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

The question of win-win in partnershipsVesalainen (2004) has studied partnerships and developed a partnership monitor frameworkfor analyzing partnerships between companies. The monitor positions them on a scalebetween pure market transaction (zero sum game) and maximal partnership (win-win). Heargues that a partnership is not a “ yes” or “ no” type of question, but rather a question of “ towhat extent” . One of the most difficult issues to handle regarding partnerships is thequestion of win-win where both parties gain, in contrast to the notion of a zero-sum game,where one of the parties wins at the cost of the other. The prerequisite for a win-winsituation is that the cooperation generates something to share between the parties. In a truepartnership the parties agree on the value created, and they are both aware of the processinvolved, plus the value is shared in a fair manner between the parties.Further Vesalainen concludes that what is complex about assessing value is that valuedoes not only relate to costs, but to volume, reference value, learning, innovations etc. ashas been recognized in previous studies and discussed earlier in the section on value. Healso discusses the impact of time in the development of a partnership - how long can oneparty invest in the partnership and wait for the payback? There is no flawless system forcalculating the benefits, which leads to a situation where one deals with issues related toevaluation. If the basis for evaluating the benefits differs between the parties, there is anobvious risk for conflict. Therefore it is vital to communicate and discuss the perceptions ofbenefits and the sharing of it, between the parties, in order to create and sustain apartnership. The more articulated and structured the handling of issues related to benefitsand the sharing of the value, the better the chances for a fruitful partnership (Ibid.).4.6.3 The costs of a high-involvement relationship“ High-involvement relationships are costly because coordination, adaptations andinteraction entail costs” (Gadde & Snehota 2000, p 310). The logic for a high-involvementrelationship is a) to benefit from cost benefits i.e. reduced costs in production and materialflows, improved flexibility and service levels or b) to benefit from revenue benefits, bytaking advantage of supplier skills and capability to improve quality of product. “ Increasedinvolvement makes sense only when the consequently increased relationship costs are morethan offset by relationship benefits” (Ibid p 310). A partnership is said to be an appropriaterelationships strategy when the business volume between the parties is considerable, whenthe relationship is long-term and stable, and when the supplier is the single source for thespecific resource (Ibid.).85