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Managing the Dark Side of Close Buyer-Supplier Relationships

It is all too easy for relationships between companies and their suppliers to become too chummy and for essential checks and balances to get less attention than they require. Often, the longer and deeper the relationship, the cozier it can be—and thus at much greater risk of underperformance. Here’s how to identify and guard against those risks.

By ·

As the Thanksgiving holiday approaches, hosts and hostesses all over the United States are thinking not only about food shopping lists but about family dynamics. Who’s coming this year? Is Uncle Jeff still not speaking to his nephew Brandon? And that simmering argument about party politics that broke out last year: Are the cousins over that now? 

Close relationships are not always synonymous with good relationships. And the same is true between businesses that have worked together for a long time.

In particular, tight links between companies and their suppliers have been touted as a business strategy to improve performance through, among other things, increased efficiency and innovation. But just as with personal relationships, the ties can become unhealthy for one or both sides. There’s a dysfunctional “dark side” to business relationships—one where complacency, closed-mindedness, short cuts, and “group think” overshadow the good side of close interactions.

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By ·
Download Article PDF

As the Thanksgiving holiday approaches, hosts and hostesses all over the United States are thinking not only about food shopping lists but about family dynamics. Who’s coming this year? Is Uncle Jeff still not speaking to his nephew Brandon? And that simmering argument about party politics that broke out last year: Are the cousins over that now? 

Close relationships are not always synonymous with good relationships. And the same is true between businesses that have worked together for a long time.

In particular, tight links between companies and their suppliers have been touted as a business strategy to improve performance through, among other things, increased efficiency and innovation. But just as with personal relationships, the ties can become unhealthy for one or both sides. There’s a dysfunctional “dark side” to business relationships—one where complacency, closed-mindedness, short cuts, and “group think” overshadow the good side of close interactions.

SUBSCRIBERS: Click here to download PDF of the full article.

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