 Relationship Orientation is a relatively new business paradigm which has been extensively embraced by the logistics industry, but is applicable to virtually all business interactions. For the logistics industry, the theory is that integrated relationships will positively impact the quality and performance of logistics provision.
Here is a definition of Relationship Orientation from the website of the Global Institute of Logistics:
“Relationship orientation refers to the proactive creation, development and maintenance of relationships between global supply chain partners resulting in mutual exchange and fulfilment of promises at a profit.
Relationship orientation is a philosophy of doing business successfully that promotes an organizational culture, which puts the buyer-seller relationship at the center of a firm’s strategic and operational thinking.”
Possibly more than any other industry, logistics – an industry with its roots in ancient trade - relied on a business model which was adversarial, even confrontational, as each party in the transaction sought some type of “advantage” – usually in the form of financial gain.
Of course, it must be said that Relationship Orientation is not really a new idea in business. It encapsulates a concept possibly as old as trade itself: that trust and reliability are the cornerstones of any business relationship. In many ways, putting the focus on the relationship, and ensuring that it remains strong, allows the business to take care of itself.
In simple terms, if people get on well and look out for each others needs, they will do business together well.
COLLABORATION NOT CONFRONTATION
 The introduction of Relationship Orientation – as both science and practice – sees the logistics industry, in this case, embrace the win-win philosophy of human interaction first clearly defined by Stephen Covey two decades ago. It involves collaboration, rather than confrontation, as the mechanism for advancement.
Virtually every industry, where two or more parties have a role in the transaction which defines the industry, can benefit from such a relationship focus.
In scientific terms a number of studies have been made in an attempt to prove that, when implemented, the theory does in fact provide the positive impact expected. The 2005 study by Photis M Panayides and Meko So examines one such case.
Panayidis and So set out to prove statistically that Relationship Orientation would have a positive effect on logistic service quality, as well as the hypothesis which naturally follows that logistic service quality will have a positive effect on the performance of the logistic service provider.
Better Relationships = Improved Quality of Service = Maximized Business Result.
The items measured included a number of factors central to the formation of relationships:
- Communication
- Empathy
- Trust
- Shared Values
- Reciprocity
- Bonding
The resulting statistical model showed that each of these items achieved reliability coefficients higher than a suggested cut-off point i.e. that each of the factors was proven to have the positive impact expected.
It is interesting to note the mix of respondents used:
| Managing Directors/General Managers | 34% |
| Marketing Executives or Firm Owners | 8% |
The findings confirmed the theory and indicated that strong relationships do, in fact, result in better coordinated logistics service of a higher quality, leading to potentially higher client satisfaction and enhanced economic outcomes.
The managerial implications noted in the study point to a change of management focus from the traditional areas of inventory and operations, in the case of the logistics industry, to the implementation of measures likely to improve relationships with their clients.
It should be noted that the same principle applies to virtually any business
A close study of the work of Panayides and So, together with a number of discussions with key people in the logistics industry, indicate that the IN YOUR RIGHT MIND program developed by Chilab Limited is a perfect fit for the task of taking the industry towards the goal of successful implementation of Relationship Orientation.
It can be noted from the discussion of the study above, that the respondents used were all in senior executive positions in various logistics firms. It is clear that the initial structuring of relationships designed to utilize this new business model must come from the top levels of the organization.
However the day-to-day maintenance of such relationships would usually fall squarely into the hands of the middle- and lower-level tiers of the logistics service providers involved. Failure on their part to maintain standards of trust, response and efficiency would see pressure fall back on senior management to support the relationship and could see it eventually fail.
- Relationship Structure by Senior Management
- Relationship Maintenance by Middle and Lower Tier Operators
Thus a clearly defined program of personal and inter-personal skills training is vital as a support mechanism for the Relationship Orientation initiative.
The list of the required characteristics identified by the study - those actually measured and listed above - goes some way to illuminating the skill set required by all parties to ensure relationship maintenance.
ChiLab Limited has developed a four-module program focusing on a number of personal and inter-personal skills including:
- Creativity and Lateral Thinking
- Memory Enhancement
- Understanding the Subconscious and working with it.
- Developing Emotional Intelligence
- Communication Skills
- Conflict Resolution
Each of the topics listed above, and the many others covered in the program, are ideally suited to the task of equipping logistic service managers and staff with the inter-personal skills to successfully support the required relationships.
The vast field of Emotional Intelligence is widely viewed by global industry to be the most important measure of successful performance. It covers each of the desired characteristics identified in the above scientific study and clearly surpasses both Intelligence Quotient and Expertise as the main requirement for efficient performance.
Many large companies now seek an Emotional Intelligence assessment by Headhunters and Staff Placement Agencies before any other measurement in primary determinations of employee suitability. Yet current studies emphasize that training in this vital skill set lags well behind the level of importance it manifests.
The IN YOUR RIGHT MIND program can help any company successfully introduce the concept of Relationship Orientation by developing the Emotional Intelligence of the work force and by equipping each member of that work force with various Right Mind skills which will carry the concept to optimal status.
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