Managing relationships to improve performance: a case study in the global aerospace industry

Organizations wishing to succeed in the competitive climate of the contemporary marketplace will need to differentiate themselves from competitors. World-class product development is considered the key to competitive advantage and, to compete effectively in global markets, organizations need to be proficient at this core activity. The knowledge-intensive process of product development will benefit from strategic alliances with customers based on trust and mutual benefit. This paper reports on research which developed a managerial tool that allows manufacturing organizations to understand the impacts of relationships at the boundaries of their internal and external activities. It focuses upon the importance of collaboration to forming and maintaining productive relationships within and between organizations. Such an approach will help organizations, and the individuals within them, to identify appropriate internal and inter-organizational network development strategies. An important assumption that underlies its development is that the model will improve project and product development performance by improving communication flows through enhanced networked relationships between team members, and hence improve the overall performance of the organization. This paper sets the research context and presents results of action research with a team of engineers from a large organization in the aerospace industry. It reveals the crucial importance of trust in underpinning successful internal and inter-organizational relationships. It is suggested that the tool provides a convenient methodology for measuring and benchmarking relational network performance.