Summary of the Achilles’ heel

Literature review suggests that Harmonious and coordinated partnerships are responsible for providing economic and strategic benefits to both partners. Although, it also gives a bright picture that trust and commitment are the two essential tools which can lead to satisfaction between the two partners, it is not true in real life. The study aims to focus on the factor which reduces the possibility of partner switching from international perspective.

Empirical data suggests that commitment, opportunism and dedication are absent from work. From international perspective, if these characteristics are absent in work, they can hamper the longest and most successful relationships[1]. A distributor has to commit to the manufacturer’s credit commitments in order to expand his horizons. Therefore, it may be necessary to increase the exit cost. The study aims to analyze commitment, relational responsiveness; opportunities and the possibility of switching partners and considers them to be essential aspect of relationship between the manufacturer and the distributor.

Commitment decreases the possibility of partner switching as the committed partners work together to endure better operational and strategic work load. Relational responsiveness is necessary to maintain stability in the strong, competitive market because a responsive distributor will work effectively with the manufacturer to reach shared goals. Opportunistic behavior if shown excessively is most likely to terminate the relationship between the distributor and the manufacturer. Switching partners is most likely to happen when the manufacturer is dissatisfied with the distributor. However, manufacturer satisfaction is most likely reducing the possibility of changing partners.

The study collected several samples and studies companies which were sorted by size. More than seven hundred respondents were studied. The results were analyzed and it concluded that distributor’s strategic leverage has a negative impact on the manufacturer’s satisfaction, commitment influences satisfaction, the receptiveness of the distributor also has positive influence on manufacturer’s satisfaction, opportunism does not influence satisfaction and manufacturer’s satisfaction with the distributor decreases the probability of switching partners[2]. However, this study has some restrictions. Since it was conducted in United States, it does not cover the entire world. Also trust is another constraint which has not been analyzed in this study.

Conclusion

The literature concentrates on taking advantages of opportunities when changing partners. The study utilizes a complicated, multifaceted system where approval, fulfillment and agreement in appropriating rent increases the probability of partner switching. The concept that time based steady, constant relationship is a misnomer because vulnerability dependent on time. In order to create satisfactory cross-border relationship, it is essential to establish a major, important trustworthy and reliable relationship without eradicating opportunities.

The elevated investments and long relationship is the key to bring satisfaction between the two partners. More than seven hundred samples were taken into consideration. The study analyzed Commitment, relational responsiveness, opportunities and the possibility of switching partners and came to the conclusion that these are essential factors which can determine the relationship between the manufacturer and distributor.

References:

Deligonul, Seyda, Daekwan, Kim, Roath, Anthony S. and Cavusgil Erin, ‘The Achilles’ heel of an enduring relationship: Appropriation of rents between a manufacturer and its foreign distributor’, Journal of Business Research, 2006, vol. 59, issue 7, pages 802-810(2006)

[1] Deligonul, Seyda, Daekwan, Kim, Roath, Anthony S. and Cavusgil Erin, ‘The Achilles’ heel of an enduring relationship: Appropriation of rents between a manufacturer and its foreign distributor’, Journal of Business Research, 2006, vol. 59, issue 7, pages 802-810(2006)
[2] Deligonul, Seyda, Daekwan, Kim, Roath, Anthony S. and Cavusgil Erin, ‘The Achilles’ heel of an enduring relationship: Appropriation of rents between a manufacturer and its foreign distributor’, Journal of Business Research, 2006, vol. 59, issue 7, pages 802-810(2006)