ABSTRACT
The power/dependency model charts the some potential power structures between any two parties in a commercial relationship. It recognizes that both parties have elements that give them power and that therefore these respective positions need to be charted against each other. The authors refer to these elements as 'critical assets', but they could equally include know-how, superior capabilities, market position and intellectual property. Similarly, the buyer might control distribution to a specific market or might have negotiated a restricted covenant on a supplier's business elsewhere. The model considers the relative strength of each party's power over the other and indicates which of the four different power structures applies in any given circumstance. Business relationships are becoming increasingly complex, and therefore power dimensions – and more particularly how each party uses them – are important to ensure purchasers are getting the best value for their organisations.
