IJLM-07-2012-0067

The International Journal of Logistics ManagementThe role of personal relationships in supply chains: An exploration of buyers andsuppliers of logistics servicesDavid M. Gligor Mary Holcomb

Article information:To cite this document:David M. Gligor Mary Holcomb , (2013),"The role of personal relationships in supply chains", TheInternational Journal of Logistics Management, Vol. 24 Iss 3 pp. 328 - 355Permanent link to this document:http://dx.doi.org/10.1108/IJLM-07-2012-0067

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The role of personal relationshipsin supply chains

An exploration of buyers and suppliers oflogistics services

David M. GligorGlobal Supply Chain and Logistics Excellence Network,

Massachusetts Institute of Technology (MIT), Cambridge,Massachusetts, USA, and

Mary HolcombMarketing & Logistics, University of Tennessee, Knoxville, Tennessee, USA

Abstract

Purpose The purpose of this paper is to understand how personal relationships influence behaviorwithin a supply-chain context.Design/methodology/approach This research employs a qualitative methodology that allows fora rich assessment of how buyers and suppliers of logistics services interact within the context ofpersonal relationships (e.g. friendships), that are themselves embedded within interfirm relationships.Based on a grounded theory approach, a model is developed describing how and why personalrelationships are important for supply-chain managers to consider when cultivating interfirmconnections.Findings The findings reveal how managers act/interact within the context of personal relationships,as well as the outcomes/benefits associated with the development of personal relationships.Research limitations/implications This study uses qualitative interviews to generate theory.The generalizability of the findings will have to be empirically examined in future research.Practical implications Managers can use the findings to understand explicitly what types ofbenefits personal relationships can yield. Further, this study presents to managers the specific actionsthat buyers and suppliers of logistics services engage in, when developing a personal relationship, inorder to facilitate the generation of positive business outcomes.Originality/value A notable weakness in the supply-chain relationship literature is the unfulfilledneed for research examining interfirm relationships at a micro/individual level, rather than thetraditionally adopted firm-to-firm view, in order to account for the social/relational elements offirm-level relationships. This paper addresses that gap by exploring personal relationships withinsupply chains.

Keywords Supply-chain management, Partnership

Paper type Research paper

1. IntroductionThe need for firms to develop closer relationships with suppliers is well recognized inthe logistics and supply-chain management literatures (Murphy and Poist, 2000; vanLaarhoven et al., 2000; Golicic and Mentzer, 2006), and a variety of benefits have beenassociated with firms cultivating close relationships, such as higher levels of partnertrust and commitment (Autry and Golicic, 2010; Golicic and Mentzer, 2006), higherlevels of customer retention, increased customer referrals (Knemeyer et al., 2003),and improved operational and market performance (Stank et al., 2003; Sinkovics andRoath, 2004; Panayides and So, 2005).

The current issue and full text archive of this journal is available atwww.emeraldinsight.com/0957-4093.htm

Received 23 July 2012Revised 15 November 20121 March 2013Accepted 14 April 2013

The International Journal of LogisticsManagementVol. 24 No. 3, 2013pp. 328-355r Emerald Group Publishing Limited0957-4093DOI 10.1108/IJLM-07-2012-0067

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Although it has long been recognized that business relationships ultimatelyprogress due to individuals within firms interacting over time (Hakansson, 1982),most buyer-supplier relationship models tend to focus on the more macro, firm-to-firm-level relationships. As managers of firms directly connected within a supply chaindevelop personal relationships, existing research offers numerous theoretical reasonsto believe that interorganizational dynamics will be impacted. The failure of supply-chain research to account for the role of personal relationships limits theunderstanding of why managers behave a certain way. For instance, Wilson (1999)argued that individual-level decisions can be adequately understood only if theongoing personal relationships within which the decisions are embedded are accountedfor. Anecdotal evidence also indicates supports for this point. According to JohnBrowne, CEO of British Petroleum, You never build a relationship between yourorganization and a company [y] You build it between individuals (Adobor, 2006,p. 474). Consequently, a notable weakness in the buyer-supplier relationship literatureis related to the need for more research to examine interfirm relationships at a moremicro, individual level in order to account for the social elements of the relationship(Celuch et al., 2006).

The supply-chain literature on buyer-supplier relationships is no exception tothis dilemma. While research has addressed firm-to-firm linkages (i.e. Autry andGriffis, 2008; Golicic and Mentzer, 2006), it has not yet specifically addressed the roleand impact of managers across firms developing personal relationships. Marasco(2007) specified a need for this type of research, calling explicitly for studies that wouldlead to a deeper understanding of the behavioral complexities that emerge throughthe interaction between the buyer(s) and provider(s) of logistics services (p. 141). Thispaper addresses that gap. It does so by building theory that describes how buyersand suppliers of logistics services interact within the context of personal relationshipsthat are themselves embedded within interfirm relationships. One of the maincontributions of this paper is the illustration of the specific behavioral processes thattake place within such a complex context.

In order to execute the current research, it is necessary to distinguish between thenotions of individual-level business relationships and individual-level personalrelationships. By personal relationships we refer to the individual-level relationshipsthat develop between persons who happen to do business, and these are consideredseparately from those relationships that exist at the individual-level but are onlybusiness-specific (Grayson, 2007). In the current research, we focus on the former. Ourresearch objective is to understand how personal relationships influence behaviorwithin a supply-chain context. Specifically, how do buyers of logistics services interactwith suppliers of logistics services when a personal relationship is present?

The paper is organized as follows. First, a brief review of previous researchrelated to interfirm relationships is presented. Buyer-supplier relationships have beenstudied at length in various disciplines such as operations ( Johnston et al., 2004),marketing (Celuch et al., 2006), and strategic management (Ring and van de Ven, 1994).Of particular interest to this research is the marketing literature concerningbuyer-supplier relationships where a personal relationship focus is taken.A comprehensive review of this literature facilitates the development of a numberof specific findings that contribute to the evolution and design of this qualitativestudy. A description of grounded theory methodology that is used to conduct primarydata collection and analysis is also provided. We describe in detail the steps taken tolocate key respondents, collect qualitative data, build theory, and validate our findings.

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From this research, it was possible to construct a number of postulates regardingthe various roles of personal interaction on supply-chain connections. The paperconcludes by providing a number of managerial and research implications, along withsuggestions for future research.

2. Unraveling personal and business relationshipsThough the study of personal relationships within business disciplines is not new, theirapplication to supply-chain settings has been relatively infrequent. Much of theexisting individual-level relationship literature has emerged in the field of marketing,where a few studies have recognized the key role that personal relationships play in thepurchasing process. For example, Haytko (2004) argued that it is difficult for personalrelationship participants to think about their interfirm affiliations without firstconsidering the nature and quality of associated personal relationships, becauseboundary spanners day-to-day experience involves working closely with otherindividuals. In their research, Lian and Laing (2007) emphasized that acknowledgingthe central role of relationships in the management of the purchasing process,examining the manner in which relationships, in particular personal relationships, arebuilt and managed is invaluable in understanding the processes underpinning thepurchasing (of) professional business services (p. 710). Thus, firm-level relationshipformation is postulated to be anchored by the series of personal relationshipsthat manifest between individuals in their respective firms in the supply chain ( Javalgiet al., 1995; Gedeon et al., 2009).

Within these boundaries, it is important to acknowledge the various types ofrelationships that individuals can develop and distinguish between a businessrelationship and a personal relationship. Berscheid and Peplau (1983) propose thata relationship exists when two actors have impact on each other, or if they areinterdependent. Other research shows that six characteristics distinguish a personalrelationship from a business relationship. First, personal relationships are usuallyexpressive (emotion based, intrinsic) vs instrumental (substantive, task) (Fournieret al., 1998; Grayson, 2007). Second, a personal relationship is based on voluntaryinteraction as opposed to non-voluntary for business relationships (Allan, 1989;Fischer, 1982). Third, the roles played by individuals within personal relationshipsare expected to be informal vs the formal roles that are expected in businessrelationships (Price and Arnould, 1999). Fourth, personal relationships are motivatedby a communal orientation (giving without the expectation of repayment) vs areciprocal orientation found in business relationships (Clark, 1984). Fifth, businessrelationships are noted for arms-length connections as opposed to personalrelationships which usually develop intimate connections (Hornstein and Truesdell,1988; Wright, 1985). Lastly, in a business relationship one of the parties involved canbe replaced and the activity can continue without a disruption. In a personalrelationship the parties are not substitutable (Silver, 1990). These dimensions arerepresentative of the personal analysis within the current study; that is, we suggestthat individual-level personal relationships can be distinguished from individual-levelbusiness relationships based on these characteristics. Table I summarizes thedifferences between pure personal relationships and pure business relationships.However, the two types of relationships can coalesce.

A number of marketing and sociology studies have examined the results ofcombining personal relationships with business relations, with many of themsuggesting that positive outcomes should accrue (Haytko, 2004; Johnson and Selnes,

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2004; Lian and Laing, 2007). In a variety of industries personal relationships werefound to be critical to building and enhancing interorganizational relationships(Mavondo and Rodriogo, 2001). Additionally, recent supply-chain managementresearch suggests that failure to use close personal relationships to deliver commercialbenefits leaves suppliers vulnerable (Gedeon et al., 2009). In the strategic managementrealm, Hutt et al. (2000) observed that a failure to nurture personal relationshipsoften has negative consequences on the firm-to-firm relationship. Moreover, based onfindings from marketing, constituents of a personal relationship are also considered tobe more trustworthy, loyal, and committed business partners (Price and Arnould, 1999;Johnson and Selnes, 2004; Adobor, 2006), which can positively impact the businessrelationship. However, while personal relationships have been shown to have a positiveeffect on business outcomes, the conflict between the personal relationship roleexpectations and the business role expectations can diminish these benefits (Grayson,2007). Other research has shown that, when combined, personal relationships andbusiness relationships can create conflict (Heide and Wathne, 2006; Price and Arnould,1999). In the current study, we maintain a distinction between personal relationshipand business relationships between individuals; personal relationships are groundedin the unique and irreplaceable qualities of partners, defined and valued independentlyof their place in public systems of kinship, power, utility, and esteem, and of anypublicly defined status in contrast to business relationships in which the substitutionof persons is inconsequential for its constitutive features (Silver, 1990, pp. 1476-1477).

The exchange of logistics services takes place within the context of bothorganizational and personal relationships. It is therefore important to understandthe role of personal relationships embedded within supply-chain settings, andhow individuals within supply-chain firms seek to make use of them to achievefirm-level outcomes.

3. MethodologyBecause there is limited knowledge about the role of personal relationships embeddedwithin a supply-chain context a main objective of this paper is theory building. Agrounded theory approach is used to investigate the phenomena of interest (Glaser andStrauss, 1967; Strauss, 1987; Strauss and Corbin, 1990). A grounded theory approach isrecommended for generating depth and understanding when little is known about atopic (Celsi et al., 1993; Schouten, 1991). This approach is adopted to examine theresearch question for a number of reasons. First, the supply-chain relationshipliterature is quite rich with studies focussing on firm-to-firm-level relationships (Hoferet al., 2009; Golicic and Mentzer, 2006). However, few studies address the individual-level relationships that interfirm relationships subsume, and those that do, do so byexamining the relationship-specific elements (trust, commitment, dependence, etc.)

Personal relationships Business relationships

Expressive (emotion based, intrinsic) Instrumental (substantive, task)Voluntary interaction Non-voluntary interactionInformal roles Formal rolesCommunal orientation Reciprocal orientationIntimate connections Arms-length connectionsParties are not substitutable Parties are substitutable

Table I.Comparison of personal

and business relationships

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of individual-level business relationships (Rinehart et al., 2004) while generallyoverlooking the existence and role of an additional type of relationships: personalrelationships.

The choice of method should flow from the statement of the phenomenon to bestudied; the research question of interest in this study deals with dynamic humanbehavior, a perspective that lends itself to grounded theory (Glaser and Strauss, 1967).Additionally, grounded theory is a recommended methodology for building theory onproblematic, dynamic social processes (Flint et al., 2005). The methodological approachalso responds to a call for increased used of grounded theory within the logisticsdiscipline when studying phenomena with complex behavioral dimensions (Mello andFlint, 2009) such as the supply-chain processes that exhibit a high degree of complexity(Bolumole et al., 2007).

Logistics researchers have long recognized the crucial role that individuals play inthe logistics outsourcing process (Rinehart and Closs, 1991; Bolumole, 2001), however,research has yet to provide an understanding of how relationships developed atthe manager-level impact the interaction between buyers and suppliers of logisticsservices. Therefore, the context chosen for this study is that of the logistics outsourcingrelationship; specifically, the relationships that exist between a member of the supplychain and its external logistics service provider that assumes some of the focalfirms logistics responsibilities. While Mentzer et al. (2001) defined supply chains asconsisting of three or more companies, a buyer-supplier dyad is a component of thatlarger supply chain that is useful for an introductory level investigation of relationalphenomena. Therefore the unit of analysis in this study is a dyadic relationship. It iscommon in the operations research/management and logistics literature to capturesupply-chain relationships by studying dyadic relationships; dyadic relationshipsare considered reflective of supply chains (Sahin and Robinson, 2002). Further, asdecisions within these dyadic relationships are made by individual managers, studyingrelationships at a more micro-individual level is firmly rooted within the domain ofsupply-chain management.

3.1 The grounded theory processThe Straussian model for conducting grounded theory was followed in this study.Strauss and Corbin (1990) proposed a coding paradigm to help researchers developtheir interpretations of an interview transcript. The proposed coding paradigminstructs the researcher to identify a core category (core phenomenon) and its causalconditions, interactions, strategies, and consequences. A detailed explanation of thisprocess is provided in Section 3.3.

3.2 Sampling and data collectionIn the grounded theory process, it is important to use a data collection procedureknown as theoretical sampling. In theoretical sampling the data collection process isdetermined by the emergent theory. Theoretical sampling played a key role in thisstudy, whereby the researchers collected, coded, and analyzed the interview data, andthen progressively decided which participants to interview next in order to developthe theory as it emerged (Strauss and Corbin, 1990; Mello and Flint, 2009). Datacollection stopped when a preponderance of redundant information suggested that thefull complexity of the concepts had been captured (Flint et al., 2002). This identificationwas essential as it served to facilitate construct comprehensiveness and theorydevelopment (Maxwell, 1996).

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In this study, only managers who had developed personal relationships within thecontext of buying and selling logistics services were sampled. Participants were seniormanagers directly involved in the process of buying or selling logistics services.In order to gain a dyadic perspective on the relationships, a modified snowballtechnique meant to elicit a dyadic relationship was also employed. Specifically,in selecting who to interview the following process was used: the first buyer and thefirst supplier were selected using purposive sampling. At the end of the interviews,these respondents were asked to facilitate contact with the managers they described ashaving a personal relationship with. Once the initial dyads were constructed,theoretical sampling was used to identify who to interview next. This iterative processresulted in a final sample consisting of 26 participants from nine different companies(12 buyers and 14 suppliers). The 26 interviews were paired, and yielded a total of16 usable dyads (six actors were involved in multiple dyads within the study). At theend of the 26 interviews theoretical saturation was attained in that each incrementalinterview yielded no additional information. Based on this fact, and in considerationof standards set forth in previous research, 26 interviews were deemed sufficient forthe current purposes (it is common to interview eight or fewer informants to reachsaturation; McCracken, 1988). Table II depicts the study participants and theirrelational ties.

The final sample included managers from multiple industries to facilitatetheory building. The buyers of logistics services interviewed in this study belongedto the following organizations: a global steamship line, an international manufacturerof pet products, a global manufacturer of paper products, and a global manufacturerof contact lenses. The suppliers of logistics services interviewed in this studybelonged to the following organizations: a global steamship line, two truckingcompanies, two logistics brokers, and a freight forwarder. Because the steamshipline was both a buyer and supplier of logistics services, different managerswithin this company were interviewed when constructing relationship dyads foranalysis.

Notes: aB1 is both a buyer and supplier of logistics services. bThe first number in parenthesis on eachconnecting line indicates the length of relationship in years between the respective buyer and supplier.The second number indicates how many years the dyad members worked together until theyconsidered the relationship to be more than a business relationship (i.e. personal relationship). Forexample, 1 represents 12 months, 1/2 represents six months, 1/4 represents three months, etc. Thesecond number was computed as the average of the values indicated by each dyad member

Table II.Study sample

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Following the McCracken (1988) guidelines for in-depth interviews, we relied onthe perspectives of the sampled logistics managers to investigate and analyze thephenomenon. The interviews were conducted in the respondents offices (21) and overthe phone (five). While most of the managers were located in the southeast USA,a number of them were located on the West Coast (five) which led to phone interviewsin those instances. The interviews were open-ended and discovery oriented andtypically lasted about one hour. An example of the interview guide is provided inAppendix A. All interviews were audio-recorded and transcribed verbatim.Analyses were done after each interview to facilitate theoretical sampling and asnew categories and insights emerged we moved back and forth between open, axial,and selective coding.

3.3 Data coding and analysisAnalyses were conducted after each interview to facilitate theoretical sampling usinggrounded theory procedures (Strauss, 1987; Strauss and Corbin, 1990). Three differenttypes of coding are suggested in Strauss coding paradigm and used in this study: opencoding, axial coding, and selective coding. The interview transcripts were analyzed ona sentence-by-sentence basis and coded for conceptual content by each analyst. Toensure an unbiased perspective and objectivity, two external analysts (not involved inthe data collection process or the study design) were also asked to assist with thecoding and analysis of the field data. In total, four analysts examined the data.

Initially, during open coding, the analysts independently broke down the data intodiscrete incidents, ideas, events, and acts, and assigned a name/code to represent these.Once each analyst independently coded the interview transcripts available at the time,the analysts met to compare codes. To facilitate this task of achieving inter-coderreliability, qualitative research computer software (QDA Miner) was used. Thissoftware allowed the analysts to independently code transcripts and, when finished,merge the files into one document to compare codes. QDA Miner overlaps the analystscodes and allows for easy comparison of inter-coder reliability. Where the codes weredifferent, the analysts reviewed the specific sections to determine the causes ofdiscrepancy and seek consensus. In order to facilitate inter-coder reliability eachanalyst kept detailed theoretical memos (the researchers record of analysis, thoughts,interpretations, questions, and directions for future data collection). When codingdiscrepancies existed, the analysts read each others theoretical memos forexplanations of why certain concepts were coded and interpreted a certain way.This not only assured that the coding process was consistent across analysts, but alsoverified that the resultant interpretations of the analysts emerged from logical andunbiased thought processes. This iterative process of individually coding transcriptsfollowed by working together to assure coding and interpretation consistency wasfollowed as additional interviews were conducted and transcripts became available.Face-to-face meetings between analysts were employed to address codingdiscrepancies. The coding process was not considered complete until the analystsreached consensus on each code. The process resulted in 100 percent inter-coderreliability between analysts and also provided a check on each analysts individualbiases. Following the described process 172 open codes were generated.

As data analysis continued, whenever another object, event, act, or happening thatwas identified as sharing some common characteristics with an object or a happening,it was placed under the same code. Concomitantly, comparative analysis wasemployed; this is an essential feature of the grounded theory methodology (Strauss and

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Corbin, 1990). In this process, each incident was compared to other incidents at theproperty (general or specific characteristic of a category which allows a category to bedefined and given meaning) or dimensional (range along which properties of acategory vary; used to provide parameters for the purpose of comparison betweencategories) level for similarities and differences and placed into a category. Followingthis dynamic reiterative process concepts were grouped into categories (e.g. enhancedcommunication, enhanced trust) for content analysis.

Once categories emerged through open coding, intense content analysis was donearound each category, one at a time. This is known as axial coding. The purpose ofaxial coding is to begin the process of reassembling data that were fractured duringopen coding. During this stage categories were related to each other to form moreprecise and complete explanations about phenomena focussing on how categoriescrosscut and link. Data were linked at the property and dimensional levels in order toform dense, well-developed, and related categories. In axial coding, as in open coding,we continued to make constant and theoretical comparisons and make use of theanalytic tools described previously. It is important to specify that while axial codingdiffers in purpose from open coding, these are not necessarily sequential analyticalsteps. Therefore, the analysts iterated between open and axial coding.

As the final type of coding performed, selective coding is the process of integratingand refining revealed categories. This was performed in order to delimit coding to onlythose variables that relate to the core variables of interest that have emerged from thestudy. In summary, during open coding the analysts were concerned with generatingcategories and their properties and sought to determine how these concepts varydimensionally. In the axial coding phase, categories were systematically developed andlinked, and finally, during the selective coding stage the process of integrating corecategories took place.

3.4 Analysis of research trustworthinessFor a research study to make a contribution to the body of knowledge it must berigorous, and qualitative studies are no exception (Pratt, 2008, 2009). As suggested byFlint et al. (2002) trustworthiness of the research in interpretive studies should beassessed by applying two overlapping sets of criteria (Appendix B). Earlier socialsciences research focussed primarily in marketing recommends that credibility,transferability, dependability, confirmability, and integrity should be the first area offocus (e.g. Hirschman, 1986; Lincoln and Guba, 1985; Wallendorf and Belk, 1989).These criteria were evaluated holistically and thoroughly. To be specific, first, asummary of initial interpretations was provided to participants for feedback(credibility); second, theoretical sampling was used (transferability); third, theguidelines for data collection and interpretation were strictly followed (dependability);fourth, an auditor was used to confirm interpretations prior to journal submission(confirmability); and fifth, participants were assured of anonymity (integrity).

Second, the criteria of generality, understanding, control, and fit emerged from thegrounded theory literature itself (Strauss and Corbin, 1990). These criteria wereassessed as follows: interviews were lengthy to allow for different aspects of thephenomenon to emerge (generality); executive summaries were provided toparticipants and asked if it reflected their stories (understanding); participants didhave some control over certain variables (control); and lastly, the criteria of fit wasaddressed through the methods mentioned earlier to control for credibility,dependability, and confirmability.

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4. Results4.1 Overall findingsThe grounded theory analysis of the interviews revealed that, in the process ofdeveloping and maintaining personal relationships, managers engaged in a series ofactions/interactions that resulted in enhanced trust, enhanced communication,enhanced personal and business understanding, and increased business volume.These four themes permeated throughout all participant experiences. As illustratedin Figure 1, the supporting-specific actions/interactions that lead to the conceptualizationof these themes also emerged from the data. Each of these actions/interactions isdiscussed below in the context of the specific theme they support.

Theme I: enhanced trust. At a firm level, trust has been identified by prior researchas an antecedent to partnering behavior in the context of logistics outsourcingrelationships (Hofer et al., 2009). Throughout their stories respondents emphasized theimportance of trust within logistics outsourcing relationships, and revealed howpersonal relationships facilitated the development of trust: I cant stress enoughthe trust factor. Its just critical that you have these personal relationships withthese customers so they know youre telling the truth and youre not lying to them(Rob/supplier), Friendships do greatly impact the business relationships because ithelps build trust (Glenda/buyer), When you get to know somebody at that deeperlevel as a friend you inherently learn to trust that person (Travis/supplier).

The social network and social capital theories provide theoretical support for thisinterpretation. Social capital theory argues that actors (individuals, teams, groups)willing to invest in relationships with other actors will enjoy positive economic andpsychic returns through their capability to leverage the relationship to gain access toneeded resources (Lin, 2001). Social capital has been defined as the benefits that actorsderive from their social relationships (Coleman, 1988, 1990). The formation of personalrelationships leads to the creation of social capital through relational embeddedness.

PersonalRelationships

*Relating/Bonding*Disclosing Personal Information*Being Honest

*Increasing Ease of Communication*Increasing Sensitivity of Information Exchanged

*Assessing Personal- Related Characteristics*Assessing Business- Related Characteristics*Cultivating Loyalty*Cultivating Reciprocity

Enhanced Trust

EnhancedCommunication

EnhancedPersonal andBusinessUnderstanding

IncreasedBusiness Volume

Figure 1.The role of personalrelationships

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The actions/interactions of relating/bonding, disclosing personal information, andbeing honest were identified as the mechanisms through which actors embedded ina personal relationship build social capital. Each of these actions/interactions wasconsistently used by respondents to develop and maintain personal relationships.In turn, these actions resulted in enhanced levels of trust (social capital).

Action 1: relating/bonding. The first category of actions that emerged as salient tothe development of personal relationships was relating/bonding. Extensive andrepeated contact between the concerned parties, combined with elements of affectand personal liking leads to personal bonds (Granovetter, 1973). Bonds can be formedthrough a process of social integration wherein individuals become psychologicallylinked to each other in the pursuit of common goals (Harrison et al., 1998). Scholarsalso argue that close personal relationships and bonds among individuals areresponsible for establishing norms of trust and reciprocity in economic exchange(Granovetter, 1973; Gulati, 1995). This provides support for the findings of this study.

In the process of developing personal relationships participants consistentlylooked for ways to relate to each other, which in turn made them feel better about therelationship overall. Having things in common and being able to relate to each othermade it easier to trust the other party:

Jeff/supplier: When you get to know people on a personal level you understand their values.If their values are similar to yours, then you eventually have more respect for that person. Youcan relate to that person. I mean youve got to understand: when I know someone has thesame values as I have I feel a lot more comfortable with that person because Im able toestablish a little more trust. I mean the whole thing is all about trust. However many ways wetalk about it its all going back to trust. Friendships allow you to develop that trust.

Other respondents had similar stories on how bonds can be developed throughpersonal relationships: Im a big fisherman [y] I love to fish and I love cooking. If oneof these managers who is visiting is involved in that as well, thats something we canbond over. I go, hey I love fishing, this guy loves fishing, I can understand what hestalking about, that hes passionate about this as well. I can relate to that. As a result youcan almost get off on a totally different tangent just talking about that. It somehowmakes it easier to trust that person (Phillip/buyer).

In summary, relating/bonding was identified as one of the main behaviors managersengaged in to facilitate the development of personal relationships. As a result of thisbehavior respondents consistently reported increased levels of mutual trust.

Action 2: disclosing personal information. During their interviews, respondentsconsistently reported disclosing personal information as a way to develop personalrelationships, and consequently build trust. While some individuals could be different andnot necessarily have things in common (making it harder to relate to each other), thedisclosure of personal information allows managers to better gauge each others charactersand determine how much they could trust the other person. Consider Dwights story:

Dwight/supplier: We developed a friendship. In the process I learned personal things abouthim and he learned personal things about me. We were very different, he was from a big city,and I grew up in a small place. However, we still developed a friendship. He could gauge thetype of person I was, that I didnt accept failure, that I was tenacious [y] from a conversationabout football! I think it initially established a trust level easier. You can get things doneeasier because you developed a small personal relationship.

The dyadic interviews allowed the exploration of both perspectives on the relationship.Dwights counterpart, Kenji, offered a similar outlook providing support for Dwights

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point of view. In his interview Kenji emphasized that he was initially reluctant toentrust Dwight with his business, but in the process of developing a personalrelationship he learned to trust him:

Kenji/buyer: Dwights company is rather small so at first I was a little bit reluctant aboutentrusting him with part of our business. We did develop a personal relationship, and in theprocess I learned a lot about him as a person. Hes a very thorough, reliable individual. Thatdefinitely increased the trust level. Right now hes one of our top carriers- very reliable.

Alison and Karina reported similar experiences as well: disclosing personalinformation makes the business better because it helps build trust (Alison/supplier),I think you build trust, they confide in you and you confide in them. It boils down totrust (Karina/buyer).

Action 3: being honest. Throughout the interviews being honest emerged as anessential condition for building trust, and personal relationships provided thefoundation for honesty. Respondents described how because of the personalrelationships they felt like they could be honest and tell the complete truth withoutbeing fearful of potential repercussions. The personal relationships put all parties atease. Richards account reveals how because of the personal relationships he developedwith some of his customers, when service failures took place he felt comfortable tellingthose customers exactly what happened and did not try to paint a different picture:

Richard/supplier: Its very important for us to have personal relationships with some of ourcustomers. In this business nothings perfect. Youre going to have missed appointments soI think when you have a personal relationship with them its easier to tell them hey, wemessed up, we missed this one, well get it scheduled, instead of telling them the chassis hada flat tire [laughs]- the same old nonsense that theyve heard a million times before. So, I thinkyou can be honest with people, they dont expect you to be perfect, were not perfect, theyrenot perfect, so the friendship really helps.

Richards counterpart Sean revealed a similar story, which further confirms Richardsperspective. Sean highlighted how, because of the personal relationship they shared,Richard was comfortable telling him the truth when a service failure occurred:

Sean/buyer: He called me one day saying that he had to send back some of the deliveriesalready dispatched to him because he didnt have enough capacity. He said his drivers arelazy and theyre all on vacation [laughs]. Now, theres no way he would have told me that if itwasnt for our personal relationship. But that honesty actually increased the trust level.It made me realize he would always tell me the truth.

Barbara (supplier) had a similar narrative: I can be honest, I can tell this customerexactly whats going to happen if it does work or whats going to happen if it doesntwork. I dont have to be politically correct. I can just be very honest. While Barbarasstory revealed how the personal relationship allowed her to be honest, Rob had asimilar story when he spoke about the roles of personal relationships and revealedhow because of the personal relationship he felt compelled to tell the truth regardlessof the potential consequences: Ive always been honest with him no matter how bad ithurt. Thats the only way to maintain that friendship. It takes only one lie for thefriendship and trust to vanish (Rob/supplier).

Table III summarizes the findings for this initial theme, and presents additionalquotes, along with supporting statistics for our interpretation.

Theme II: enhanced communication. Throughout all the interviews enhancedcommunication emerged as a key theme, being described by respondents as essentialto establishing partnerships and conducting business. At a firm level, communication

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has been recognized as an important element in logistics alliances (Sink and Langley,1997; Moore and Cunningham, 1999; Knemeyer and Murphy, 2004). For instance,Bowersox (1990) argued that complete and open exchange of operating and strategicinformation is the glue that holds logistics alliances together. Communication betweenbuyers and suppliers is considered a sine qua non condition for the success of abusiness relationship and the achievement of the desired level of business performance(Logan, 2000; Randall et al., 2011).

Respondents consistently reported using personal relationships to improve thecommunication process suggesting that they enhanced communication by makingit open, good, easier, and better. The social network theory also helpssupport this interpretation. According to Walter et al. (2007) densely embeddednetworks with strong and cohesive social ties facilitate the exchange of information.Within the confines of personal relationships, managers reported engaging in a coupleof actions leading to enhanced communication. These actions are described indetail below.

Action 1: increasing ease of communication. Ease of communication isconceptualized, consistent with the qualitative interviews, as a measure of howcomfortable the managers are to openly exchange information. Respondents storiesrevealed that managers were a lot more comfortable communicating with someonethey had a personal relationship with as opposed to someone with whom they did not

Action/interaction

Number/percentage ofparticipants discussingthe action/interaction Additional sample quotes

Relating/bonding Participants: 22Percentage: 85

You develop the friendship by findings thingsyou have in common. Were both big countrymusic fans. It creates somewhat of a bond, andslowly you start trusting that person a little bitmore. (Barbara/supplier)Ive learned he was a very religious as wellperson, so we established a connection over that.As a result there was more mutual trust(Glenda/buyer)

Disclosing personalinformation

Participants: 19Percentage: 73

He shared personal things with me that hewould not share with anyone else. This takes thepersonal relationship to the next level and itcreates trust. (Brian/supplier)Our friendship allows us to talk about personalproblems [y] this enhances the level of trust inthe relationship (Karina/buyer)

Being honest Participants: 24Percentage: 92

My experience has been that the friendshipallows you to be honest. You dont have to sugar-coat your story. Now youll probably trust memore because I always tell you about the bad stuffas well, I dont hide it (Wayne/supplier)The friendship compels you to tell the completetruth [y] and you expect the same. You cantbuild a friendship on lies, everybody knows that.As a result the mutual trust increases (Kenji/buyer)

Table III.Enhanced trust theme

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share a personal relationship. Managers consistently emphasized that a personalrelationship increased the ease of communication. As Blake (buyer) described it, thepersonal relationship allows for completely uncensored communication. Managersalso reported being more likely to exchange business ideas when a personalrelationship is present, and attributed the generation of many business ideas to casualconversations. Consider what Blakes counterpart, Travis, had to say when contrastinga business relationship where elements of a personal relationship were present withina business relationship when the elements of a personal relationship were completelyabsent:

Travis/supplier: I have business relationships right now that dont even scratch the surface ofa personal relationship. Im thinking of one individual in a different company that Im dealingwith. This fellow has a concrete wall around him, always strictly business, never personal[y] and its really uncomfortable. Theres not a casual conversation taking place where ideascan be openly shared back and forth, so for that reason theres a ton of lost opportunity. To bequite honest with you, I dont want to jeopardize any business relationships but [y] theremight be times when I have a great idea and I just dont share it with him because I know hesnot going to listen to it. I know hes not going to put in the time to even have a conversationabout it. Its so uncomfortable to even talk to these people sometimes that [y] you sort ofwant to jump on and off the phone. You want to deal with what has to be dealt with, and if itsnot absolute required communication we dont communicate; and, all those non requiredcommunication opportunities have been responsible for a lot of new ideas and brainstormingsessions.

Travis quote illustrates that, as it relates to the communication process, personalrelationships can be more than a social element needed for the completion of thetransaction, they can actually provide the platform for a brainstorming session andtherefore generate new business ideas.

Action 2: increasing sensitivity of business information exchanged. Sensitivity isdefined here, based on the qualitative interviews, as a measure of the confidentiality ofthe information exchanged. Throughout the interviews managers described how,within the confines of the personal relationship, they were exchanging businessinformation that they would normally not share with people they did not have apersonal relationship with. The information exchanged also has the potential to benefitboth parties. Consider Robs story:

Rob/supplier: [y] with Phillip on the other hand, we trust each other. He might be able to tellme something about his business thats not even for public consumption yet so that I can startdigesting that information behind the scenes and already be thinking and planning with him.Because he trusts me to share that information it gets us off the starting block a lot soonerthan we would otherwise. He doesnt have to wait until its ready for public consumption toshare it with me. He can share it with me in advance and trust that its safe with me, and wecan work on our plan so that when its time to go were ready, were not starting to plan atthat point.

The dyadic interview with Phillip supported Robs perspective. Sean confirmed that hefelt comfortable sharing information with Richard that he would not share with othervendors:

Phillip/buyer: I can share information with him (e.g. Rob) that I dont feel comfortable sharingwith other vendors. Its just because of the nature of the relationship we developed over time.

Other managers revealed similar accounts. For instance, Karina described how dueto their personal relationship one of her vendors felt comfortable sharing with her

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information that could be considered confidential, therefore providing anotherillustration of how within the confines of the personal relationships managers canincrease the sensitivity of information exchanged:

Karina/buyer: [y] shed say (paraphrasing the customer), Im going to tell you somethingI dont tell all my other customers. Were having cutbacks and its going to affect this and thatand our cost will go up. Shed let me know things they wouldnt dare tell other customers. Imthe first one to know a lot of things, inside sales and things like that. It is from developing thatpersonal relationship with her.

Table IV summarizes the findings for this theme, and presents additional quotes, alongwith supporting statistics for our interpretation.

Theme III: enhanced personal and business understanding. The third theme thatemerged as important in explaining how personal relationships impact relationshipsbetween buyers and suppliers of logistics services was labeled enhanced business andpersonal understanding. Marketing researchers have long recognized the importanceof a mutual understanding of organizational and personal factors as businessrelationships progress through various cycles ( Frazier, 1983, p. 70). Throughout theinterviews, managers reported using personal relationships as a means to betterunderstand the other party, both on a personal and professional level. Theyconsistently reported applying the understanding of the other party to better addresswork-related issues as well as personal issues and therefore perform better. Each typeof action employed by managers to develop a better understanding of the other party isdescribed below. At the firm-level, an accurate understanding of the buyer-firms needshas been recognized as a key enabler of supplier performance (Sanders et al., 2011).In fact, such understanding is critical for the buyer-supplier co-creation of customervalue ( Whipple and Roh, 2010).

Action/Interaction


Increasing ease ofcommunication


The friendship we have allows for easiercommunication. It really helps when dealing withproblems or delicate issues (Paul/buyer)Good communication is essential for success inthis business. Our friendship helps us constantlyimprove the communication process-it allows usto exchange business information in a casualway. You cut through all the red tape (John/supplier)

Increasingsensitivity ofbusiness informationexchanged


With Wayne for instance [y] a few months agohe told me that his company was in the process ofbeing sold. He explained to me the how thatwould affect business and everything. Now,theres no way he would have shared that with meif it wasnt for our friendship. That wasconfidential information (Brian B/buyer)Because of our friendship Kenji shared his coststructure with me. This allowed us to agree onrates that benefit both of us. Its a win-win(Dwight/supplier)

Table IV.Enhanced

communication theme

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Action 1: assessing personal-related characteristics. Assessing personal-relatedcharacteristics refers to the process of seeking to evaluate and assess the otherindividuals personality, background, hobbies, and other personal characteristics. Thisconceptualization emerged from the qualitative data. Consistently throughout theinterviews respondents described how within the confines of the personal relationshipthey would actively seek to develop a better understanding of the other partyspersonal characteristics. Furthermore, managers reported using the deeper insightinto the personal side to better approach business-related issues. ConsiderCharles story:

Charles/buyer: Having a better, closer, personal relationship is a plus [y] I definitely think itsbeneficial because it helps you understand where a person is coming from, his beliefs andhis personality. Then, when you are dealing with that person in a work situation, youre ableto better cater to him and present a situation a little bit more appropriately.

Charles relationship counterpart, Selena, shared his perspective:

Selena/supplier: I can tell by the tone of his voice when I first call in the morning whetherI should bring up any annoying operational issues, or wait until later in the day. I learned thatthrough the personal relationships.

The following excerpts from respondents interviews support this interpretation aswell: you get to know their personality, their humor, their wit and youre less likely totake something said in a business conversation in a negative way (Barbara/supplier),When you developed a friendship theres no disguise in feelings, you know exactlyhow someone is. Its just like the relationship with your wife, you know when shesays no, Im not upset, you know exactly whether she is upset or not. It has nothing todo with the words they say, its how they act [y] and you find out through thatpersonal relationship. You understand when something is wrong, you can tell sorrow,you can tell when something got screwed up or missed. The personal relationshipallows you to do that, and you can use that knowledge when conducting business(Ron/buyer).

Action 2: assessing business-related characteristics. Assessing business-relatedcharacteristics refers to the process of seeking to evaluate and assess the other partysbusiness needs. This definition is based on managers interviews. Respondentsinvolved in a personal relationship consistently reported using personal relationshipsas a platform to look into and better gauge the other partys business needs. Dwightillustrates how his personal relationship with Kenji helped him better understandKenjis business needs:

Dwight/supplier: Anytime you have a customer youve got to determine their business goals,their needs. I think thats very important [y] what does he need? Does he need somebody tostand by 24/7? Find out what your customers need. The personal relationship makes it easierto find those needs, and then meet those needs. My friendship with Kenji allows me to betterdo that. Its just much easier.

The following quotes also supports this interpretation: Just by knowing Tony on apersonal level I know what he expects from a logistics company, and I can better assesshis business needs. The friendship that we share allows for the kind of interaction thathelps me better gauge his business requirements and expectations (Alison/supplier),Knowing Ron on a personal level makes it easier to understand what his companyexpects now and in the future. The relationship we share allows me to gain a deeperknowledge of his firms business needs and therefore perform better ( John/supplier).

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Table V summarizes the findings for this theme, and presents additional quotes,along with supporting statistics for our interpretation.

Theme IV: increased business volume. Throughout their stories both buyers andsuppliers of logistics services reported using personal relationships as a means tocultivate loyalty and reciprocity and, as a result, increase the business volume with thespecific vendor/customer. At a firm-to-firm level, marketing researchers have longemphasized the importance of developing and maintaining relationships withcustomers (Morgan and Hunt, 1994). In fact, there is an assumption that developingrelationships with customers leads to long-term customer retention (Daugherty et al.,1997; Davis and Mentzer, 2006).

It is important to emphasize that respondents did not report using personalrelationships as a means to an end. Rather they simply revealed the benefits associatedwith developing personal relationships. Consider Richards story when asked todescribe the role of personal relationships: I think personal relationships in thisbusiness are vital [y] youve got to pick up the phone and talk to people, get to knowthem, get to know what theyre all about, their families, what their interests are.If you can do that the customer will be very loyal to you in the long run. As a resultyoull see increased business volumes (Richard/supplier).

Within the confines of personal relationships, managers reported engaging ina couple of actions leading to increased business volume for the parties involved.These actions are described in detail below.

Action 1: cultivating loyalty. Throughout their interviews managers consistentlydescribed how through the process of developing personal relationships they alsocultivated mutual loyalty. Robs story is a good example. He described how he

Action/interaction


Assessing personal-relatedcharacteristics


Getting to know each others personalities ishuge, and personal relationships facilitate that.You can use that knowledge in a businesssetting (Sean/buyer)Through the personal relationship Ive becomevery familiar with Charles personality. Ivelearned how to approach him with specificbusiness related issues. This is very important insales or any other aspect of conducting business(Selena/supplier)

Assessing business-relatedcharacteristics


We both like fishing, so every other weekend wefish together. Most of the time we talk business aswell. Its a very laid back setting and weve got alot of time to talk, so that allows me to learndetails about his business that otherwise I mightnot get exposed to (Richard/supplier)We developed a closed friendship. This allowsme to provide Rob with a better service. Therelationship provides a platform for me todevelop a better perspective on what his firmsneeds are. I think its an advantage. It works bothways (Brad/buyer)

Table V.Enhanced personal andbusiness understanding

theme

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developed a personal relationship with Brad, and believed that as a result of thepersonal relationship Brad was more loyal to him:

Rob/supplier: I think personal relationships are very important in this business. Therescamaraderie between Brad and I. Ultimately, this is the only way I can protect my businesslong-term. You can always have somebody offer a lower price for the same service.

The dyadic interview with Brad supported Robs perspective. Brad confirmed that ifRob were to leave S2 and go work for a competitor he would continue to support Robby awarding him the business that he had when he was employed by S2. It is importantto emphasize that his loyalty was to Rob and not S2:

Brad/buyer: For instance, if Rob was to leave S2 and go over to company X that wouldprobably make a big impact on how the southeast region looked like completely. Ill be like,well Robs over there now and he took care of us in the past with this company so I know hellcontinue to do that with this new company.

The field data were permeated with additional examples linking personal relationshipsto the development of loyalty, and ultimately increased business volume for the partiesinvolved. A representative sample of these quotes is provided in Table VI. The findingsare consistent with prior firm-level research linking loyalty to increased businessperformance for the members of the buyer-seller dyad (Daugherty et al., 2003).

Action 2: cultivating reciprocity. Managers narratives further revealed that in theprocess of developing personal relationships they were also invariably cultivatingreciprocity. Defined as a mutually contingent exchange of benefits between two or moreunits, the important role of reciprocity within relationships has long been explored bysociologists (Gouldner, 1960, p. 164). In fact, Simmel (1950, p. 387) suggests that social

Action/interaction


Cultivating loyalty Participants: 23Percentage: 89Being Honest

My experience has been that when developing afriendship you also build a sense of loyalty. Someof my long-term vendors are also my bestfriends (Tony/buyer)I didnt try to become Rons friend hoping forany business related benefits. However, I believethat because of our friendship hes been a loyalcustomer- our volumes have increased since Itook over his account. Good service and goodrates have to be there, but the personalrelationship definitely helps differentiate youfrom the competition ( John/supplier)

Cultivatingreciprocity


I might need his help today and he might needmine tomorrow. It happens all the time! Ourpersonal relationship allows us to help each otherthat way. (Brian B/buyer)I get the first shot at all his import containers.In return if he calls with a hot load Ill dropsomebody elses container and put the driver onhis load. As a result our businesses have growntogether (Alison/supplier)

Table VI.Increased businessvolume theme

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equilibrium and cohesion would not be possible in the absence of reciprocity as allcontacts among men rest on the schema of giving and returning the equivalence.Respondents emphasized that within the confines of the personal relationship managerswill at various times exchange favors or go the extra mile for each other. Managers arein a position to help each other at various times, and personal relationships wereidentified as the foundation on which reciprocity could be cultivated. While nothing isexpected in return, these actions do create an environment where managers can creategoodwill. For instance, Brian described his personal relationship with Wayne andemphasized how relationship building is very important in reaching the stage in thebusiness relationship where favors can be traded:

Brian/buyer: I think in business as a whole reciprocity is a very, very big and crucial part ofhaving any follow up business because when you have a customer you want to be able to helpthem out and at the same time have them show the same loyalty back to you. So relationshipbuilding does become a very intrinsical part of conducting business. My friendship withWayne allows us to do that, and it benefits both of us.

Waynes interview provided support for Brians perspective:

Wayne/supplier: I built a very good personal relationship with Brian, so if any new businesscomes up Im probably the first person he calls. Theres a mutual commitment and wevegotten a lot of business because of that. Any new business its mine to lose in a way.Our company has gone from having a pretty small stake with his company to finallybeing their number one carrier and I believe that has a lot to do with the friendshipwe share.

Other managers shared similar experiences. Consider Selenas story. Her descriptionfor reciprocity is you scratch my back, Ill scratch your back, and she associates theexistence of reciprocity with the friendship she developed with her customer: I dealwith this gentleman at B1 and he and I have built a very good relationship over theyears. When you build this kind of relationship theyre more willing to help you ina situation where they wouldnt help someone else that they didnt have therelationship with [y] its like you scratch my back Ill scratch your back type thing.The friendship does help (Selena/supplier). The positive impact of personalrelationships is highlighted by supply-chain management literature which emphasizesthat managers within the buyer-supplier dyad must act in a selfless manner toprevent relationship failure (Logan, 2000). Therefore, by going the extra mile to helpeach other, managers can ensure business relationship continuity.

Table VI summarizes the findings for this final theme, and presents additionalquotes, along with supporting statistics for our interpretation.

5. Research contributionsWhile previous supply-chain studies have addressed the role and impact offirms developing closer relationships with suppliers of logistics services, theserelationships have largely been assessed at an organizational level. This studyexplores the role and impact of firm managers (buyers) developing personalrelationships with their LSPs managers (suppliers). Specifically, it investigateshow buyers of logistics services interact with suppliers of logistics services whena personal relationship is present. Considering that academic business literaturepermeates with evidence that business decisions cannot be fully explained unlessthe ongoing personal relationships within which the individuals are engaged areaccounted for (Wilson, 1999; Celuch et al., 2006; Grayson, 2007), it is important that

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a more in-depth understanding of this phenomenon be gained within a supply-chaincontext. Therefore, an important contribution of this study to supply-chain managementliterature is the introduction of a new research area that focusses on the individualmanager as the unit of analysis. This stream of research addresses the need fora deeper understanding of the behavioral complexities within the buyer-supplierdyad as suggested by previous research (Marasco, 2007). One of the main theoreticalcontributions of this study is the identification of the specific actions/interactions thatlogistics managers engage in while in the process of developing and maintainingpersonal relationships with other managers. By providing a detailed description of thedynamic process of how logistics managers interact within such a context this studymakes an important contribution to the current knowledge base. While studies in otherdisciplines have suggested the possibility of using close personal relationships asa way to deliver commercial benefits (Gedeon et al., 2009), they do not describe howthese benefits are actually generated or conveyed. This study expands on existingliterature by identifying the mechanisms (actions/interactions) managers use to deliversuch benefits. For instance, studies by Child (2005) and Adobor (2006) argue thatinterorganizational relationships may benefit from personal relationships in theareas of trust and information transfer but do not identify the mechanismsresponsible for the increased level in trust and information transfer previous studiessimply imply an association between these variables. Another theoretical contributionof this study is the identification of the specific outcomes/benefits associatedwith the actions/interactions identified in this study. The study confirms thatsome of the benefits associated with personal benefits do indeed transfer to asupply-chain context (e.g. trust and communication), and also identifies additionalbenefits associated with such relationships (e.g. enhanced personal and businessunderstanding).

Specifically, the grounded theory analysis of the field data revealed that in theprocess of developing and maintaining personal relationships managers engagedin four distinct categories of actions/interactions leading to four specific outcomes.First, managers reported relating/bonding, disclosing personal information, and beinghonest, as actions that they associated with enhanced trust within the relationship.Second, managers reported actions related to increasing ease of communication,and increasing sensitivity of business information exchanged, actions which theyfurther associated with enhanced communication. Third, managers reported assessingpersonal-related characteristics and assessing business-related characteristics, asactions related to enhanced personal and business understanding. Fourth, managersreported cultivating loyalty and cultivating reciprocity, as actions they furtherassociated with increased business volume.

The findings from this research expand on current supply-chain managementinterorganizational relationship literature. For example, at the organizational levelGolicic and Mentzer (2006) emphasize the critical role that trust and commitmentplay in the creation of relationship value. This study provides insight into howmanagers across firms interact to create trust and cultivate commitment. Existingsupply-chain management research also recognizes the critical role of communicationin the success of the buyer-supplier relationship (Logan, 2000; Randall et al., 2011;Sanders et al., 2011). Our study expands on this body of literature by offering a betterunderstanding of how communication can be improved across firms by revealingthe important role of personal relationships developed between buyer- and suppliermanagers.

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Further, the current study also makes a significant contribution to the supply-chainmanagement loyalty research. Davis and Mentzer (2006) describe how loyalty can becreated between buyers and suppliers. These authors suggest that the loyalty in abuyer-supplier relationship is driven more by relationship factors (i.e. handlingproblems and communication) than operational factors (i.e. fill rates and on-timedelivery). We expand on their research by identifying additional factors/processes thatcontribute to the creation of loyalty within the dyad. In addition, our study highlightsthe importance of considering the individual manager as the unit of analysis wheninvestigating loyalty-related phenomena within the supply chain.

The findings of this study have direct managerial implications as well. Theyhighlight that personal relationships are more than just a simple social lubricantneeded for the completion of the business interaction within the supply chain. Personalrelationships that facilitate a set of behaviors can impact multiple aspects of thebusiness relationship.

As some of the respondents disclosed, sometimes personal relationships arefrowned upon by upper management as some managers perceive them as timeconsuming, or unproductive activity. However, this study revealed a wealth ofbenefits that can result from the actions/interactions that managers engage in whileforming or maintaining personal relationships. As illustrated in this study, even casualconversations that on the surface might appear as an unproductive activity, can serveas a platform for business brainstorming sessions.

Managers can also use the findings to understand explicitly what types of benefitspersonal relationships can yield (e.g. enhanced trust, enhanced communication,enhanced personal and business understanding, and increased business volume).Further, this study presents to managers the specific actions that buyers and suppliersof logistics services engage in, when developing a personal relationship, in order tofacilitate the generation of positive business outcomes. The study results do notsuggest that managers should develop personal relationships for instrumentalpurposes. Rather it provides behavioral guidelines to managers on how to increase thepositive outcomes of such relationships.

Managers can also use these findings to reevaluate the quality of their personalrelationships with managers across firms. Perhaps some managers solely approachclients from a business perspective to gain/keep/increase a new account and neglectthe personal aspect. The findings reveal that managers should coach their employeeson the importance of personal relationship building in the process of developing closerbusiness relationships. This coaching should also be done to establish specificguidelines needed to protect against agency problems and potential suboptimaldecisions. When managers interact on a daily basis they will develop some sort ofrelationship, as a buyer of logistics services described it, when youre doing businessit kind of opens up other things. If youre dealing with them every day you do followin the lines where you actually do get to meet up and sometimes developfriendships (Phillip). Whether it is acknowledged or not by the firm, managers willdevelop a relationship. Therefore coaching on specific behavioral guidelines/normsis important.

As it relates to points of managerial interest, it is also important to emphasize thatrespondents consistently suggested that the absence of personal relationships canactually have a negative business impact. As one of the managers noted, if youre notat least [y] a little personable youre going to cost yourself business because peoplewill do business with people they like and sometimes that matters more than the price

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(Brad). The impact of personal relationships was emphasized by both suppliers andbuyers of logistics services. Consider Robs statement:

Rob (supplier): Its all about relationships with people. Ive found that if people like you, theyllfind a way to do business with you. We develop friendships with people we like, so thepersonal and business elements go hand in hand. Its hard to separate them. Were humansand most of us like to socialize.

Robs perspective was also shared by the buyers interviewed for this study. ConsiderGlendas interview excerpt as an example:

Glenda (buyer): [y] when I have a vendor that I really like, Ill give him more business if Ihave more of a personal relationship with him. The reality is that, if circumstances allow it,we all want to do business with people we enjoy interacting with.

The development of personal relationships can be equally important for buyers andsuppliers of logistics services. In the trucking industry, reduced capacity and ananticipated driver shortage implies that it is going to be all about relationships andcarriers having the luxury of choosing who they do business with (Council of SupplyChain Management Professionals, 2011, p. 12). The shift in power will increase theneed for buyers of logistics services to pursue the development of close relationshipswith logistics service providers in order to ensure business continuity.

6. Research limitationsWhile the findings from this qualitative research contribute to the understandingof how buyers and sellers of logistics services interact when a personal relationshipis present, the results are based on the perceptions and opinions of a limited numberof participants. This is a limitation of qualitative studies. Although the inductivemethod leads to theory development, it is not generalizable to a broader population.Also, cross-sectional research design limits the extent to which cause-effect relationscan be inferred. Future research using longitudinal data could help addressthis limitation.

7. Future researchMoving forward there are additional opportunities for future research. One directionconsists of empirically testing the generalizability of the findings proposed in thisstudy. It would be interesting for future research to investigate the tensions thatbuyers and suppliers of logistics services experience as a result of each groupbeing given conflicting directions from their upper management: suppliers typicallybeing encouraged to develop personal relationships, and buyers typically beingdiscouraged out of fear of favoritism. This study revealed the positive aspects ofallowing buyers and suppliers of logistics services to develop personal relationships.Similarly, it would be interesting to understand what sorts of conflict could emergebetween buyers/suppliers and their employers due to personal relationships in thesupply chain is there a point when the personal relationship becomes dangerousto the firm?

Future research could also explore how evolving technology impacts the waymanagers across companies interact, specifically through the use of social media.A large number of respondents reported using social media to develop personalrelationships with managers across companies. Considering that respondentsconsistently suggested that the absence of personal relationships can actually havea negative business impact, future research should also explore the negative aspects

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associated with the lack of personal relationships in the buyer-supplier relationship.Such research is needed to offer a balanced perspective on the role of personalrelationships.

Another important avenue for future research relates to the negative aspects ofstrong personal relationships (i.e. the dark side of personal relationships). Researchshould explore how personal relationships can lead to negative outcomes and howmanagers can establish policies and/or provide guidance to employees to encouragepositive relationships and outcomes and discourage negative ones.

Finally, the nature of personal relationships and their role in business can be cultureladen. While this does not negate the insights that can be drawn from a US sample,future research should explore the questions addressed in this study using samplesdrawn from other cultures. Based on cultural differences among nations, one mightexpect different behaviors and outcomes.

Bromberger and Hoover (2003) suggest that the management of personalrelationships is the most tenuous aspect of supply-chain management and one thatis least understood. This research is intended to be a starting point in developinga deeper understanding of the behavioral complexities that emerge in the process ofbuying and selling of logistics services. Additional research is needed to gain a betterunderstanding of these and other related issues.

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