Reciprocity requires fair and balanced exchanges between businessmen. If one company accepts business risk, the other must be prepared to do the same. If one company commits to investing time and money on an important project, the other company must be ready to reciprocate. They decide what is fair and balanced by negotiating dialogue and applying other guiding principles. Autonomy means avoiding the use of power to advance one's self-interest at the expense of the other. At the individual level, autonomy refers to the ability to act based on causes and motivations that reflect an individual's own values and beliefs. The same applies to business relationships. Businesses want to make their own decisions, uninfluenced by others; they want to work as equals and want to be part of a process that allows them to make decisions in sync with each other. Integrity : Healthy relationships require integrity as the sole criterion, with accuracy and truth as the cornerstone. Accurate or fact-based conversations separate facts from explanations that explain or colorize those facts. Facts are things that can be observed. An explanation illustrates this fact. Authentic Conversations take accurate conversations to the next level and leverage multiple perspectives for new insights and opportunities for improvement, growth or change.
When the conversation is real, everyone's point of view is real, and that person also recognizes that a personal point of view is not the whole story. Loyalty requires both companies to be loyal to the relationship. Loyalty to the relationship develops when the interests of both companies are equally important. Loyalty is not allegiance to a company in all circumstances. Not to be united by any means. Loyalty is about loyalty to the relationship as a single entity. Equity has two equally important components: proportionality industry mailing list redress. Proportionality means that one firm may receive a larger distribution of rewards (remedies) than another to compensate that firm for taking a greater risk or making an investment (proportion). Equitable remedies allow companies to reach a fair settlement when the contract itself may limit the outcome or remain silent on the matter. For example, a contract may not adequately meet the service provider's performance requirements during a catastrophic natural disaster such as a Category 4 hurricane. Any resulting ambiguity should be discussed taking into account the principle of fairness.
Integrity : Simply put, integrity means consistency in decisions and actions. Intuitively, people understand this principle. People want to be able to depend on each other and know that they will get the same results from the same set of operations. Stop and ask yourself these five questions Before you consider implementing these social norms, stop and ask yourself these five questions. Answering these questions will help you understand the nature of existing relationships. How do you (your organization) define trustworthy? Is the other party's definition of trustworthiness the same as yours and your organization's? Are there challenges in acting in a trustworthy manner? For example, are you or your organization making excuses for not being trustworthy? What challenges do other people or organizations face in acting in a trustworthy manner? For example, is that person or that organization making excuses for not being trustworthy? Does each of you act in an opportunistic way? If so, how will you repair the lost trust? If you think there is a sufficiently generic definition of trustworthiness, consider implementing the six principles as part of your relationship governance structure. And, if you've acted opportunistically, be sure to discuss principles for repairing any lost trust. There are such clear financial advantages to working more collaboratively that it doesn't make financial sense to continue to speculate. This is just a small example from my white paper titled Unpacking Collaboration Theory . Economic benefits of reducing opportunism When companies trust each other by developing a common set of social norms, they examine opportunistic tendencies within both companies. For example, a client with appropriate specifications may choose not to send a job for a competitive bid and instead negotiate with an incumbent supplier. The cost of entering the market to get a better deal—called bargaining cost—is one aspect of transaction cost.
Reducing negotiating costs can free up much-needed time and money that the two companies can reinvest to achieve their mutual goals. However, this will only happen if there is enough trust and the chances of opportunism to flourish are slim. in conclusion Research in sociology, game theory, economics, and other social sciences shows that relationships based on trust, reciprocity, and other social norms outperform more traditional ones. While social scientists have proven time and time again that collaborative approaches are more effective than more traditional transactional approaches, organizations still engage in traditional transactions, which tend to foster opportunistic behavior by buyers and suppliers. These organizations engaged in opportunistic behavior also lamented a lack of innovation, flexibility to respond to market challenges, unrealized profit potential—and more importantly, a failure to build sustainable supply chain relationships. Many individuals and businesses don't realize that they can choose between being trustworthy and being opportunistic to achieve their goals. Business leaders often do what they have done before without evaluating the validity of their choices.