Executive summary and implications for managers and executives

Citation

(2007), "Executive summary and implications for managers and executives", Journal of Services Marketing, Vol. 21 No. 5. https://doi.org/10.1108/jsm.2007.07521eaf.001

Executive summary and implications for managers and executives

This summary has been provided to allow managers and executives a rapid appreciation of the content of the issue. Those with a particular interest in the topic covered may then read the issue in toto to take advantage of the more comprehensive description of the research undertaken and its results to get the full benefit of the material present.

Keep things simple are three words with have served product manufacturers well in the past. Keeping things simple can not only help save time and money by cutting down on the complexity of design and manufacture, it can also help the customer use the product effectively – and it is easier to repair if something goes wrong.

The only drawback is when a competitor comes up with something not just far more complex, but far more desirable because of the extra things it can do, or can do better. Trying to balance the desires of cutting costs by reducing complexity and providing a sophisticated yet easy-to-operate product for the end-user is a demand service providers also face.

Internet and other twentieth and twenty-fist century technologies have seen a dramatic increase in the reliance of businesses on services based on information and communication technology (ICT). The enormity of the task of managing, storing and organizing essential information has been admirably met by breakthroughs in ICT systems for customer relationship management, supply chain management and enterprise resource planning.

The way those services are produced and marketed, however, has become increasingly important in two major ways. First, rapid technological innovation has led to a significant increase in the complexity of ICT services, influencing the design and production processes, and customer interface. Second, the customer expectations have become more demanding. Reliability is taken for granted and customization is needed to differentiate from competitors.

From an ICT service provider’s point-of-view, this creates many concerns with regard to service development, marketing, and implementation. Development becomes more difficult, as the variety of different software technologies concerning the actual service increases, and marketing and selling become more challenging, as the customers’ requirements are more and more unique.

If a service provider cannot manage this complexity it will lead to increasing production costs, systems failures, and to customer dissatisfaction and defection. Consequently, service design is a critical phase in addressing this complexity.

In “Service packaging: Key to successful provisioning of ICT business solutions”, Mika Hyötyläinen and Kristian Möller, use a case study of a large Finnish ICT company to describe how three service design and development methods – service industrialization, tangibilization and service blueprinting – can be used to reduce the complexity of ICT business services.

Industrialization of services applies techniques found in manufacturing, and focuses more on the activities that are required in producing the service – and how they could be re-engineered – than on the performer of those activities. In human-intensive activities, hard, soft and hybrid technologies should be used to systematically industrialize services. Hard technology refers to replacing human activity through a technology-based processes – as in the ATM and internet banking services. Soft technology refers to rationalizing and specialization of the human activities involved in services, as well as repacking or modularizing them (as in the modularized service and maintenance packages offered by the ICT providers for, e.g. corporate telephony services), and hybrid is a combination of hard and soft technologies.

Tangibilization of the intangible promises inherent in the provision of most services provide reassurance to prospective customers about services which cannot be pre-tested.

Service blueprinting comprises four steps. First, the service process should be broken down into steps and sequences. Second, the potential failure points (where the performer is seen to have too much discretion) should be isolated. Third, a suitable timeframe for service should be established. Fourth, the service should be analyzed to identify possible changes of unprofitable sequences or timeframes.

With key business services becoming difficult to manage in the case-study company, and complexity identified as the core problem, a project targeted aimed at reducing that complexity was launched, concentrating on business process networking (BPN) services in the managed services portfolio.

When the core problem was examined further it was found that the large variety in every aspect of the services led to increased complexity that in turn led to challenges concerning service quality, cost structure, and customizability. As alternative actions were identified to reduce the variety, it was recognized that the complexity challenge could be approached from various perspectives – customer need, technology, process, system etc.

In the end it was decided that the project would concentrate on developing a framework that encompasses both the customer need perspective as well as the technology perspective. Industrialization, service blueprinting and tangibilization were identified as suitable methods to do this. From the customers point of view, it was seen that the about ten services under the old BPN concept should be integrated and regrouped into one BPN service.

Mika Hyötyläinen and Kristian Möller say:

In many customer and sales oriented service companies the managers in charge of the service production are usually the last ones to learn about new particular solutions that has especially been sold and promised for one customer. Because of this lack of internal communication and coordination between service marketing, design and production many managers working in the ICT services production are struggling with complex solutions that have been designed and developed to perfectly match a specific customer need, as understood by a salesman, without any concern of their runtime management.

Reducing and streamlining customer service offering does not necessarily mean less customer satisfaction. On the contrary, a service producer can cut down the number of offered service products and functions, but fulfill the same real and differentiated customer needs. By achieving better transparency between the unique customer needs and the implemented modular service offer, which allows reduced delivery time and improves functionality, customer satisfaction can actually be improved while simultaneously reducing service production costs.

An antecedent of improving customer satisfaction is to assess customer service. Within consumer service markets the collection of customer feedback appears to have become integral to the service process itself, yet less explicit attention seems to have been given to the issue in business-to-business marketing.

As there is no consensus what information to collect, who to collect it from and when and how to collect it, Judy Zolkiewski, Barbara Lewis, Fang Yuan and Jing Yuan, in their piece “An assessment of customer service in business-to-business relationships,” use an in-depth pilot case study of a leading UK provider of fire protection and safety systems whose service interactions range from a four-hour service visit to a hotel or retail outlet, to the complete installation of a multi-million pound fire protection system.

The company identifies service quality as a key performance indicator in their desire to maintain market leadership, but customers and suppliers appear to have some similar, and some different, perceptions and understanding of service quality, and some different expectations. Managers need to be aware of components that might be generalized across industries and those which are specific to their own.

Communication, installation, invoice accuracy/clarity of written material, price and responsiveness were customer service/satisfaction factors identified by both seller and buyer respondents.

Problems with internal communication often related to messages not being passed to the person they were intended for, or left for someone who was on leave, resulting in customers’ queries not being dealt with. Managers must be aware of the significance of the role of internal communication in service quality and ensure that procedures are in place to ensure it is effective.

A factor identified by buyer respondents was complaint handling with a quarter of customers interviewed being dissatisfied with the procedures in place. A factor identified by seller respondents was the efficiency of office personnel, with an engineer noting: “Speaking to some customers, the problem seems to lie more in the office rather than out in the field. It seems that in a lot of cases, they are not happy with the people in the office rather than the engineers.”

The majority of customers discussed product performance – a problematic area for an industry that sells products the customer hopes they will never use. “How do you know if your fire-prevention and fire-fighting systems work effectively unless you have a fire?” The experience of a customer whose building was saved by an effective sprinkler system was subsequently a major factor in a purchasing decision.

Judy Zolkiewski et al. advise managers to recognize the dynamic nature of service quality and the role of both provider and user and make sure they develop strategies that cater for this complexity, e.g. by ensuring that employees are aware of the factors that their customers deem to be significant in service quality and how these requirements may change over time.

Managers need to find mechanisms for collecting perceptions about service quality both internally and externally (including perceptions from their wider network, such as subcontractors). Instead of using measures of service quality and satisfaction that have been transferred from consumer markets, managers need to take time to consider the most appropriate method of gaining feedback on aspects of quality in the context of the industries in which they operate.

Technical expertise and experience of a customer’s business/industry may well provide a company with competitive advantage and bring them repeat business. Managers should ensure that they utilize the experience of their employees to the full in this context.

Personnel should be empowered and given appropriate technical training to enable them to solve problems before they escalate and become sources of real dissatisfaction.

The concept of “minimum disruption” as a dimension of service quality also has wide-ranging implications. Once managers are aware that such a factor is of central importance to customers, they should be able to offer solutions that explicitly focus on this aspect of their service. It can also be suggested that this notion does not just apply to aspects such as installation; it may well apply in maintenance and other consultancy visits, even in the context of making sales appointments to visit a customer.

Managers must also be aware of the influence of other actors in the network, e.g. the requirements that insurance companies place upon purchasers and that the selling company needs to have the expertise to implement. They also need to be aware of the impact that subcontractors may have on customer perceptions of service quality. In this context, it may well be pertinent to suggest that managers consider including performance indicators that relate to service quality in any contracts they set up with subcontractors.

Customers need to receive accurate, appropriate and timely information about products and services. Employee skills, including knowledge, courtesy and understanding of customer requirements, should be high priority in the recruitment and development of all employees (both front and back office).

When considering employee skills in a business-to-business service market context, employers need to be aware of the huge shifts in emphasis and operation that have taken place in personal selling and sales management. Salespeople were once selected merely on their ability to sell products and services. What’s needed these days is consultative selling from problem solvers rather than persuaders.

There is a move from the use of charisma and aggressiveness, to customer understanding and the ability to provide high levels of customer service. Sales organizations should seek salespeople who can adapt their communications based on customers’ needs and wants.

In “The shift in sales organizations in business-to-business services markets,” Professor Arun Sharma traces the evolution of sales organizations and the changing business world they face. When business-to-business sales organizations initially emerged, salespeople sold a product in a specific location and were experts in explaining product attributes and functionality. As some firms’ customers became national in scope, national account management sales forces were created, providing higher levels of service to important customers. In addition some firms recognized that some functions could be automated – order and payment through mail systems, for instance.

In the initial stages of services selling and sales management, the typical product sales force organization was used. But it became clear that selling services posed special challenges. Salespeople needed to use unique sales strategies as business customers perceived a higher level of variability and uncertainty when buying services.

In addition, the behaviour of salespeople influenced business customers’ perceptions of quality more in a service setting than in a product context. And, in contrast to product selling, service selling needed in-depth knowledge of the customer’s processes. The service salespersons needed to understand how their service processes matched the processes and desired outcomes of the buying firm. Therefore, the service salesperson needed to be a customer expert rather than a service or product expert. Additionally, in some cases, the service salesperson was also responsible for implementation of the service – not a requirement for product sellers.

The customer-focused, rather than service-focused, sales organization performed better as both the businesses and sales organizations changed toward a solution- and satisfaction-based service model. The shift toward solution selling has changed the role of a salesperson from a spokesperson for the firm’s services to that of a consultant for the buying firm, involving them becoming experts in seeking solutions for the customer firm. Earlier research has suggested that an expected evolution from product selling to solution selling to trusted partner will take place.

As it was being becoming increasingly clear that the traditional product-focused sales force was ill-suited for the service context, traditional product-focused organizations were declining for many reasons. First, the rise of multi-channels, specifically inexpensive and effective channels such as the Internet, was causing firms to re-examine the cost of the traditional sales force. Salesperson costs have risen tenfold in the last five decades, now approaching about 3,000 dollars per order in the US. For example, costs of lead generation and qualifying from an internet site are insignificant when compared to a salesperson performing the same functions. It costs a firm about 500 dollars when a salesperson receives an order, but the same transaction can be accomplished on the internet for less than ten dollars.

Second, buying firms were moving from a focus on attribute-based products and services to solution-based products and services. Increasingly more firms are seeking a pay-per-use model where they pay for the solution service that is used. In this context, the role of the salesperson is changing from that of a service-based expert to a solution- or customer-based expert.

Third, tools such as the internet and e-mail were reducing the need for salespeople to be primary communicators of service attributes. Most business service firms have websites that provide extensive data on their services. Similarly, most firms have downloadable brochures. In addition, technologies were making ordering automatic, with the result that some sales processes, such as order taking, have become less relevant.

Sales organizations are evolving in two distinct directions. First, there is a reduction in salespeople’s contact with customers due to enhanced sales automation. Sales automation through communication technologies such as the Internet and telephone has reduced costs and in some cases has enhanced customer satisfaction. Second, due to a solution and customer-based focus, there is an enhancement in the level of customer contact. For the majority of firms there will be an increase in the deployment of customer-focused sales organizations. The role of a salesperson will change from that of a persuasion agent to that of a consultant and implementation agent to the buying firm.

Professor Sharma suggests that customer-salespeople meetings be scheduled to evaluate the performance of the marketing firm. He also notes that, in the era of consultative selling, both evaluation and compensation systems will need to change. Salespeople’s incentives need to be based on sales growth, profit growth, and customer satisfaction.

While a solution seller’s evolution into a trusted partner can only be good for business, it’s worth considering – when we use that word “trust” – exactly what we mean by it. It is also worth considering what other people think “trust” means, bearing in mind different people have different definitions, and for organizations to ask themselves, not just how big a part trust plays in their business, but whether they do anything to foster it, or just “let it happen.”

In their “The role of trust in financial services business relationships,” Katherine Tyler and Edmund Stanley say trust underpins many variables in the interactions and relationships in service business markets, and is crucial to our understanding of services business-to-business markets – not least in financial services, despite a formidable regulatory system which seeks to protect customers against misplaced trust.

The overwhelming majority of respondents in their study of UK corporate bankers and their clients identified trust as critically important within their bank relationships, a significant number arguing that without trust there could be no relationship, and most saying that a significant failure of trust would lead them to leave a relationship. Only four interviewees, on the client side, believed that other control systems obviated the need for trust.

There was, however, no common understanding of trust. Even managers from the same bank conceptualised trust differently. All considered it to be a means of controlling or limiting risk and there was a general appreciation that trust must be mutual. All the interviewees appreciated the difference between interpersonal, organizational and inter-organizational trust and, in general, interpersonal trust was viewed as more critical to relationship success than inter-organizational trust, and was interpreted more positively.

As most respondents were in long-term relationships, it suggests that there was some mechanism (levels of trust?) sufficient to maintain the exchange relationships that typify the UK business-to-business bank market. However, serious failures of trust were not unknown. Moreover, numerous bank clients were less than completely satisfied, even if this had not led them to rethink their financial services purchasing and switch banks. This dissatisfaction was particularly marked among SMEs.

Within interpersonal relationships, both bankers and their clients commonly saw honesty, integrity, discretion, mutuality, predictability and ability as essential components of perceived partner trustworthiness.

In addition, all clients were concerned with bank manager and bank reliability. The central component of reliability was “doing what was agreed.” Trust in partner reliability created a sense of “confidence” and “comfort” and reduced uncertainty. If bankers failed to complete actions as agreed (this applied equally to dispatching a chequebook as providing finance), or worse, promised actions that were subsequently not approved, trust swiftly turned to mistrust. Bankers understood this danger.

Most respondents acknowledged that banks have become increasingly reliable. However, this development has gone hand-in-hand with less well-received changes. Those with a longer experience of bank markets, on both sides, felt the nature of trust in banking had changed significantly. In particular, there has been a reduction in the expression of trusting behaviours by banks, connected to increasing use of technology, a proliferation of paperwork, bank centralization and impersonal call centres, especially in relation to specialist product generation and key decision-making.

Company and bank respondents with experience of “old style” account management, expressed disquiet with this change. An experienced banker said:

The bank, in it’s training programme and certainly the fast-track training programme, trains people to be very good money lenders, but there is a lot further to go in developing bankers.

This quote encapsulated awareness that trust, and by extension “good banking”, were products of more than simple service satisfaction. However, only a minority of interviewees (mostly bankers) had considered trust development and maintenance in a sophisticated way, despite the widespread acknowledgement of its importance. A number even argued that there was little they could do to develop trust. Only a minority displayed evidence of having thought about trust in the structured way in which they would consider other important elements of their business practice.

Bankers and their clients would be well advised to gain an understanding of trust, and provide key people, who build external relationships, with an insight into the role of trust in customer service and relationship building and maintenance in services business-to-business markets.

Katherine Tyler and Edmund Stanley say:

Although trust is foundational to establishing relationships at a personal, organizational and inter-organizational level and an essential element of customer service and service quality, banks and bankers have no explicit strategy or staff guidelines for developing trust. The banks have no generally-recognised and accepted definitions of trust, trusting behaviours, or how trust should be operationalised. As an important underpinning element of customer service, service quality and relationship building and maintenance, trust should be developed explicitly, strategically and consciously through the adoption of behaviours likely to encourage trusting.

Trust is not the only concept with which marketers and practitioners have to grapple with differing definitions and a complex array of views relating to antecedents and consequences. If people have to put their trust in trust to create and maintain profitable business-to-businesses arrangements, what value should they put on value?

Various accolades have been bestowed on the concept of product and service providers giving “value” to customers, including “value is what every marketer should be all about”, “value is the basic foundation for everything we do in marketing” and the equally unequivocal view that “in business markets, the value of a product offering in a given application can be thought of as the cornerstone of marketing strategy.”

But what is the functional relationship between value, satisfaction and intention to repurchase?

In their “A re-examination of the relationship between value, satisfaction and intention in business services” Graham Whittaker, Lesley Ledden and Stavros P. Kalafatis contribute to the relatively sparse literature dealing with that question, and add to the debate regarding conceptualisations and operationalisations of value within a professional service domain.

Their research framework includes the following six consumption values:

1. 1.

   Functional value is related to the perceived performance or utility of the product or service, i.e. an offering’s ability to fulfil the function that it has been created to provide, as well as the benefits associated with owning it. This dimension is particularly associated with extrinsic attributes.

2. 2.

   Epistemic value refers to benefits derived through an offering’s ability to arouse curiosity, provide novelty or satisfy a desire for knowledge. The inclusion of this dimension is based on the fact that many professional services (e.g. consultancy, training, etc.) are specifically designed to improve the skill and knowledge base of the client organization.

3. 3.

   Emotional value accounts for benefits obtained from an offering’s ability to arouse feelings and/or affective states.

4. 4.

   Social value represents the benefits derived through inter-personal/group interactions and, together with emotional value, this dimension is considered to account for relational benefits.

5. 5.

   Image represents benefits derived from being associated with a business partner that enjoys high market status. This dimension is closely related to the reputation of the service supplier and can be considered to act as a risk-reducing mechanism.

6. 6.

   Price/quality value represents an evaluation of functional aspects of value relative to the give aspects of the consumption experience. More specifically its accounts for customers’ perceptions of the service they receive in exchange for what they give in terms of payment/sacrifice.

Concluding that value is a higher order formative measure that includes both benefits (get) and sacrifices (give), Whittaker et al. say:

The results support the conceptualisation of emotional, functional, epistemic, price/quality, social and image as collectively comprising perceived value in a business service domain. This in turn implies that in order to engender perceptions of value, providers of business services should consider their actions in terms four main customer perceptions.

These are:

• •

  outcome directed perceptions (i.e. value related to the very purpose of the business service on offer and the resultant service knowledge);

• •

  relationship building perceptions (i.e. value related to inter-personal interactions and development of trust);

• •

  atmosphere related perceptions (i.e. value related to feelings and risk reduction safeguards generated through association with a specific service provider); and

• •

  sacrifices related perceptions (i.e. whether the experience merited the financial and other associated costs incurred as part of the service experience).

Mapping their offering against the above and identifying specific actions designed to account for these facets of value are obvious ways that providers of business services can enhance customer perceptions. The authors say:

Until further research allows us to be more confident in our recommendations we suggest that although our results indicate that emphasis should be placed on actions that enhance perceptions of social, epistemic and price/quality values, the other identified dimensions of value (i.e. emotional, functional and image) should not be overlooked.

Their observed weak impact of satisfaction on re-purchase intention leads the authors to suggest that, although service providers could improve customer retention by attempting to increase their level of satisfaction, their efforts will be more effective if focused on demonstrating the way that the service provided has helped their customers to achieve their goals. In other words, that emphasis should be placed on goal-based rather than consequence-based satisfaction.

Customers can be a pretty strange bunch of people when it comes to satisfying their needs and encouraging them to stay loyal. To take an example, if a customer sees an improvement in the visual aspect of packaging their overall satisfaction with the product can increase significantly. However, a drop in its visual aspect might have little impact on their overall satisfaction.

Another example is that a drop in reliability can significantly lower a customer’s satisfaction with a service provider, but an equivalent increase in service reliability might have little impact on that customer’s satisfaction.

Strange lot, indeed. But they are not just whims on the part of individual customers. There is a logic to it, and the asymmetric effects which service quality creates need to be better understood. So too does the importance of considering customer segments separately. Failure to consider the differences between customer groups may lead to managers getting misleading information, and result in the firm trying to optimize performance on the wrong attribute for a given segment.

In “Segment differences in the asymmetric effects of service quality on business customer relationships” Simona Stan, Kenneth R. Evans, Charles M. Wood and Jeffrey L. Stinson study satisfaction and relationship continuance intentions of business customers of advertising services, proposing a model of service quality consisting of: service outcome (results for the client’s business), technical quality (e.g. reliability of technical service delivery) and functional quality (e.g. reps’ responsiveness, empathy and assurance).

They found that, along the service dimensions-satisfaction-retention chain, there are significant negative asymmetric effects. More importantly, perhaps, there were significant differences across different customer segments.

Large accounts were primarily concerned with getting results from advertising. Negative asymmetry means that if large accounts experience a loss in advertising results, their overall satisfaction will be impacted more than if they experience a similar gain. Service outcome had a similar effect on relationship continuance intentions.

However, this effect is completely mediated by overall satisfaction. This means that delivering a consistently high level of advertising results to large accounts is critical for keeping them satisfied, which in turn determines their level of loyalty to the service provider. In contrast, it seems that small accounts are not as influenced by the service outcome.

In contrast, reliability, which is the technical service quality dimension, has a significant positive direct impact on small accounts’ relationship continuance intentions with a negative asymmetric effect. This effect is not mediated by customers’ overall satisfaction. In fact, reliability seems not to play a significant role in determining satisfaction. Instead, it has an additional effect on relationship continuance intentions, after the effect of overall satisfaction has been accounted for. Interestingly, reliability has no significant effect in the case of large accounts. This means that, for small accounts, satisfaction and relationship continuance intentions are at least partially determined by different aspects of service quality. While overall satisfaction remains the most important factor in retaining all type of customers, small customers tend to be particularly sensitive to reliability issues, which act as a utility preserving factor, when considering repurchasing from the same service provider.

Functional service quality seems to have a significant effect on small accounts but not on large accounts. More specifically, small customers’ overall satisfaction is positively impacted by reps’ assurance and empathy. While assurance seems to have a symmetrical effect, empathy seems to have a fairly strong negative asymmetry that suggests that small accounts tend to view reps’ understanding and caring behavior as an important utility preserving factor.

The same pattern of effects is displayed for relationship continuance intentions. However, the effects of both assurance and empathy on relationship continuance intentions are completely mediated by overall satisfaction. This means that, while large accounts seem to be less sensitive to the quality of reps’ interaction, small accounts’ satisfaction and, in turn, repurchase intentions, are significantly determined by reps’ assuring and nurturing behavior.

As in the case of account size, new and mature accounts do not differ in terms of service quality perceptions, satisfaction or relationship continuance intentions. However, important differences are found in the impact of service quality. Customers with mature relationships may be accustomed to receiving a certain level of results from the advertising services provider and therefore are only slightly affected by perceptions of service outcome. In contrast, new customers seem to be particularly sensitive to the service outcome.

The reliability of the service provision process seems to be a significant factor in retaining the new customers. Among customers with similar levels of overall satisfaction with the service provider, new customers are more likely to end the relationship when receiving lower than average service reliability, than they are likely to continue the relationship when they receive higher than average service reliability.

Functional quality seems to be important, although in different ways, for both newer and mature accounts. In the case of mature accounts, empathy is the only service quality dimension which has a significant impact on customers’ satisfaction and intentions to continue the relationship with the service provider. In contrast, for newer accounts, all dimensions of service quality play a role in customers’ satisfaction and retention.

Managers should invest resources in improving low performance in the service quality dimensions with strongest impact on customer satisfaction and highest negative asymmetry. Delivering results through the service outcome is the dominant factor in satisfying and retaining large accounts.

Given that keeping the customer satisfied, and eager to continue with a relationship, entails understanding different types of customers and the different values they put on service outcomes, what of the complexity of relationships spanning fundamentally different organisational environments and corporate cultures, each having different motives and expectations – i.e. business and university?

Given the increasing need of organisations for innovation in competitive, fast-moving marketplaces around the world, research customers provide a highly-relevant services business market.

Research services are anchored in vast pools of knowledge, capabilities and facilities and may take on a number of forms due to the diversity of research areas and methods accumulated at universities. They all encompass one characteristic, namely the need for a close interaction between the research providers and customers to enable the transfer of knowledge and research, indicating a need for a relational approach.

In “Key drivers of university-industry relationships: the role of organisational compatibility and personal experience” Carolin Plewa and Pascale Quester investigate research-oriented university-industry relationships (UIRs). They warn, however, that:

Developing any interactive, trusting and long-lasting relationship is not possible if the organisational structure, culture or senior management oppose the idea of relationship building. Hence, management aiming at developing UIRs should be confident of their groups’ ability and willingness towards building relationships with the other environment.

Given the different benefits sought by both parties, the concept of satisfaction was deemed a valuable measure of relationship success, enabling the analysis of an overall impression of success gained by both partners, reflecting their respective expectations and performance perceptions.

Universities are believed to benefit primarily in economic terms, including financial support for future research, plus the benefits of seeing their basic research results applied to industry problems. Organisations generally want to acquire technology and knowledge, and also gain access to the talented people they might encounter during the relationship.

Unsurprisingly, matters of confidentiality arise when collaborating on matters of research and technology with another party, especially when entering an unfamiliar environment. Consequently, the implicit need for trust. However, trust is considered in the study, not as an actual behaviour, but as an underlying psychological condition based on the overall relationship.

As uncertainty is inherent to research and increased by confidentiality concerns, trust is essential for the collaboration. As time is needed for trust to develop, it follows that university-industry relationship development requires a long-term focus.

Trust was confirmed as the strongest predictor of satisfaction. The building of close, trusting relationships reduces perceived risk and also offers flexibility in operations and information exchange, providing a basis for research and discovery. Given the impact of trust on satisfaction, the study results’ lack of a significant link between trust and intention to renew was surprising. Since neither trust nor satisfaction was shown to influence intention to renew, it would appear that decisions about the future do not necessarily depend on the affective conditions in the relationship.

Industry groups appear to approach, and collaborate with, those research groups and academics that had previously demonstrated their ability to build relationships with industry. A research group may, therefore, position itself based on previous relationship experience.

Following the attraction of a potential partner, trust should then be allowed to first develop through small-scale undertakings rather than directly considering high-risk projects.

Compatibility of organisational cultures strongly related to trust and was seen to also influence commitment and integration. As it can be achieved by means of matching goals, objectives and operating philosophies, the deliberate consideration of these factors is required in the relationship initiation phase and should be repeated continuously, as goals change with the parties’ environments and circumstances. Furthermore, structures and processes for knowledge dissemination between partners need to be established to encourage integration.

The authors comment:

Our results clearly indicate that groups aiming at the long-term continuation of a relationship should focus primarily on increasing levels of commitment. Besides valuing the relationship, they have to actively contribute to maintaining the relationship in order to achieve an ongoing affiliation.

As the time and financial effort provided to a specific relationship may depend on the overall university or corporate strategy, processes should be put in place to determine the relationships that the organisation wants to retain and to empower groups to contribute to these relationships in their best possible way.

(A précis of the special issue “Business to business services: multiple markets and multi-disciplinary perspectives for the twenty-first century”. Supplied by Marketing Consultants for Emerald.)