Exchange, interdependence, and autonomy

The environmental and atmospheric influences on a relationship modify a simplified distinction between a competitive and collaborative coordination mechanism. Competitive markets, power based hierarchies and cooperative relationships may exist in a pure form, but are not necessarily mutually exclusive; i.e. governance modes can include

combinations of transaction based, power based or cooperative interaction (Ritter 2007).

So, there is no simple one-to-one relation between structure, the configuration of transactional and relational exchange elements, and the applied governance mode. The specific characteristics of an exchange relationship is an expression of the local and contextualized conditions under which the exchange takes place. It is a relative world (Ford, Håkansson 2006a).

4.3.2 Interdependence and autonomy

Neither actors, nor dyads are isolated; they are interrelated and part of a wider network (Håkansson, Snehota 1989). In the ARA model the network structure is analyzed with three distinct, but interrelated perspectives; the actor, resource and activity perspective. The interrelatedness of the perspectives is of importance for the strategizing of a focal actor. In order to cope with relationships, a focal actor must monitor and evaluate a specific dyad in the light of the collection of relationships he has, and the potential offered by an

alternative constellation of ties.

Any actor has a limited resource base consisting of his own resource collection, and the resources of other actors which he can access through resource ties. The value of this resource base depends on the value of the activities performed with these resources. This value is assessed as the combined present outcome and future potential of a relationship.

Consequently, an actor who considers how to increase the value of his activities through repositioning (finding a new position in the network) must assess the activities he performs (his function or role), his capabilities (resource collection) and the character of his

relationship (the actor bonds). All three aspects are elements in an actor’s position, and thus of importance for his decision on actions to be taken to preserve a position or to reposition himself (Lutz 2009).

At the same time, the distinction between the actor, the resource and the activity perspective in the ARA model can assist the analysis of the motivational duality for tie formation. There are two distinguishable motives for the formation of closed triads;

clustering (resource combination) or countering (value appropriation) (Madhavan, Gnyawali & Jinyu He 2004). This categorization resembles the distinction between

cooperative behaviour and strategic cooperativeness in the study of conflict and survival in

triads (Hartman, Phillips & Cole 1976). Both studies point to the possible motivational duality of cooperative behaviour, related either to a functional activity/resource aspect (clustering) or to a strategic actor/position aspect (countering). The distinction and interplay between strategic and functional motives for tie formation are apparent in a number of studies related to network change and strategic positioning, e.g.:

1. The distinction between activity-based connections as network stabilizers and actor-based connections as the source of change in networks (Smith, Laage-Hellman 1992) 2. The distinction between changing activity patterns as adaptation to conditions in the

environment and changing activity patterns as actor initiated drivers of change and development processes in distribution channels (Gadde, Hakansson 1992)

3. Interdependence as related to task performance and power as related to the role of members in a channel (Reve, Stern 1979)

4. The distinction between position interrelation as a matter of resource

interdependencies in the production system, and position interrelations as a matter of the actors’ intentions and interpretations at the network level (Johanson, Mattsson 1992)

These studies of network change and strategic positioning have another common denominator: They all point to the significance of the actors’ perceptions, interpretations and actions for the working of a network. Network structures exist as a reality which constrains and facilitates the actions of the involved actors; actors and dyads are interdependent. But networks are not deterministic or self-generating structures. They emerge, stabilize and change as a result of the actors’ interpretations of the value potential of the structure, and as a result of the decisions and actions that actors take based on this sense-making. The interpretation of the value potential motivates the decision either to develop existing ties, or to exit from existing ties and create new ones.

Thus, the emergence of networks which the MAN approach describes is generated by the interdependent, but also autonomous actors, who take functionally or strategically motivated actions.

Summing up, the interaction model offers concepts for the understanding of the contents of ties as economic exchanges embedded in a social structure. They are mutual, but not necessarily symmetric. They consist of various combinations of episodic transactional exchange and relational exchange. Besides, they depend on the local context, and there is no one-to-one relationship between structure, the configuration of transactional and relational exchange elements, and the applied coordination mechanism and governance mode. The ARA model conceptualizes networks of interrelated actors and dyads on the

basis of three substance layers; actors, resources and activities. These perspectives are interrelated, but distinct. On the one hand the ARA model points to the significance of interdependence for the development of capabilities, for marketing and purchasing, and for strategy development. On the other hand the categorization of actors, resources and activities in three substance layers facilitates a distinction between the structure of interdependent resource ties and activity links and the agency of autonomous actors. This distinction emphasizes that the emergence, stability and change of networks results from the decisions and actions taken by interdependent, but also autonomous actors.

Relationships are not exclusively and necessarily assets and structures may not only facilitate activities. Relationships also entail costs and investments; they are a burden, too, and the structure may constrain activities and value creation. Therefore, the analysis of the content of ties (the activities) can support the understanding of the value potential of a structure. However, activities result from decisions and actions taken by autonomous actors. These decisions and actions can be either functionally motivated (related to resources and activities) or strategically motivated (related to actors and positions).

Therefore, motivation apparently is related to the actors’ perceptions and interpretations, and guides the decisions and actions which influence the working of the network.

This being so, the review of the literature related to the MAN approach to networks point in the same direction as the review of the SNA literature: The understanding of a structure must include the significance of the actors’ motivation for participation. And this

motivation apparently is linked to the value potential of a structure. Therefore a further question is phrased:

How is the actors’ motivation for participation in triadic relationships linked to the value potential of the structure?

Interpretations and perceptions are elements of the agency of actors. The significance of the agency of actors for the conceptualization of triadic relationships is discussed further in the next chapter.

CHAPTER 5: CONCEPTUALIZING TRIADIC