ExxonMobil’s Partnership with Suppliers Essay

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Power is the concept associated with the organizational ability to influence other parties in partnerships (Key concept 2014). Although power is commonly perceived as a negative phenomenon that involves manipulation or excess dominance, it may have multiple positive impacts on the business conduction, value creation, and the establishment of long-term partnerships.

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Power is one of the major and valuable properties of large international enterprises that assists in the effective fulfillment of various operational tasks, such as supply chain management (Meehan & Wright 2012). For example, ExxonMobil is one of the largest publicly traded oil and gas companies operating worldwide, and its power helps the organizational leaders and management to increase operational control and achieve significant positive outcomes. It is observed that organizational power may positively affect the relations with sellers or buyers by influencing the decisions and actions of another party and increasing its commitment to the partnership (Cox 2004).

ExxonMobil complies with the ethical principles of conduct and considers the social interests and needs to contribute to the development of its positive corporate citizenship (Corporate citizenship report 2016). In this way, by using its property of power, the company may incline its partners and suppliers to the ethical business conduct. ExxonMobil may influence the suppliers’ decisions to increase their orientation to the environmental sustainability and realization of ecological principles in supply chain management.

As an international enterprise, ExxonMobil has an extensive supply base, and its dependence on the suppliers thus is relatively small. The ability to acquire multiple sources of supply is regarded as a contribution to power increase (Key concept 2014). And it is possible to assume that the more power the organization obtains, the more attractive it is to the potential suppliers and consumers. Thus, the organizational power has an overall positive impact on the establishment of the relationships, the commitment to partnerships, and the loyalty of other parties.

Trust

Trust is an essential element in the successful buyer-seller cooperation (Stuart, Verville & Taskin 2011). Trust is associated with confidence, belief in the credibility, competence, and goodness of another party. Trust supported by the organizational reliability increases the effectiveness of relationship establishment with both partners and consumers (Key concept 2014).

ExxonMobil may build its relations with suppliers according to different principles of trust. For example, the basic level of trust, calculus-based trust, can be achieved and enforced at the initial stage of the buyer-seller relationship establishment. Calculus-based trust is supported by the legal regulations, and it helps to reduce the financial and reputational risks provoked by the collaboration with the inexperienced or unfamiliar suppliers.

ExxonMobil‘s relationships with familiar and prominent suppliers may be associated with knowledge-based trust. This level of trust is achieved when the suppliers’ actions and decisions may be predicted according to the available information about its previous professional experience and corporate values (Key concept 2014). A knowledge-based trust may help to build a long-term partnership that would lead to the achievement of the shared identification.

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Identification-based trust can be achieved in case the buyer has enduring relationships with the supplier. At this level, the parties share the common values and aim at the achievements of the mutual benefits. Although identification-based trust is hard to achieve, it has many advantages – it reduces the risk of relationship interruption and facilitates the purchasing process (Stuart, Verville & Taskin 2011).

The different levels of trust may help ExxonMobil to establish and control relationships with the different suppliers. Being a powerful and prominent enterprise well-known for its ethical and social considerations, ExxonMobil most likely works with the experienced suppliers and its relationships are characterized by the knowledge-based and identification-based trust because theses level of trust support the high standards of conduct and significantly reduce the reputational risks.

Reference List

Corporate citizenship report 2016. Web.

Cox, A 2004, ‘Business relationship alignment: on the commensurability of value capture and mutuality in buyer and supplier exchange’, Supply Chain Management: an International Journal, vol. 9, no. 5, pp. 410-420. Web.

Key concept: power and trust in buyer and seller relationships 2014, Laureate Education, Liverpool, UK. Web.

Meehan, J & Wright, G 2013, ‘Power priorities in buyer–seller relationships: a comparative analysis. Industrial Marketing Management, vol. 42, no. 8, pp. 1245-1254. Web.

Stuart, I, Verville, J & Taskin, N 2012, ‘Trust in buyer-supplier relationships’, Journal of Enterprise Information Management, vol. 25, no. 4, pp. 392-412. Web.

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IvyPanda. 2020. "ExxonMobil's Partnership with Suppliers." July 16, 2020. https://ivypanda.com/essays/exxonmobils-partnership-with-suppliers/.

1. IvyPanda. "ExxonMobil's Partnership with Suppliers." July 16, 2020. https://ivypanda.com/essays/exxonmobils-partnership-with-suppliers/.


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IvyPanda. "ExxonMobil's Partnership with Suppliers." July 16, 2020. https://ivypanda.com/essays/exxonmobils-partnership-with-suppliers/.

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