Value Co-Creation in Industrial Buyer-Seller Partnerships ... - Doria

Portfolio management and key account management practices are widely applied by bothsuppliers and customers on industrial markets. The idea being that companies can applydifferent relationship management strategies with different types of partners in order to getthe most out of them. The most important customers/suppliers are identified, and thencustomized management models and even tailor-made organizations are designed for theseparticularly important relationships.Ford (1980) suggests that a characteristic of industrial marketing is that it takes placewithin a close relationship between buyer and seller. Companies choose long-termrelationships instead of “ playing the market” in the name of cost reduction and increasedrevenues. Companies do not act alone. The definition of “ a company” includes the idea thatthe entity is engaged in interaction with other parties, that a company’ s identity is formed bythe partners that it works and interacts with. A company is dependent on its environment -without interaction with other parties the organization has no activity and no means ofcreating value.When companies possess complementary, heterogeneous resources, cooperation islikely to emerge. The access to the resources of another company is achieved throughinteraction, it is through interaction that relationships are created and maintained. Simplyput:10“… Interaction is not a simple mechanism regulating the life of the company, but amajor part of its life. It is through interaction that a company exists and develops…Hence, interaction is a fundamental aspect of development” (Håkansson 2002, p 14).Since the 1970´s the dominant discussion within the IMP Approach (the IndustrialMarketing and Purchasing School of thought) is about understanding how business marketsoperate, from single companies interacting with other companies on a transactional basis,towards long-term relationships through interaction to partnerships, alliances, and networksof companies. The interest has been on why companies invest in relationships, what can begained from this type of interaction, and on the different ways of looking at value and valuecreation in such a context.When looking at the world from the point of view of relationships and networks, wesee companies that create long-term relationships taking the shape of alliances andpartnerships of different kinds, creating networks of interconnected companies that producethe output together by cooperating and joining forces. This change in competitive andcooperative environment blurs the lines between companies and redefines what traditionallyhas been thought of as enterprises or industries (Parolini 1999). Interaction becomes key;the ability to interact with the right counterparts and be able to use the counterpart’ sresources in a meaningful way becomes crucial.