Enhancement of commitment in the export management company supplier relationship through e-business.

Sharma, Varinder M. ; Sharma, Brij M.

Abstract

Even though U.S. manufacturers / suppliers and the Export Management Companies have been dealing with each other over the last century to take advantage of global export marketing opportunities, their relationships generally remained short lived. Taking a relationship-based perspective, this study notes that the supplier-EMC relationship lacked mutual long terra commitment, which if built into the relationship can be advantageous in the contemporaneous e-business era for both parties. The study makes a strong case for enhancement of commitment between suppliers and export management companies and proposes e-business based strategies to accomplish that.

I. INTRODUCTION

Export Management Companies (EMCs) are primarily small size U.S. companies that have been operating as indirect exporting intermediaries for U.S. suppliers/ manufacturers since the beginning of the twentieth century. Despite suppliers' increased leaning toward direct exporting after the World War II, EMCs remained their primary indirect exporters (Sharma, Taiani, and Sharma, 2010). On their part, EMCs have survived over time despite changes in export channel structures and international marketing environment, and now, even the e-business proliferation (Oxley and Yeung, 2001; Sharma 2005). Collectively, EMCs have been contributing about 10% toward the U. S. export trade annually. Even with their important contributions, relationship between EMCs and suppliers remained fragile that in variably lead to termination (Bello and Williamson, 1985; Haigh, 1994; Sharma, 2005).

Notwithstanding their relational history, suppliers and EMCs need each other. According to Leonidou, Katsikeas, and Hadjimarcou (2002), it is essential that suppliers and EMCs work together, which would not only result in greater understanding and cooperation between them but would also, enhance export efficiency and effectiveness. The B2B literature also suggests several other benefits to firms in committed relationships such as increased exclusivity of patronage and reduction of business uncertainty (Anderson and Weitz, 1992; Aurier and N'Goala, 2009; Brown, Lusch, and Nicholson, 1995; Lusch and Brown, 1996). Furthermore, the global spread of e-business has placed EMCs, by virtue of their end position in the export value chains of many suppliers, in a superior position than ever before to exploit greater opportunities for their suppliers (Sawhney and Parikh, 2001). In essence, EMCs have become more indispensable to U.S. suppliers than ever before.

This study takesa fresh look at the supplier-EMC relationship from a relationship-based perspective and makes a strong case for commitment enhancement between EMCs and their suppliers. In this context, we first describe the supplier-EMC relationship over time prior to the spread of e-business. Later, building upon the buyer-seller relationship and e-business-related literatures, the study generates specific propositions addressing the use of e-business to enhance commitment between the suppliers and EMCs. By doing so, the study significantly advances the export marketing literature in many ways. First, it connects the EMCs, the e-business, and the B2B relationship literatures, which is important in itself, because it has the ability to set the stage for potential empirical testing (Hunt, 1991). Second, it highlights the increasing importance of EMC s in the era of global proliferation of e-business, and how suppliers can enter into a committed relationship with EMCs to their advantage rather than being adversarial to them. Third, the study extends the application of e-business into the relationship literature. In this context, this study adds on to the increasing set of applications of e-business. Finally, the study provides a platform for scholarly discussion on supplier-EMC commitment.

II. EXPORT MANAGEMENT COMPANIES

Brasch (1978) described EMCs as U.S. firms that furnish export marketing services to their U.S. suppliers in foreign markets. Williamson and Bello (1984) defined them as export intermediaries whose primary role is to manage the exports of a few unrelated suppliers. Building upon this line of thinking, Fingar (2001) described EMCs as outsourced export departments of many U.S. producers in certain foreign markets. To sum up, EMCs are independently owned and operated entrepreneurial firms whose primary business is the export marketing of products for one or many U.S. producers (Sharma, 2005). In this context, all sizes of suppliers, small, medium, and large take advantage of their services though the majority of such supplier firms are small and medium sized. Most of the EMCs are small in size with limited human and financial resources; however, they have superior foreign market-related knowledge-based assets that can be categorized into of two types (Sharma, Taiani, and Sariteke, 2006). While type I assets include relational assets, for example, relationship with foreign customers, local dealers, and other institutions or authorities relevant to importing in a country; the type II assets, called as intellectual assets, entail knowledge about foreign and domestic market conditions, and logistics operations. EMCs deploy these assets in various combinations to perform what Bello and Williamson (1985) describe as transaction creating and physical fulfillment services to carry out the export marketing operations for their suppliers.

EMCs are not a new breed of firms; rather their origin can be traced back to firms such as Combination Export Managers and Manufacturer's Export Representatives that existed in the U.S. during the time between the latter half of the nineteenth century and the earlier part of the twentieth century (Greene, 1968). Despite the increasing use of direct exporting by suppliers after the World War II, EMCs remained and still are the primary indirect export marketing mode for many U.S. firms for several reasons. One, as describe before, EMCs have well developed unique foreign-market based assets that are vital to the marketing of U.S. products in those countries. Two, they are a low cost alternatives to direct exporting due to their small size and low overheads (Bello and Williamson, 1985). Three, EMCs are better placed in providing solutions to foreign customers' problems pertaining to information or transaction uncertainty than the direct exporters (Sharma, 2009). Fourth, they act as the first time market entry mode for many small and medium domestic firms (Johansson and Vahlne, 2006). Lastly, EMCs are the preferred choice for suppliers under a variety of conditions such as filling small orders from geographically dispersed foreign clients, catering to declining demand of foreign products, dealing with foreign customers in politically and economically unstable countries. Despite EMCs' many and varied contributions, their relationship with suppliers remained problematic.

III. EXPORT MANAGEMENT COMPANY-SUPPLIER RELATIONSHIP

The supplier-EMC relationship has been described as opportunistic, testy and fragile (Bello, Urban, and Verhage, 1991; Bello and Williamson, 1985; Brasch, 1978; Haigh, 1994; Sharma, Taiani, and Sariteke,2006). Looking from the supplier side, studies over time have brought out the following concerns of suppliers about EMCs. For example, EMCs show persistent openness to increasing the size of their product range, i.e., they are engaged in exporting whatever they can rather than specializing in certain categories of products. Also, many EMCs showed invariance toward selling any specific category of products from any specific category of firms. Brasch observed that such a behavior, in suppliers' perception, was synonymous with EMCs being more committed to achieving their goals rather than that of their suppliers. Similar finding were reported by Haigh (1994). Based upon his interviews with many suppliers, Haigh found that EMCs give less than the needed attention to their products. Furthermore, EMCs do not have the needed resources and exhibit lack of commitment to suppliers' products. In essence, EMCs were following a shot gun approach rather than a targeted marketing approach to export marketing of their suppliers' products. And, the consequences of such an approach to marketing usually fall short of success (Kotler and Keller, 2009).

Like suppliers, EMCs had their own version of suppliers' lack of commitment to their services. For example, according to Bello and Williamson (1985), rather than regarding EMCs as part of their supply chains, suppliers treat them as an extra cost layer and as soon as their efforts get suppliers' products established in foreign markets, EMCs are removed from those operations. An indication of supplier's opportunistic behavior toward EMCs was also observed in Williamson and Bello's (1984) empirical investigation, which found that if an independently operating EMC acting as an agent of a supplier succeeded in exceeding the annual sales target, that EMC was disengaged from the relationship by the supplier. Furthermore, suppliers did show evaluation bias against EMCs, specifically, against the independently operating ones (Bello, Urban, and Verhage, 1991).

From the above description, it becomes clear that regardless of the reason(s), both, EMCs and suppliers, exhibit little or no commitment to a long term relationship between them. Rather, each party is engaged in an opportunistic behavior toward the other by trying to maximize its payoff at the expense of the other. Such a condition in the game theory is called as prisoner's dilemmain which each party is afraid of the other taking advantage of its contribution. According to Gulati, Khanna, and Nohria (1994), firms in such relationships end up getting lower yield from relationship benefits, however, they could get a larger yield if both show serious commitment to the relationship. In the supplier-EMC relational context, we argue that having committed relationship would have lessened if not completely eliminated the afore-mentioned irritants in the supplier-EMC relationship, thereby helping both the EMCs and suppliers to take advantage of greater number of export opportunities globally. For example, EMCs would have given more attention to their suppliers' products rather than indiscriminately entertaining more products into their product range if they had been confident of the continuity of their relationships. The suppliers would have had a better exporting outcome over time if they had developed a better understanding that export marketing of products in a foreign country is difficult due to a variety of problems stemming from geographic distance, cultural differences, and communications difficulties, and, it takes time, efforts and persistence to get products accepted in a foreign country (Howard, 1994; Moore, 1990). In short, both parties would have gained much more if they had along term committed relationship.

The B2B relationship literature speaks volumes of benefits to firms in committed relationships. For example, in the farm equipment channels, Brown, Lusch, and Nicholson (1995) found that the supplier-retailer commitment enhanced the overall channel performance. In a recent study involving service firms, Aurier and N'Goala (2010) found that relationship commitment on the part of the service providers not only enhances retention of the customers but also the exclusivity of their patronage. Once in relationship, commitment between partners also reduces the power asymmetries between the smaller and larger members (Narayandas and Rangan, 2004). The relationship commitment between firms provide several more advantages such as reduction in business uncertainty, increased exchange efficiency and satisfaction, enhanced performance and profitability, and development of mutually beneficial new business opportunities (Anderson and Weitz, 1992; Dwyer, Schurr, and Oh, 1987; Johanson and Vahlne, 2006; Lusch and Brown, 1996). In addition to the afore-mentioned benefits, several other positive externalities also come into existence that are specifically important to the supplier-EMC relation. For example, according to Ganesan et al. (2010), under most circumstances, a buyer-supplier commitment works to buffer against mild incidences of unethical behavior and opportunism. That is to say, that commitment in a supplier-EMC relationship can substantially reduce opportunistic behavior of both parties toward each other. A second positive outcome is the increase in commitment between the parties over time because the perception of commitment on the part of one party begets commitment from the other party (Anderson and Weitz, 1992).

IV. COMMITMENT

The B2B relationship literature review brings out several inter-related perspectives on relationship commitment between the exchange partners. According to Dwyer, Schurr, and Oh (1987), commitment refers to an implicit or explicit pledge of relational continuity between the exchange partners. In their view, parties' commitment to a relationship can be estimated through significant levels of inputs of resources to that relationship, consistency of those inputs, and the durability of the relationship. Moorman, Zaltman, and Deshpande (1992) described commitment as an enduring desire of parties to maintain a valued relationship. Anderson and Weitz (1992) depicted commitment to a relationship as a desire of the parties to develop a stable relationship, a willingness on the part of the partners to make short term sacrifices to maintain the relationship, and have a confidence in the stability of the relationship. In their empirical study, they observed that perception of commitment of one partner leads to commitment by the other. Wilson (1995) also referred commitment as a desire of the partners to continue the relationship into the future because of its importance. Finally, Morgan and Hunt (1994) looked at relationship commitment as a belief of exchange partners that an ongoing relationship is so important that it warrants maximum efforts at maintaining it to ensure that it goes on indefinitely.

From these afore-mentioned definitions, it is apparent that whether it is the desire, belief, pledge, or all of them of the parties to enter into or to continue to be in commitment with each other for a long term, there are two key interrelated aspects of commitment: 'importance of the relationship' and 'value from the relationship' to the partners. That is, partners are less likely to be in a committed relationship unless they perceive it to be important to their long term goal achievement. Likewise, they are not likely to commit themselves to a partner unless in their perception, the value addition from commitment at least exceeds the costs entailed in that committed relationship. These costs may include: high switching costs, delay in decision making, opportunistic behavior of the partner, and opportunity costs of not pursuing the alternatives (Anderson and Jap, 2005; Bhide, 2000). Also, implied in these definitions is that the firms pursuing commitment have the needed resources to support a committed relationship.

According to Wilson (1995), firms should look for relational partner that would provide superior value but less risk to their operations. Although such partners would be ideal for committed relationships, finding them in reality may be extremely difficult if not impossible for a simple reason that if such partners existed; every other firm would like to be in commitment with them. And, that would enable such firms to extract higher costs from firms seeking their commitment, thereby making them less valued to the seeker. In our view, it is more likely that the partnering firms in a committed relationship may get a mix of benefits and costs of commitment. To the extent the partners can handle their respective costs from the relationship while obtaining or expecting to obtain the benefits is likely to determine the longevity of that committed relationship. As a corollary, if the benefits to cost ratio for the partners keeps on increasing over time, the partners may also increase their level of commitment between them over time. However, if the reverse happens, the partners may start moving toward dissolution of their commitment.

Moving forward into the current time frame, both EMCs and suppliers are now in the era of e-business. In our view, the global proliferation of e-business and its adoption enables EMCs and suppliers to minimize if not completely eliminate the irritants in their relationship that acted as barriers to ling term commitment formation previously. In this regard, this study offers a model for commitment enhancement in the supplier-EMC relationship through e-business by specifically focusing on three key aspects lacking in that relationship: adequacy of resources and capabilities of EMCs, importance of the relationship, and value addition to the relationship. Further, this study takes the view that the onus of development of commitment lies with the EMCs while recognizing that the commitment has to be mutual for longevity. Our position is based on two reasons. One, EMCs' existence is primarily related to their ability to satisfy their customers' and suppliers' needs. By developing committed relationships with certain suppliers, they can assure foreign customers about the constancy of supply for their needs. Two, EMCs' attempt at commitment enhancement would also send a strong signal to suppliers of dedicated efforts toward exporting their products. And such an approach is likely to elicit reciprocation of commitment from suppliers as well (Gulati, Khanna, and Nohria, 1994). Next, we briefly describe e-business to lay the foundations for EMCs to enhance commitment in their relationship with suppliers.

V. E-BUSINESS

E-business, the business conducted over the web, has structurally transformed the ways in which businesses have been operating since the late 1990s. Whether these are B2B or B2C business transactions, e-business has become the platform of necessity as it covers almost all of the business functions such as transferring of funds, communication with customers, electronic buying and selling of goods and services, servicing customers, partnering with other businesses, and conducting transactions within organizations (Cavusgil, 2002; Krumwiede, Swain, and Stocks, 2003; Rohm and Sultan, 2004; Turban et al., 2012). According to Sharma (2005), e-business is a highly interactive platform that enables a more efficient and effective co-creation and appropriation of economic value among relevant exchange parties than the traditional ways throughout the firm's value chain. For example, on their marketing-side, firms can create values for their customers by providing them with discounts vouchers and coupon, sending customized messages, offering choices of different value packages of products, and enabling payment transactions online anytime from anywhere. Likewise, on their supply side, E-business also enables firms to enhance their efficiencies and effectiveness through coordination of their business processes with other firms (Zhu and Kraemer, 2002; Rai and Tang, 2010). Additionally, E-business can also create value for firms by enabling them to tap into the complementarities of their resources (Amit and Zott, 2001).

A steady stream of research has appeared in various academic and practitioner outlets showing improvements inefficiency and coordination in supply chain management (Moen, Madsen, and Asplund, 2008; Rai and Tang, 2010; Zhu and Kraemer, 2002). Likewise, several articles pertaining to the impact of e-business on EMCs' resources, global market coverage, exporting services, and product portfolio have also been published (Bennett, 1997; Loane, McNaughton, and Bell, 2004; Sharma, 2005). These works have advanced the EMC literature and brought EMCs into focus of serious research. Also, studies using e-business to build trust at B2B and B2C levels have appeared recently (Doney, Barry, and Abratt, 2007; Ratnasingham and Phan, 2003). Likewise, empirical studies showing a strong impact of e-business on inter-firm commitment has started appearing in the literature. For example, Kent and Mentzer (2003) found a positive relationship between retailers' investment in e-business technologies and relationship commitment with their suppliers. Most recently, Sanders (2007) found out that the use of e-business technologies among supply chain members not only has a direct positive impact on their inter-firm collaborations but also has indirect impact on their intra-firm coordination. Building upon these literature streams and the relationship-based perspective, this work extends the EMC literature by offering ways in which e-business enables EMCs in enhancing commitment in the supplier-EMC relationship.

VI. BUILDING COMMITMENT WITH SUPPLIERS THROUGH E-BUSINESS

As described before, the two key reasons underlying a firm's motivation to enter into a long term committed relationship with another firm are:expectations of superior value addition from this firm and the demonstration of importance that this firm gives to the relationship. Of course, the underlying assumption is that both firms have adequate resources without which the abilities of partners to provide superior value and demonstration of importance to the relationship become questionable. It needs to be noted here that the lack of these aspects happen to be the primary concerns of EMCs-supplier relationship. How can EMCs entice suppliers to enter into commitment with them now given their traditional concerns about EMCs? Obviously, one could argue that the suppliers would be reluctant to enter into this uncharted territory fearing that entering into commitment would give lesser motivation to EMCs than before to provide the needed attention to their products. In our view, such supplier apprehensions though seem to make sense when viewed through the prism of their relational history with EMCs may turn out to bemisplaced in the era of e-business for at least two reasons. One, the global proliferation of e-business has disproportionately benefited firms at the end of their value chain such as EMCs (Sawhney and Parikh, 2000). Two, the e-business spread has become a resource multiplier for EMCs' resources and has enabled them to enhance efficiency and effectiveness in providing export marketing services (Sharma, 2005). Given the premise of this study, it is incumbent upon EMCs to demonstrate through their desire, pledges, and actions to suppliers that they are worthy of long term commitment with them.

As described earlier, EMCs are primarily small sized firms with limited human and financial resources but have superior relational assets (for example, relationship with foreign customers, local dealers, and other institutions or authorities relevant to importing in a country), and intellectual assets (such as knowledge about foreign and domestic market conditions, export documentations, and logistics operations). These sources are valuable because EMC deploy them to generate value for their suppliers through selling their products in foreign markets as well as values for themselves in the form of commissions, goodwill, and reputation for future business. Second, these resources are hard to be duplicated because of several reasons. One, they are specific to each EMC. Two, these resources have time compression diseconomies of scale and high degree of tacitness and hence can't be easily copied by competitors(Reed and DeFillippi, 1990). That is why these resources are the primary reason underpinning the survival of EMCs and are also responsible for their reintermediation (Sharma, 2005).

Prior to the spread of e-business, EMCs were limited in putting these resources to full use because of their limited human and financial resources and also the limited scale and scope of the available communications technologies at that time. For example, prior to the e-business spread, building personal or structural bonds with foreign customers, developing new leads in foreign markets, or estimating demands for their suppliers' products entailed EMCs to travel to those foreign countries. And such activities took time and monetary resources that were already in short supply with EMCs.Therefore, EMCs could not accomplish these activities for their suppliers' interests as well as their own interest. Likewise, accurate knowledge of the prevailing economic and political conditions in those markets was limited to EMCs due to the then available technologies such as phone, mail, or fax. Essentially, both types of EMC's market-related assets remained underutilized.

The cheaper availability and global spread of e-business enables EMCs to utilize both types of their market-related assets to a much greater extant even with the same level of human and financial resources. For example, EMCs can conduct almost all aspects of their business with suppliers and customers on-line in real time because of e-business's ability to provide cost-effective real time connectivity. In a way, the time and money spent on traveling can now be used more prudently than before. Essentially, e-business has become a resource multiplier for EMCs human and financial resources (Sharma, 2005). Furthermore, e-business spread has tremendously improved the quality and quantity of E MCs' foreign market relational and intellectual assets by enabling them to be in touch with their current customers more often through e-mails and web-based video conferencing as well as establish contacts with new customers through web-based searches. In sum, the global spread of e-business has enhanced the ability of EMCs to fully utilize their resources and capabilities for export marketing of their suppliers' products. Also, e-business has enabled EMCs to enhance the quality and quantity of EMCs' intellectual and relational assets. With the e-business boosted resources available to EMCs, next, we describe how EMCs can use them to enhance commitment with their suppliers.

Superior Value to Suppliers

According to Anderson and Narus (1998), "value in the business markets is the worth in monetary terms of the technical, economic, service, and social benefits a customer company receives in exchange for the price it pays for a market offering." And, it is a superior value if it is superior to the next best alternative available to the customer, whether that is provided by another firm or generated by the customer itself. They suggest that a thorough understanding of the activities of a customer can enable a provider of a value to show the value the customer is going to receive. In export marketing, a firm has to perform two inter-related sets of activities to conduct export marketing operations. These are transaction creating activities and physical fulfillment activities (Bello and Williamson, 1985). The transaction creating activities entail, the gathering of foreign market-specific demand and supply knowledge, foreign market advertising, personal selling, and all other activities that stimulate foreign market demand, and the physical fulfillment activities include all undertakings necessary to supply foreign demand such as export documentation, logistics, tariffs, export-import regulations, and foreign market warehousing. As agents or distributors, EMCs perform these services regularly to conduct export marketing for their suppliers (Haigh, 1994). And, as described before, it is suppliers' negative perception of the performance of these activities that is a key to the lack of commitment between the two. As described earlier, one key way in which e-business creates value is through enhanced efficiency (Amit and Zott, 2001). This study posits that EMCs can add superior value to their suppliers by providing enhanced efficiencies and effectiveness in the performance of these activities by suitably deploying e-business as follows.

E-Business and Transaction-Creating Activities: E-business enables EMCs to generate foreign market demand estimates in far less time than they used to spend earlier using the traditional communication methods such phones, faxes, or postal services. For example, EMCs can obtain inputs for their products from their customers in real time, create demand estimates which they can pass on to their suppliers in real time. This helps suppliers plan their production and inventory for EMCs-related exports. Likewise, e-business enables EMCs to make better forecasts about economic, political, and environmental conditions in the foreign countries of their operation. And, that enables EMCs to provide real time information to their suppliers of potential delays or disruptions in their services in case of sudden changes. Likewise, other foreign market transaction creating activities such as advertising, personal selling targeted at stimulating foreign market demand can also be done in lesser time than before. In sum, e-business enables EMCs to provide superior efficiencies in time and monetary value to their suppliers in providing transaction creating activities for their products in foreign markets.

E-Business and Physical-Fulfillment Activities: The deployment of e-business also enables EMCs to become more efficient in performing their physical-fulfillment services. For example, EMCs can obtain orders from their foreign customers on-line and pass them on-line to the relevant suppliers who can fill them in time. Once the suppliers agree to fill those orders, they can be shipped without further delay because the needed shipping documentation can be filled online. E-business enables EMCs to keep track of their shipments-in-transit and enable their customers and the suppliers to know the status of their merchandize, communicate with the related banks for payment collection, and receive feedback from their customers and suppliers. Essentially, e-business enables EMCs to perform the needed physical-fulfillment services more efficiently and hence generate more value for their suppliers. Summing up, e-business enables EMCs to provide superior value to their suppliers through achieving enhanced efficiencies in providing export marketing services. This leads to our first proposition:

P1: E-business, ceteris paribus, enhances the abilities of EMCs to provide superior value to their suppliers through higher efficiencies in export marketing services.

Superior Attention to Suppliers' Products

As described before, in suppliers' perception, EMCs pay less attention to the export marketing of their products and are more concerned about achieving their goals. Such a perception could have emerged from at least two sources. One, EMCs didn't allocate the needed resources toward their suppliers' products rather they tried to maximize their own profits by spreading their existing resources on additional suppliers. Although such a strategy is highly unlikely among the well-established EMCs due to their longevity in business, but could have been followed by some EMCs who turned myopic in their approach to export marketing to hedge against the impending threat of internalization of their services by some of their suppliers. Two, EMCs' couldn't deliver on the promised results to their suppliers regardless of any number of reasons beyond their control even if in their view, they had done the needed activities for export marketing of supplier's products. Regardless of the above-mentioned situation, EMCs may not have been successful in creating suppliers' perception of adequate attention given to their products. Essentially, it is an issue of perception management for EMCs. Such a problem can be minimized if EMCs can get their suppliers involved in setting goals for export of their products, informing them of allocation of resources toward accomplishing those goals, and keeping them updated about the status of export marketing of their products. Our thinking is very much in line with Haigh (1994), who found that those suppliers that set well defined goals in participation with EMCs had much higher level of satisfaction with EMCs' performance than those who had set goals by themselves.

E-Business and the Enhanced Importance to Suppliers' Products: E-business greatly enables EMCs to involve suppliers from goal setting toresource allocations for their exports, to keeping them updated about the status of export marketing of their products. All these can be done online in real time without wasting time or efforts in travelling to each other's location. For example, aftercoming to an agreement about goals for their suppliers' exports, EMCs can let their suppliers know about the human, technical, and financial resources that are going to be allocated to their products from the start to the end for a specific export marketing transaction, their time line of those planned actions, and the probable outcomes. And, the suppliers can be given access to EMCs' website to monitor the progression of those actions over time. That way, the suppliers would be involved in the export transaction and would be less concerned about the EMCs' lack of attention to their products. Furthermore, any updating of EMCs' activities in the light of changing condition in a specific country can also be informed to suppliers in real time. Essentially, E-business enables EMC s to enhance their suppliers' perception of the superior attention being paid to their products. This leads to our second proposition:

P2: E-business, ceteris paribus, enhances the abilities of EMCs in creating suppliers' perception of providing superior attention to their products.

Summing up the above discussion, one can visualize that e-business enables EMCs to work better for the export marketing of their suppliers' products, i.e., provide superior value through enhanced efficiencies, and create a perception of superior attention to their suppliers' products. It is not that the suppliers and EMCs are unfamiliar with each other. In fact, they have been dealing with each other and have decided to remain uncommitted with each other because of the reasons cited before. Appropriate deployment of e-business enables EMCs to minimize if not completely remove the three irritants (described in this study) in their relationship, and hence, enhance commitment with their suppliers. This leads to our third proposition:

P3: E-business, ceteris paribus, enables the EMCs to enhance their commitment in the supplier-EMC relationship.

Suppliers' Perception of EMCs' Commitment

Studies have shown that deliberate action of commitment from one party to another party usually produces reciprocation of commitment. For example, according to Anderson and Weitz (1992), perception of commitment in a relationship on the part of one party brings out commitment from the other party as well. Similar findings were reported by Gulati, Khanna, and Nohria (1994) on 'unilateral commitments' among B2B firms. According to these scholars, when a party makes a unilateral commitment toward another party in an alliance, it sends a signal that it is willing to sacrifice its payoffs for the sake of relationship. And, such a sacrifice is likely to elicit a reciprocating behavior from the partner. Based upon their study of industrial alliances, these scholars found some support for their contention. In fact, one can visualize support for such behavior in Gouldner's (1960) pioneering work on reciprocity in human behavior. That brings us to the fourth proposition:

P4: Supplier's perception of EMCs' abilities to generate superior value and provide superior attention to their products, ceteris paribus, would likely generate reciprocity of their commitment to the relationship.

Summing up, in our view, EMCs' attempt at starting the development of committed relationship with their suppliers can lead to long term committed supplier-EMC relationships, which would not only generate superior values for their suppliers but for EMCs as well. Our position finds further support in Ulaga and Eggert (2006), according to which "Market exchanges take place because all parties involved expect to be better off after the exchange. The higher the net-value expected or received, the stronger the motivation to commence and to sustain an exchange process respectively." And, the E-business, globally pervasive, a highly interactive, and cost-effective communication tool can enable EMCs and suppliers to develop and maintain successful long term committed relationships.

VII. CONCLUSION

Despite their long inter-twined history of more than a century, supplier-EMC relationship has remained short lived with each side accusing the other as the source of their relationship fragility. Based upon our literature review and analysis, this study notes that the supplier-EMC relationship suffered from lack of long term relationship commitment on the part of both parties. Looking from supplier side the study points out three specific problem areas that EMCs need to improve upon to encourage suppliers to enter into committed relationship with them. These areas are: inadequacy of EMCs' resources and capabilities, inability to generate superior value, and lack of needed attention to suppliers' products. In this work, we describe that the e-business has already acted as a resource multiplier for EMCs. And, with those boosted resources EMCs can minimize if not completely eliminate the other two problems to their long term relationship with suppliers by generating superior value and giving superior attention to suppliers' products, and hence be able to enhance their commitment to the relationship with their suppliers. And, the suppliers' perception of these acts of EMCs is likely to generate reciprocity of long term commitment to their relationship with EMCs.

The supplier-EMC relationship can gain several advantages such as reduction in business uncertainty, increased exchange efficiency and satisfaction, and enhanced performance and profitability from long term commitment.

And, the E-business can be used as an effective tool to establish long term committed relationship between the EMCs and their supplier partners. What we have accomplished in this study hardly represents a complete solution to the supplier-EMC relationship commitment problem. Rather, we just provided a new opening into this unresolved area for scholarly discussion and we hope this study would encourage other scholars to carry out theoretical and empirical analyses of this relationship as well. One such area of future research is the use of e-business tools to build symmetrical relational commitment between the suppliers and EMCs. Another future area that this work opens up is to do a comparative assessment of supplier relationship with well-established versus newly formed EMCs. Finally, there is another area that this study opens up is to analyze the e-business spawned changes in EMCs' relationship with their customers in less-developed countries vis-a-vis those in the developed countries.

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VARINDER M. SHARMA, Indiana University of Pennsylvania, Indiana, PA 15705

BRIJ M. SHARMA, Punjab & Sind Bank, New Delhi 110008, India