Advertisement

Behaviour Transformation: An Examination of Relational Governance in Complex Engineering Service

  • Lei Guo
  • Irene Ng
Chapter
Part of the Decision Engineering book series (DECENGIN)

Abstract

In the present study, we investigated two outcome-based maintenance, repair and overhaul (MRO) service contracts in the attempt to better understand the effect of relational governance on firms’ boundary-spanners behaviours in co-producing complex engineering service. Our field interviews indicate that managers are heavily dependent on interpersonal relationships to promote mutual cooperation in service delivery. The role of legal contracts in monitoring behaviours seems insignificant. Furthermore, we noted that with the development of interpersonal relationship, cooperation moved from reciprocal to communal. That is, at the early stage of relationship, both parties cooperate conditionally according to the norm of reciprocity. When the relationship becomes more mature, both parties share a common identity and work towards their collective goals. To that end, service performance would then be greatly enhanced. Through a theory-in-use methodology, our study maps the practices of behaviour transformation in complex engineering service systems, effected through interpersonal relationship development.

Keywords

Interpersonal Relationship Service Contract Exchange Partner Formal Contract Individual Provider 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

References

  1. P. Adler, Market, hierarchy, and trust: The knowledge economy and the future of capitalism. Org. Sci. 12(2), 214–234 (2001)CrossRefGoogle Scholar
  2. J.C. Anderson, J.A. Narus, Capturing the value of supplementary services. Harv. Bus. Rev. 73(1), 75–83 (1995)Google Scholar
  3. K.D. Antia, G.L. Frazier, The severity of contract enforcement in interfirm channel relationships? J. Mark. 65(4), 67–81 (2001)CrossRefGoogle Scholar
  4. K. Artz, T. Brush, Asset specificity, uncertainty and relational norms: An examination of coordination costs in collaborative strategic alliances. J. Econ. Behav. Organ. 41(4), 337–362 (2000)CrossRefGoogle Scholar
  5. T.S. Baines, H.W. Lightfoot, O. Benedettini, J.M. Kay, The servitization of manufacturing: A review of literature and reflection on future challenges. J. Manuf. Technol. Manag. 20(5), 547–567 (2009)CrossRefGoogle Scholar
  6. N. Bendapudi, R.P. Leone, Psychological implications of customer participation in co-production. J. Mark. 67(1), 14–28 (2003). JanuaryCrossRefGoogle Scholar
  7. B.D. Bernheim, M.D. Whinston, Incomplete contracts and strategic ambiguity. Am. Econ. Rev. 88(4), 902–932 (1998)Google Scholar
  8. J. Bradach, R. Eccles, Price, authority, and trust: From ideal types to plural forms. Annu. Rev. Sociol. 15, 97–118 (1989)CrossRefGoogle Scholar
  9. J.P. Cannon, S.A. Ravi, T.G. Gregory, Contracts, norms, and plural form governance. J. Acad. Mark. Sci. 28(2), 180–194 (2000)CrossRefGoogle Scholar
  10. P. Dabholkar, How to improve perceived service quality by improving customer participation, in Developments in marketing science, ed. by B.J. Dunlap (Academy of Marketing Science, Cullowhee, 1990)Google Scholar
  11. P. Dabholkar, Consumer evaluations of new technology based self-service options. Intern. J. Res. Mark. 13(1), 29–51 (1996)CrossRefGoogle Scholar
  12. J. Dyer, W. Chu, The role of trustworthiness in reducing transaction costs and improving performance: Empirical evidence from the United States, Japan, and Korea. Org. Sci. 14, 57–68 (2003)CrossRefGoogle Scholar
  13. J. Dyer, H. Singh, The relational view: Cooperative strategy and sources of interorganizational competitive advantage. Acad. Manag. Rev. 23(4), 660–679 (1998)Google Scholar
  14. R.G. Eccles, The quasi-firm in the construction industry. J. Econ. Behav. Organ. 2(4), 335–357 (1981)CrossRefGoogle Scholar
  15. J.A. Fitzsimmons, Consumer participation and productivity. Serv. Opera. Interfaces. 15(3), 60–67 (1985)MathSciNetGoogle Scholar
  16. S. Ghoshal, P. Moran, Bad for practice: A critique of the transaction cost theory. Acad. Manag. Rev. 21(1), 13–47 (1996)Google Scholar
  17. C. Goodwin, I can do it myself: Training the service consumer to contribute. J. Serv. Mark. 2(4), 71–78 (1988)CrossRefGoogle Scholar
  18. M. Granovetter, Economic action and social structure: The problem of embeddedness. Am. J. Sociol. 91(3), 481–510 (1985)CrossRefGoogle Scholar
  19. G.T. Gundlach, R.S. Achrol, Governance in exchange: Contract law and its alternatives. J. Pub. Policy. Mark. 12(2), 141–155 (1993)Google Scholar
  20. A. Haslam, Psychology in organizations: The social identity approach, 2nd edn. (Sage, London, 2004)Google Scholar
  21. J. Heide, G. John, Do norms matter in marketing relationships? J. Mark. 56(2), 32–44 (1992)CrossRefGoogle Scholar
  22. S.W. Kelley, J.H. Donnelly, S.J. Skinner, Customer participation in service production and delivery. J. Retail. 66(3), 315–335 (1990)Google Scholar
  23. C.A. Lengnick-Hall, V. Claycomb, L.W. Inks, From recipient to contributor: Examining customer roles and experienced outcomes. Eur. J. Mark. 34(3/4), 359–383 (2000)CrossRefGoogle Scholar
  24. C.H. Lovelock, J. Wirtz, Services marketing: People, technology, strategy, 5th edn. (Pearson/Prentice Hall, Upper Saddle River, 2004)Google Scholar
  25. C.H. Lovelock, R.F. Young, Look to consumers to increase productivity. Harv. Bus. Rev. 57(3), 168–178 (1979)Google Scholar
  26. R.E. Lusch, J.R. Brown, Interdependency, contracting, and relational behavior in marketing channels? J. Mark. 60(4), 19–38 (1996)CrossRefGoogle Scholar
  27. S. Macaulay, Non-contractual relations in business: A preliminary study. Am. Sociol. Rev. 28(1), 55–69 (1963)CrossRefGoogle Scholar
  28. I.R. Macneil, The new social contract: An inquiry into modern contractual relations (Yale University Press, New Haven, 1980)Google Scholar
  29. M.L. Meuter, M.J. Bitner, Self-service technologies: Extending service frameworks and identifying Issues for research, in AMA winter educators’ conference, ed. by D. Grewal, C. Pechmann (American Marketing Association, Chicago, 1998)Google Scholar
  30. M.L. Meuter, A.L. Ostrom, R.I. Roundtree, M.J. Bitner, Self-service technologies: Understanding customer satisfaction with technology-based service encounters. J. Mark. 64(3), 50–64 (2000)CrossRefGoogle Scholar
  31. P.K. Mills, J.H. Morris, Clients as ‘partial’ employees of service organizations: Role development in client participation. Acad. Manag. Rev. 11(4), 726–735 (1986)Google Scholar
  32. P.K. Mills, R.B. Chase, N. Margulies, Motivating the client/employee system as a service production strategy. Acad. Manag. Rev. 8(2), 301–310 (1983)Google Scholar
  33. L. Poppo, T.R. Zenger, Do formal contracts and relational governance function as substitutes or complements? Strateg. Manag. J. 23(8), 707–725 (2002). AugustCrossRefGoogle Scholar
  34. L. Poppo, K.Z. Zhou, T.R. Zenger, Examining the conditional limits of relational governance: Specialized assets, performance ambiguity, and long-standing ties. J. Manag. Stud. 45(7), 1195–1216 (2008). NovCrossRefGoogle Scholar
  35. J. Potter, Representing reality: Discourse, rhetoric and social construction (Sage, London, 1996)Google Scholar
  36. B. Schneider, D.E. Bowen, Winning the service game (Harvard Business School Press, Boston, 1995)Google Scholar
  37. C.J. Thompson, Interpreting consumers: A hermeneutical framework for deriving marketing insights from the texts of consumers’ consumption stories. J. Mark. Res. 34(4), 438–455 (1997)CrossRefGoogle Scholar
  38. C.J. Thompson, W.B. Locander, H.R. Pollio, Putting consumer experience back into consumer research: The philosophy and method of existential-phenomenology. J. Consum. Res. 16(2), 133–147 (1989)CrossRefGoogle Scholar
  39. B. Uzzi, Social structure and competition in interfirm networks: The paradox of embeddedness. Adm. Sci. Q. 42, 35–67 (1997)CrossRefGoogle Scholar
  40. S. Vandermerwe, J. Rada, Servitization of business: Adding value by adding services. Eur. Manag. J. 6(4), 315–324 (1988)CrossRefGoogle Scholar
  41. S.L. Vargo, R.F. Lusch, Evolving to a new dominant logic for marketing. J. Mark. 68, 1–17 (2004)CrossRefGoogle Scholar
  42. S.L. Vargo, P.P. Maglio, M.A. Akaka, On value and value co-creation: A service systems and service logic perspective. Eur. Manag. J. 26(3), 145–152 (2008)CrossRefGoogle Scholar
  43. O.E. Williamson, Markets and hierarchies (McGraw-Hill, New York, 1975)Google Scholar
  44. O.E. Williamson, Transaction cost economics and organization theory, in The handbook of economic sociology, ed. by N.J. Smelser, R. Swedberg (Princeton University Press, Princeton, 1996)Google Scholar
  45. A. Zaheer, N. Venkatraman, Relational governance as an interorganizational strategy: An empirical test of the role of trust in economic exchange. Strateg. Manag. J. 16(5), 373–392 (1995)CrossRefGoogle Scholar
  46. G. Zaltmann, K. LeMasters, M. Heffring, Theory construction in marketing: Some thoughts on thinking (Wiley, New York, 1982)Google Scholar
  47. V.A. Zeithaml, M.J. Bitner, D.D. Gremler, Services marketing: Integrating customer focus across the firm, 4th edn. (McGraw-Hill, New York, 2006)Google Scholar

Copyright information

© Springer-Verlag London Limited  2011

Authors and Affiliations

  1. 1.University of Exeter Business SchoolExeterUK

Personalised recommendations