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The Impact of Relational Supplier Exchange on Financial Performance: A Study of the Hospital Sector

P.S. Raju, PhD Richard Germain, PhD B. Davis-Sramek S. Lonial
Journal of Business Logistics. September 11, 2011

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Vol. 32 (3), September 2011, pp. 240-253.

Abstract

In the hospital context, when responsiveness is high, relational exchange with suppliers associates with better financial performance. But when a hospital’s responsiveness is low, relational exchange has no effect on performance—the hospital’s inability to adopt “things that are new” and extirpate “things that are old” eclipses the potential financial benefits of long-term, relational exchange with suppliers. Furthermore, the quality orientation of the hospital and supplier uncertainty associate with relational supplier exchange—these effects are not moderated by hospital responsiveness. The net effect is that a quality orientation in a hospital impacts financial performance only when hospital responsiveness is high.

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