A framework for performance evaluation of channel partners in distribution relationships

Abstract

Purpose – The purpose of this paper is to develop a conceptual framework for performance evaluation of channel partners in distribution relationships and develop a scale to measure the proposed dimensions of performance. Design/methodology/approach – The proposed framework is built on the theoretical foundations of salesforce control systems and organizational performance. The authors developed the measurement scale by the three-stage protocol and established the scale’s reliability, factor structure and validity through the data collected from 252 firm-channel partner dyads across automobile firms in India. Findings – The proposed framework highlights three distinct dimensions of channel partners’ performance, i.e. output performance, the financial/other objective results; activity performance, the activities, behavior and process-compliance levels; and capability performance, the resources and capabilities of channel partners. An 18-item measurement scale is developed to measure the three proposed dimensions of channel partners’ performance. Research limitations/implications – The proposed framework conceptualizes the three key dimensions of channel partners’ performance that can assist firms in exercising a focussed approach to performance management in distribution channel relationships and other inter-firm contexts. This study contributes to the legitimacy and further development of research in the area. Practical implications – The measurement scale provides valid and reliable items for a rigorous performance analyses of channel partners, both at the individual level as well as at the level of the distribution channel as a whole. These performance analyses have multiple applications, right from managing the day-to-day channel activities to steering the channel strategy. Originality/value – The paper presents a multidimensional conceptual framework for performance evaluation of channel partners and provides a suitable instrument for operationalizing future empirical research in the area.