Chapter 3 Framing the Investigation and Conducting the
3.1 Positioning of the Investigation to Close the Gaps
Through a comprehensive review of extant literature three gaps have been identified in the understanding of professional buying behaviour. The first of these gaps relates to the lack of empirical evidence to explain the extent to which buyers identify and adopt co-operative, operationally focussed strategies from which both buyer and seller will potentially benefit. The second gap relates to the lack of empirical understanding as to the degree to which buyers seek to gain unilateral, commercial, advantage through enhancing their relative power position. Finally, there is an acknowledged need to develop research methods which will embrace the inherent complexity of the buyer-seller interaction.
Gereffi, Humphrey, and Sturgeon (2005:89) recognise that trading relationships have evolved within a range of governance mechanisms, which at the extremes of integration involve explicit co-ordination of the trading partners’ activities within hierarchical structures which preclude traditional buyer-seller interaction. Cox (2004c:35) classifies such business relationships as being horizontally aligned as in, for example, the creation of formal joint venture companies. Cox also recognises a second broad category of sourcing mechanisms which he terms vertically aligned, and which include both
80 collaborative sourcing and market tested sourcing. It is within vertically aligned relationships that the governance structure permits buyers to make decisions regarding the behavioural direction on which they wish to embark.
It is also noted by Ralf (1995:31) that in many situations there is no reason why organisations need ever go beyond market tested supplier relationships.
The decision was, therefore, taken to embed the investigation within vertical trading arrangements in order to gain the required insight into the behavioural choices open to professional buyers.
As developed within the discussion of the power perspective’5 the combination of resource utility and resource scarcity gives rise to a suggested ideal exchange relationship between buyer and seller (Cox, Sanderson and Watson, 2000:28) which is graphically summarised in Figure 3.1.
Figure 3.1:Potential Buyer and Supplier Exchange Relationships Source: Cox, Sanderson and Watson (2000:28)
Positions of interdependence between buyer and seller are characterised by situations in which buyers have an incentive to be proactive in their choice of sourcing behaviours, but where they do not possess the power advantage that would allow a position of dominance to be achieved. Bonoma and Johnston (1978:220) further consider that by far the most commonly occurring interaction between professional buyers and sellers is one in which they share something close to an equality of resource control and are, therefore, functionally equivalent in terms of power. Despite this Gundlach and Cadotte (1994:526), Squire, Cousins and Brown (2009:472) and Kọhkửnen and Virolainen (2011:118) recognise that there has been limited research into exchange interaction in conditions of interdependence. Situations in which there is a condition of power based interdependence between buyers and
5 The power perspective is discussed in Section 2.2.2.2
81 sellers, therefore, give rise to the potentially most fertile areas in which to explore the behaviours of professional buyers.
3.1.1 The Research Questions
In formulating the research questions it is the intent to obtain answers which will effectively lead to a closure of the identified gaps. The research questions also seeks to position the research effort within the power dependency and trading conditions that have been established as most likely to develop data from which insightful conclusions may be drawn.
Consideration of the identified gaps gives rise to two research questions which are articulated as follows:
In situations where there is the potential to form a vertical relationship between two mutually dependent organisations:
1) To what extent is the operational focus of the buyer Collaborative as opposed to Arm’s-Length?
2) To what extent is the commercial focus of the buyer Adversarial as opposed to Non-Adversarial?
The terminology adopted in the research questions is aligned to that used by Cox et al. (2004:79) in their development of the four basic relationship management styles6. It should also be noted that although the literature review identified three gaps, the third gap which relates to the need to develop research methods capable of penetrating the inherent complexity of the buyer-seller interaction, is seen as enabling the answer to the research questions rather than informing the research questions themselves.
3.1.2 The Purpose of Conducting an Exploratory Investigation
Mason (2002:45) suggests linking the development of the research design process to an exploratory study conducted early in the research process.
Exploratory or pilot studies are, as noted by Yin (2003:79), not intended as a dress rehearsal whose purpose is to pre-test the full blown study. The role of the pilot is formative and intended to assist the development of relevant lines of questioning or to provide a degree of conceptual clarification for the research design. Acknowledging, as a prompt for further research, the need
6 In Section 2.6 Cox et al. (2004) was identified as an element of key literature is respect of the identified gaps.
82 to increase understanding of the behaviour patterns of professional buyers, a first step was taken to undertake an exploratory study to better inform the research effort.
The specific objectives of the exploratory study were, therefore, not directly intended to address the research questions but rather to:
• to build a prima facie case for power based interdependence between buyer and seller.
• to ascertain the presence of the expected buying behaviours and establish that these are, to some degree, both operationally and commercially driven.
• to consider the suitability, and willingness, of participants for inclusion in a second and more detailed research phase.
The exploratory study was also expected to inform the main investigation in respect of developing the research method7 to enable delivery of a more thorough subsequent examination of the issues under examination.
3.1.3 The Research Paradigm
Having formulated a research question it is, thereafter, incumbent on the researcher to adopt a research paradigm that is closely aligned with the ontological and epistemological positions encapsulated (Mason, 2002:18).
Qualitative research embodies a view of social reality that is based on the constantly shifting creation of individuals and emphasises the importance of what is said and written rather than what is physically measured (Bryman and Bell, 2003:25). It involves understanding real-life situations through a search for context, logic and rules in order to build an appreciation of social reality (Miles and Huberman, 1994:6). Qualitative methods predominantly emphasise the use of inductive logic (Bryman and Bell, 2003:25) which involves the researcher in making inferences as to the implications of their findings on the domain of their enquiry (Gill and Johnson, 1997:33 and Bryman and Bell, 2003:10).
The complementary approach to qualitative research is the use of quantitative methods that proceed from the positivist assumption that if
7 Including determination of the most suitable unit of analysis.
83 something exists it can be numerically measured (Jankowicz, 1995:174).
Quantitative methodologies incorporate the practices and norms of the natural sciences including the adoption of deductive logic (Bryman and Bell, 2003:25). Deductive reasoning involves the development of a conceptual and theoretical structure, followed by a review of these concepts in an empirical setting to ascertain if the building process is supported (Gill and Johnson, 1997:28).
Having different roots, both approaches are the subject of criticism and a degree of debate about their appropriateness (Easterby-Smith, Thorpe and Lowe, 1991:22). The criticisms of qualitative approaches frequently relate to a perceived lack of reliability and over emphasis on the researchers, often unsystematic, views as to what is significant and important within the data collected (Bryman and Bell, 2003:299). Similarly, those who criticise quantitative approaches argue that methodologies whose epistemological roots lie within the physical sciences are thought to have limited applicability in the social world (Bryman and Bell, 2003:13).
The criticisms of qualitative methods are, however, countered by those who emphasise the need to design studies in a manner so as to ensure Internal Validity, External Validity and Reliability. (Easterby-Smith, Thorpe and Lowe, 1991:41; Yin, 2003:19 and Bryman and Bell, 2003:33) Internal Validity is the issue of ensuring that any conclusion that incorporates a causal relationship between two or more variables is robust. External Validity relates to the ability to generalise the conclusions beyond the specific research context.
Reliability is concerned with whether the results of the study are repeatable.