Effectiveness of power use in buyer-supplier negotiations

Purpose Building on the dual-system approach and resource-advantage theory, the purpose of this paper is to investigate how a particular personality trait of negotiators – namely, agreeableness – moderates the effectiveness of using coercion and reward power to appropriate value in buyer-supplier negotiations. Design/methodology/approach Simulated negotiations in buyer-supplier dyads with 152 participants are analyzed using hierarchical regression analysis. Findings The analysis shows that negotiators’ agreeableness moderates the effectiveness of using coercion and reward power for suppliers, but not for buyers. Negotiators in the role of suppliers use reward power more effectively and coercion power less effectively if they have high agreeableness. Buyer negotiators benefit from using coercion, regardless of their personality. Research limitations/implications This research focuses on two common negotiation tactics and one particularly relevant personality trait. Future research might examine additional tactics and personality traits, and might delve deeper into explaining the observed differences between negotiators in the role of buyer and supplier. Practical implications The findings suggest that negotiators on the supplier side can improve their effectiveness by choosing tactics that fit their personality. Negotiators on the buyer side should consider using coercion power, regardless of their personality. Originality/value This research introduces dual-system theory to the supply chain management (SCM) literature and suggests that SCM research can benefit from simultaneously examining conscious decision processes and subconscious influences. It further suggests that the effects of dual-system interactions are sensitive to context, and more theory accounting for differences between buyers and suppliers in a dyad should be developed.