In this paper, we investigate how buyers’ and suppliers’ distinct perceptions of
technology uncertainty affect the relationship between communication frequency
and supplier performance. Information processing theory suggests that a fit is
desirable between perceived environmental uncertainty and the communication
processes between organisations. However, if partners in a buyer-supplier
relationship do not concur on the high level of technology uncertainty, it is
highly questionable whether increased communication will be effective in
increasing supplier performance. Using dyadic data from 86 buyer-supplier
relationships, involving 388 respondents, we found that communication frequency
was positively related to supplier performance only when both suppliers
and buyers perceived high levels of technology uncertainty. When buyers
perceived greater technology uncertainty than their suppliers, communication
frequency was negatively related to supplier performance. The findings in this
study show that it is important to take the distinct perceptions of buyers and
suppliers of technology uncertainty into account when assessing the effects of
communication frequency. It appears that increased communication is only
effective when both parties acknowledge the need to communicate, and can be
unfavourable when only one party sees the benefits of it.
uncertainty
perceptions