What Are Publicly Traded Partnerships?

Due to historical and cultural backgrounds, usually people's understanding of relationships is mainly derogatory concepts such as walking the back door and pulling relationships. The company and its stakeholders conduct standardized, open and frank transactions in accordance with the principle of fair reciprocity. Capital, in short, is the value that adds value. No matter which way capital is adopted, its characteristic is to obtain more output in the future through current input than current input. The purpose of establishing long-term and stable relationships between companies and stakeholders is to maximize the benefits to the owners of such relationships. Relationship capital (Relationship capital) is defined as the capital formed by enterprises and stakeholders to establish, maintain and develop relationships in order to achieve their goals.

Relationship capital

Due to historical and cultural backgrounds, usually people's understanding of relationships is mainly derogatory concepts such as walking the back door and pulling relationships. The company and its stakeholders conduct standardized, open and frank transactions in accordance with the principle of fair reciprocity.

China has been in a natural economic state for a long time and has not formed a market in a commercial society

Relational capital can bring competitive advantages to enterprises. It has the following basic characteristics:

First, value.

Corporate relationship capital has strategic value, it can bring long-term benefits to stakeholders, create long-term competitive advantages for companies, and enable companies to have higher

The formation of relational capital is a dynamic and complex process. It not only requires all parties in the relationship to merge their organizational structure and corporate culture with each other, but also consumes resources such as time, material, human and financial resources. In the process of cooperation, the sum of the material, human, and financial resources invested by the parties to form the relationship capital constitutes the cost of the relationship capital. The establishment of relationship capital will help improve the performance of all parties in the relationship and create new cooperation value. Therefore, enterprises should strengthen the marketing of relational capital so that the benefits of relational capital outweigh the costs. In this way, all parties in the relationship will have the initiative to promote the formation of relationship capital and build a new competitive advantage for the entire relationship.

Change the business philosophy of the enterprise

Relational capital marketing enables the relationship between enterprises and customers, customers, suppliers, intermediaries, competitors, governments, employees, etc., to evolve from a traditional one-way, single-win transaction marketing strategy to a mutual, multi-win Marketing relationship strategy. Under traditional marketing conditions, the company is in a dominant position, while consumers are in a passive acceptance position; the relationship between the company and its competitors is antagonistic; the relationship between the company and other stakeholders is mainly reflected in the company's own interests How to use them to serve your business. And relational capital marketing enables enterprises and stakeholders to become an interactive relationship of coordinated development, interdependence, and common profit. Enterprises need to maintain and cultivate this kind of good partnership, and provide long-term value, large amount of business, and a high degree of trust to the relationship partners, even when the relationship partners are in difficult times.

Relational capital marketing has transformed the philosophy of business management from a customer-oriented market to a stakeholder-oriented market, thereby expanding the scope of business management philosophy. Relational capital marketing changes the thinking mode of simple transaction marketing. It studies the relationship capital formed between the company and its stakeholders as a factor for the company to create profits, and puts its business activities in the entire society. Examining in the large economic system, the company's business philosophy is more in line with the characteristics of the times, and it is more adaptable to changes in the company's living environment.

2. Enhance interactions between relationship members

The role of relationship partners is a prerequisite for promoting the formation of relationship capital. Generally speaking, the longer the relationship members cooperate, the higher the level of trust and the easier it is to establish relationship capital. In the process of frequent interactions, the parties to a relationship judge their risk appetite and future behavior choices based on the historical behavior records of potential relationship partners, thereby determining whether the other party has potential opportunistic behavior. Through repeated interactions, the understanding of all parties in the relationship is improved, information asymmetry is reduced, and the possibility of opportunistic behavior is reduced.

From the perspective of game theory, establishing a long-term relationship with stakeholders means changing from one game to a repeated game. The problem of opportunistic behavior in a game can be solved by repeated games. Therefore, under the role of relationship marketing, with the development of cooperation between all parties in the relationship, mutual understanding is deepened, opportunistic behavior is gradually reduced, and trust is gradually developed as the relationship matures, thus promoting the formation of relationship capital.

3. Adjust the organizational structure and construct the corporate ecosystem

The mutual adaptation of the organizational structure between the relationship partners is conducive to the creation of relationship efficiency and cooperation value, and to the formation of relationship capital. Establishing a close, long-term and reliable partnership between stakeholders is to build an ecosystem that can add value, be mutually restrictive and coexist. This ecosystem requires consistency and complementarity in the organizational structure of the relationship partners. Resources between different organizations can only be well integrated under the premise of coordinated or compatible organizational systems, strategies, and culture, reducing the risk of partnership cooperation and enhancing the stability of the ecosystem.

In such an ecosystem, members work in cooperation and complement each other, organically form a whole for a common goal, and survive and develop in market competition. Stakeholders have common interests and common risks, so they must trust and rely on each other to succeed in the market. The members of the system have also evolved together, and each member pays attention to actively cooperate with other members of the system while improving himself. At the same time, this ecosystem is dynamic and each member remains independent of each other in order to better encourage and give play to the initiative and creativity of each member.

4. Promote sharing of information and knowledge among relationship partners

Information and knowledge can only be developed through mutual communication, and new knowledge can be derived from original knowledge only through continuous use. The wider the exchange of information and knowledge, the better the effect. When more information and knowledge are shared by relationship partners, the parties to the relationship can gain greater benefits. If all parties in the relationship put in place various security measures to prevent the sharing of information and knowledge, it will not help the parties to build a solid relationship.

To establish a mechanism for sharing information and knowledge among relationship partners, it is undoubtedly necessary to establish a trust relationship based on risk sharing and benefit sharing among relationship partners, and then invest in each other and form relationship capital. A good trust relationship will inevitably further promote the depth and breadth of information and knowledge sharing among relationship partners. When the information and knowledge sharing mechanism based on the trust relationship brings good performance to the relationship partners, a virtuous circle is formed between the trust and sharing mechanism, which continuously promotes the formation of relationship capital.

5. Increasing investment in relationship capital

Strengthening the relationship between stakeholders requires members to invest in special assets such as relationship capital. Increasing investment in dedicated assets is an effective way to increase the level of trust among relationship partners. After the parties to the relationship have made a specific investment in relational capital, the parties are locked in and assume obligations. The essence of this "lock-in" effect is that the withdrawal of either party will cause losses to the parties to the relationship at the same time. The stronger the asset specificity of relational capital, the stronger the "lock-in" effect and the greater the withdrawal loss. At the same time, the specialized asset will be difficult to use for other purposes.

The relationship partners should promote investment in relationship capital through continuous communication, coordination and negotiation. Increasing the investment in relationship capital can increase the level of trust between relationship partners, reduce transaction costs, and increase the parties to the relationship.

6. Strengthen the control of relational capital risks

Because relational capital is asset-specific, it may lead to opportunistic behaviors, bluffing problems, and risk to relational capital. Rip-off is a kind of post-contract opportunistic behavior in which a trader seeks quasi-rents from a special investment made by a trading partner under an incomplete contract. Generally speaking, when the relationship risk is higher than the performance risk, the enterprise can adopt the equity-type relationship structure to effectively control the risks related to opportunistic behavior and achieve the goals of the enterprise. This equity-type relationship structure can effectively constrain and avoid opportunistic behavior through property rights arrangements.

When the performance risk is higher than the relationship risk, the enterprise can choose a non-equity relationship structure to share and avoid risks, because the non-equity relationship structure is more flexible and flexible, and the cost of establishing the relationship structure is relatively low. . In the case of high-performance risks, the internal binding force of all parties in the relationship can effectively avoid investment losses. The higher the relationship parties' investment in relationship capital, the greater the performance risk perceived by each member.

At the same time, companies should actively and rigorously evaluate and measure when selecting relationship partners to reduce the risk of relationship capital.