Activity Coordination and Resource Combining in Distribution Networks - Implications for Relationship Involvement and the Relationship Atmosphere

Technical developments in production, transportation, and information systems have resulted in new distribution channel arrangements. The new conditions have affected the atmosphere in distribution channels encouraging more cooperative relationships. The main reason for this change is that activity interdependencies in the evolving networks have increasingly come to cross corporate boundaries and this makes enhanced coordination among firms necessary. Consequently, the resources of the parties have become more integrated and, furthermore, individual firms are increasingly reliant on resources controlled by others. The objective of the paper is to analyze and compare contemporary distribution networks with 'traditional' channels in terms of activity coordination, resource combining, and producer-distributor relationships. On the basis of this discussion the paper concludes with a discussion of managerial implications for relationship involvement and the relationship atmosphere. The main finding is that power and conflict are just as important in today's distribution networks as they have been in traditional channels, but they are exploited in different ways than previously.