Abstract
In the present study, we investigated two outcome-based maintenance, repair and overhaul (MRO) service contracts in the attempt to better understand the effect of relational governance on firms’ boundary-spanners behaviours in co-producing complex engineering service. Our field interviews indicate that managers are heavily dependent on interpersonal relationships to promote mutual cooperation in service delivery. The role of legal contracts in monitoring behaviours seems insignificant. Furthermore, we noted that with the development of interpersonal relationship, cooperation moved from reciprocal to communal. That is, at the early stage of relationship, both parties cooperate conditionally according to the norm of reciprocity. When the relationship becomes more mature, both parties share a common identity and work towards their collective goals. To that end, service performance would then be greatly enhanced. Through a theory-in-use methodology, our study maps the practices of behaviour transformation in complex engineering service systems, effected through interpersonal relationship development.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsReferences
P. Adler, Market, hierarchy, and trust: The knowledge economy and the future of capitalism. Org. Sci. 12(2), 214–234 (2001)
J.C. Anderson, J.A. Narus, Capturing the value of supplementary services. Harv. Bus. Rev. 73(1), 75–83 (1995)
K.D. Antia, G.L. Frazier, The severity of contract enforcement in interfirm channel relationships? J. Mark. 65(4), 67–81 (2001)
K. Artz, T. Brush, Asset specificity, uncertainty and relational norms: An examination of coordination costs in collaborative strategic alliances. J. Econ. Behav. Organ. 41(4), 337–362 (2000)
T.S. Baines, H.W. Lightfoot, O. Benedettini, J.M. Kay, The servitization of manufacturing: A review of literature and reflection on future challenges. J. Manuf. Technol. Manag. 20(5), 547–567 (2009)
N. Bendapudi, R.P. Leone, Psychological implications of customer participation in co-production. J. Mark. 67(1), 14–28 (2003). January
B.D. Bernheim, M.D. Whinston, Incomplete contracts and strategic ambiguity. Am. Econ. Rev. 88(4), 902–932 (1998)
J. Bradach, R. Eccles, Price, authority, and trust: From ideal types to plural forms. Annu. Rev. Sociol. 15, 97–118 (1989)
J.P. Cannon, S.A. Ravi, T.G. Gregory, Contracts, norms, and plural form governance. J. Acad. Mark. Sci. 28(2), 180–194 (2000)
P. Dabholkar, How to improve perceived service quality by improving customer participation, in Developments in marketing science, ed. by B.J. Dunlap (Academy of Marketing Science, Cullowhee, 1990)
P. Dabholkar, Consumer evaluations of new technology based self-service options. Intern. J. Res. Mark. 13(1), 29–51 (1996)
J. Dyer, W. Chu, The role of trustworthiness in reducing transaction costs and improving performance: Empirical evidence from the United States, Japan, and Korea. Org. Sci. 14, 57–68 (2003)
J. Dyer, H. Singh, The relational view: Cooperative strategy and sources of interorganizational competitive advantage. Acad. Manag. Rev. 23(4), 660–679 (1998)
R.G. Eccles, The quasi-firm in the construction industry. J. Econ. Behav. Organ. 2(4), 335–357 (1981)
J.A. Fitzsimmons, Consumer participation and productivity. Serv. Opera. Interfaces. 15(3), 60–67 (1985)
S. Ghoshal, P. Moran, Bad for practice: A critique of the transaction cost theory. Acad. Manag. Rev. 21(1), 13–47 (1996)
C. Goodwin, I can do it myself: Training the service consumer to contribute. J. Serv. Mark. 2(4), 71–78 (1988)
M. Granovetter, Economic action and social structure: The problem of embeddedness. Am. J. Sociol. 91(3), 481–510 (1985)
G.T. Gundlach, R.S. Achrol, Governance in exchange: Contract law and its alternatives. J. Pub. Policy. Mark. 12(2), 141–155 (1993)
A. Haslam, Psychology in organizations: The social identity approach, 2nd edn. (Sage, London, 2004)
J. Heide, G. John, Do norms matter in marketing relationships? J. Mark. 56(2), 32–44 (1992)
S.W. Kelley, J.H. Donnelly, S.J. Skinner, Customer participation in service production and delivery. J. Retail. 66(3), 315–335 (1990)
C.A. Lengnick-Hall, V. Claycomb, L.W. Inks, From recipient to contributor: Examining customer roles and experienced outcomes. Eur. J. Mark. 34(3/4), 359–383 (2000)
C.H. Lovelock, J. Wirtz, Services marketing: People, technology, strategy, 5th edn. (Pearson/Prentice Hall, Upper Saddle River, 2004)
C.H. Lovelock, R.F. Young, Look to consumers to increase productivity. Harv. Bus. Rev. 57(3), 168–178 (1979)
R.E. Lusch, J.R. Brown, Interdependency, contracting, and relational behavior in marketing channels? J. Mark. 60(4), 19–38 (1996)
S. Macaulay, Non-contractual relations in business: A preliminary study. Am. Sociol. Rev. 28(1), 55–69 (1963)
I.R. Macneil, The new social contract: An inquiry into modern contractual relations (Yale University Press, New Haven, 1980)
M.L. Meuter, M.J. Bitner, Self-service technologies: Extending service frameworks and identifying Issues for research, in AMA winter educators’ conference, ed. by D. Grewal, C. Pechmann (American Marketing Association, Chicago, 1998)
M.L. Meuter, A.L. Ostrom, R.I. Roundtree, M.J. Bitner, Self-service technologies: Understanding customer satisfaction with technology-based service encounters. J. Mark. 64(3), 50–64 (2000)
P.K. Mills, J.H. Morris, Clients as ‘partial’ employees of service organizations: Role development in client participation. Acad. Manag. Rev. 11(4), 726–735 (1986)
P.K. Mills, R.B. Chase, N. Margulies, Motivating the client/employee system as a service production strategy. Acad. Manag. Rev. 8(2), 301–310 (1983)
L. Poppo, T.R. Zenger, Do formal contracts and relational governance function as substitutes or complements? Strateg. Manag. J. 23(8), 707–725 (2002). August
L. Poppo, K.Z. Zhou, T.R. Zenger, Examining the conditional limits of relational governance: Specialized assets, performance ambiguity, and long-standing ties. J. Manag. Stud. 45(7), 1195–1216 (2008). Nov
J. Potter, Representing reality: Discourse, rhetoric and social construction (Sage, London, 1996)
B. Schneider, D.E. Bowen, Winning the service game (Harvard Business School Press, Boston, 1995)
C.J. Thompson, Interpreting consumers: A hermeneutical framework for deriving marketing insights from the texts of consumers’ consumption stories. J. Mark. Res. 34(4), 438–455 (1997)
C.J. Thompson, W.B. Locander, H.R. Pollio, Putting consumer experience back into consumer research: The philosophy and method of existential-phenomenology. J. Consum. Res. 16(2), 133–147 (1989)
B. Uzzi, Social structure and competition in interfirm networks: The paradox of embeddedness. Adm. Sci. Q. 42, 35–67 (1997)
S. Vandermerwe, J. Rada, Servitization of business: Adding value by adding services. Eur. Manag. J. 6(4), 315–324 (1988)
S.L. Vargo, R.F. Lusch, Evolving to a new dominant logic for marketing. J. Mark. 68, 1–17 (2004)
S.L. Vargo, P.P. Maglio, M.A. Akaka, On value and value co-creation: A service systems and service logic perspective. Eur. Manag. J. 26(3), 145–152 (2008)
O.E. Williamson, Markets and hierarchies (McGraw-Hill, New York, 1975)
O.E. Williamson, Transaction cost economics and organization theory, in The handbook of economic sociology, ed. by N.J. Smelser, R. Swedberg (Princeton University Press, Princeton, 1996)
A. Zaheer, N. Venkatraman, Relational governance as an interorganizational strategy: An empirical test of the role of trust in economic exchange. Strateg. Manag. J. 16(5), 373–392 (1995)
G. Zaltmann, K. LeMasters, M. Heffring, Theory construction in marketing: Some thoughts on thinking (Wiley, New York, 1982)
V.A. Zeithaml, M.J. Bitner, D.D. Gremler, Services marketing: Integrating customer focus across the firm, 4th edn. (McGraw-Hill, New York, 2006)
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2011 Springer-Verlag London Limited
About this chapter
Cite this chapter
Guo, L., Ng, I. (2011). Behaviour Transformation: An Examination of Relational Governance in Complex Engineering Service. In: Ng, I., Parry, G., Wild, P., McFarlane, D., Tasker, P. (eds) Complex Engineering Service Systems. Decision Engineering. Springer, London. https://doi.org/10.1007/978-0-85729-189-9_9
Download citation
DOI: https://doi.org/10.1007/978-0-85729-189-9_9
Published:
Publisher Name: Springer, London
Print ISBN: 978-0-85729-188-2
Online ISBN: 978-0-85729-189-9
eBook Packages: EngineeringEngineering (R0)