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Organizational Dependence

Organizational dependence refers to the ability of managers to influence the actions of customers and suppliers. Every organization is dependent on other organizations to some extent. To the extent that a company or organization needs it's suppliers less than the suppliers need it, the organization has power. An asymmetric dependence creates power for one of the parties in the relationship. The lower the amount of influence that managers of an organization have on customer and/or supplier actions, the greater the organization's dependence on their customers and/or suppliers. For example, a company with a single major customer is often very dependent on that customer for future sales.



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