Ragnhild Silkoset

Extendedness as a Relationship Governance Mechanism for Securing Cooperation in Marketing Relationships

ABSTRACT Traditionally, buyers encourage fierce price competition among suppliers. Such price competition has been the dominating strategy for purchase of commodities in business markets. Undoubtedly, this practice has been effective in many cases. Unfortunately, transactional purchasing practices could have negative effects because they demotivate suppliers to engage in value creating activities and incur substantial transaction costs. In contrast to competition, buyer-seller cooperation can also bring prices and total costs down. One problem of cooperation is that the parties can realize individual gains by defection while the other continues to cooperate. This article examines how industrial buyers of a commodity can overcome this problem and realize cost savings and low prices by motivating the supplier to cooperate by offering an extended time frame for purchases. The authors test the research hypotheses in a sample of 347 industrial buyers of electricity. The empirical tests provide general support for their predictions. The implications of the findings for marketing theory and practice are discussed.

Buying CSR with employees’ pensions? The effect of social responsible investments on Norwegian SMEs’ choice of pension fund management: A conjoint survey

Purpose Employees often expect an emphasis on financial aspects to be predominant when their employers choose a fund management company for the investment of employees’ pension fund deposits. By contrast, in an attempt to appear as socially responsible company managers may emphasize social responsibility (SR) in pension fund choices. The purpose of this paper is to examine to what extent managers for small- and medium-sized companies emphasize SR vs expected returns when choosing investment managers for their employees’ pension funds. Design/methodology/approach A conjoint experiment among 276 Norwegian SMEs’ decision makers examines their trade-offs between social and financial goals in their choice of employees’ pension management. Furthermore, the study examines how the companies’ decision makers’ characteristics influence their pension fund management choices. Findings The findings show that the employers placed the greatest weight to suppliers providing funds adhering to socially responsible investment (SRI) practices, followed by the suppliers’ corporate brand credibility, the funds’ expected return, and the suppliers’ management fees. Second, employers with investment expertise emphasized expected returns and downplayed SR in their choice, whereas employers with stated CSR-strategies downplayed expected return and emphasized SR. Originality/value Choice of supplier to manage employees’ pension funds relates to a general discussion on whether companies should do well – maximizing value, or do good, – maximizing corporate SR. In this study, doing well means maximizing expected returns and minimizing costs of the pension investments, whereas doing good means emphasizing SRI in this choice. Unfortunately, the employees might pay a price for their companies’ ethicality as moral considerations may conflict with maximizing the employees’ pension fund value.