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A Model of Relational Governance in Reverse Auctions
Author(s) -
Pearcy Dawn,
Giunipero Larry,
Wilson Andrew
Publication year - 2007
Publication title -
journal of supply chain management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.75
H-Index - 92
eISSN - 1745-493X
pISSN - 1523-2409
DOI - 10.1111/j.1745-493x.2007.00023.x
Subject(s) - reverse auction , corporate governance , common value auction , transactional leadership , business , popularity , industrial organization , empirical research , transaction cost , microeconomics , marketing , economics , finance , management , psychology , social psychology , philosophy , epistemology
SUMMARY Despite the popularity of electronic reverse auctions, limited empirical research on their use and key outcomes such as supplier cooperation, purchase price reductions and time savings has been conducted. The current research examines the role that the relative strategic importance of the existing buyer–supplier relationship plays in reverse auction usage, including the type of governance structure established and the three previously mentioned outcomes. Results indicated that existing buyer/supplier relationships characterized as strategic opted for relational forms of governance in reverse auctions. When using transactional governance, this research provides empirical support for reports that reverse auctions result in reduced purchase prices and increased purchaser productivity. Managerial implications are offered, along with directions for future research.