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Improving Professional Selling Effectiveness throughthe Alignment of Buyer and Seller ExchangeApproachesChad W. Autry, Michael R. Williams & William C. MoncriefPublished online: 23 Sep 2013.

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Journal of Personal Selling & Sales Management, vol. XXXIII, no. 2 (spring 2013), pp. 165–184.© 2013 PSE National Educational Foundation. All rights reserved. Permissions: www.copyright.com

ISSN 0885–3134 (print) / ISSN 1557–7813 (online)DOI: 10.2753/PSS0885-3134330202

ImprovIng professIonal sellIng effectIveness through the alIgnment of Buyer and seller exchange approaches

chad W. autry, michael r. Williams, and William c. moncrief

Salespeople employ transactional- and relational-oriented approaches to maximize sales productivity. However, relatively little is known about situational factors that affect the success of these alternative approaches. This research begins with an exploratory study that differentiates transactional and relational selling as unique approaches and develops applicable measures. A second study employs a dyadic methodology linking the success of these alternative approaches with the buyer’s strategic purchasing orientation. Results of testing support sales organization performance as being contingent upon the buying firm’s supply market risk and commodity profit impact and therefore suggests the firm should allocate regional resources primarily where buyer’s market risk or profit impact are high. The findings provide an alternative per-spective to common customer valuation arguments suggesting the allocation of relational resources should be based on the customer’s value to the selling firm.

chad W. autry (Ph.D., University of Oklahoma), Associate Profes-sor of Logistics and Director, UTK North American Supply Chain Forum College of Business, University of Tennessee–Knoxville, autry@utk.edu.

michael r. Williams (Ph.D., Oklahoma State University), Professor of Marketing and Sales, Meinders School of Business, Oklahoma City University, mrwilliams@okcu.edu.

William c. moncrief (Ph.D., University of Mississippi), Senior Associate Dean and Bedford Professor of International Business, M.J. Neeley School of Business, Texas Christian University, b.moncrief@tcu.edu.

The shift from transactional to relational marketing perspec-tives over the past two decades has engendered parallel strate-gies and tactics within the domain of professional selling, with sales organizations increasingly focused on the construction of enduring customer relationships (Morgan and Hunt 1994; Srinivasan and Moorman 2005; Wilson 2000). Scholars emphasize the integration and alignment of seller activities and processes with those of the buyer and the buying situa-tion for achieving enhanced value creation and performance (Bradford et al. 2010; Esper et al. 2010; Min, Mentzer, and Ladd 2007). Adjusting the selling approach to match the specific situation is not a new idea. Sales training manuals and trade publications have urged salespeople and their organiza-tional units to adopt relational selling (RS) approaches as a part of the firm’s sales strategy portfolio alongside traditional transactional selling (TS) approaches (Sharma and Pillai 2003; Weitz and Bradford 1999) and to be flexible in selecting a sales approach according to the selling situation. Indeed, a defining aspect of the adaptive selling framework (Spiro and

Weitz 1990; Weitz, Sujan, and Sujan 1986) is a salesperson’s use of knowledge about the customer and buying situation to adapt the selling approach.

More recent research has begun to assess the relative efficacy of adaptive selling behaviors and relational selling strategies (e.g., Giacobbe et al. 2006; Palmatier et al. 2008; Porter, Wiener, and Frankwick 2003). Relational strategies often lead to higher costs, investments, and risks than transactional strategies (Giacobbe et al. 2006; Guenzi, Pardo, and Georges 2007), and not all buyers desire relational exchanges; associ-ated costs can exceed the perceived benefits, and misapplied relational selling strategies can be counterproductive, resulting in negative customer reactions (Cao and Gruca 2005; Colgate and Danaher 2000; Palmatier et al. 2008). As Palmatier et al. report, “practitioners that strive to shift customers to purportedly more desirable relational interactions often wind up disappointed in the returns” (2008, p. 174). Thus, in a contemporary study of buyer–seller relationships, Bradford and Weitz (2009) note that while sellers are generally shifting away from transactional selling approaches and toward long-term relational exchanges, 95 percent of the participating salespeople report having experienced selling task conflicts in their relationships. Statistics such as these underscore that we still have much to learn regarding the effective alignment of buyer and seller exchange approaches.

Despite the emergence of RS as an alternative selling strategy, and increasing evidence relating the adaption of sales strategies to improved sales performance, there is little research on the situational aspects of various selling situations, and little guidance is available by way of theory-based prescriptions for salespeople to follow when adapting to external situational contingencies. Despite over two decades of scholarship on both relational- and transaction-based selling approaches, a critical

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question remains: Under what situations are transactional selling strategies versus relational selling strategies optimal?

In addressing this question, we look to the buying firm for answers, with specific focus on two key situational con-tingencies that drive buying firm behavior. Recent theoretical developments in supply chain management indicate that the efficacy of various selling approaches may depend on the role of the focal commodity within the overall scheme of the buy-ing firm’s key processes as pertains to supply market risk and impact on the buying firm’s profitability. The current research adopts a multitheoretical perspective in assessing the alignment of customer and supplier exchange approaches. We begin on the seller side of the dyad by reviewing RS versus TS strategies. We then employ accepted scale development principles to develop and validate measures specific to TS and RS, and then offer hypotheses relating the alignment between the selling organization’s strategic-level sales approach and the purchaser’s strategic commodity orientation to sales performance. We describe a dyadic empirical methodology used to assess this alignment, beginning with the operationalization of TS and RS approaches, and present the results of hypothesis testing. In the concluding section, we discuss the results of the study and further research opportunities.

theoretIcal Background and hypotheses

adaptive selling

Following the conceptualization of adaptive selling (Weitz, Sujan, and Sujan 1986) and measure development (Spiro and Weitz 1990), a number of research studies have documented that salespeople do engage in adaptive selling behaviors (ASB) (Bello 1992; Bodkin and Stevenson 1993; Giacobbe et al. 2006; Tanner 1994; Verbeke, Belschak, and Bagozzi 2004). Defined as “the altering of sales behaviors during a customer interaction or across customer interactions based on perceived information about the nature of the selling situation” (Weitz, Sujan, and Sujan 1986, p. 175), the adaptive sales approach has since evolved to become the standard for sales interac-tions spanning both TS and RS scenarios (e.g., Franke and Park 2006; Giacobbe et al. 2006; McFarland, Challagalla, and Shervani 2006).

In their review of the ASB literature, Giacobbe et al. (2006, p. 116) catalog 27 studies of ASB and characterize the find-ings from studies investigating the relationship of ASB with sales performance as mixed. A number of studies have found support for a positive relationship between ASB and perfor-mance (e.g., Booram, Goolsby, and Ramsey 1998; Franke and Park 2006; Park and Holloway 2003; Siguaw 1993; Sujan, Weitz, and Kumar 1994); others found either mixed or no support (e.g., Anglin, Stoltman, and Gentry 1990; Blackshear

and Plank 1994; Keillor, Parker, and Pettijohn 2000; Marks, Vorhies, and Badovick 1996). Based on the theoretical models of Sujan, Weitz, and Sujan (1988) and Weitz (1978, 1981), both Giacobbe et al. (2006) and Porter, Weiner, and Frankwick (2003) propose differing situational effects as reason for the mixed findings for ASB and sales performance.

situational Influences

Sujan, Weitz, and Sujan (1988) emphasize that knowledge about which selling strategy is best for a specific selling situa-tion is among the most critical ingredients for effective selling. The contingency model of salesperson effectiveness (Weitz 1981) details two levels of situational contingencies that affect sales performance: (1) characteristics of the salesperson (e.g., capabilities and resources, behaviors, selling strategy, profit opportunity, and organizational support) and (2) character-istics of the buyer (e.g., capabilities, type of buying situation, complexity of buying center, importance of commodity pur-chased, and buyer’s perceived risk). Giacobbe et al. (2006) characterize selling situations that are high in these traits as the “adaptive condition,” a selling situation in which one expects ASB to be effective, and the opposite composite condition, the “nonadoptive condition,” in which one expects ASB to be relatively less effective.

While most ASB research has focused on the first level of situational contingency—the characteristics of the salesper-son (Giacobbe et al. 2006; Porter, Wiener, and Frankwick 2003)—several studies have begun to explore the nature of situational characteristics’ impact on selling performance. Porter, Wiener, and Frankwick (2003) provide the founda-tional research for the second level analysis with findings that support a performance link with the type of selling situation; new task, modified rebuy, and straight rebuy concepts are shown as moderating the ASB–sales performance relationship. Subsequently, in a test of the contingency model, Giacobbe et al. find evidence that the relationship between ASB and sales performance is “increasingly dependent upon the selling con-dition” (2006, p. 116) with the buyer-side adaptive condition situation showing a stronger positive ASB–sales performance relationship than exists in the nonadaptive condition situa-tion. Similarly, Palmatier et al. (2008) find that the customers’ relationship orientation moderates the impact of relationship marketing on the performance outcome of trust and exchange inefficiency and that the customers’ level of product depen-dence predicts customers’ relationship orientation.

These initial empirical investigations illuminate the impact that buyer-side characteristics of the selling situation have on the relationship between ASB and performance; however, they fall short of providing the granular level of detail required to assist salespeople in selecting and applying selling approaches because they fall short of specifying activities aligned with the

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characteristics of the specific selling situation. Existing scales that measure ASB assess the degree of a salesperson’s predis-position to practice adaptive selling (Spiro and Weitz 1990), utilizing items that measure (1) beliefs regarding the practice of ASB, (2) preparatory knowledge necessary to conduct ASB, and (3) behaviors associated with adaptive selling. However, high or low scores on these ASB scales do not explicate specific types of selling approaches or activities a salesperson should engage in to achieve higher performance. More precisely stated, the existing measures do not allow for the explication of which sales approaches positively affect performance in dif-ferent selling situations. The more granular approach taken in the present study emphasizes the activities that comprise two archetypical approaches, TS and RS, and links them to specific outcomes based on buyer-side contingencies. This approach departs from traditional studies in the sales field that forgo buyer-side influences in favor of a salesperson-centric view.

types of selling approaches: transactional and relational selling

The selling approaches considered in this study build on the TS and RS typology developed over the past two decades within the sales management literature (e.g., Crosby, Evans, and Cowles 1990; Gonzalez, Hoffman, and Ingram 2005; Guenzi, Pardo, and Georges 2007; Weitz and Bradford 1999). Although firms and sales organizations typically adopt a single, overarching strategic approach to selling that is slow to evolve (Narayandas and Rangan 2004), individual salespeople have the capacity to “flex” tactically within the guidelines of these approaches, that is, Weitz’s notion of adaptive selling (Weitz 1978, 1981; Weitz, Sujan, and Sujan 1986). Weitz (1981) argued that salespeople have the opportunity to match their behavior to the specific customer situation they encounter, that is, the adaptive sales approach. The adaptive sales approach has become the standard for implementing TS and RS approaches (e.g., Franke and Park 2006; Giacobbe et al. 2006; McFarland, Challagalla, and Shervani 2006).

Transactional Selling

As explained in the literature, a TS approach emphasizes the current exchange—getting the order—as the near-term outcome of the selling activity (Slater and Olson 2000). TS strategies focus on persuading the customer to buy, and often include the use of sales activities designed to stimulate demand (Weitz and Bradford 1999; Wilson 2000) and alternate between generating customer interest, overcoming objections, and closing the sale (Weitz and Bradford 1999). Salespeople who practice TS stress generating new business rather than devoting significant efforts and resources to ensuring customer satisfaction and retention (Gonzalez, Hoffman, and Ingram

2005) and thus deemphasize the long-term benefits of main-taining durable customer relationships. Given the long history of firms’ and salespeople’s success using TS techniques, and salespeople’s continued ability and willingness to employ such techniques as needed during adaptive selling, we hypothesize that TS is positively associated with salesperson success:

Hypothesis 1: Salespeople’s adoption of a TS approach is positively related to sales performance.

Relational Selling

Unlike TS’s focus on immediate exchange outcomes, the RS approach focuses on initiating and building a mutually benefi-cial stream of future transactions and interactions between the parties (Guenzi, Pardo, and Georges 2007). The salesperson replaces persuasive tactics with cooperative intentions and actions, frequent contacts, highly collaborative communica-tion, and mutual disclosure in order to generate and nurture the reciprocal trust that allows buyers and sellers to fully share information and work together as a strategic problem- solving team (Crosby, Evans, and Cowles 1990; Slater and Olson 2000; Weitz and Bradford 1999). RS involves creative problem solving and generating innovative solutions that the buyer may not have otherwise identified and that yield value for both parties exceeding that of the core product or service being exchanged (Weitz and Bradford 1999). In RS, the salesperson serves as relationship manager and value creator through identification of new alternatives aligned with needs of the buyer and capabilities of the seller (Weitz and Bradford 1999). Following years of application, relationalist principles have become an effective alternative strategy for salespeople. Thus, our second hypothesis augments our first by predicting the effectiveness of the RS approach:

Hypothesis 2: Salespeople’s adoption of an RS approach is positively related to sales performance.

strategic purchasing orientation

The rational choice of a selling approach must balance customer value and costs for the selling firm while also con-sidering the exchange-specific needs and preferences of the buyer (Cannon and Homburg 2001). Different buying firm needs and purchasing contingencies occur across different buying orientations and serve as factors to which salespeople must adapt when crafting a sales approach. Recognizing that modern purchasing has become a strategic business function, supply chain management researchers have devoted significant effort in recent years to identifying strategies used by contem-porary firms when sourcing and procuring needed supplies, that is, strategic purchasing orientations (SPO) (Lawson et al. 2009).

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In a seminal article, Kraljic (1983) initiated the idea of SPO based on the specific nature of a buying episode via two loosely linked but discriminant criteria describing the risk/reward trade-off for each purchased commodity: supply market risk and contribution to profitability. Based on Kraljic, the com-modity profit impact (CPI) element of SPO is reflective of the “strategic importance of [the commodity] in terms of value added . . . impact on profitability,” whereas the supply market risk (SR) element is “complexity gauged by supply scarcity, pace of technology and/or materials substitution, entry barri-ers, and [market] conditions” (1983, p. 110). Gelderman and van Weele’s (2002) update of the Kraljic dimensions develops commodity-specific SPOs for a buying unit based on risk minimization or potential profitability of sourced goods and services. Firms that practice strategic purchasing approach each buying task uniquely according to seller identity and product category, thereby adopting a risk- or reward-focused orientation toward each unique purchase episode. The updated Gelderman and van Weele SPO dimensions are conjoined to tactical-level purchasing techniques that prescribe optimal firm-level buying processes based on the extent of supply risk (high/low) or profit impact (high/low) for a purchased com-modity (Gelderman and van Weele 2002, 2003).

The use of the Gelderman and van Weele’s (2003) SPO dimensions has become somewhat ubiquitous in modern pur-chasing organizations (Caniëls and Gelderman 2007). Impor-tant for the purposes of the current study is consideration of how supply market risk and profit impact criteria significantly influences sales organizations’ tactical choices pertaining to RS. In some SPO scenarios, the close cooperation and coordina-tion between buyers and sellers that characterize RS can yield competitive advantages that TS’s arm’s-length arrangements cannot achieve (Dahlstrom, McNeilly, and Speh 1996) due in part to enhanced trust and commitment between the exchang-ing parties (e.g., Morgan and Hunt 1994). However, it is also likely that the opposite is true—that TS principles should be more effective in certain cases. Unfortunately, research has yet to determine whether and in what SPO scenarios buyers might prefer TS approaches, and researchers have theorized that the overapplication of relational resources in such situations could prove problematic due to misalignment with buyer preferences (Lawson et al. 2009).

aligning selling approaches with Buyer strategic purchasing orientation

In concert with the “strategic choice school” of contin-gency theory, we bring a “fit-as-moderation” perspective (Venkatraman 1989) to the current assessment of the optimal sales approach for salespeople and their organizations accord-ing to purchasing firm SPO. Prior contingency research has revealed that no organizational strategy is universally superior

(Donaldson 1996; Hofer 1976). Instead, strategy should vary according to contingencies of the environmental context. Consistent with the ISTEA (Intermodal Surface Transporta-tion Efficiency Act) sales process model (Weitz 1978), the contingency model of salesperson effectiveness (Weitz 1981), and the adaptive selling framework (Weitz, Sujan, and Sujan 1986), contingency theory—and more specifically, the stra-tegic choice perspective—would therefore suggest that the selling firm’s agents should perform most effectively when the selling approach and SPO (i.e., the environmental context) are in optimal alignment.

To understand this type of interorganizational alignment, we integrate these contingency principles with postulates from resource dependence theory. Resource dependence theory builds on social exchange foundations (e.g., Thibaut and Kelley 1959) and explains interfirm relationships as strategic responses to resource uncertainty and dependence (Pfeffer and Salancik 1978). The logic of resource dependence theory is, first, that firms depend on actors outside the organization for critical resources giving rise to uncertainty in terms of sup-ply. Second, in order to safeguard against the loss of critical resources, firms will seek to reduce the uncertainty and man-age the dependence by purposefully developing tailor-made relationships and increasing the extent of coordination with relevant exchange partners (Berman, Phillips, and Wicks 2005; Heide 1994). In contrast, when resource dependence and uncertainty are low, resource streams are more predictable and resource dependence theory predicts firms will be less inclined to seek cooperative relationship links with suppliers.

By integrating resource dependence theory with our contingency foundations, we increase the likelihood that purchasing organizations and agents will view supply risk in positive disproportion when evaluating the SPO for a given commodity. In situations where supply risk is dominant, procurement agents want to “ensure” their investments ver-sus supply risk through the acceptance and reciprocation of relational norms (e.g., Heide 1994). Alternatively, in com-modity orientations where low dependence and uncertainty characterize the purchase decision process, procurement agents often want to capitalize on saturated supply markets, or buy quickly and nonstrategically in order to optimize purchasing resources by focusing more intensively on riskier or more profitable scenarios.

In terms of the present research study, the key implication of resource dependency theory is its identification of depen-dence and uncertainty (e.g., supply risk) as primary predic-tors of the buyer’s SPO and associated purchase behaviors. In purchase situations characterized by high levels of supply risk, procurement agents will seek more cooperative behavior through formal or informal relationships; in situations with low levels of supply risk procurement, agents will employ procurement approaches characterized by self-interest and

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significantly less cooperation (Berman, Phillips, and Wicks 2005). Our theoretical integration, therefore, leads us to sug-gest that the selling firm’s agents will be most effective when the selling approach aligns with the procurement approach. Specifically, we posit that RS will be more effective when aligned with relationship-based procurement approaches and TS approaches will be more effective when aligned with self-interest-based procurement approaches. This logic leads to the following hypotheses supporting selling approach–SPO alignment for a given sales situation:

Hypothesis 3: For a given sales encounter, the positive association between TS and sales performance is lessened as buyers’ supply risk increases.

Hypothesis 4: For a given sales encounter, the positive association between RS and sales performance is greater as buyers’ supply risk increases.

Further following Gelderman and van Weele (2003) and Kraljic (1983), we base our interorganizational alignment of sales approach–SPO criteria on the potential profit impact of the sourced goods and services on buying firm operations. One can explain such possibilities by integrating the principles of contingency theory with the commitment-trust theory of relational marketing and its explanatory cousin, resource-advantage theory. According to Morgan and Hunt’s (1994, p. 25) commitment-trust theory, firms that receive superior benefits from their partnership—relative to nonpartnership options—on dimensions such as profitability and performance will commit more firmly to the relationship. The decision to enter into a business relationship involves a strategic choice. To explain how this strategic choice can make firms more competitive and positively affect profitability and perfor-mance, Hunt, Arnett, and Madhavaram (2006) subsequently draw on resource-advantage theory as a grounding framework for relational marketing. Via this theoretical advancement, relationships become a resource by generating interfirm trust through effective communications, shared values, and kept promises. In turn, these factors promote collaboration and cooperation, allowing partners to access and combine comple-mentary and idiosyncratic resources in ways that contribute to the development of competitive advantages and enhanced financial performance.

Specific to this study, commitment-trust theory and its extended framework of resource-advantage theory predict the degree to which one can motivate purchasing organizations and agents to seek cooperative relationships with suppliers in order to source specific commodities. As purchasing agents perceive that commodities yield increasing levels of potential profit for the purchasing organization, and the presence of cooperative relationships increases the probability that the commodities will be effectively sourced, the purchasing agent

is increasingly motivated to develop cooperative relation-ships. Conversely, in situations where sourced commodities’ perceived impact on the buying firm profit is low, the pur-chasing agent will feel less motivated to develop relationships with suppliers because of the increased costs of entering and maintaining relationships. Integrating these commitment-trust/resource-advantage theory principles with the alignment proposition from contingency theory, as described previously, yields the final two hypotheses:

Hypothesis 5: For a given sales encounter, the positive association between TS and sales performance is lessened as the potential profit impact of the commodity to the buyer increases.

Hypothesis 6: For a given sales encounter, the positive asso-ciation between RS and sales performance is greater as the profit impact of the commodity to the buyer increases.

methodology

Figure 1 pictorially summarizes the hypotheses for this study. Figure 2 summarizes the two-study methodology used to explore and test the research hypotheses. An initial concern when conducting this study was that there were few (if any) scales available for measuring TS and RS that were based on the activities of salespeople; all of the existing scales were more global in nature or focused on general behavioral trends at the sales departmental level. Thus, prior to assessing the hypothesized relationships, it was first necessary to develop and validate reliable TS and RS scales. As detailed in the fol-lowing sections, Study 1 follows the recommended steps for developing and validating measures. Per Churchill (1979), we undertook the following steps for scale development: (1) we began by establishing the definitions and domains for both constructs, then proceeded by (2) generating a pool of items tapping each dimension, (3) purifying the measures through one data collection and analysis, (4) using a second data collec-tion, and (5) conducting analysis for further item purification and evaluating reliabilities and validities. Study 2 then utilizes a dyadic methodology matching salespeople selling specific products with purchasing agents procuring those products to test the hypotheses.

study 1: creation and assessment of relational sales and transactional sales measures

Prior to testing the hypotheses, we found it necessary to develop and validate measures representative of TS and RS approaches employed by representatives of the selling firm. We began the construct development process, as noted above, by establishing construct domains. We defined a selling approach as the set of behaviors strategically enacted by a salesperson within

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the context of a salesperson-product-customer encounter, with the goal of maximizing value for the selling firm. We began with the realization that sales approaches are necessarily the conscious assemblage and deployment of activities on the part of salespeople, and therefore we established the construct domain as the potential set of activities that salespeople might undertake when seeking to create firm value through sales encounters. Thus, the primary goals of the first study were to attempt to identify groups of sales activities closely aligned with relational- and transactional-oriented selling approaches, and to identify the approach (if any) used by a salesperson when selling his or her primary product within a given sales encounter. We determined that, based on his or her responses to a list of sales activities, we could identify each salesperson according to his or her TS or RS approach. This step facili-tated the cross-comparison of salespeople’s selling approaches with the different SPOs enacted by purchasing agents in the second study.

In order to begin the process of identifying a set of sales activities that might differentiate the two professional selling

approaches, we had to define RS and TS approaches. To this end, we initially searched the sales and sales management lit-erature for definitions of TS and RS. Using the extant literature as a guide, we created rough definitions for both constructs. We then asked a panel of six sales-focused academics to review these definitions and to suggest any needed changes and make comments. In addition, we asked a panel of 12 sales executives to look at the preliminary definitions and asked for similar feedback. After reviewing and comparing the two panels’ work, we accepted the following definitions, representative of sales approaches, as final for the current study:

• Transactional Selling: These selling activities emphasize the current exchange. The focus is on convincing the customer to buy through the use of sales presentations to build the prospect’s interest, overcoming objections, and successfully closing the sale at a price that satis-fies revenue and profit needs. Communication focuses on explaining how product/service matches with the customer’s needs and persuading the customer that

figure 1 Interorganizational alignment of sales and procurement approaches

* The selling approach is measured as that being employed in the focal selling episode only and is not implied to be an enduring characteristics of the salesperson over all sales encounters.

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proposed products/services are better than the com-petitors’ offers.

• Relational Selling: These selling activities emphasize the initiation and nurturing of long-term buyer–seller interactions. The focus is on activities that develop mutual trust and expanded benefits that are valuable

to both parties. Information gathering, collaborative listening, and questioning allow all parties to gener-ate unique, beneficial solutions. Satisfying custom-ers’ needs and providing added value now and in the future allow all parties to fully share information and work together as a strategic problem-solving team.

figure 2 research process map

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A third panel consisting of eight sales academics and eight practitioners validated and tested the finalized definitions. Within the validation process, each participant completed a paper survey instrument containing both the RS and TS definitions without any labels or introductory cues. The survey instrument required that each panelist independently read each definition and check a box indicating that he or she judged the definition as describing either TS or RS, or neither. The panel correctly identified each of the offered definitions with 100 percent agreement. Based on this consensus, we adopted these definitions for the remainder of the study.

Following the development of the sales approach defini-tions, the next step is the collection of a set of items repre-sentative of the domain. The domain consisted of salesperson behaviors associated with sales approaches, both relational and transactional. As previously mentioned, this step was necessary because the existing scales tapping RS and TS were generalized behavioral scales that reflected a departmental- or organizational-level emphasis on the selling approach, but did not reflect sales force activities supporting either approach at the more granular, individual salesperson activity level. Thus, we built our sales approach variables from the activity level up, following the examples of Slater and Olsen (2000), who used marketing department activities to construct overall marketing strategy approaches, and Autry, Zacharia, and Lamb (2008), who did the same in a logistics management context. A review of the literature made clear that the set of 105 sales activities utilized by Moncrief, Marshall, and Lassk (2006) (hereafter, MML) in the construction of their sales position taxonomy provided the most extensive base of selling-related activities to draw from for the purposes of building our strategic sales approaches, and we adopted this set of items as the initial pool for the purpose of formative construct development.

Specifically, the purpose of the first study was to classify salespeople’s approach when selling within a critical incident scenario, according to the RS/TS approach employed. Accord-ingly, it was necessary to reduce the complete MML list to only activities that aid in this delineation, as the result of being entirely representative of one distinct approach or the other (since activities salespeople commonly employed, regardless of the approach taken, would not provide such a distinction). To begin the reduction process, 6 academics specializing in the sales field rated each of the 105 MML activities on a seven-point semantic differential scale, with one endpoint described as “heavy transaction orientation” and the other described as “heavy relationship orientation” and using the definitions as written above. We eliminated any activity rated as neutral 4 by all six reviewers (26 total items) from the list. In addition, items that at least four of the six judges rated as a neutral 4 were eliminated if the two remaining judges rated that activ-ity as a 3 or a 5, that is, the two judges rating the item as a

non-neutral had the item just to the left or right of the neutral on the seven-point differential. This process eliminated an additional 32 items, leaving 47 of the original 105 items in the MML study as critical differentiators of sales approach.

Based on this initial item reduction, and verbal feedback from the academics and sales practitioners who participated in the study, we next sought to corroborate or refute the panel’s input, by classifying the remaining items as transactional or relational. To do this, we used a two-step process, seeking opinions of both practitioners and sales academics. We asked 26 executives and 20 sales academics to rate the 47 items as transactional or relational. The consensus of the check panels allowed us to determine that 25 of the remaining items are representative of RS approaches, whereas 22 items reflected TS approaches. Thus, we made the decision to proceed with construct development with confidence that TS and RS are distinct constructs, each consisting of numerous differenti-ating activities undertaken by salespeople. The 47 retained items were next used for construct development as described below.

Method

Per Churchill (1979), we needed a unique sample for con-struct development purposes in Study 1 versus that employed for hypothesis testing in Study 2. To collect this sample, we began by defining the sample frame. Since it was important to assess the sales activities of interest in the business-to-business setting (i.e., not selling directly to end users), we determined that the best unit of analysis was to survey salespeople work-ing for manufacturing firms. We purchased a commercial database that contained several thousand U.S. manufacturing firms and drafted a letter that we sent to the highest-ranking identifiable sales executive at 1,500 randomly selected firms asking for their participation. Executives who consented to participate received a reply card with enough survey packets to accommodate their entire sales force. The packet included a questionnaire, a letter from the authors explaining the purpose of the study and assuring confidentiality of responses, and a pre-addressed, postage-paid envelope for returning the com-pleted survey. Using this method, the researchers contacted a total of 2,267 salespeople working for 61 unique firms across 15 manufacturing SIC (Standard Industrial Classification) codes and provided each rep with a survey packet.

The survey instrument, designed according to the prescrip-tions set forth by Dillman (2007), included the 47 identified MML items and questions designed to reveal respondents’ demographic and firmographic information, sales-related outcomes, and levels of experience. A total of 1,042 sales reps submitted a completed survey. After screening each of the surveys for usability, we removed a total of 81 surveys for

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nonresponse or response inertia reasons. The final sample (n = 951) yielded an effective response rate of 41.9 percent of the original sample frame. The final set of respondents was most heavily representative of sales reps working in the chemi-cal (23 percent), light machinery (16 percent), petroleum (13 percent), and household furniture (10 percent) industries, along with significant participation (>5 percent) in the raw materials (metals, rubber, plastics) industries. The sample was evenly distributed across organization sizes and respondent age categories, ethnic, age, income, and gender statistics. These figures are relatively proportional to the U.S. sales workforce as a whole, based on comparisons with the U.S. Bureau of Labor Statistics Web site, accessed July 2009. These findings led the research team to believe that the response frame was of significant experience, maturity, and representativeness to provide valid responses for the purposes of Study 1.

Analysis and Results

To establish convergent and discriminant validity for the TS and RS constructs, we conducted a series of exploratory factor analyses using SPSS 16.0, with Promax rotation employed because of concerns that factors would be correlated. We included all 25 remaining RS items and all 22 remaining TS items in the analysis, with the goal being to identify underlying dimensions representative of TS and RS. We conducted initial exploratory factor analyses (EFAs) with 1, 2, 3, 4, 5, 6, 7, and 8 latent variables specified, and used a model that allowed items to load freely on an unspecified number of latent variables. Following these initial analyses, we identified an optimized latent structure consisting of two higher-order formative constructs (based on scree tests and an [eigenvalue > 1] con-straint), each with multiple formative (activity-level) dimen-sions. Specifically, we identified RS as a higher-order variable with five formative relationship-oriented dimensions and TS as a higher-order variable with two formative transactional-oriented dimensions. Each of the dimensions of the higher-order measures consisted of between three and five sales force activities from the MML list. In conducting this analysis, retained activity items were subject to minimum 0.4 loading size restrictions as per Hair et al. (2009). With this model and under the specified constraints, many (15) of the transactional items cross-loaded or did not load on a factor, while seven of the relational items also exhibited significant cross-loading. We eliminated these items from further consideration, leaving two multidimensional constructs believed to represent RS (18 items) and TS (7 items). Each of these constructs exhibited strong convergent validity: all loadings were greater than 0.46. We identified RS dimensions as cocreation communications, need-based sales, interpersonal bonding, postsale service, and relationship continuity activities. We identified TS dimensions

as business search activities and logistical support activities. Confirmatory models run using LISREL 8.8 indicated simi-larly strong standardized loadings, and variance extracted of 0.73, supporting the strong and multidimensional nature of the revealed constructs. Scale items and confirmatory model fit statistics appear in Table 1.

Discriminant Validity

Given our belief that the TS and RS constructs represented similar but distinguishable approaches to the achievement of sales-related goals, we deemed it imperative to establish the two constructs’ discriminant validity. We established discriminant validity using LISREL output, referencing specifically the phi matrices. First, all the identified dimensions exhibited higher variance extracted than their correlation with any other dimensions described in the matrices. This validity check was also supported for the higher-order constructs. Second, no 99 percent confidence intervals constructed around any of the dimensions or higher-order constructs, when compared with any other dimension/construct, included the value 1.0. As a result of these tests, we can clearly distinguish between TS and RS from a psychometric standpoint. Based on the methodol-ogy including multiple screening stages, definition develop-ment, item reduction based on the definitions, strong EFA and confirmatory modeling results, and the validity checks, we concluded that the higher-order two- and five-dimensional formative constructs (comprising 7 and 18 items, respectively) are valid for the current purposes of Study 2.

study 2: research model testing and evaluation

We tested our research hypotheses using dyadic/paired data in the context of the passenger airlines industry. Method-ologically, this study posed several challenges. The first was obtaining a sizable sample of purchases by a single purchas-ing organization that we could categorize according to their SPO within the buying firm. Strategic purchasing processes manifest themselves in different ways from firm to firm and industry to industry. The measurement and assessment of such processes across firms is likely to be prone to substantial errors because, depending on context, uniform measurements may overstate or understate process characteristics. To remove such disturbances and thereby isolate the effects of interest in order to test the hypotheses, we focused on a single buying firm’s multiple dyadic relationships (i.e., with numerous sup-pliers’ salespeople).

A second challenge, which was critical for the purpose of assessing the alignment of salespeople’ strategic selling approach with the buyer’s SPO, was to identify a single firm having a sufficient sample of salespeople frequently calling on

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the purchasing agents responsible for buying products of each procurement approach, that is, a firm whose procurement relationship portfolio was expansive enough to yield a large dyadic sample given reasonable nonresponse. The passenger airline industry consists of firms often possessing relatively large supply bases, consisting both of products and services, and easily identifiable supplier-firm salespeople, and thus we deemed it appropriate for addressing each of these challenges. Because of the complex nature of the buyer–seller interactions in this industry, the research methodology for Study 2 again required a multistep process.

Purchasing Agent Sample (Products and Strategic Purchasing Orientation)

We approached the Director of Procurement of a large global passenger airline (Airline P) seeking cooperation for the project. After consultation with the Airline P executive team, the procurement department received permission from its executives to provide us with procurement data. The first step in data collection included determining which procured products and product categories were appropriate for the study. We examined all the purchase categories and products

Table 1Confirmatory Factor Analysis and Measurement Properties, Study 1

Factor

Item 1 2 3 4 5 6 7

Relational SellingCocreation communications (VE = 0.59)

R6: Consult with customers on their problems 0.588R7: Coordinate activities with sales support 0.562R12: Handhold customers 0.657R17: Provide market and customer feedback 0.568R25: Work with key accounts 0.583

Need-based selling (VE = 0.56)R1: Adapt presentations to customer needs 0.689R14: Make multiple calls to close a deal 0.494R19: Sell unique competencies of your products 0.676R20: Sell value-added aspects of products 0.619

Interpersonal bonding (VE = 0.70)R10: Entertain customers 0.786R22: Take clients to dinner 0.780R23: Throw parties for clients 0.761

Postsale service (VE = 0.57)R18: Provide technical support for the product 0.684R21: Supervise product installation 0.617R24: Train customers on product use 0.767

Relationship continuity (VE = 0.60)R3: Build relationships with suppliers 0.692R9: Develop relationships with customer organizations 0.473R16: Network with contacts 0.654

Transactional SellingBusiness search (VE = 0.63)

T1: Call prospects 0.648T12: Search out new leads 0.886T14: Sell to customers by phone 0.509

Logistical support (VE = 0.62)T2: Check customer inventory levels 0.510T5: Create/monitor/put up point-of-purchase materials 0.686T15: Set up product displays 0.873T20: Work conferences or trade shows 0.516

Notes: Model goodness-of-fit statistics: c2 = 997.03 [df = 943]; CFI (comparative fit index) = 0.947; TLI (Tucker–Lewis index) = 0.921; RMSEA (root mean square error of approximation) = 0.07. VE = variance extracted.

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where the total annual spend for the product category was in excess of $3 million.1 We applied this constraint because at smaller buying volumes, many purchasing activities become nonstrategic to some degree, and products can therefore be mistakenly identified as noncritical (i.e., having very low sup-ply market risk or profit impact) simply due to small purchase volumes. We compiled a list of 119 procured products that met the minimum spend figure. In order to make a purchase, this group of products also frequently required formal approval from a purchasing supervisor. After reviewing our list of potential products, company executives reduced the list to 111 items due to the competitive sensitivity of 8 products. Given that an average of over 4 salespeople call on the airline per year for each product, we determined that Airline P’s dyadic interactivity across the procurement–sales interface would be acceptable in magnitude, and we adopted the firm as the basis for our sample frame.

In order to form the buyer side of the buyer–seller dyad, we identified purchasing agents for each procured product using internal airline documentation. The purchasing agent was posi-tioned as our key contact with regard to the product, though as will be shown below, a multiple respondent process was used to derive the measurements necessary. Within a set of general, preestablished guidelines related to interaction behavior and ethics, the purchasing agents at the airline are able to act with significant autonomy. Each is responsible for the management of his or her own supply base and can act as necessary within budgetary constraints to accomplish the purchasing related goals of the internal customer. As described below, purchasing agents were matched into pairs with salespeople from their suppliers based on a snowball sampling technique, creating independent/dependent variable pairings for the constructs of interest. No salesperson/purchasing agent pairing was repeated in the sample, thereby ensuring independence of error terms across dyads, and allowing us the use of parametric statistical techniques described in our analysis.

Product and Strategic Purchasing Orientation Measurement

For this study, we operationalized supply market risk and commodity profit impact consistent with the definitions provided in our justification for H3 and H4. To ensure reli-ability, we employed a multirespondent technique. We trained the director of procurement on the use of the original Kraljic (1983) typology and asked him to categorize each of the 111 products according to its supply market risk and commodity profit impact (on a scale from low to high). Then, we asked a jury of six upper-level purchasing managers to conduct a similar procedure independently, without knowledge of the director’s responses. Following comparisons between the director’s responses and the aggregated responses of the jury, we identified only two discrepancies. These two items were

classified according to the jury since we believed it to be more familiar with product and market attributes.

We then took single-item direct measurements of supply market risk and commodity profit impact by interviewing the purchasing agents in charge of each product. We asked the purchasing agents to plot each of their respective product categories on two 11-point scales (anchored with 1 being low and 11 being high in both cases), reflecting profit impact and supply risk. We then compared these results to the Kraljic classification provided by the jury of executives. The use of this technique resulted in 99.1 percent (110 of 111) agree-ment on classification between the purchasing agent group and the jury of executives. Only one product’s categorization was in dispute (with the product located on the mid-point of the supply risk scale by its purchasing agent), and thus we determined the single item measures of supply market risk and commodity profit impact taken from the purchasing agents to be valid.

Sales Force Sample (Selling Approach and Sales Performance)

To complete the agent–salesperson dyad, we had to gain access to a sample of salespeople who frequently call on the airline to sell the identified products. Thus, to obtain the matched-pairs sample, we used a modified snowball-sampling technique where we asked the purchasing agents to provide business cards for up to five current salespeople per individual product. The business cards provided to the research team were originally given to the airline’s purchasing agents by salespeople who had made a sales call on the airline in the past year, but a contract had not necessarily been awarded to these salespeople. This process yielded 280 salespeople (approximately 2.5 per product) with complete contact information. We found eight of the identified salespeople to have sold or attempted to sell products to the airline in more than one category (i.e., both wine and beer); for the purposes of the current research, we placed each of these salespeople in the category in which they had sold more product to the airline (i.e., their dominant busi-ness), leaving a total population of 272 unique salespeople as a sample frame.

Selling Approach Instrumentation and Measurement

A trained telemarketer attempted to contact the 272 identified salespeople to elicit their cooperation on a survey related to their TS/RS activities and sales performance when interacting with Airline P’s purchasing personnel. Sixteen numbers were out of service of the salesperson no longer worked there. Fol-lowing several attempts, the telemarketer made contact with 241 of the 256 remaining salespeople, explaining the study purpose. Respondents were assured of anonymity. Those consenting to participate received a link to a Web-based

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questionnaire in which they had the opportunity to indicate their frequency of practice for the reduced list of MML sales activities, as developed to measure TS and RS in Study 1, and to answer questions measuring personal and performance-related data (see Appendix A for a complete list of scales used in the questionnaire). Following up to 4 attempts to collect the data, the respondents returned a total of 171 completed questionnaires for a 70.9 percent response rate. The Armstrong and Overton (1977) methods (wave analysis and polling) were used to check for nonresponse bias, with no harmful effects found. Interitem correlations are shown in Appendix B.

Questionnaire Implementation

We implemented the approach advocated by Dillman (2007) to create the Web-based questionnaire on a university file server with response tracking capabilities based on a unique passcode. Tracking the respondents allowed the research team to match the salesperson to his or her respective purchasing agent, thereby completing the buyer–seller dyad. Because of concerns associated with common method variance between the main effects (TS and RS approaches and the sales perfor-mance outcomes were collected from a single source), during the questionnaire design phase, we took a number of steps to reduce the possibility that our results could be attributed to a methodology-based factor, including proximal separation of measurement items in the survey, counterbalanced question ordering (we asked the dependent variable questions prior to the independent variable questions), and anonymity assurance. Podsakoff et al. (2003) suggest that these remedies should be sufficient in most cases for mitigating common method vari-ance/interitem multicollinearity. As a post hoc check against this possibility, we employed Harmon’s single-factor test. This analysis yielded multiple factors, with the largest accounting for no more than 21 percent of the variance in the factor structure. Thus, common method variance and item multicol-linearity were not considered to be problematic in Study 2. Correlations study variables appear in Appendix B.

analytical approach

The analysis began with the construction and evaluation of a confirmatory measurement model of the TS and RS approach variables developed in Study 1, using LISREL 8.8 to assess the salesperson sample data from Study 2. For this analysis, We employed the dimensions identified in Study 1 as underlying factors for the overall latent constructs, and the individual items served as indicators of the underlying factors. The results again supported the discriminant and convergent validity of the constructs, and the models fit well with the data. Table 2 includes measurement properties of the Study 2 scales. As expected based on the initial study, the

measures display acceptable measurement properties for our current purposes.

To measure sales performance, we used a nine-item scale obtained from Cravens et al. (2004), which combines behav-ioral and outcome components of sales performance. Given that researchers have used this scale in previous research with success, we deemed that only a confirmatory assessment was necessary. A confirmatory factor analysis (CFA) conducted using LISREL verified that this scale was trustworthy for the current purposes (c2 = 290.47 [df (degrees of freedom) = 146]; CFI [comparative fit index] = 0.918; TLI [Tucker–Lewis index] = 0.915; RMSEA [root mean square error of approximation] = 0.05).

hypothesis testing and results

We employed a series of hierarchical regression models to test the hypotheses (consistent with Flaherty et al. 2009 and Licata et al. 2003). In Table 3, Model 1 provides a baseline scenario (control variables only), whereas the remaining models are incrementally augmented models that increasingly contain fac-tors of interest to the current study. Specifically, with Model 1 as the baseline, Models 2 and 3 examine the direct effects of TS and RS on sales performance, respectively, thereby pro-viding access to results for H1 and H2. Models 4 and 5 then introduce the moderation effects of supply market risk and commodity profit impact, as described in H3–H6, in contrast to the baseline and direct effects already observed.

As Table 3 shows, we observe support for H1 and H2 for the current data set. The adoption of a TS approach by the sales rep is positively associated with sales performance (b = 0.26, p < 0.01), as is the adoption of an RS approach (b = 0.49, p < 0.01). Importantly, as shown in the last two rows of the table, the regressions that include the sales approaches explained significantly more variance in sales performance than the baseline model. These results indicate that the sales approach adopted by a rep is a key contributing factor in predicting salesperson success above and beyond such factors as experience, job tenure, and education.

H3 and H4 proposed moderating relationships for supply market risk on the TS/RS to sales performance relationships, while H5 and H6 proposed moderating relationships for commodity profit impact on the TS/RS to sales performance relationships. Models 4 and 5 (which provide the tests for H3–H6) yield interesting yet more complex findings. Address-ing the hypotheses in sequence, we begin with the test of H3 as presented in Model 4. As presented earlier, H3 suggests that the positive relationship between a TS approach and sales performance diminishes when the buyer views the focal com-modity as one whose supply market is fraught with risk due to contingent resource dependence issues. We find support for this hypothesis, in that the [TS × SR] moderator effect is

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negative, significant, and sizable (b = –1.28, p < 0.01) even though the TS direct effect is considered within the same model, and a large change in R 2 is evidenced in Model 4 ver-sus Model 2, which contained only the TS direct effect. For purposes of clarity, Figure 3 offers a pictorial display of the moderation effect for H3 in the upper left panel.

We execute the test of H4 in Model 5. This hypothesis predicted, again from a contingency/resource dependence perspective, that supply market risk would serve as a posi-tive moderating effect between RS orientation and sales performance. We also observe support for this hypothesis in our current data; the regression coefficient for [RS × SR] is

positive, significant, and sizable (b = 0.78, p < 0.05) even in light of the included direct RS effect, and the change in R 2 between Models 3 and 5 is large and significant. For ease of interpretation, we demonstrate the outcome of this hypothesis test pictorially in the upper right panel of Figure 3 for ease of interpretation.

To assess the outcome of H5, we return to Model 4. This hypothesis predicted, based on logic grounded in contingency and resource-advantage theories, that the positive relationship between TS and sales performance would be negatively mod-erated by the buyer’s profit impact for the focal commodity. To assess this finding, we examine the [TS × CPI] coefficient.

Table 2Confirmatory Factor Analysis and Measurement Properties, Study 2

Factor

Item 1 2 3 4 5 6 7

Relational SellingCocreation communications (VE = 0.63)

R6: Consult with customers on their problems 0.756R7: Coordinate activities with sales support 0.664R12: Handhold customers 0.511R17: Provide market and customer feedback 0.750R25: Work with key accounts 0.716

Need-based selling (VE = 0.50)R1: Adapt presentations to customer needs 0.647R14: Make multiple calls to close a deal 0.687R19: Sell unique competencies of your products 0.707R20: Sell value-added aspects of products 0.781

Interpersonal bonding (VE = 0.53)R10: Entertain customers 0.775R22: Take clients to dinner 0.717R23: Throw parties for clients 0.472

Postsale service (VE = 0.55)R18: Provide technical support for the product 0.711R21: Supervise product installation 0.599R24: Train customers on product use 0.817

Relationship continuity (VE = 0.65)R3: Build relationships with suppliers 0.772R9: Develop relationships with customer organizations 0.745R16: Network with contacts 0.779

Transactional SellingBusiness search (VE = 0.61)

T1: Call prospects 0.785T12: Search out new leads 0.833T14: Sell to customers by phone 0.663

Logistical support (VE = 0.65)T2: Check customer inventory levels 0.463T5: Create/monitor/put up point-of-purchase materials 0.713T15: Set up product displays 0.715T20: Work conferences or trade shows 0.674

Model goodness-of-fit statistics: c2 = 290.47 [df =146]; CFI = 0.918; TLI = 0.915; RMSEA = 0.05.

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Although the revealed effect is in fact negative, it is small in size and insignificant, and thus we fail to find support for H5. Finally, we assess the relationship posited in H6 through an examination of the [RS × CPI] coefficient in Model 5. H6 predicted, again based on integrated contingency/resource-advantage logic, that the positive relationship between the RS approach and sales performance would be positively moderated by the buyer’s commodity profit impact. Our test indicates support for this hypothesis: the standardized coefficient is positive, large, and highly significant (b = 1.59, p < 0.01) and appears in conjunction with the aforementioned large and significant increase in R 2 over Model 3 (see lower panels of Figure 3).

dIscussIon

Although modern salespeople are constantly under pressure to deliver revenue for their firms, there remains a general lack of consensus as to precisely what behavioral approaches are most effective in generating positive returns. Reflecting the tenets of adaptive selling and the increasing emphasis on RS, managers guide their salespeople to vary their approach to the buying situation strategically (e.g., Weitz, Sujan, and Sujan 1986). Yet selling practice and the literature indicate that the primary inputs for selling strategies and allocation of selling effort continue to be internally focused indicators of the

buyer account’s importance to the seller—for example, sales potential, size of the account, account opportunity, seller’s competitive position with the account, and previous account relationships (e.g., Ingram et al. 2009; LaForge, Cravens, and Young 1985; Piercy 2006; Piercy and Lane 2006). The current paper suggests that an alternative logic, based on the align-ment of selling approaches with the SPO of the buying firm, as reflected by the level of supply market risk and commodity profit impact, may yield greater returns for salespeople and the firms they represent.

contributions and managerial Implications

This research accomplished several goals identified at the outset and makes multiple contributions to the sales literature. First, we find that the TS and RS approaches have similar effects on many selling activities, but are importantly different based on several other items that together form distinguishing dimen-sions. Although TS and RS are well embedded within the marketing and selling literature, comprehensive searches found no published empirical research validating activity-level scales measuring these two traditional sales approach archetypes. Pre-vious research points out that closer relationships do not always translate to enhanced performance (Cannon and Perreault 1999), that transactional customers can offer the same levels of profitability as relational customers (Reinartz and Kumar

Table 3Tests of Hypotheses

Independent Variable Model 1 Model 2 Model 3 Model 4 Model 5 Model 6 Model 7

ControlsTenure in position –0.32** –0.33** –0.19* –0.08 –0.12 –0.11 –0.09Tenure with firm 0.09 0.12 0.08 0.00 0.03 0.02 –0.01Sales experience 0.45** 0.44** 0.29** 0.26** 0.27** 0.31** 0.24**Education –0.12 –0.11 –0.15* –0.14* –0.15* –0.14* –0.14*Effort –0.01 –0.02 0.02 0.02 0.03 0.03 0.03Age –0.04 –0.00 0.03 –0.05 0.00 –0.05 0.02Gender –0.19* –0.18* –0.10 –0.08 –0.07 0.08 –0.09Firm sales force size –0.05 0.09 0.06 0.05 0.05 0.06 0.07

Main EffectsTS approach (TS) — 0.26** — 0.30** –0.62* —RS approach (RS) — — 0.49** –0.33* — –0.99**Supply risk (SR) — — — 0.45** 0.48** 0.16 0.21Buyer commodity profit impact (CPI) — — — –0.20* 0.03 0.13 0.11TS x SR — — — –1.28** —TS x CPI — — — –0.17 —RS x SR — — — — 0.78*RS x CPI — — — — 1.59**SR x CPI — — — –0.18 –0.73*

R 2 0.19 0.25 0.40 0.40 0.46 0.48 0.51ΔR 2 — 0.06* 0.21** 0.15** 0.06* 0.08* 0.05*

Notes: R 2 is adjusted; * p < 0.05; ** p < 0.01; changes in R 2 are versus previous model in same TS/RS sequence; coefficients are standardized.

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2000), and that firms should extend micro-segmentation to better understand how their buyers prefer to buy and coalign sales approaches with purchasing preferences so that selling resources can become more strategic, and managers can better allocate sales resources to meet buyer needs and expectations (Leigh and Marshall 2001). This study’s support for overlap-ping but discriminant, activity-based TS and RS constructs provides managers a useful framework for this type of account segmentation and allocation of selling resources. Similarly, various studies have supported the positive influences of RS on performance outcomes (e.g., Schwepker 2003); however, the lack of specific measures for TS has impeded the testing of TS’s influence on performance. As a consequence, both researchers and managers are left with little or no understand-ing or guidance as to when RS or TS strategies work best. The granularity of our measures of TS and RS, as developed through this research, will enable further research into the antecedents and outcomes of both selling types and better inform managers of the activities on which they should coach and train representative to enhance selling practices.

A second contribution is the investigation of the efficacy of both selling approaches and our finding that a salesperson may effectively employ both TS and RS effectively for the purposes of generating sales performance, given the right selling situation. As noted by Leigh and Marshall (2001),

organizations have undertaken fundamental change in adopting customer-oriented strategies with the sales func-tion taking on a relational or partnership business model. Yet, as documented in this study, there is still a place for TS strategies, and the literature has tended to neglect this possibility in favor of a more ubiquitous reliance on RS strategies in recent years. Our test of competing hypotheses supports both TS and RS as having a significant, strong, and positive association with increased sales performance. This finding holds the promise of encouraging additional research into the explication of how and when salespeople can best use these selling approaches. It also serves as a reminder to managers that there is a place for TS strategies and that the selling firm should look beyond the buying account to find primary segmentation criteria and guides for developing effective selling strategies.

A third contribution stems from integrating the concept of supplier SPO from the supply chain management litera-ture with literature from the sales domain. This integration serves as a means for generating situation-specific criteria for segmenting accounts and thereby informs the adoption of either TS of RS as efficacious selling strategy. In a practical sense, this study complements the works of Anderson and Narus (1991) and the Chally Group (1998), which empha-size the importance of improved sales customer segmentation

figure 3 sales approach—strategic procurement orientation Interactions

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according to how the accounts prefer to buy. It also responds to the recommendation of Leigh and Marshall (2001) that scholars conduct more academic research addressing this type of segmentation. The aforementioned authors note that such segmentation research in business markets is lacking. We find that when buying firms are more oriented toward man-agement of supply market risk, selling firms’ transactional approaches are significantly less successful than normal and relational approaches are significantly more successful than in the generic case. Alternatively, we find that when buy-ing firms are more oriented toward the profit impact of the sourced commodity than toward supply risk management, the selling firm may find that transactional approaches are no more or less effective than normal, and relational approaches are once again sources of valued performance increases. These findings directly respond to Leigh and Marshall’s (2001) assertions for sales customer segmentation and sell-ing strategy research. The findings also provide prescriptive guidance to salespeople and managers in the use of specific, sales-situation characteristics—the level of supply market risk and the purchase commodity’s profit impact for the buying account—as account classification and segmentation criteria for use in deciding among selling approaches.

limitations and future research

The generalizability of the current findings is necessarily limited because of the nature of the research design and data collected. Although our subjects are professional buyers and salespeople, the buyers are all members of the same large organization, and our research design involved cross-sectional data; researchers should not interpret the results as evidence of universal causal effects. Future research could benefit from longitudinal explorations of TS, RS, and SPO influences on sales performance from a broader swath. Moreover, we used well-recognized and accepted self-report indicators of sales activities and sales performance. The field could gain additional insight through managerial ratings of salesperson performance or through the use of objective performance data. The measure of performance also does not capture per-formance on important sales-related behaviors that may be at the core of behavioral control systems.

Further research should also investigate other factors moderating the relationship between TS, RS, and sales per-formance. What other factors moderate the effectiveness of TS versus RS? Can researchers develop frameworks that will facilitate a salesperson’s ability to effectively and efficiently segment accounts according to procurement orientations and thus guide the development and application of proper selling approaches and strategies?

Understanding the differential effects of TS and RS in terms of aligning selling approaches with buyer preferences

and expectations will continue to be a significant topic within the sales literature. It is our hope that this initial exploration of TS, RS, and SPO in terms of understanding the nature of their interactions and impact on sales performance will contribute to further efforts aimed at increasing our understanding of salesperson effectiveness.

note

1. For the airline being studied, this is also the level at which a purchase becomes considered “large” and requires managerial notification by the agent. The size of the purchase volume (in dollars) is not correlated with profit impact within each pairing (r = –0.09, p > 0.10), likely because each purchased commodity also bears differential total cost of ownership. The profit impact variable for the sample was normally distributed, with no sig-nificant kurtosis and only slight positive skewness.

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appendIx a measures

relational selling (1–7; “never”/“very frequently”)

When selling your primary product, how often do you do each of the following activities?

R6: Consult with customers on their problemsR7: Coordinate activities with sales supportR12: Handhold customersR17: Provide market and customer feedbackR25: Work with key accountsR1: Adapt presentations to customer needsR14: Make multiple calls to close a dealR19: Sell unique competencies of your firm’s productsR20: Sell value-added aspects of productsR10: Entertain customersR22: Take clients to dinnerR23: Throw parties for clientsR18: Provide technical support for the productR21: Supervise product installationR24: Train customers on product useR3: Build relationships with suppliersR9: Develop relationships with customer organizationsR16: Network with contacts

transactional selling (1–7; “never”/“very frequently”)

When selling your primary product, how often do you do each of the following activities?

T1: Call prospectsT12: Search out new leadsT14: Sell to customers by phoneT2: Check customer inventory levelsT5: Create/monitor/put up point-of-purchase materialsT15: Set up product displaysT20: Work conferences or trade shows

performance (1–7; “needs Improvement”/“outstanding”)

Below are several factors for evaluating sales force performance. Please circle the number that most closely describes how you honestly are performing each activity.

Building effective relationships with customersMaking effective presentations to customers and prospects

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appendIx B measure correlatIons (study 2 data)

Measure 1 2 3 4 5 6 7 8 9 10 11 12

1. TS 1.02. RS 0.27 1.03. SR 0.17 0.79 1.04. CPI 0.69 –0.04 –0.29 1.05. TENPOS –0.09 –0.15 –0.14 0.04 1.06. TENFIRM –0.15 –0.03 0.08 –0.23 0.51 1.07. SALESEXP –0.02 0.17 0.20 –0.14 0.50 0.35 1.08. EDU –0.03 0.10 0.07 –0.06 0.02 –0.05 0.01 1.09. EFFORT –0.01 –0.10 –0.10 0.02 –0.09 –0.03 –0.14 –0.07 1.0

10. AGE –0.02 –0.02 0.09 –0.20 0.14 0.11 0.30 –0.04 –0.07 1.011. GENDER 0.05 –0.16 –0.22 0.19 –0.05 –0.25 –0.13 –0.20 –0.02 –0.06 1.012. FIRMSIZE –0.14 0.00 0.03 –0.19 –0.09 0.09 –0.01 0.04 0.01 –0.10 0.08 1.013. SALEPERF 0.23 0.56 0.54 –0.17 –0.24 0.14 0.33 –0.08 –0.03 0.07 –0.22 0.06

Notes: TS = transactional selling; RS = relational selling; SR = supply risk; CPI = commodity profit impact; TENPOS = tenure in position; TEN-FIRM = tenure with firm; SALESEXP = sales experience; EDU = salesperson’s education; EFFORT = salesperson’s effort expended; AGE = salesperson’s age; GENDER = salesperson’s gender; FIRMSIZE = firm’s sales force size; SALEPERF = sales performance. Boldface coefficients are significant to p < 0.05.

Achieving annual sales targets and other objectivesUnderstanding our products/services and their applicationsProviding feedback to managementUnderstanding customer needs and work processesKeeping expenses at acceptable levelsIncreasing territory market shareContributing to my sales unit’s profits

control variables

Salesperson’s Tenure in PositionNumber of years in your current position

Salesperson’s Tenure with FirmYears of experience with your current company

Salesperson’s Total Sales ExperienceTotal years of sales experience

Salesperson’s EducationHow many years of formal education have you completed?

Salesperson’s Effort Expended (1–7; “Among the Least”/“Among the Most”)In the last three years, how many sales calls have you made per week, on average?

Salesperson’s AgeWhat is your age (in years)?

Salesperson’s GenderWhat is your gender?

Selling Firm’s Sales Force SizeNumber of salespeople in your organization

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