1. European Journal of Social Sciences Volume 12, Number 4
(2010) Relationship Marketing and Organizational Performance
Indicators Shaker, T. Ismail Philadelphia University P.O. Box (1)
,Code: 19392- Amman- Jordan E-mail: [email protected] Basem,
Y. Alsadi Philadelphia University P.O. Box (1) ,Code: 19392- Amman-
Jordan Abstract Purpose- This paper aims at exploring the
theoretical foundations of relationship marketing concept and
examining the effect of utilizing and adopting this concept on
organizational performance indicators from the perspective of
several high educational institutions experts and academic staff.
Design/methodology/approach- Despite the recent popularity of
research into relationship marketing, there is still some confusion
surrounding the concept of and how it differs both from non
relationship marketing and from other ways of managing marketing
relationships. Acquiring new customers and retaining existing
customers is another key goal for relationship marketing. Findings
- This paper finds that there is a positive relationship between
relationship marketing concept and organizational performance
indicators, relying on successful relationship is the two-way flow
of value. Originality/value - For academicians and marketing
professionals, the study provides a practical insight into the
changes in marketing paradigms, an alternate paradigm of marketing
need to be developed that is more process rather than outcome
oriented and emphasize value creation rather than value
distribution. Keywords: Relationship marketing; Interactive
marketing, Value creation rather than value distribution,
Partnership and strategic alliances.1. IntroductionThis paper works
from the premise "that the real purpose of business is to create
and sustain mutuallybeneficial relationships, especially with
selected customers. With the main proposition which assumethat
successful relationships is the two-way flow of value (Christopher,
M., et, al. 2002). Relationshipmarketing is consider a true balance
between "giving and getting" as a key benefit to encourage anactive
role and is conductive in delivering two- way value, where loyalty
is based on trust andpartnership, will prove to be one of the most
significant policies to be pursued in development andsustenance of
competitive advantage (Ismail, Sh. T. 2009, Gronroos, Ch. 1994).
Relationship marketing usually results in strong economic,
technical and social ties among thestakeholders parties thereby
reducing their transactions costs and increasing exchange
efficienciesincluded in relationship marketing which are not only
buyers / sellers exchanges but also businesspartnerships, strategic
alliances, and cooperative marketing networks. The relationship
typicallyinvolves seller- customer exchange, but it could involve
any stakeholders relationship (Morgan andHunt, 1994, Gronroos, Ch.
1994). 545
2. European Journal of Social Sciences Volume 12, Number
4(2010) Marketing as a distinct discipline was born out of
economics around the beginning of thiscentury. As the discipline
gained momentum, and developed through the first three quarters of
thetwentieth century, the primary focus was on transactions and
exchanges. However, the development ofmarketing as a field of study
and practice is undergoing reconceptualization in its orientation
fromtransactions to relationships (Kotler and Armstrong, 2008,
Gronroos, Ch. 1994).. The emphasis onrelationships as opposed to
transaction based exchanges is very likely to redefine the domain
ofmarketing. All relationship marketing activities are ultimately
evaluated in the basis of companys overallprofitability as a key
relationship marketing outcomes: customer loyalty and positive
customer word -of mouth communication (Thurau, Th, He, et, al.
2002).2. Theoretical BackgroundJobber and Fahy (2006) mentioned
that the relationship marketing is the process of
creating,developing and enhancing relationship with customers and
other stakeholders. Relationship marketingrefers to the
development, growth, maintenance of long- term, cost- effective
exchange relationshipwith individual customers, suppliers,
employees, and other partner for mutual benefit (Boone andKurtz,
2007). Developing excellent service quality creates the opportunity
to build an on goingrelationship with customers. The idea of
relationship can apply to many industries. It is
particularlyimportant in services since there is often direct
contact between service provider and customers. Thequality of
relationship that develops will often determine its length. Every
marketing transaction involves a relationship between the buyer and
seller in atransaction-based situation, the relationship may be
quite short in duration and narrow in scope. Thecustomer-seller
bonds developed in a relationship marketing situation, on the other
hand, last longerand cover a much broader scope than those
developed in transaction marketing. Customer contacts aremore
frequent, a company emphasis on customer service contributes to
consumer satisfaction.(Armstrong and Kotler, 2007). When a company
integrates customer service and quality with marketing, the result
is arelationship marketing orientation. Relationship marketing
creates a new level of interaction betweenbuyers and sellers.
Rather than focusing exclusively on attracting new customers,
marketers havediscovered that it pays to retain current
customers.2.1. Interactive MarketingInteractive marketing refers to
buyers- seller communications in which the consumer controls
theamount and type of information received from a marketer.
Interactive techniques have been used formore than a decade;
point-of-sales brochures and coupon dispensers are a simple form of
interactiveadvertising. Today, however, the term also includes
two-way electronic communication using a varietyof media such as
the internet, CD-ROMS, and virtual reality kiosks (Boone and Kurtz,
2007). Interactive marketing frees communication between marketers
and their customers from thelimits of the traditional, linear, one
way message to passive customers using broadcast or print ads.Now
customers come to companies for information, creating opportunities
for one-to-one marketing.For example, each customer who visits a
Web site has a different experience, based on the pathway oflinks
he or she chooses to follow. These electronic conversations
establish innovative relationshipsbetween users and the technology,
providing customized information based on users interests andlevels
of understanding. People gain access to chosen programs and
services via their personalcomputers and telephones, and they can
purchase products not only from stores but also via televisionor
the internet. (Miller, et, al. 2002). The study of Varey and
Ballantyne (2005), titled Relationship marketing and the challenge
ofdialogical interaction, the authors make the distinction between
three types of interaction,informational, communicational and
dialogical, and argue that dialogical communication between
546
3. European Journal of Social Sciences Volume 12, Number 4
(2010)marketers and stakeholders is necessary for an organization
to be an innovative social and economiccontributor. The authors
explain that dialogical interaction refers to an extended
conversation amongtwo or more people - in essence the basis for a
relationship that involves both parties learning together.Yet in
todays high tech world where managers are removed from any contact
with their customers, theway such dialogues can occur are much
different from the approaches used in traditional marketswhere the
seller of a product interacts directly with the customer.
Therefore, it is argued, managersneed to make an effort to develop
dialogical inquiry which can inform them and allow them to
reflecton their past behaviors and consequences. This believes will
lead to a greater understanding of eachparticipants point of view
and lead to the establishment of further and deeper
relationships.2.1.1. Buyer-Seller RelationshipRelationship
marketing depend on the development of close ties between the
buyer, whether anindividual or company and seller. This tie
considers as the core elements of the buyer-sellerrelationship; the
three promises that form the basis of relationship marketing and
the four dimensionsof relationship marketing model (Boone &
Kurtz, 2007, Gronroos, Ch. 1994).). Relationships MKG is based on
promises from organizations that go beyond obvious assurancethat
potential customer expect. Asset of promises- out side the
organization, within the organizationand between buyers and sellers
interaction- determine whether a marketing encounter will be
positiveor negative buyer-seller relationship. Relationship
marketing has seen a number of developments since the early work of
ChristopherM. et al. (2002), most notably the development of terms
and processes that have been used todemonstrate the adoption of the
new paradigm. It is the automation of processes that has
drivenpractitioners with Customer Relationship Management Programs
that enable data collection, analysisand communication of tailored
messages to the most promising prospects as the focus of
activity.2.1.1.1. Making PromisesMost firms makes promises to
potential customers through external marketing, directs
towardcustomers, suppliers, and other parties outside the
organization. The promises communicate what acustomer can expect
from the firms goods and service. The promises must be both
realistic andconsistent with one another. A firm that makes
unrealistic promises cans a disappointed customer whomay not buy
the good or service again, (Zeithmal, V. et al. 2006, Boone and
Kurtz, 2007),)2.1.1.2. Enabling PromisesA company can follow
through on its promises to potential customers through external
marketing onlyif it enables these promises through internal
marketing. Internal marketing includes recruiting talentedemployees
and providing them with tools, training, and motivation they need
to do their job effectively(Boone and Kurtz, 2007).2.1.1.3. Keeping
PromisesEvery customer interaction with a business reaches the
moment of truth when a good or service isprovided to the customer.
Buyer-seller relationship following external and internal
marketing, definesthe point at which a company keeps its promises
(Zeithmal, V. et al. 2006)2.1.2. Dimensions of Relationship
MarketingClearly, making, enabling, and keeping promises are
crucial parts of relationship marketing process,but developing
relationships require more than promises. All relationships depend
on the developmentof emotional links between the parties. There are
four key dimensions of relationship marketing:bonding, empathy,
reciprocity, trust and tangibility (Chris and Graham, 2007).
547
4. European Journal of Social Sciences Volume 12, Number
4(2010)2.1.2.1. BondingTwo parties must bond together in order to
develop a long- strong relationship. Stronger bonds increaseeach
partys commitment to the relationship (Jobber and Fahy,
2006)2.1.2.2. EmpathyThe ability to see situations from the
perspective of the other party- is another key emotional link in
thedevelopment of relationships (Chris and Graham, 2007)2.1.2.3.
TangibilityThe physical facilities, equipment and appearance of
personnel (Lovelock and Wirtz, 2006)2.1.2.4. ReciprocityEvery
long-term relationship includes some give-and-take between the
parties; one make allowancesand grants favors to the other in
exchange for the same treatment when its owned need arises
(Chrisand Graham, 2007).2.1.2.5. TrustTrust is ultimately the glue
that holds a relationship together over the long haul. Trust
reflects theextent of one partys confidence in another partys
integrity. When parties follow through oncommitments, they enhance
trust and strengthen relationships. Stronger trust leads to more
cooperationbetween parties in a relationship (Chris and Graham,
2007)2.2. Creating ValueMarketing has progressed from a simplistic
focus on "giving the customer what they want to a pan-company
orientation in which the specific capabilities of the business are
focused around creating anddelivering customer value to the target
market segment. A Key role of marketing in this newframework is to
determine what value proposition to create and deliver to which
customer. (ZeithamlV. et al. 2006).2.2.1. Axioms and Purpose of
Relationship MarketingRelationship marketing attempts to involve
and integrate customers, suppliers and other
infrastructuralpartners into a firms developmental and marketing
activities such involvement results in closeinteractive
relationships with suppliers, customers or other value chain
partners of the firm. Interactiverelationships between marketing
actors are inherent as compared to the arms length
relationshipsimplied under the transactional orientation. This
emphasizes cooperation rather than competition andconsequent
conflict among the marketing actors. Thus, development of
relationship marketing points toa significant shift in the axioms
of marketing competition and conflict to mutual cooperation. (Peck,
H.et al. 2000)2.2.1.1. The First AxiomOf transactional marketing is
the belief that competition and self-interest are the drivers of
valuecreation. Through competition, buyers can be offered a choice,
and this choice of suppliers motivatesmarketers to create a higher
value offering for their self-interest. This axiom of competition
is nowchallenged by the proponents of relationship marketing who
believe that mutual cooperation, asopposed to competition and
conflict, leads to higher value creation, In fact, some social
psychologistshave gone so far as to suggest that competition is
inherently destructive and mutual cooperationinherently more
productive (Shoham et al. 2005, Morgan, et, al,. 1994). 548
5. European Journal of Social Sciences Volume 12, Number 4
(2010)2.2.1.2. The Second AxiomOf transactions marketing is the
belief that independence of choice among marketing actors creates
amore efficient system for creating and distributing marketing
value. Maintaining an arms lengthrelationship is considered vital
for marketing efficiency. Industrial organizations and
governmentpolicy makers believe that independence of marketing
actors provide each actor freedom to choosehis/her transactional
partners on the basis of preserving their own self-interests at
each decision point.This results in the efficiency of lowest cost
purchases through bargaining and bidding. However, thisbelief is
also challenged recently in economics (Agarwal & Eramilli,
2003, Morgan, et, al,. 1994).). The purpose of relationship
marketing is, therefore, to enhance marketing productivity
byachieving efficiency and effectiveness (Gronroos, Ch. 1994).
Several relationship marketing practicescan help achieve
efficiency, such as customer retention, efficient consumer response
and the sharing ofresources between marketing partners. Each of
these activities has the potential to reduce operatingcosts of the
marketer(Gronroos, Ch. 1994). Similarly, greater marketing
effectiveness can be achievedbecause it attempts to involve
customers in the early stages of marketing program
development,facilitating the future marketing efforts of the
company. Also, through individualized marketing andadoption of mass
customization processes, relationship marketers can better address
the needs of eachselected customer, making marketing more effective
(Kim, Y. 2003).2.2.2. Customer LoyaltyThe relationship marketing
ladder of loyalty, most companies direct the greater part of their
marketingactivity at wining new customers. But while businesses
need new customers, they must also ensure thatthey are directing
enough of their marketing effort at existing customers. So we can
describerelationship marketing as a ladder-hierarchy of loyalty
(Christopher M. et al. 2002). Loyal customers(moving from new
customers to regular purchasers then to loyal supporter. In 1994
Gummesson defined relationship marketing as a process, a chain of
activities. Itrepresents a holistic attitude to marketing and thus
reflected the shift from transactional aspects ofdoing business
with a customer to relational aspects. The development of these
relational aspectsindicates the importance attached to the duration
of the relationship, i.e. the longer the relationshiplasts, the
more profitable it becomes. To manage a relationship successfully
over time necessitatesproficiency in terms of process management,
i.e. organizing your company in an efficient manner sothat the
customers needs and wants can be satisfied in an effective way over
time. Thus processmanagement should offer the possibility of moving
a transactional customer up the loyalty ladder(Payne, A., et al,
1997) to become a repeat buyer i.e. a loyal customer. There is a
plethora of tools to aid loyalty management. Reicheld, (1994),
refers to measurementsystems, customer targeting based on lifetime
value, and defection analysis and value propositionrenewal. Payne,
et, al. (1997) emphasize the importance of measuring, arguing that
what getsmeasured, or lends itself to measurement, is likely to be
implemented. Darryn, M. et al. (2006), mapping the re-engagement of
CRM with relationship marketing, they aims toreframe and enhance
the relationship marketing literature through advocating an
emphasis on processand a renewed commitment to social and
informational exchanges. It takes as its starting-point
therecognition that customers exist in complex dynamic systems in
which they enact multiple roles.However, current implementations of
customer relationship management (CRM) typically only viewcustomers
through a single lens (as customers) that denies firms a holistic
view of those with whomthey interact. Moreover, CRM systems
typically embed and script actions (i.e. call centre options,offers
driven by cross-selling and segmentation) rather than enabling rich
communication andfacilitating appropriate responses that emerge
from that communication (Gronroos, Ch. 1994).. It isargued here
that, as a consequence, both parties to a relationship need to
negotiate the nature ofsystems that connect them, because those
systems, in part, determine the content of relationshipexchanges.
549
6. European Journal of Social Sciences Volume 12, Number
4(2010) Bejou and Palmer (2005) make a concerted attempt to stretch
our thinking about the futuredirection relationship marketing can
take more than a decade on from the early writings. The content
isbased on a colloquium in relationship marketing held at
Cheltenham, UK and the manuscript is co-published simultaneously as
volume four of the Journal of Relationship Marketing. A set of six
paperscover the topics of communication, justice theory,
word-of-mouth, organizational theory, CRMimplementation and verbal
behavior in negotiations. A seventh paper by the editors introduces
theissues addressed by the papers. Combined they present
alternative approaches to thinking about anorganizations
relationship with its customers or stakeholders that can guide
future research inrelationship marketing. Woratschek and Horbel
(2005) play devils advocate by asking why we should bother trying
tosatisfy variety seekers given that they are unlikely to become
loyal customers. They use the example ofa tourist destination that
has low repeat custom because it attracts passing tourists rather
than having abase of local residents. This situation is common for
many tourist destinations and could also apply toirregularly
purchased products and services as well. They present reports a
link between customersatisfaction and the level of word of mouth
recommendation by visitors, indicating that a satisfiedinfrequent
visitor will deliver business through word of mouth communications
(Thurau, Th, He, et, al.2002). These findings challenge managers
approaches to viewing variety-seeking behavior and anumber of
practical recommendations are made by the authors.2.3. Partnership
and strategic alliancesPartnering with others, more companies today
are partnering with other members of the supply chain toimprove the
performance of the customer value-delivery network. For example,
Toyota knows theimportance of building close relationships with it
suppliers. In fact, it even includes the phrase "achievesupplier
satisfaction" in its mission statement. Suppliers satisfaction
means that they can rely onsuppliers to help it to improve its own
quality, reduce cost, and develop new products quickly(Christopher
M. et al. 2002). Another form of Partnership and strategic
alliances are the "suppliers" and "alliance" marketsthey both need
to be viewed as a partnership they can make to the establishment of
a successfulrelationship marketing strategy. In the mid-1980s, the
Austin Rover car manufacturing company hadwell over 1000 suppliers
with whom it had arms-length, often adversarial, relationships. Ten
yearslater a transformed company now called the Rover group, had
fewer than 500 preferred suppliers withwhom it had the closest
possible relationships (Peck H. et al. 2000). The study of Leo Y.
M. et al. (2002), concludes that there is a positive association
betweenrelationship marketing orientation (RMO) and business
performance, a valid measure of RMO has notyet been proposed and
systematic analysis of its effect on business performance has thus
far not beenpossible. This paper addresses some conceptual and
measurement issues related to the study of RMOand its impact on
business performance in a service context. It first reviews the
concept of RMO andits important dimensions. Next, a measurement
scale with acceptable reliability and validity isdeveloped to
capture the dimensions of RMO. In turn, analysis of data shows that
RMO is positivelyand significantly associated with sales growth,
customer retention, market share, ROI, and overallperformance. The
other paper explores relationship marketing from a management
philosophy perspective.Pels and Saren (2005) discuss the influence
of positivistic and interpretative approaches to
strategy,organizational theory and marketing by reviewing the
philosophies that have dominated these topicsand how they have
changed. They conclude that a pluralistic approach now needs to be
taken thataccepts the co-existence of multiple approaches. The
reader is left with the challenge to solve theresultant problem of
how multiple paradigms can coexist in the same firm. Henneberg
(2005) providesa practitioner oriented article by examining the
opportunities for future research in customerrelationship
management implementation models. The paper provides managers with
direction for theimplementation of a CRM program, although the
failure of many current programs and very high 550
7. European Journal of Social Sciences Volume 12, Number 4
(2010)dissatisfaction levels with such programs (reported as 52% in
the study) may mean that the CRMmodels may quickly become obsolete
as managers move on to more rewarding activities.3. Research
ObjectivesThis study attempts to explore the extent to which the
concept of relationship marketing clearlyunderstood and adopted by
Jordanian private universities. This study is cause and effects in
nature andseeks to answer the following research questions: To what
extent is the concept of; interactive marketing, Value creation
rather than valuedistribution, and "Partnership and Strategic
Alliances"? Are understood and adopted by theseuniversities. And to
measure its effect on an organizational performance indicator as
Increasing marketShare, Retaining current customers. Attracting new
customers. Creating loyal customers. Increasingprofit, Increasing
return on investment, Positive image.4. Significant of the StudyThe
study is expected to make recommendations to high educational
institutions managers on thecritical role of marketing relationship
in doing their business, particularly in highly competitive
marketas a Jordanian educational market, which consider a
profitable market.5. Variables of the Study5.1. Independent
VariableRelationship Marketing; Interactive Marketing, Value
creation rather than value distribution,Partnership and strategic
alliances.5.2. Dependent VariableOrganizational performance
indicators; Increasing market Share, Retaining current
customers.,Attracting new customers., Creating loyal customers.,
Increasing profit, Increasing return oninvestment, Positive
image.6. Hypotheses of the StudyThere is a significant statistical
relationship between the degree of utilizing the components
ofrelationship marketing concept by Jordanian high educational
institutions (private universities) andtheir performance
indicators. Related to interactive marketing, value creation rather
than valuedistribution, and "partnership and strategic
alliances".7. Materials and MethodsThis study is cause and affect
in nature and relies on a simple random sample to collect the
requireddata.7.1. The Population Study and the Sample of the
StudySix of thirteen of high educational institutions (private
universities) withdrawn randomly from thepopulation of the study.
551
8. European Journal of Social Sciences Volume 12, Number
4(2010)7.2. Data CollectionThe data collected through pre- designed
questionnaire which was directed to the academic people ineach
university. A self-administered questionnaire was used to collect
the required data from thesample of the study. Using the drop and
collect method, the researchers delivered 19 questionnaires tothe
academic people in each university and then collected it within 14
days. The highly controlled datacollection procedures ensured 88 %
response rate.7.3. The Research ToolThe require data was collected
by means of a self-administered questionnaire, which was developed
forthis purpose. The questionnaire was validated through a mini
survey of academics and experts. Theiropinions and comments were
considered in the final version of the questionnaire. The author
excludesthese questionnaires from the final analysis7.4.
Reliability testThe reliability correlation was examined by
Cronbach alpha and found 0.959 which is consideredacceptable for
this research. Because it is more than accepted value (0.60).
(Malhotra, N. K. 2007)8. An Applied SectionThe statistical package
SPSS was used to analyzed data. Descriptive analysis and one-way
ANOVAwere used. A Descriptive analysis for Independent &
dependent variables, shows that the range meansvalue was (2.88
3.77).8.1. Hypothesis TestingThe aim of this project is to study
the relationship marketing concept and its effects on
anorganizational performance indicator, the result will display by
following Hypothesis:8.1.1. The Main HypothesesThere is a
significant relationship between the degree of utilizing
relationship marketing concept, andincreasing the level of an
organizational performance indicator. This was branched to three
hypotheses,which was:8.1.1.1. H1There is a significant relationship
between the degree of utilizing interactive marketing concept,
andincreasing an organizational performance indicator. To
investigate hypothesis No. 1 of the study, descriptive statistics
of variables were computed,table (1) shows that:Table 1:
Descriptive statistics for utilizing interactive marketing concept
variable mean Std.deviation Interactive marketing concept 3.39
0.84918 Organizational performance 3.44 0.871685 Descriptive
analysis Shows that the mean value of utilizing interactive
marketing concept was(3.39) with std. deviation value (0.84918),
and the mean value for an organizational performanceindicator was
(3.44) with std. deviation value (0.871685).which means that there
are positive attitudestoward these variables because their means
are above mean of the scale (3). 552
9. European Journal of Social Sciences Volume 12, Number 4
(2010) To investigate first hypothesis; simple regression analysis
was applied table (2) shows that:Table 2: Regression analysis for
utilizing interactive marketing * Model r r2 t Sig. F Sig. H.
Result Utilizing interactive marketing 0.761 0.579 0.781 11.610
0.00 134.784 0.00 Reject H0 concept The analysis shows that there
is a relationship between the utilizing interactive
marketingconcept, and increasing an organizational performance
indicator, r. Value reached (0.761), F. ValueReached (134.784) by
significant (0.00), this indicate there is a relationship between
utilizinginteractive marketing concept and increasing an
organizational performance indicator. Thereforehypothesis No. 1
(H1) is true and Null hypothesis was rejected.8.1.1.2. H2There is a
significant relationship between the degree of utilizing Value
creation rather than valuedistribution concept, and increasing an
organizational performance indicator.To investigate hypothesis No.2
of the study, descriptive statistics of variables were computed,
table (3)shows that:Table 3: Descriptive statistics for Value
creation rather than value distribution concept variable means
Std.deviation Value creation rather than value distribution concept
3.20 0.86876 The mean value of the utilizing Value creation rather
than value distribution concept was (3.20)with std. deviation value
(0.86876), which means that there are positive attitudes toward
thesevariables because their means are above mean of the scale (3).
To investigate hypothesis three simple regression analyses was
applied; table (4) shows that:Table 4: Regression analysis for
Value creation rather than value distribution concept Model r r2 t
Sig. F Sig. H. Result Value creation rather than 0.753 0.567 0.755
11.322 0.00 128.192 0.00 Reject Null H value distribution concept
There is a relationship between degree of utilizing Value creation
rather than value distributionconcept, and increasing an
organizational performance indicator, r. Value reached (0.753), F.
ValueReached (128.192) by significant (0.00), this indicate there
is a relationship between utilizing Valuecreation rather than value
distribution concept, and increasing an organizational performance
indicator.Therefore hypothesis No. 2 (H2) is true and Null
hypothesis was rejected.8.1.1.3. H3There is a significant
relationship between the degree of utilizing Partnership and
Strategic Alliancesconcept, and increasing an organizational
performance indicator. To investigate hypothesis No.3 of the study,
descriptive statistics for variables were computed,table (5) shows
that:Table 5: Descriptive statistics for Partnership and Strategic
Alliances concept Variable mean Std.deviation Partnership and
Strategic Alliances concept 3.106 0.89914 553
10. European Journal of Social Sciences Volume 12, Number
4(2010) The mean value of the degree of utilizing Partnership and
Strategic Alliances concept was(3.106) with std. deviation value
(0.89914), which means that there are positive attitudes toward
thesevariables because their means are above mean of the scale (3).
To investigate hypothesis No.3 simpleregression analyses was
applied; table (6) shows that:Table 6: Regression analysis for
Partnership and Strategic Alliances concept Model r r2 t Sig. F
Sig. H. Result Partnership and Strategic Alliances 0.736 0.541
0.713 10.749 0.00 115.537 0.00 Reject Null H The table shows that
there is a relationship between the degree of utilizing Partnership
andStrategic Alliances concept and increasing an organizational
performance indicator, r. Value reached(0.736), F. Value Reached
(115.537) by significant (0.00), this indicate that there is a
relationshipbetween the utilizing Partnership and Strategic
Alliances concept and increasing an organizationalperformance
indicator. Therefore hypothesis No.3 (H3) is true and Null
hypothesis was rejected. Also, multiple regression analysis were
applied for independent variables to detect its affecton dependent
variables, table (7) shows that:Table 7: Regression analysis -the
degree of utilizing relationship marketing concept and increasing
an organizational performance indicator for total model The
relationship marketing on an organizational performance t Sig. F
Sig. H. Result indicator. A- Interactive marketing 0.379 4.027
0.000 B Value creation rather than value distribution 0.253 2.478
0.015 69.355 0.00 Reject H0 C- Partnership and Strategic Alliances
0.282 3.188 0.002 Shows that (F) value reached (69.355) by sig.
(0.00), this indicate to There is a significantrelationship between
relationship marketing concept, and an organizational performance
indicator.9. Conclusion and Recommendation9.1. ConclusionDepend on
above display for the result of this study which aims at
investigates the relationshipmarketing concept and its effects on
an organizational performance indicator, the summary
concludes:Positive relationship between relationship marketing and
organizational performance indicators. Theseresults agreed with the
ideas represented by various authors in the theoretical background
to prove thatthe relationship marketing refers to long-term and
mutually beneficial arrangement wherein both buyerand seller focus
on value enhancement through the certain of more satisfying
exchange (Gronroos, Ch.1994). So relationship marketing can be
applied: when there are competitive service alternatives
forcustomers to choose from; and when there is an ongoing and
periodic desire for the service. Relationship marketing is one of
the most time-consuming, but most effective strategies formarketing
extension programs. Relationship marketing is a process, not a
one-time event; clients mustunderstand that you are committed
long-term and that they can depend on you to provide the
servicesrequired. To be effective, you must establish a
relationship with the customers (students andstakeholders) you are
targeting by making a connection with them over time. In order to
build arelationship, as with any other relationship in life,
Extension needs to be constantly in touch with itscustomers. By
making a connection with diverse customers. Utilizing Relationship
marketing; Interactive marketing, Value creation rather than
valuedistribution, Partnership and Strategic Alliances: Creates
value; Value creation generates the energy 554
11. European Journal of Social Sciences Volume 12, Number 4
(2010)that holds these institutions together, and their very
existence depends on it. The physics that governsthe
interrelationships and energy states of institution systems
elementary particles - its customers,employees, and investors - can
be called the forces of loyalty. Because of the links between
loyalty,value, and profits, these forces are measurable in cash
flow terms (Thurau, Th, He, et, al. 2002,Christopher M. et al.
2002, Boone and Kurtz, 2007). Loyalty is inextricably linked to the
creation ofvalue as both a cause and an effect. As an effect,
loyalty reliably measures whether or not theuniversity has
delivered superior value: Customers either come back for more or
they go elsewhere. The key feature of institution success is the
development of mutually beneficial relationships(Christopher M. et
al. 2002).. The result is agreed with the fact that relationships
are two way andindeed, should be mutually beneficial (Gronroos,
Chr. 1994). as mentioned through introduction andtheoretical
background. The assumption is that a satisfied customer equates to
a loyal customer andthat a loyal customer implies a relationship
(Thurau, Th, He, et, al. 2002). The main findings show that there
is an imbalance between giving and getting that wheneducational
institutions ask their customers for friendship, loyalty and
respect, they often dont givethese in return, despite adopting the
concept of relationship marketing.9.2.RecommendationAs a cause,
loyalty initiates a series of economic effects that cascade through
the educationalinstitutions, as follows: 9.2.1) Revenues and market
share grow as the best customers are swept into the educational
institutions, building loyal customers, positive word of mouth and
referrals (Thurau, Th, He, et, al. 2002). Because the institutions
value proposition is strong, it can afford to be more selective in
new customer acquisition and to concentrate its investment on the
most profitable and potentially loyal prospects, further
stimulating sustainable growth (Gronroos, Ch. 1994).. 9.2.2)
Sustainable growth enables the educational institution to attract
and retain the best employees. Consistent delivery of superior
value to customers increases employee loyalty by giving them pride
and satisfaction in their work. Furthermore, as long-term employees
get to know their long-term customers to connect with them, they
learn how to deliver still more value, which further reinforces
both customer and employee loyalty. 9.2.3) Loyal long-term
employees learn on the job how to reduce costs and improve quality,
which further enriches the customer value proposition and generates
superior productivity. The educational institutions can then use
this productivity surplus to fund superior compensation and better
tools and training, which further reinforce employee productivity,
compensation growth, and loyalty (Gummesson, 1994) . 9.2.4)
Spiraling productivity coupled with the increased efficiency of
dealing with loyal customers generates the kind of cost advantage
that is very difficult for competitors to match. Sustainable cost
advantage coupled with steady growth in the number of loyal
customer (Gummesson, 1994, Gronroos, Ch, 1994).10. Areas For
Further ResearchFuture researchers may wish to explore moderating
relationship of consumer relational preferences.Another limitation
is that the cross-sectional nature of the data only allows for co
relational, rather thancausal, inferences to be made. The
possibility exists for a path to be operating in the opposite
directionfrom what we propose. Another potentially fruitful area
for future research is delineating among thedifferent types of
special treatment benefits explored in this study. Perhaps some
special treatmentbenefits are more relevant than others with
respect to their impact on an organizational performanceindicator
555
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