Exploring the Influence of Supplier Relationship Quality on South African Municipalities’ Service Delivery Performance

Authors

  •   Stanford Kasai Department of Marketing, University of the Witwatersrand, Johannesburg, 2000
  •   Norman Chiliya Department of Business Management, University of Venda, University Rd, Thohoyandou, 0950

DOI:

https://doi.org/10.17010/ijf/2022/v16i12/172571

Keywords:

Management Practices

, Relationship, Quality, Satisfaction, Service Delivery, Performance.

JEL Classification Codes

, M1, M2, M3

Paper Submission Date

, December 30, 2021, Paper sent back for Revision, February 22, 2022, Paper Acceptance Date, August 10, Paper Published Online, December 15, 2022

Abstract

Most South African municipalities are yet to perform at the desired level. Service delivery protests have been a permanent feature in the South African media for years. Apprehending the factors influencing relationship quality may help municipalities enhance their performance and reduce service delivery problems. The study adopted a quantitative approach within the South African municipality setting. The respondents were sampled using stratified random sampling and snowball sampling. Data were collected from 205 respondents using a structured 5-point Likert scale questionnaire. The data were coded and analyzed using descriptive statistics, SPSS, and AMOS statistical software. The main finding was that relationship quality influenced service delivery performance from the management’s perspective. The composite relationship quality variables (cooperation, trust, commitment, and satisfaction) significantly influenced the relationship quality. The implication is that the quality of the relational interactions between the municipalities and their suppliers significantly impacted the quality-of-service delivery performance.

Downloads

Download data is not yet available.

Downloads

Published

2022-12-01

How to Cite

Kasai, S., & Chiliya, N. (2022). Exploring the Influence of Supplier Relationship Quality on South African Municipalities’ Service Delivery Performance. Indian Journal of Finance, 16(12), 57–76. https://doi.org/10.17010/ijf/2022/v16i12/172571

References

Abdul-Muhmin, A. G. (2005). Instrumental and interpersonal determinants of relationship satisfaction and commitment in industrial markets. Journal of Business Research, 58(5), 619–628. https://doi.org/10.1016/j.jbusres.2003.08.004

Alexander, G., & Kane-Berman, J. (2014). The 80/20 report: Local government in 80 indicators after 20 years of democracy. South African Institute of Race Relations. https://irr.org.za/reports/occasional-reports/files/the-80-20-report-on-local-government-26-may-2014-1.pdf

Alexander, P. (2013). South Africa: The rebellion of the poor. Popular Resistance.org. https://popularresistance.org/south-africa-the-rebellion-of-the-poor/

Alexander, P., & Pfaffe, P. (2011). South Africa's rebellion of the poor: Balfour and relationships to the means of protest. In, Version for academic and activist workshop on 'Protests, Elections and Emerging Politics.' South African Research Chair in Social Change, Humanities Faculty, University of Johannesburg.

Almomani, H. Q. (2019). Relationship quality as predictor of B2B customer loyalty in the pharmaceutical sector: Evidence from Jordan. Journal of Relationship Marketing, 18(2), 108–123. https://doi.org/10.1080/15332667.2018.1534062

Auditor General (SA). (2012). General report of the auditor-general on local government. https://www.agsa.co.za/Reporting/AnnualReport.aspx

Auditor General (SA). (2016). General report of the auditor-general on local government. https://www.agsa.co.za/Reporting/AnnualReport.aspx

Baumgartner, H., & Homburg, C. (1996). Applications of structural equation modeling in marketing and consumer research: A review. International Journal of Research in Marketing, 13(2), 139–161. https://doi.org/10.1016/0167-8116(95)00038-0

Becker, A., Laligi, H., & Thiel, C. (2004). Effective supplier management in the Brazilian automotive industry. In, N. Schweickart, & L. Kaufmann (eds.), Lateinamerika-Management (pp. 279–313). Gabler Verlag. https://doi.org/10.1007/978-3-322-90458-4_14

Bentler, P. M. (1990). Comparative fit indexes in structural models. Psychological Bulletin, 107(2), 238–246. https://doi.org/10.1037/0033-2909.107.2.238

Bentler, P. M., & Bonett, D. G. (1980). Significance tests and goodness of fit in the analysis of covariance structures. Psychological Bulletin, 88(3), 588–606. https://doi.org/10.1037/0033-2909.88.3.588

Bollen, K. A. (1989). Structural equations with latent variables. John Wiley and Sons, Inc. https://doi.org/10.1002/9781118619179

Browne, M. W., & Cudeck, R. (1992). Alternative ways of assessing model fit. Sociological Methods & Research, 21(2), 230–258. https://doi.org/10.1177/0049124192021002005

Cameron, R. (2014). Vertical decentralisation and urban service delivery in South Africa: Does politics matter? Development Policy Review, 32(s1), s81–s100. https://doi.org/10.1111/dpr.12070

Cater, B., & Zabkar, V. (2009). Antecedents and consequences of commitment in marketing research services: The client's perspective. Industrial Marketing Management, 38(7), 785–797. https://doi.org/10.1016/j.indmarman.2007.10.004

Čater, T., & Čater, B. (2010). Product and relationship quality influence on customer commitment and loyalty in B2B manufacturing relationships. Industrial Marketing Management, 39(8), 1321–1333. https://doi.org/10.1016/j.indmarman.2010.02.006

Daunoriene, A., & Zekeviciene, A. (2015). A reference model of public institutions' quality practices, citizens' satisfaction and performance quality. Engineering Economics, 26(4), 422–430. http://doi.org/10.5755/j01.ee.26.4.6066

De Cannière, M. H., De Pelsmacker, P., & Geuens, M. (2009). Relationship quality and the theory of planned behavior models of behavioral intentions and purchase behavior. Journal of Business Research, 62(1), 82–92. https://doi.org/10.1016/j.jbusres.2008.01.001

Empowerdex. (2012). Service Delivery Index (Munidex). Empowerdex Economic Empowerment Rating Agency. https://www.empowerdex.com/

eNCA. (2015, February 05). Service delivery protests peaking. https://www.enca.com/south-africa/service-delivery-protests-peaking

Gadde, L.-E., & Snehota, I. (2000). Making the most of supplier relationships. Industrial Marketing Management, 29(4), 305–316. https://doi.org/10.1016/S0019-8501(00)00109-7

Ghzaiel, K., & Akrout, F. (2012). Dimensions and antecedents of relationship quality in a business-to-business context: An exploratory study. Journal of Supply Chain and Customer Relationship Management, Vol. 2012, 1–17. https://doi.org/10.5171/2012.589977

Hair Jr., J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2010). Multivariate data analysis (7th ed). Pearson Prentice Hall.

Hastie, T., Tibshirani, R., & Friedman, J. (2009). The elements of statistical learning: Data mining, inference, and prediction (2nd ed.). Springer-Verlag.

Hawley, K. (2014). Trust, distrust and commitment. Noûs, 48(1), 1–20. https://doi.org/10.1111/nous.12000

Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43, 115–135. https://doi.org/10.1007/s11747-014-0403-8

Holm, D., Eriksson, K., &, Johanson, J. (1999). Creating value through mutual commitment to business network relationships. Strategic Management Journal, 20(5), 467–486.https://doi.org10.1002/(SICI)1097-0266(199905)20:5<467::AID-SMJ38>3.0.CO;2-J

Hooper, D., Coughlan, J., & Mullen, M. R. (2008). Structural equation modelling: Guidelines for determining model fit. Electronic Journal of Business Research Methods, 6(1), 53–60. https://doi.org/10.21427/D7CF7R

Hoppner, J. J., Griffith, D. A., & White, R. C. (2015). Reciprocity in relationship marketing: A cross-cultural examination of the effects of equivalence and immediacy on relationship quality and satisfaction with performance. Journal of International Marketing, 23(4), 64–83. https://doi.org/10.1509/jim.15.0018

Hu, L.-T., & Bentler, P. M. (1999). Cutoff criteria for fit indexes in covariance structure analysis: Conventional criteria versus new alternatives. Structural Equation Modeling: A Multidisciplinary Journal, 6(1), 1–55. https://doi.org/10.1080/10705519909540118

Ismail, A., Abdul Ghani, A. B., Subhan, M., Joarder, M. H., & Ridzuan, A. A. (2015). The relationship between stress and job satisfaction: An evidence from Malaysian peacekeeping mission. Mediterranean Journal of Social Sciences, 6(4), 647–655. http://dx.doi.org/10.5901/mjss.2015.v6n4s3p647

Keh, H. T., & Xie, Y. (2009). Corporate reputation and customer behavioral intentions: The roles of trust, identification and commitment. Industrial Marketing Management, 38(7), 732–742. https://doi.org/10.1016/j.indmarman.2008.02.005

Kim, Y. K., Trail, G., & Ko, Y. J. (2011). The influence of relationship quality on sport consumption behaviors: An empirical examination of the relationship quality framework. Journal of Sport Management, 25(6), 576–592. https://doi.org/10.1123/jsm.25.6.576

Kini, A. N., & Basri, S. (2022). A framework for customer engagement behaviour in the financial services industry: A critical review of evidence. Indian Journal of Finance, 16(6), 27–43. https://doi.org/10.17010/ijf/2022/v16i6/169925

Kline, R. B. (2011). Principles and practice of structural equation modeling. Guilford.

Lytras, M. D., De Pablos, P. O., Avison, D., Sipior, J., Jin, Q., Leal, W., Uden, L., Thomas, M., Cervai, S., & Horner, D. (2010). Technology enhanced learning: Quality of teaching and educational reform. In, Proceedings of First International Conference, Tech-Education 2010. https://link.springer.com/book/10.1007/978-3-642-13166-0

Malik, S., & Kaur, S. (2020). Challenges of financing infrastructure deficits through PPPs: Lessons from global experience. Indian Journal of Finance, 14(10–11), 8–23. http://doi.org/10.17010/ijf/2020/v14i10-11/155968

Mehta, R., Polsa, P., Mazur, J., Xiucheng, F., & Dubinsky, A. J. (2006). Strategic alliances in international distribution channels. Journal of Business Research, 59(10–11), 1094–1104. https://doi.org/10.1016/j.jbusres.2006.07.003

Mettler, T., & Rohner, P. (2009). Supplier relationship management: A case study in the context of health care. Journal of Theoretical and Applied Electronic Commerce Research, 4(3), 58–71. https://doi.org/10.4067/S0718-18762009000300006

Miocevic, D., & Crnjak-Karanovic, B. (2012). The export market orientation-export performance relationship in emerging markets: The case of Croatian SME exporters. International Journal of Business and Emerging Markets, 4(2), 107–122. http://dx.doi.org/10.1504/IJBEM.2012.046235

Morgan, R. M., & Hunt, S. D. (1994). The commitment–trust theory of relationship marketing. Journal of Marketing, 58(3), 20–38. https://doi.org/10.2307/1252308

Moss, T. P., Lawson, V., & White, P. (2015). Identification of the underlying factor structure of the Derriford Appearance Scale 24. PeerJ, 3:e1070. https://doi.org/10.7717/peerj.1070

Mukherjee, A., & Nath, P. (2007). Role of electronic trust in online retailing: A re‐examination of the commitment‐trust theory. European Journal of Marketing, 41(9/10), 1173–1202. https://doi.org/10.1108/03090560710773390

Naude, M. J., Ambe, I. M., & Kling, R. (2013). Supplier relationship management – Anathema for the South African public procurement sector. Journal of Transport and Supply Chain Management, 7(1), 1–13. https://doi.org/10.4102/jtscm.v7i1.93

Nyaga, G. N., & Whipple, J. M. (2011). Relationship quality and performance outcomes: Achieving a sustainable competitive advantage. Journal of Business Logistics, 32(4), 345–360. https://doi.org/10.1111/j.0000-0000.2011.01030.x

Palmatier, R. W., Dant, R. P., Grewal, D., & Evans, K. R. (2006). Factors influencing the effectiveness of relationship marketing: A meta-analysis. Journal of Marketing, 70(4), 136–153. http://doi.org/10.1509/jmkg.70.4.136

Peters, S., & Van Nieuwenhuyzen, H. (2013). Understanding the dynamics of the capacity challenge at the local government level. Technical Report: 2013/14 Submission for the Division of Revenue.

Powers, T. L., & Reagan, W. R. (2007). Factors influencing successful buyer-seller relationships. Journal of Business Research, 60(12), 1234–1242. http://dx.doi.org/10.1016/j.jbusres.2007.04.008

Rauyruen, P., & Miller, K. E. (2007). Relationship quality as a predictor of B2B customer loyalty. Journal of Business Research, 60(1), 21–31. http://dx.doi.org/10.1016/j.jbusres.2005.11.006

Redmond, M. V. (2015). Social exchange theory (English Technical Reports and White Papers). https://dr.lib.iastate.edu/entities/publication/3269a123-c890-4b0c-b114-fd12e43e7f41

Ribarsky, E. (2013). Choose your own adventure: Examining social exchange theory and relational choices. Communication Teacher, 27(1), 29–32. https://doi.org/10.1080/17404622.2012.737924

Sheth, J. N., & Sharma, A. (2006). The surpluses and shortages in business-to-business marketing theory and research. Journal of Business & Industrial Marketing, 21(7), 422–427. http://doi.org/10.1108/08858620610708902

Sheu, J.-B., & Hu, T.-L. (2009). Channel power, commitment and performance toward sustainable channel relationship. Industrial Marketing Management, 38(1), 17–31. http://doi.org/10.1016/j.indmarman.2007.07.003

Tanskanen, K. (2015). Who wins in a complex buyer-supplier relationship? A social exchange theory-based dyadic study. International Journal of Operations & Production Management, 35(4), 577–603. https://doi.org/10.1108/IJOPM-10-2012-0432

Tung, B., & Carlson, J. (2013). Modeling a formative measure of relationship quality and its effects: Evidence from the Hong Kong retail banking industry. Services Marketing Quarterly, 34(2), 139–158. http://dx.doi.org/10.1080/15332969.2013.770674

Vaid, Y. K., Singh, V., & Sethi, M. (2020). Benefits of goods & services tax and its impact on taxpayers' satisfaction. Indian Journal of Finance, 14(5–7), 62–75. https://doi.org/10.17010/ijf/2020/v14i5-7/153325

Van Bruggen, G. H., Kacker, M., & Nieuwlaat, C. (2005). The impact of channel function performance on buyer-seller relationships in marketing channels. International Journal of Research in Marketing, 22(2), 141–158. https://doi.org/10.1016/j.ijresmar.2004.06.004

Walter, A., Müller, T. A., Helfert, G., & Ritter, T. (2003). Functions of industrial supplier relationships and their impact on relationship quality. Industrial Marketing Management, 32(2), 159–169. http://doi.org/10.1016/S0019-8501(02)00230-4

Wang, C. L., Siu, N. Y., & Barnes, B. R. (2008). The significance of trust and renqing in the long-term orientation of Chinese business-to-business relationships. Industrial Marketing Management, 37(7), 819–824. https://doi.org/10.1016/j.indmarman.2008.01.008

Wang, W.-T., Wang, Y.-S., & Liu, E.-R. (2016). The stickiness intention of group-buying websites: The integration of the commitment–trust theory and e-commerce success model. Information & Management, 53(5), 625–642. https://doi.org/10.1016/j.im.2016.01.006

Williams, T. (2005). Cooperation by design: Structure and cooperation in interorganizational networks. Journal of Business Research, 58(2), 223–231. https://doi.org/10.1016/S0148-2963(02)00497-6

Zhu, Y. (2012). A review of social exchange relationship. Studies in Sociology of Science, 3(3), 57–61. http://doi.org/10.3968/j.sss.1923018420120303.1658