This article examines the underlying rationale behind successful intra-and interfirm relationships. Relationships based on equity and social exchange are developing into major strategic tools. Productive and profitable partnerships can be built by creating trusting, committed, reciprocal relationships. Lasting, fruitful alliances are built and maintained by the employees charged with managing the alliance interfaces. The significance of relationship management is explored by examining the linkages found in the literature on organizational competition in a rapidly changing environment. In a global economy, all system members are interdependent and are customers. Companies are restructuring (i.e., downsizing) to fund only those core competencies that are key to their profitability and long-term survival. Managing relationships with their customers - especially with employees, channel partners, and strategic alliance partners - is critical to the firm's long-term success. The article concludes that customer relationship management based on social exchange and equity significantly assists the firm in developing collaborative, cooperative, and profitable long-term relationships. J BUSN RES 1998. 41.71-81.
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