The impact of relationship history on negotiation strategy expectations

Abstract

Purpose – The purpose of this paper is to explore how the history of a supply chain relationship impacts expectations concerning negotiation strategy use. Design/methodology/approach – Following a grounded theory approach, experienced buyers and suppliers were interviewed to enhance understanding of the complexity of supply chain negotiations. Findings – Qualitative analysis developed a theoretical framework emphasizing the impact of relationship history on negotiation strategy expectations in long-term buyer-supplier relationships. Data supports that previous negotiation interactions build a history between the involved organizations. This relationship history creates expectations. When negotiation strategy use is consistent with expectations, the relationship history will continue to develop in the same manner as it has previously. When negotiation strategy expectations are violated, the relationship impact will differ depending on evidence of an Extrarelational Factor that leads to the strategy change. Research limitations/implications – Results of this study present a theoretical framework that future research can quantitatively test, which has the potential to open up new streams of research on relationship history and supply chain negotiations. Practical implications – Results show that buyers and suppliers should consider the strategy expectations of their negotiation partner. When actions are inconsistent with expectations, the effects impact the relationship. Originality/value – Negotiation research has largely focussed on negotiations as discrete events with economic outcomes. This ongoing buyer-supplier relationship research highlights the impact that previous negotiations (relationship history) have on negotiation expectations. It also explores the relational impact when those expectations are or are not met.

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