Conclusion
A consistent theme in works on relationship marketing is the "co-operate to compete" thesis: being an effective competitor in the global economy often requires one to be an effective co-operator in some network. This thesis, a central part of relationship marketing, implies that at least some co-operate arrangements among firms are pro-competitive. However, the co-operate to compete thesis cannot be grounded in neoclassical, perfect competition theory because it admits only capital, labour, and land to qualify as firm resources. As discussed, no tinkering with perfect competition will suffice. what is needed is a new theory of competition.
The resource-advantage theory of competition can theoretically ground relationship marketing because it expands the view of resources to include all entities that have an enabling capacity, including such intangible entities as relationships with competitors, suppliers, customers, and employees. Importantly for grounding relationship marketing, firm resources need not be owned by the firm, only available to it. For R-A theory, when such relationships contribute to firm efficiency or effectiveness, they constitute relational resources. A firm's relational resources contribute to its organizational capital. Because relational resources are heterogeneous and immobile, they can result in positions of competitive advantage that persevere through time, resulting in sustained superior performance.
Because relational resources can contribute to organizational capital and a firm's marketplace position of competitive advantage, the strategic planning process should include plans for developing relationships that complement existing organizational competencies. Ideally, a firm would wish to calculate the profit potential of each relationship, both existing and potential. Because the explicit calculation of profits to be derived from a specific relationship is frequently impossible, addressing the relationship portfolio conundrum requires focusing in a more qualitative manner on the efficiency/effectiveness-enhancing characteristics of each relationship.
R-A theory suggests that a useful starting point for developing an optimal
relationship portfolio is to periodically conduct a strategic resource audit. This audit would bare little resemblance to a conventional balance sheet. Rather, it would focus on the core competencies of the firm and the role relational resources can play in enhancing the total mix of strategic competencies.
Although the concept of a relationship portfolio or mix ought to be very useful in strategic planning, we should be mindful that a strategic portfolio of resources is very different from a portfolio of stocks. One major difference is that, at least in principle, a portfolio of stocks can be selected at a point in time. In contrast, strategic competencies and the relational resources that contribute to these competencies must be developed through time. In developing the portfolio of relational resources, a key criterion should be that the firm can fulfill its obligations to its partners. In short, not only should firms "choose partners carefully" (Hunt and Morgan 1994) by avoiding opportunists, but one should also choose partners with whom one can fulfill one's own obligations.
In conclusion, the resource-advantage theory of competition can both theoretically ground relationship marketing and provide insights on the process of developing a firm's relationship portfolio. This does not mean, of course, that there are not other theories of competition that could potentially ground relationship marketing. Indeed, relationship marketing scholars are strongly encouraged to propose rival theories that could do so. What is needed, of course, is that each rival's structure, and the foundational propositions underlying that structure, be clearly articulated. It is only by comparing rival structures and foundational propositions that one can clearly evaluate how and why theories are consistent or inconsistent, saying different things or saying the same things differently, genuinely rival or actually complementary.
Conclusion
A consistent theme in works on relationship marketing is the "co-operate to compete" thesis: being an effective competitor in the global economy often requires one to be an effective co-operator in some network. This thesis, a central part of relationship marketing, implies that at least some co-operate arrangements among firms are pro-competitive. However, the co-operate to compete thesis cannot be grounded in neoclassical, perfect competition theory because it admits only capital, labour, and land to qualify as firm resources. As discussed, no tinkering with perfect competition will suffice. what is needed is a new theory of competition.
The resource-advantage theory of competition can theoretically ground relationship marketing because it expands the view of resources to include all entities that have an enabling capacity, including such intangible entities as relationships with competitors, suppliers, customers, and employees. Importantly for grounding relationship marketing, firm resources need not be owned by the firm, only available to it. For R-A theory, when such relationships contribute to firm efficiency or effectiveness, they constitute relational resources. A firm's relational resources contribute to its organizational capital. Because relational resources are heterogeneous and immobile, they can result in positions of competitive advantage that persevere through time, resulting in sustained superior performance.
Because relational resources can contribute to organizational capital and a firm's marketplace position of competitive advantage, the strategic planning process should include plans for developing relationships that complement existing organizational competencies. Ideally, a firm would wish to calculate the profit potential of each relationship, both existing and potential. Because the explicit calculation of profits to be derived from a specific relationship is frequently impossible, addressing the relationship portfolio conundrum requires focusing in a more qualitative manner on the efficiency/effectiveness-enhancing characteristics of each relationship.
R-A theory suggests that a useful starting point for developing an optimal
relationship portfolio is to periodically conduct a strategic resource audit. This audit would bare little resemblance to a conventional balance sheet. Rather, it would focus on the core competencies of the firm and the role relational resources can play in enhancing the total mix of strategic competencies.
Although the concept of a relationship portfolio or mix ought to be very useful in strategic planning, we should be mindful that a strategic portfolio of resources is very different from a portfolio of stocks. One major difference is that, at least in principle, a portfolio of stocks can be selected at a point in time. In contrast, strategic competencies and the relational resources that contribute to these competencies must be developed through time. In developing the portfolio of relational resources, a key criterion should be that the firm can fulfill its obligations to its partners. In short, not only should firms "choose partners carefully" (Hunt and Morgan 1994) by avoiding opportunists, but one should also choose partners with whom one can fulfill one's own obligations.
In conclusion, the resource-advantage theory of competition can both theoretically ground relationship marketing and provide insights on the process of developing a firm's relationship portfolio. This does not mean, of course, that there are not other theories of competition that could potentially ground relationship marketing. Indeed, relationship marketing scholars are strongly encouraged to propose rival theories that could do so. What is needed, of course, is that each rival's structure, and the foundational propositions underlying that structure, be clearly articulated. It is only by comparing rival structures and foundational propositions that one can clearly evaluate how and why theories are consistent or inconsistent, saying different things or saying the same things differently, genuinely rival or actually complementary.
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