⫽ ⫺0.35, p ⬍ 0.01), thus supporting H5. As a whole, our results provide substantial support for the proposed conceptual model.

interfirm exchanges is unknown. Given the boundaryspanning role of the salesperson in the Buyer-seller interaction, our study proposes that the salesperson’s OC, along with the salesperson’s disposition to innovate, is antecedent to relationship-specific value created by the salesperson in a Buyer-seller relationship and, in turn, affects buyer behaviors of long-term orientation and opportunism. By introducing OC in the Buyer-seller relationship literature, our study has made an effort in responding to Ketchen and Hult’s (2007) call for bridging organization theory and Buyer-seller relationships in channel/supply chain management. Third, our study contributes to Buyer-seller relationship literature by enriching the explanations of relationship governance mechanisms in interfirm exchange. Specifically, our study empirically tested an alternative effect of asset specificity – the bonding effect (Rokkan et al., 2003). Asset specificity is a key tenet in TCE that has received considerable attention. The traditional transaction cost argument implies that asset specificity leads to exploitation and opportunism, the exploitation effect (Lui et al., 2009; Heide and John, 1988, 1990). Our study, however, supports a bonding effect and argues that the effects of asset specificity may vary with the type of asset specificity and the dimension of assets. Focusing on human asset specificity (the type) and value to the partner (the dimension), adopting resource dependence theory, our study posits that specific value of human assets (the salesperson’s skills and knowledge know-how) to the partner (the buyer) induces partner’s long-term orientation, supporting the bonding effect. Thus, our study contributes to Buyer-seller relationship literature by providing evidence for further examination of different types of asset specificity in Buyer-seller relationships.

5. Discussion 5.1 Theoretical implications The salesperson, as a boundary spanner, plays an important role in creating, developing and sustaining Buyer-seller relationships (Parasuraman et al., 1985; Ferguson et al., 2005). Previous studies focus on the social aspects (interpersonal trust and social ties) between boundary spanners. Although sales and organization research has demonstrated that the salesperson’s characteristics such as OC (MacKenzie et al., 1998) and innovativeness (Kanai, 1991) lead to job performance, the effects of such characteristics on Buyer-seller relationships are unknown. Our study fills this gap by examining this missing link, and the results confirm the importance of including boundary spanners’ individual characteristics in studying Buyer-seller relationships. As such, our study has made the following three contributions to Buyer-seller relationship literature. First, our study contributes to buyer-seller relationship literature by focusing on the salesperson’s individual characteristics in performing the boundary-spanning role in buyer-seller relationships, an area that has received little attention from previous studies. Specifically, we include two individual characteristics – OC and disposition to innovate – and examine the effects of these two characteristics of the salesperson on buyer behaviors such as the buyer’s long-term orientation and opportunism. The results from our study not only confirm the important role of the salesperson as a proactive relationship manager (Steward et al., 2009; Walter, 1999) in a buyer-seller relationship but also provide a starting point for including the boundary spanners’ individual characteristics in studying buyer-seller relationships. Second, our study contributes to Buyer-seller relationship literature by introducing a key organizational concept to the dynamics of interfirm exchange. OC of employees has been extensively studied in the field of organizational behavior. Although the impact of employee’s OC on job and organizational performance has been well-documented (Hunt et al., 1985; Luthans et al., 1985), its influence in dynamic

5.2 Managerial implications From a managerial perspective, our study provides several implications. First, our study shows that OC motivates the salesperson to learn and to create value for the buyer both directly and through salesperson’s disposition to innovate. Further, the salesperson’s specific value to the buyer enhances buyer’s long-term orientation and, in turn, diminishes buyer’s opportunistic behavior. These findings, combined with findings from organizational studies on the positive influence of OC on organizational performance, demonstrate that a high degree of boundary spanners’ OC benefits a company not only directly but also indirectly through promoting its exchange partner’s long-term relationship orientation and curbing its opportunistic behavior. As a result, an important implication from our study is that the seller firm should strive to increase all of salespersons’ OC. Promoting OC among boundary spanners will be beneficial to the firm because boundary spanners represent the firms and reflect the image or the reputation of their firms (Bettencourt and Brown, 2003, Ferguson et al., 2005). Also, the seller firm should design training programs and incentive structures in such ways that a high degree of OC is maintained. Periodically, the seller firm needs to assess the OC of salespeople and deploying highly committed salespeople to key customers. Second, in contrast to some of the previous studies, our study shows that asset specificity may not induce opportunistic behavior, but rather facilitate long-term 622

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Effects of the salesperson’s characteristics

Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

References

cooperative actions, as long as the assets are unique and valuable for the partner. Previous studies (Anderson and Weitz, 1992; Noordewier et al., 1990) argue that for two parties to have a long-term relationship while avoiding opportunism, both parties need to reciprocally invest specific assets, resulting in mutual dependence (Heide, 1994). This calculated mutual dependence, or mutual vulnerability, is designed to bring stability to a relationship by making it unprofitable for either side to be exploitive (Coughlan et al., 2007). Most of studies based on the exploitation perspective have assumed that having highly specific assets causes an unfavorable situation for the investor because the unilateral investment leads the party to a more dependent position; therefore, the other party gains relative power. Our results, however, support the idea that even though a seller makes unilateral investments, if the buyer perceives its investments as valuable and hard to replace, a situation of dependence balancing would be formed (Heide and John, 1988). As such, our findings imply that the presence of power imbalance in Buyer-seller relationships does not always mean that the power will be explicitly exercised. For managers, this finding means that safeguarding may not be necessary when idiosyncratic investments provide hard-to-replace value.

Anderson, E. (1988), “Transaction costs as determinants of opportunism in integrated and independent sales forces”, Journal of Economic Behavior & Organizations, Vol. 9 No. 5, pp. 247-264. Anderson, J.C. and Weitz, B. (1992), “The use of pledges to build and sustain commitment in distribution channels”, Journal of Marketing Research, Vol. 29 No. 1, pp. 85-97. Axelrod, R. (1984), The Evolution of Cooperation, Basic Books, New York, NY. Bagozzi, R., Yi, Y. and Philips, L. (1991), “Assessing construct validity in organizational research”, Administrative Science Quarterly, Vol. 36 No. 3, pp. 421-458. Bettencourt, L.A. and Brown, S.W. (2003), “Role stressors and customer-oriented boundary-spanning behaviors in service organizations”, Journal of Academy of Marketing Science, Vol. 31 No. 4, pp. 394-408. Bettencourt, L.A., Brown, S.W. and Mackenzie, S.B. (2005), “Customer-oriented boundary spanning behavior: test of a social exchange model of antecedents”, Journal of Retailing, Vol. 81 No. 2, pp. 141-157. Brown, J.R., Dev, C.S. and Lee, D. (2000), “Managing marketing channel opportunism: the efficacy of alternative governance mechanisms”, Journal of Marketing, Vol. 64 No. 4, pp. 51-65. Brown, S.P. and Peterson, R.A. (1993), “Antecedents and consequences of salesperson job satisfaction: a metaanalysis and assessment of causal effects”, Journal of Marketing, Vol. 30 No. 2, pp. 63-77. Coughlan, A., Anderson, E., Stern, L.W. and El-Ansary, A. (2007), Marketing Channel, 7th ed., Prentice Hall, Upper Saddle River, NJ. Dwyer, F.R., Schurr, P.H. and Oh, S. (1987), “Developing buyer-seller relationships”, Journal of Marketing, Vol. 51 No. 4, pp. 11-27. Ferguson, R.J., Paulin, M. and Bergeron, J. (2005), “Contractual governance, relational governance, and the performance of inter-firm service exchanges: the influence of boundary-spanner closeness”, Journal of Academy of Marketing Science, Vol. 33 No. 2, pp. 217-234. Ganesan, S. (1994), “Determinants of long-term orientation in buyer-seller relationships”, Journal of Marketing, Vol. 58 No. 4, pp. 1-19. Gavin, D.A. (1993), “Building a learning organization”, Harvard Business Review, Vol. 71 No. 4, pp. 78-91. Ghosh, M. and John, G. (1999), “Governance value analysis and marketing strategy”, Journal of Marketing, Vol. 63, pp. 131-145. Hair, J.F., Anderson, R.E., Tatham, R.L. and Black, W.C. (1998), Multivariate Data Analysis, Prentice Hall, NJ. Haytko, D.L. (2004), “Firm-to-firm interpersonal relationships: perspectives from advertising agency account managers”, Journal of Academy of Marketing Science, Vol. 32 No. 3, pp. 312-328. Heide, J.B. (1994), “Interorganizational governance in marketing channels”, Journal of Marketing, Vol. 58 No. 1, pp. 71-85. Heide, J.B. and John, G. (1988), “The role of dependence balancing in safeguarding transaction-specific assets in

5.3 Limitations and future research As with any study, our study has several limitations. First, our study only examines one dimension of TSA, further research should continue with other dimensions of TSA regarding their effects in Buyer-seller relationships. Also, the construct of partner-specific value had two items for each dimension and a Cronbach’s alpha of 0.62. Although this Cronbach’s alpha is acceptable for an exploratory study, future studies on the construct may seek to refine and improve the measure. Second, our study uses data from Japan to test hypotheses. Readers may think that OC in Japan is stronger than that in the Western countries and, therefore, reject the generalizability of our model. However, a cross-cultural study of OC by Luthans et al. (1985) find that OC in the USA is actually slightly higher than that in Japan and in Korea, thus refuting this widespread belief. Nevertheless, future studies may use data from other countries/cultures to verify the model and to compare the strength of the paths in the model. Third, our study uses a single key informant, an approach that is likely to result in common method bias. Although the authors have assessed and concluded that common method bias is not a major issue in our data, the authors suggest that future research uses a dyadic approach asking a respondent from the buyer side to evaluate partner-specific value. Fourth, the sample of our study consists of salespersons, taking the seller’s perspective. Future studies may verify the model from the buyer’s perspective and examine the boundary spanner’s characteristics on the buyer side. Further research may also look at whether the boundary spanner’s OC to his own organization may lead to a higher degree of commitment to the favorable relationship with the partner and, in turn, the partner firm. Finally, although model testing yields results that are consistent with the proposed hypotheses, the crosssectional design limits the ability to rule out alternative causal inferences. Future studies need to use a longitudinal design for further model testing. 623

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Journal of Business & Industrial Marketing

Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

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Yonghoon Choi, Ying Huang and Brenda Sternquist

Volume 30 · Number 5 · 2015 · 616 –625

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About the authors Yonghoon Choi is a Professor of Marketing at Doshisha University, Japan. He received his PhD from Kyoto University in Japan, and his main research areas and publications are related to Buyer-seller relationships, B2B marketing and distribution system. He has published in journals such as Asian Business & Management, Journal of Marketing & Distribution and Japan Marketing Journal, and has presented at conferences such as Academy of International Business and American Marketing Association. Ying Huang is an Assistant Professor of Marketing, Department of Management, Manning School of Business, University of Massachusetts at Lowell. She received her PhD from Michigan State University. Her research focuses on buyer – supplier relationships, foreign market entry, emerging markets and sustainability issues. She has published in Journal of Management, Journal of Operations Management, Journal of the Academy of Marketing Sciences, Journal of International Business Studies, International Business Review, Industrial Marketing Management, etc. Ying Huang is the corresponding author and can be contacted at: [email protected] Brenda Sternquist is a Professor of Marketing, Department of Marketing, The Broad College of Business at Michigan State University. Her research focuses on buyer – supplier relationships, internationalization of retailing and retail change in transitional markets. She has published more than 100 journal articles in journals such as Journal of Retailing, Journal of International Marketing, Journal of Business Research, Industrial Marketing Management and Journal of Business and Industrial Marketing

Further reading Caniëls, M.C.J. and Gelderman, C.J. (2010), “The safeguarding effect of governance mechanisms in Inter-firm exchange: the decisive role of mutual opportunism”, British Journal of Management, Vol. 21 No. 1, pp. 239-254. De Vita, G., Tekaya, A. and Wang, C. (2010), “Asset specificity’s impact on outsourcing relationship

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