Market orientation in franchise networks: a contrast analysis of franchisors and franchisees views

Market orientation is considered as key to organizational survival and performance. In inter-firm settings, previous research indicates that it contributes to the overall performance of marketing channels. This research note investigates the perception of market orientation in franchise networks. Based on a dyadic multi-sectorial sample of 27 franchisors and 720 of their franchisees, the study examines how franchisors and franchisees perceive market orientation and to what extent their perceptions are concordant views. The underlying hypothesis is that a common view of the network orientation facilitates co-ordination and eventually performance. Results indicate that although the spirit of market orientation may be partially shared within the franchise channel, its consequences in terms of performance are not uniform.     

The moderating effect of brand orientation on inter-firm market orientation and performance

Abstract

While prior research has shown that market and brand orientation are key contributors to successful business performance, research to date has not fully explored how inter firm collaboration for these two key orientations can enhance business performance. The purpose of the paper is to investigate the relationship between inter-firm market and performance; to test for the moderating role of brand orientation in that relationship. A total of 169 completed pairs of surveys were collected of small and medium enterprises operating internationally in a variety of industries in Switzerland. The results show that inter-firm market and brand orientation are two antecedents of marketing and financial performance. The impact of inter-firm market on marketing and financial performance is significant when the brand orientation is favorable. This study extends previous research by examining the moderating role of brand orientation on inter firm market orientation, which is important, especially for firms wanting to increase their brand reputation by entering into partnerships with other firms. Further research is indicated, to identify the key moderators of the driving force of inter-firm market in relation to business performance and the reason why maintaining a strong brand presence is important in the international marketplace.     

Weaving network theory into effectuation: A multi-level reconceptualization of effectual dynamics

This paper positions effectuation as a network-driving and network dependent phenomenon and suggests that understanding networks and network processes is essential to understanding the dynamics of effectuation. We argue that the implementation of effectuation is influenced by the nodal, relational, and structural characteristics of pre-existing and emerging networks, and by the processes through which these networks come about. We use these arguments to develop a multi-level, multi-theoretical reconceptualization of effectuation that provides for distributed agency and collective cognition of network members. We allow for the simultaneous and interactional use of effectual and causal logics, as well as the co-construction of knowledge, identity, and social capital within and across network levels. Our model also addresses changing uncertainty as opportunities develop, nuances of effectual interactions, and evolving market dynamics. Our propositions and reflections offer directions for further studies at the intersection of network and effectuation research.Executive summaryThere is little doubt that effectuation is reshaping how we think about entrepreneurial cognition and behavior. A core argument is that under conditions of uncertainty, entrepreneurs can co-create opportunities by collaborating with other willful agents. This moves us away from classical views of entrepreneurship and positions effectuation as a network-driving and network-dependent phenomenon. Yet, recent debate highlights that effectuation research has paid insufficient attention to the network of external parties involved. As a result, although the extant model of effectuation recognizes the importance of networks, our understanding of the relationship between effectual logic and entrepreneurial networks is far from complete.Several theoretically important and practically relevant questions arise from this knowledge gap. For example if we think about network development, how are potential stakeholders brought to mind and persuaded to commit if end-points and stakeholder preferences are both unknowable? What are the characteristics (i.e. structure, content and governance) of the networks that emerge through these commitments? Reciprocally, how do the characteristics of the emerging network influence effectual processes and outcomes?In this paper, we begin to address this line of questioning by considering effectuation not only at the level of the individual but also through lenses reflective of the three levels of analysis commonly adopted in network research: i) dyadic relationships, ii) the entrepreneurial network, and iii) the market more generally. While we attend to pre-existing networks (the constitution of which is likely to affect the probability of adopting effectual logic), our focus is on linking the individual and emerging networks across these levels.At the level of the individual, we break from prior effectuation research and ascribe new and influential roles to entrepreneurial ideas and instrumental mindsets in focusing an entrepreneur's attention on particular relationships (i.e. the cognitive activation of a cohesive network involving interested and persuadable individuals). At the level of the dyad, we suggest the very nature of interactions between actors can influence individual choice of logic. We specify that stakeholders will expect signs of process legitimacy (e.g. cognitive flexibility on the part of the entrepreneur) before making effectual commitments. We also move away from assumptions about altruistic behavior to suggest that power and influence will accrue to stakeholders whose resources are at risk and/or perceived by others to resolve uncertainty. At the level of the entrepreneurial network, we link effectuation to a brokerage orientation (tertius iungens) that enhances inclusiveness surrounding means and collective cognition. Moreover, we move beyond the narrow view of facilitating and constraining factors portrayed in the effectuation literature to argue that (e.g.) i) with respect to network content, resource specificity will shape possible futures; ii) with respect to governance, trust, supported by social mechanisms will predominate; and, iii) with respect to structure, specific network characteristics will be more supportive of certain aspects of effectuation than others (e.g. cohesive networks are more supportive of collaboration, but may limit the flexibility needed to embrace contingencies). At the market level, we posit that on the one hand, institutions will shape effectual processes. On the other hand, effectual processes are more likely than causal processes to create new institutions and/or supplant existing institutions.Overall, our study contributes to the understanding of both effectuation and networks by offering a multi-level, multi-theoretical re-conceptualization of the dynamics of effectuation. Our arguments should spur research in at least three interdependent areas: i) uncertainty and individual cognition; ii) network processes surrounding interactions and commitments; and iii) the contingent effects of network characteristics on effectuation. For practitioners, our insights should help shape thoughts about i) who to interact with in the face of uncertainty; ii) what stories to tell and how to deal with image management; iii) what to expect during negotiations; iv) how to broker relationships to enhance the ‘co’ in ‘co-creation’; and moreover, v) what network characteristics might facilitate or constrain their efforts.     

Information technology impact on market orientation in e-business

This study presents how information technology (IT) contributes to market orientation (MO). The authors analyze the way companies deal with market intelligence to facilitate the identification of customer needs and to generate the appropriate response to such needs. Research methodology includes multiple case studies of retail companies with e-business operations (the three largest in Brazil). The findings indicate that investment in interorganizational systems strongly supports the development of MO capabilities. The article develops a framework to help companies in assessing how IT applications support their MO behaviors; as an academic contribution, the study presents two hypotheses for future studies.     

How risk influences the choice of governance mode in biopharmaceutical inter-firm relationships

This paper proposes a new theoretical framework for assessing the influence of risk in shaping the governance form in biopharmaceutical inter-firm relationships. In particular, we propose a multidimensional operationalization of relational and performance risk and, by following Transaction Cost Economics (TCE) and Real Options (RO) theory constructs, we hypothesize a relation between the aforementioned risk components and the choice of governance form. Specifically, following TCE reasoning, we hypothesize that a high level of relational risk leads towards more hierarchical governance forms, while, following RO theory, we hypothesize that a high level of performance risk leads toward market-oriented governance forms; finally, we hypothesize a moderating effect of each risk component on the other. We empirically test our framework through the analysis of 353 inter-firm relationships signed worldwide between pharmaceutical and biotech companies from 2007 to 2010. The results show substantive support for our theoretical framework. Furthermore, we find a significant moderating effect of the performance risk on the TCE relation between relational risk and governance forms.     

Policy Interventions for Industrial Network Formation: Contrasting Historical Underpinnings of the Small Business Policy in Japan and the United States

This article examines the role of policies in promoting inter-firm networks, by contrasting policy frameworks for small businesses in Japan and the United States. While the policies in two countries share similarities in many respects, different historical underpinnings have led small business policies to play different roles in economies of Japan and the United States. This paper analyzes how Japan's small business policy came to encourage inter-firm collaborations over the course of its history, while policies in the United States have not had explicit orientation toward the development of inter-firm networks until the 1990s.     

Why do firms seek to share human resource management knowledge? The importance of inter-firm networks

This study untangles the social processes and inter-firm mechanisms underlying human resource management (HRM) knowledge networks. The research questions serve to advance understanding of why HRM knowledge flows between firms under contractual relationships and in the absence of formal relationships. The study analyzes data from a complete network of 51 high-technology firms located in a science and technology park to report the structural properties and relational dimensions of inter-firm flow of HRM knowledge. The results from this social network analysis show that the firms in the study actively engage in the sharing of HRM knowledge. Specifically, the results not only indicate the preeminence of formal ties but also of relational factors relating to firm legitimacy, prestige, and collaborative interaction. Participation in inter-firm knowledge networks appears to be an effective tool for obtaining HRM knowledge as well as for enhancing legitimacy and prestige between firms and developing trust and reciprocity within collaborative relationships.     

IT and Coordination Modes: The Case of the Garment Industry in France and US

The aim of this article is to illuminate the relations between information technologies (IT) and modes of coordination among firms. Does IT strengthen existing partnerships, accentuate market volatility or facilitate integration strategies ? Up to what point do the institutional environment and organisational forms favour the diffusion of IT or not? What may be said about the role of IT in the reorganisation of a supply chain ? Through a study of the garment industry we will try to throw light on these subjects, presenting here some preliminary results of our investigations. We first explain previous research and then show the interest of studying the garment industry as a supply chain comparing the two supply chains in France and the United States. The transaction cost perspective will help us to explore how IT affects relationships between companies. In this context the diffusion of electronic networks should be a major stake in rationalising inter-firm coordination modes. But we will see that this stake remains imperfectly strengthened: complex and rich social networks in some crucial stages of the supply chain offer a significant explanation.     

Early internationalization: A transaction cost economics and structural embeddedness perspective

This paper develops and tests a framework for the determinants of early internationalization by drawing on transaction cost economics supplemented with structural embeddedness reasoning. We theoretically explore how asset specificity, prior international experience of the management team, and international network contacts impact early internationalization of the firm. Furthermore, we elaborate how early internationalization is related to foreign market performance. Our results show that asset specificity is negatively related to early internationalization, whereas prior international experience of the management team and international network contacts have a positive impact on early internationalization. Furthermore, our results suggest that early internationalizers are more successful in respect to foreign market performance than companies that have internationalized in later years.     

社交网络可视化分析对电商企业网络口碑营销的影响

社交网络可视化分析能够高效地对海量数据进行简化处理,从而成为帮助电商企业推进网络口碑营销的重要工具。本文以电商企业为研究对象,通过实证调查的方法来探究企业内部社交网络可视化分析对电商企业网络口碑营销的影响。调查发现社交网络可视化分析在电商企业的市场定位、营销定向、营销成本、工作效率以及经济效益等方面都有积极的作用。本文研究以期为电商企业进行优质的网络口碑营销提供理论支持。     

企业间关系的类型及选择

在定义企业间关系的基础上,指出企业间关系可以进一步分为有清晰界面的市场交易关系和边界关系较模糊的非市场交易关系(又可称为中间组织或准市场关系),重点解析了中间组织的类型,给出了企业关系选择的各种可能.     

The evolution of the pharmaceutical-biotechnology industry

This paper presents an application of network economics to the formation of alliances in the biotechnology-pharmaceutical industry. The framework analysis provides insights under which firms create hybrid governance forms, integrate strategy and economics into a more holistic perspective on network strategy. Firm network types link network economies, competencies and market structure, creating integration between participants and change as additional dimensions. ‘Change’ introduces a dynamic, evolutionary aspect. The resulting contructs involve the network dimension as a mechanism design for investigating the evolution and life cycles of firm networks. An analysis of alliances within the pharmaceutical and biotechnology industries develops the framework, including a historical tracing, and an empirical examination of the relationship between collaboration rate (CR) and market performance of major globally operating pharmaceutical firms. Case examples, supported quantitatively and qualitatively, provide evidence for the efficacy and implications of the network dimension.     

Market Orientation and Raw Material Control

Much of the existing literature on market orientation emphasizes the role played by the competencies of companies in selling products. However, in industries that rely on a natural resource sector for its primary input, another constraint may dominate: the limitations on supply of that input. We examine this issue in the context of a particular natural resource sector, the fishery, as a case study of the more general phenomenon. Using the example of Norway's apparent lack of market orientation as a supplier of fresh fish, the paper demonstrates how the characteristics of natural resource sectors as well as how public policies are used to manage those sectors may place significant roadblocks in the way of developing a market orientation by the industries that depend on those sectors for raw material. The paper notes that there has been an increased consumer demand for fresh fish, away from the frozen product. This, in principle, should lead to an increased need for a market orientation by sellers and closer relationships between the primary processors and the distributors of fresh seafood. However, several barriers, including those associated with fishery management, hinder this process. These include the presence of a structure where earnings from fishing are independent of quality, the seasonality of supplies in the raw fish markets, the way fish quotas are managed, the structure of first hand sales, and the underdeveloped relationships between supermarkets and the primary processors. In short, the analysis identifies critical linkages between fishery management and the marketing of seafood. Its broader contribution is to increased understanding of the interdependencies between the marketing of natural resource-based products and public management of that resource.     

Retail networks and real estate: the case of Swiss luxury watches in China and Southeast Asia

Shopping centers are among the most significant places to sell luxury goods in East Asia. However, the relations between retail networks of luxury companies and access to land and real estate still need to be addressed. On the one hand, an extensive literature highlights how the turn to luxury industry since the 1990s has enabled some European countries to maintain their comparative advantage on the global market and at the same time to keep a significant part of their production non-globalized. Yet, an issue that remains to be addressed is the way European luxury companies are able to enter and expand their sales networks in emerging countries. On the other hand, while real estate has become a major economic circuit in East Asia, there is still a lack of research about the property industry and companies’ concrete strategies and business models. This article is hence an exploratory study that tackles the issue of real estate within the strategies of the main actors of the Swiss watch industry, namely Swatch Group, Richemont, and LVMH, which have massively invested in their retail network in China and East Asia since the 1990s.     

The relationship between organizational culture and market orientation in the Greek telecommunication companies

The modern business environment is characterized by intense competition, which has led telecommunication companies to a continuous race towards gaining and maintaining a competitive advantage. In order to succeed, telecommunication companies “cultivate” market orientation and market oriented cultures as non-imitable characteristics, capable to ensure long–term corporate viability and growth. This paper provides an insight into the Greek telecommunication industry by: a) revealing the coordination between market orientation strategies with corresponding culture, b) the relationship between extrovert-type cultures with performance and c) how special traits of telecommunication providers (size and age) influence the degree of market orientation and the dominant culture type (introvert or extrovert). The paper contributes: a) to the creation of national cultural profile in the telecommunication industry, which can become a starting point in a wider trial to create a European industry profile, b) to the empirical testing of the correlation between culture and market orientation and c) to the examination of the extent to which background factors (such as firms’ age and size) should be taken into account during the implementation of a business strategy.     

Managing conflict to improve the effectiveness of retail networks

Retailers are becoming involved with networks consisting of multiple firms in order to more effectively perform business activities such as supply chain management. This research develops and tests a framework outlining the effects of conflict in networks and how conflict management can mitigate and exacerbate these effects. A study of 81 simulated networks finds that inter-personal and task conflict have a negative effect on network member satisfaction and desire to be a member of the network. The use of a collaborative conflict management style has a positive effect on satisfaction and desire for continuity, but the effects of accommodative and confrontational styles depend on the level of inter-personal and task conflict present in the network.     

基于集群系统结构的企业集群成长与政府行为研究

企业集群成长中政府行为的理论基础就在于弥补市场失灵和制度失效,其目的是加强企业之间的知识网络和联系,满足企业的各种需要。根据要素在企业集群系统中的定位和作用方式不同,可以把企业集群系统分为核心要素系统、支持要素系统和促进要素系统,政府应在企业集群系统结构三要素互动中找准行为的着力点。     

The Status of Marketing in the UK Service Industries

This article describes the status of marketing in the UK service industries based on a sample of 320 service companies. It draws comparisons between service marketing companies and product marketing companies in terms of marketing orientation and marketing practice. Some significant differences are found between the two types of companies and it is suggested that there is scope for increased marketing professionalism in many service industries; and a greater sensitivity to market needs is required as markets become more competitive.     

Do Entrepreneurial Social Networks Boost Enterprise Growth? Evidence from the Pearl River Delta in China

Against the backdrop of China’s traditional culture and economic transition, the effect of entrepreneurs’ social networks on enterprise growth has become an important topic attracting attention from both academics and practitioners. This paper decomposes entrepreneurs’ social networks into three dimensions: the external horizontal social network representing inter-firm relationship, external vertical social network in the form of interactions between enterprises and the government, and internal vertical social network referring to entrepreneurs’ control over enterprise operation. Results based on data from the Pearl River Delta reveal that all of the three dimensions of social network exert a positive impact on enterprise growth. The external horizontal social network plays the most influencing role, while the effects of the other two kinds of networks cannot be neglected either.