Participation in Organizational Buying: Some Conceptual and Methodological Problems

ABSTRACT - This paper focuses on problems related to participation in organizational buying decisions. Examination of previous research reveals that the most basic questions are not answered, partly due to conceptual ambiguities and methodological weaknesses.

Citation:

Kjell Gronhaug (1978) ,"Participation in Organizational Buying: Some Conceptual and Methodological Problems", in NA - Advances in Consumer Research Volume 05, eds. Kent Hunt, Ann Abor, MI : Association for Consumer Research, Pages: 635-638.

Advances in Consumer Research Volume 5, 1978      Pages 635-638

PARTICIPATION IN ORGANIZATIONAL BUYING: SOME CONCEPTUAL AND METHODOLOGICAL PROBLEMS

Kjell Gronhaug, Norwegian School of Economics and Business Administration

ABSTRACT -

This paper focuses on problems related to participation in organizational buying decisions. Examination of previous research reveals that the most basic questions are not answered, partly due to conceptual ambiguities and methodological weaknesses.

INTRODUCTION

The present point of departure is that organizational buying may be regarded as a subset of organizational decision making. [Organizational buying is adopted as the appropriate term both because it is broader and more fruitful compared with terms like "industry", "bank" and so forth, and because of accumulated research on organizations assumed relevant in the context of buying. Organizational decision making has been an important research areas for decades. (March, Simon, 1958; Thompson, 1967; March, Olsen, 1976)] An important, if not the important, element in every organization is people, that is, "organizations are social units. . ." (Etzioni, 1964, p. 3).

The frequently posed questions like who make(s) the decisions and how to reach the influentials, indicate that problems related to participation in organizational buying are important.

Based on well known, almost "classic" studies (Buckner, 1967; Harding, 1966; Walsh, 1961) leading textbooks claim that "many" people are involved in the buying decision. The widely accepted term "buying center", further indicates that not all the members of the organization need to be involved in the buying decision. Empirical research has demonstrated great variations with regard to participation both within and across organizations. However, the main impression seems to be that the number of unresolved questions still are numerous. (Zaltman, Bonoma, 1977).

PROBLEMS, INTERESTED PARTIES, AND PURPOSES

Problems

In order to proceed, let us try to pose the most basic questions. Review of the literature (Webster, Wind, 1972; Sheth, 1976) reveals that important questions are: (1) who participates, and (2) with what degree of influence? Due to the contingency perspective in organizational research (Thompson, 1967) the following question also ought to be added: (3) under what conditions?

Parties Interested

Insight related to participation in organizational buying all probably be of interest to several parties, such as:

--the buyer (in order to improve the buying system etc.)

--the marketer (in order to design effective marketing program and improve the marketing information system).

--authorities (as basis for regulations)

--researchers (as basis for further and hopefully more relevant research).

--educational institutions (as basis for educational programs).

This list of interest groups is in no way meant to be complete, but will probably be sufficient to demonstrate variations in interests and scope.

Purposes

The various interest groups may have different purposes in mind when occupied with questions related to participation in organizational buying. Here we may make a distinction between descriptive - explanatory - predictive and prescriptive purposes. When relating the various purposes to the interest groups, we get the following matrix:

FIGURE 1

INTEREST GROUPS AND PURPOSES

In Figure 1, some interest groups have been collapsed into "others". Obviously there will be some inter-relationships between the various purposes, such as description is made in order to explain and predict, prediction is made in order to take prescriptive actions and so forth.

From a normative point of view the buyer ought to undertake descriptive research based on relevant theories in order to take prescriptive actions. The predominant purpose for the marketer ought be predictions as basis for prescriptive actions as it ought to be for authorities and educational institutions.

However, when making a confrontation with research conducted the following picture emerges:

--In spite of the vast amount of research related to organizational buying surprisingly few studies have focused on participation.

--Furthermore, most studies seem to have a marketing perspective in mind. The descriptive aspects, however, are predominant.

--The buyer's interests mainly taken care of in the purchasing literature on the other hand, seem to be combined by a normative approach with almost no emphasis on the descriptive aspect.

--The all-over impression is that the various pieces of research are scattered with few (if any?) attempts to further generalizations and theory-building. (Sheth, 1976; Webster, Wind, 1972; Bonoma, Zaltman, 1977)

Some years ago Sheth (1972) made a distinction between four phases when assessing the research related to buying behavior with regard to the present theme, however, the research conducted has to be classified in the first two phases, i.e. the "empirical - inductive" and probably the first part of the "formative phase" respectively.

PARADIGM AND RESEARCH

In order to pursue problems related to critique and explanations of the present state, and, hopefully, indicate future guidelines, let us point at:

FIGURE 2

PARADIGM AND RESEARCH

The figure is to be interpreted as follows: Given specific problems in mind, existing "models" or "paradigms" will exert influence on the research. The broken feed-back-line indicates that "paradigm"/"model" may change. However, as maintained by Kuhn (1962) and demonstrated in recent research on organizational decision-making by March and Olsen (1976), existing "models" and "paradigms'' often prove to be very stable and unaffected by feed-back.

In the following we will discuss problems related to "paradigm/model" and research, respectively.

The process - paradigm

These seem to be an almost complete agreement that purchase ought to be studied in a process perspective. (Engel, 1973) However, as will be demonstrated in the following, such a perspective is not without ambiguities.

For one thing, a process ha to start. Almost no attention has been given to the underlying "mechanism". In consumer buying it is often assumed that an instability such as a "felt need" or "problem recognition" represents the starting point, i.e. human needs activated by internal and external stimuli. In organizational buying this "mechanism" may prove more problematic. Where the purchase is closely related to the output such as raw materials, the "need perception" or "problem recognition" will probably be unproblematic. But when there are only loose ties between the organizational output and the potential purchase, this need in no way to be the case.

This may lead us to one often overlooked point, namely, that organizational buying, as a subset of organizational decision making, involved both cognitive and social processes. (Vroom, Yetton, 1973) Most studies have concentrated on only one aspect, mainly the cognitive, and have neglected the interaction between cognition and participation.

This perspective may furthermore be related to the starting point or "the problem recognition". In most studies on organizational buying, the assumption (also reflected in the research designs) seems to be that there exists an unambiguous stimulus situation. However, the contrary may be the case, which may require both internal and external participation. (Cyert, et. al., 1956; Hakansson, et. al., 1977)

This neglect is probably related to the almost unconscious intraorganizational perspective for most studies, which also is reflected in a commonly used definition of buying center as ". . . members of the organization." (Webster, Wind, 1972, p. 77) By applying an interorganizational perspective, members not included in the focal organization may participate in the purchase (Guiellet de Monthoux, 1975; Hakansson, et. al. 1977)

The buying process is often perceived as a set of stages. (McMillan, 1973) However, two problems still seem overlooked:

(1) There may be interactions between the various stages, which also may have implications for participation and outcome,

(2) A purchase usually involves several decisions, where the sequence between the various decisions may vary, and thus participation and outcomes need in no way to be predetermined.

In organizational buying there seems to be a firm belief in "long-lasting-relationships." (Hill, Alexander, Cross, 1975) Such Perspective, however, intuitively has an impact both on the process per se and on participation. Obviously a purchase at time t may influence a purchase at time t+1. In a study both reduction in number of decisions and participants were observed over time. (Gr°nhaug, 1971) This coincides with the proposition that ". . . cost reducing tendencies generally will function to deepen and stabilize social relations. . . " (Emerson, 1962, p. 35)

Most (all?) studies related to organizational buying are based on the assumption that buying has to be regarded as purposeful behavior. The same observation with regard to consumer buying has been made by Sheth (1972). However, for some years, there has been some focus on artifactual decision-making, particularly as related to situations involving ambiguity and characterized by problematic preferences, unclear technology, and fluid participation. (Cohen, et. al. 1971) From the discussion above, such a perspective may also prove useful in the context of organizational buying. From the discussion so far it follows that the dominating process-paradigm involves ambiguities and has implications for participation in organizational buying only partly dealt with in previous research. Even more surprising is the picture of man emerging implicitly from the discussion above. In consumer buying the model of an active problem solver seems to be common. The neglected participant seems passive almost without influence on the buying process and outcome, just contrary to what is predominant in management thinking. (Vroom, 1976)

Part time participants

Our discussion so far has only focused on our first question, i.e. who participate(s) which naturally is related to the next two questions, degree of influence and modifying conditions.

A common observation is that people outside the purchasing department (Buckner, 1967; Gr°nhaug, 1977; Harding, 1966; Spekman, 1977; Walsh, 1961) may also participate in the organizational buying decision. This, however, implies that for many participants buying represents only a part-time activity, and thus the time devoted to this activity will partly depend on the total load of activities.

Degree of Influence

In spite of the importance of questions related to degree of influence, surprisingly few studies have dealt with this in the context of organizational buying. The interorganizational distribution literature, which of course includes organizational buying activities, represents an exception. (Gr°nhaug, 1976) When reviewing the literature, one finds the buyer described by a multitude of characteristics such as by socio-economics, attitudes, motives and personality traits. The impact of such variables on participation in organizational buying has hardly been discussed at all. However, when reexamining the findings, variables related to insight (such as educational and experience) are found positively related to degree of influence. Furthermore, insight may be viewed as one dimension of capability or a source of power. Other dimensions probably positively related to degree of influence are: political access, control over information and group support.(Pettigrew, 1973)

Conditions

With reference for the contingency perspective in organizational research, the modifying question "under which conditions" was raised. In the context of participation in organizational buying, this perspective has hardly been examined at all. This, however, does not mean that such an approach is irrelevant. From previous research it is evident that the product per se may influence participation. (Buckner, 1967; Spekman 1977; Gr°nhaug, 1975) The impact of individual capabilities was discussed above. Furthermore, factors related to the organization and environment have been demonstrated to affect participation.(Gr°nhaug, 1976, 1977; Spekman, 1977)

Research

In spite of the predominant emphasis on the buying process, very few studies, if any, really have been designed to map the processes. The interactions between process and participation have also been neglected. This somewhat limited perspective on process has naturally influenced the designs of the research conducted.

The samples studied, in terms of both underlying frames and sizes, may cause some interpretational problems. First the samples/populations studied are often restricted to one industry/area. Furthermore, many studies, in particular the more "serious" ones, are often found to be based on small samples. This does not mean that this research is inappropriate. However, at least the following seems important to consider. If certain variables are assumed to exert influence, they have at least to be present in the study. Furthermore, when going back to Figure 1, the use of research findings will often include generalizations:

FIGURE 3

DIRECTIONS OF GENERALIZATIONS

Different directions of generalizations from research concluded are indicated in Figure 3. Intuitively it is easier to generalize with regard to a future, purchase for the same product within the same organization than it is with regard to new products in new organizations. The degree of variation between organizations is important in this context. Frequently made generalizations based on observations from big organizations in one specific industry need not to be valid in all industries. (Buckner, 1967; Harding, 1966; Walsh, 1961) In a similar way variations across purchases may affect to what degree specific findings may be generalized, as in the Copeland's (1924) pioneering classification of markets. Both the unit of observation and analysis will obviously influence the research. Neither isolated studies of professional buyers, such as previous studies related to "emotional" factors in buying, or the main emphasis on process seem to be adequate in order to answer the questions raised at the outset of this paper. Both information about the various actors and information related to the processes and constraints seem relevant in this context.

Research related to participation in organizational buying will of course raise measurement problems which are in no way trivial but which will be overlooked here. (March, 1955)

CONCLUDING COMMENTS

At the outset of this paper we pointed to three basic questions related to participation in organizational buying. These questions are in no way satisfactorily answered. In spite of this, the questions related to participation are important with relevance for both buying and selling organizations, as well as to authorities, educational institutions and so forth. How to proceed? There definitely is more than one road to Rome, and probably there does not exist one best way. However, to the present author, the following ought to be done:

--Make explicit the underlying models and paradigms in order to improve the feedback from conducted research (see Figure 2)

--Reanalyze the process-perspective in order to use it properly as basis for research, and

--Reorient 'thinking to include the participation-perspective.

--As noted in previous "state-of-the-art" reviews much research has been conducted. However, there definitely is a need to integrate including results from other disciplines, to advance theory construction and help the generalizations of present findings. (Sheth, 1973)

--When reviewing the literature a multitude of used concepts emerges. It is almost like new concepts are created for every problem. A better strategy would probably be to reduce the number of concepts to a few basic ones, use these intensively and concentrate our energy on the relevant questions.

--From this follows that choice of concepts and the borrowing from other disciplines should be done in a more systematic way.

--Attempts should also be done in order to reduce the time-lag between what is going on in the mother disciplines and what is borrowed.

--The various interest groups and purposes in Figure 1 may prove helpful when trying to list the research questions. Attention should also be given to when questions related to participation are relevant. The marketer's interest is related to the choices of the buyers. However, in some cases the actor has no choice, as in authority innovation - decisions, and thus questions related to participation from the marketer's side, if monopolist, are almost irrelevant. (Rogers, Shoemaker, 1971, p. 300-315) In a similar way, if there exists some type of agreement that this product--shall always be bought from. . . "then a narrow analysis of the buying center within the buyer organization will probably not prove to be very helpful for the marketer. Future research should aim at advancing our pool of relevant knowledge, and should include examination of underlying paradigms and reanalysis of previous results before adding one more empirical study.

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