Investigating the impact of a shared services intermediation on the perceptions of B2B buyer-supplier relationship benefits

Abstract

It is clear that there is a strong drive for organisations to adopt the shared service model with the intention to gain some economic benefits. This research also acknowledges the theory on supplier relationship management, as well as relationship quality management and how these two bodies of knowledge are connected to shared service and ultimately how they affect the relationship benefits between buyers and sellers in business to business environments. With the growing importance to distinguish one’s business from others to gain competitive advantage, relationships have become a crucial differentiator. It is important to appreciate whether the shared service model enhances relationships or not. This research therefore sought to examine the relationship quality measure elements such as trust, satisfaction and commitment as well as the relationship benefits; social, psychological and functional which are impacted by the introduction of a shared service. The research findings offer some important insights into how the introduction of a shared service model into an organisational structure impacts these relationship benefits. When comparing a shared service structure to that of a decentralised model it was evident that all elements of relationship quality and benefits changed. The results indicated that once the shared service became the central point of contact and communication for many of the suppliers, relationship quality and relationship benefits declined. Further, the results found were that many of the anticipated benefits of shared service were also not seen or experienced by the suppliers. This research involved two phases, a qualitative phase component and a quantitative phase. The qualitative phase involved face-to-face interviews with five significant suppliers to Sasol, companies in industries such as Civil, Manufacturing as well as industrial goods suppliers. The quantitative phase involved an electronic survey, distributed to all of Sasol’s suppliers. The data gathered from these interviews and surveys, together with the reviewed literature helped to measure the affects of shared service on supplier relationships. One hundred and forty questionnaires were processed and data was subjected to a variety of statistical analysis. This research will add to the limited knowledge of shared service as well as equip managers implementing shared service with some strategic insights. When implementing shared service it is imperative to look beyond mere cost savings and to also consider the relationship affects for all concerned when changing the relationship dynamics.