Interfirm Relationship Quality Analysis

There is a growing interest in interfirm relationships and many firms build cooperation relationships via supply chain. Technological transformation and globalization influence them to form such relationships to compete successfully (Su et al., 2008). From the organization management perspective, most firms lean to build up close relationship with main suppliers and customers. The relationships between and among manufacturer/supplier, distributor/retailer, and salesman/customer have been investigated in existing literatures. In a competitive environment, interfirm relationship management becomes crucial to achieve competitive advantages, when firms become more dependent on outside partners to fulfill sophisticated customer need (Kim et al.,

Interfirm relationship quality is a total assessment of the strength of a relationship and the extent to which it meets the needs and expectations of the parties based totally on a records of a success or unsuccessful encounters or events (Crosby et al., 1990). Relationship quality is associated with buyer-suppler literatures, however there no consensus between the scholars regarding the definition of relationship quality. There are special views like customer perspective view, degree of relationship view, supplier angle view (Fayezi and Zomorrodi, 2015; Visentin and Scarpi, 2012; Tsarenko and Simpson, 2017). Important reason of lack of consensus is that type of relationship in numerous client and business markets. For that reason, we outline interfirm relationship quality as: the degree to which each parties in a relation are engaged in an enthusiastic, long-term working relationship. We recommend that the definition of relationship quality cannot be restricted handiest inside the relational processes of the relationship. From an executive angle, a relationship quality construct must be comprehensive, and includes all components of the connection, i.e., both the economic

In this paper, we state that mutual trust, information sharing, cooperation, and communication describe all aspects of relationship and they construct interfirm relationship quality. Mutual trust and communication represent the connection between and amongst humans (companies), cooperation represents the relational activities, moreover, information sharing represents the economic and social additives of relationship. In this paper, governance mechanism means a comprehensive governance systems which is followed by both parties for terminating relationship, maintaining relationship or extending relationship, and these strategies determine the further development of business relationships. In interfirm relations, governance mechanism has two features. First, because of different degree and means engaging transaction, governance may be formal or contractual, which reflects the legal boundaries and liabilities of the relationship. Second, governance may be mutual trust based and