It is recognised that the role of the professional buyer is to maximise the added value of purchased inputs (Sashi and Kupdi, 2001:194 and Sánchez- Rodríguez, 2009:169) and that value creation is the core objective of customer-supplier relationships and of the economic exchange that lies at the heart of these relationships (Walter, Ritter and Gemünden, 2001:372 and
104 Vargo, Maglio and Akaka, 2008:145). It is relevant, therefore, to return to the literature that explores the related notions of values and of value perception in order to better understand how they might influence buying behaviour.
Firstly, it is necessary to distinguish between the concepts of value and of values. Rokeach (1968:159) and Woodruff (1997:141) contend that human values influence the conduct of individuals. They argue that across all human populations, these values are relatively few in number and are commonly shared by all individuals, all be it to different degrees. Individuals develop value systems that are hierarchically determined (Crosby, Bitner, and Gill, 1990:127 and Rokeach, 1973:3) because it is not possible to universally satisfy all human needs and desires. The antecedents of these hierarchies lie in the culture of society at large (Rokeach, 1973:3 and Woodruff, 1997:141).
Therefore, the hierarchically derived system of values held by individual buyers may well, to some degree, influence the behaviours they exhibit.
However, as Zajac and Olsen (1993:132) argue it is through the examination of the processes by which value is created and claimed that a richer perspective on buyer-supplier interaction can be developed.
As observed by Lindgreen and Wynstra (2005:732), it is a well-established perception that value is gained through the managed interaction between professional buyers and suppliers. It is, however, also recognised that there has been little research conducted to establish either the precise nature of value (Lapierre, 1997:377 and Lindgreen and Wynstra, 2005:733) or how this value is created (Lapierre, 1997:377 and Aarikka-Stenroos and Jaakkola, 2012:15). Despite, or perhaps because of, this lack of research there is recognition that value is conceptually complex. Firstly, the term value is seen as having many different meanings (Dumond, 1994:3 and Sánchez-Fernández and Iniesta-Bonillo, 2007:429) and as being ‘multi-faceted’ (Ravald and Grửnroos, 1996:19; Lapierre, 1997:380 and Aarikka-Stenroos and Jaakkola, 2012:23). Value is also perceived to be socially constructed (Helkkula, Kelleher and Pihlstrőm, 2012:559), by individuals under the influence of their own emotions, attitudes and perceptions (Hill and Hillier, 1977:69 and Lapierre, 1997:380), which can extend beyond the simple rationalisation of utility (Sánchez-Fernández and Iniesta-Bonillo, 2007:429). Notwithstanding this perception of complexity, considerations of value and its appropriation are seen to influence the behaviour of professional buyers (Dholakia et al.,
105 1993:289; Dumond, 1994:3; Cox, 2004a:413 and Liu, Leach and Bernhardt, 2005:566), even if all of the phenomenologically determined aspects of value may not be externally observable (Helkkula, Kelleher and Pihlstrőm, 2012:557).
That value is based on customer perception, and not on the externally derived assessment of the vendor, is the view of Parasuraman (1997:154), Woodruff (1997:141), Anderson and Narus (1998:54), Lapierre (2000:123) and Khalifa (2004: 647). It is also noted that these buyer perceptions of value may alter with time (Lapierre, 1997:389 and Woodruff, 1997:141) and that pre-purchase notions of value may vary from the value that accrues from the eventual use of the purchased goods or services (Gardial et al.: 1994:555). Building on the idea of value perceptions changing over time, Lindgreen and Wynstra, (2005:740) differentiate between value in exchange and value in use. They associate the former with the transaction and the latter with the relationship between buyer and seller. This distinction is reinforced by Lapierre (1997:386) who, in an empirical study of the purchase and delivery of professional services, also records distinct perceptions relating to value in exchange and value in use.
A common presentation of customer value perception is based on buyer gain versus sacrifice models such as those of Monroe (1990:46), Anderson and Narus, (1998:54) and Lapierre (2000:123). Khalifa (2004:656) provides a diagrammatic representation of such a model in his conceptual summary of Customer Value in Exchange (Figure 4.1).
Figure 4.1: Customer Value in Exchange Source: Adapted from Khalifa (2004:656)
106 Khalifa (2004:645) considers that net customer value substantially informs the buying decision. He recognises that total customer costs comprise elements of supplier costs, supplier margins and the customer’s search and acquisition costs. Total value to the customer against which total customer costs are to be offset, comprise an element of Utility Value and, perhaps most interestingly in the context of the findings of the exploratory study in relation to the emergence of buyer specific behavioural drivers, an element of Psychic Value associated with the exchange.
Psychic Value is discussed by Groth (1994:9) who considers that it differs from Utility Value in so far as it does not accrue directly from the use of the goods or services but is rather imbedded in human factors such as feelings, emotions and even buyer ego. Lapierre (1997:390), Anderson and Narus (1998:54) and Lindgreen and Wynstra (2005:740) recognise that the process of exchange itself can generate value in excess of the Utility Value associated with use, while Ravald and Grửnroos (1996:22) extend this recognition to encompass a suggestion that the personal needs and preferences of professional buyers may be related to the creation of Buyer Specific Perception of Value (BSPV).
Similarly, Wilson (2000:783) recognises that while organisational purchasing behaviour is typically perceived as having a basis that is rationally and logically driven, in contrast with the emotional and psychic elements of consumer behaviour, he strongly questions if this distinction between organisational and consumer purchasing is justified.
Within consumer research, the concept of brand is heavily associated with emotionally driven value attributes and researchers such as Sheth (1973:56) and Cretu and Brodie (2007:232) suggest that concepts such as Psychic Value and brand may also have significant resonance in a business to business context. This view is shared by Michell, King and Reast (2001:424) who note that the branding of industrial products generates an increased level of confidence in the related industrial purchasing decisions, while Saunders and Watt (1979:116) link the concept of brand to the satisfaction of a business buyer’s psychological needs. Mudambi, Doyle and Wong (1997:444), in an exploration of branding in industrial markets, also recognise the importance played by intangible factors, even in the deployment of supposedly rational and systematic decision making processes.
107 Generally, however, the relevance of brand and the wider considerations of how industrial buyer’s individual BSPV influence their behaviours are felt by many to be an under researched area. Zaltman and Bonoma (1977:54) recognise that the influence of individual buyers’ differing personal value perceptions and the effect that these have on the purchasing process are in need of further observation and research, a view that is shared by Howard and Doyle (2006:277) and Sánchez-Fernández and Iniesta-Bonillo (2007:443).
Similarly, Michaels, Day and Joachimsthaler (1987:29) perceive the complexity of the workplace from the perspective of the professional buyer’s search for value and note the absence of related empirical studies. Extending this idea by suggesting a potential direction for future research, Wilson (2000:794) posits:
‘Perhaps it is time to develop a research emphasis which asks what are the similarities between organisational and consumer buying behaviour ... the shift in focus may well necessitate a shift in research methodology from quantitative oriented surveys to the increasing use of ethnographically informed approaches.’
While there is a degree of consensus across relevant literature that value perceptions drive buying decisions, there is also emergent debate from the area of Service Science as to how perceptions of value are formed. This debate may well further inform the understanding of the buyer specific behavioural drivers to emerge from the exploratory study.