Is the theory of trust and commitment in marketing relationships incomplete?

Trust and commitment are central to the relational mediators model of relationship marketing. Extant research suggests that trust enhances commitment, as a trusted partner is so highly valued that a channel member will invest in the relationship and put forth efforts to maintain that relationship. This study re-examines the causality between trust and commitment by comparing alternative models across three datasets (including the seminal Morgan and Hunt 1994 data). The results indicate that while trust enhances commitment, commitment can also erode trust. Several viable, theoretically-driven explanations for this negative effect are discussed, and propositions are developed for future research.     

Which one is more valuable in coordinating the online and offline distribution? Service support or online price coordination

Nowadays effective mechanisms to coordinate the online and offline distribution become increasingly important in the business market. In this research, we first propose two mechanisms (i.e. the offline service to the retailer and the online price coordination) for the manufacturer and the retailer to employ. Our results show that the online price coordination does help coordinate the online and offline distribution and bring higher profits to the manufacturer-retailer supply chain and thus both the manufacturer and the retailer, while the offline service to the retailer does not; comparing to the offline service to the retailer, the online price coordination is a better strategy to be utilized to alleviate the online to offline competition. Furthermore, we investigate if a novel coordination mechanism, which combines the offline service to the retailer with the online price coordination, can help coordinate the online and offline distribution better and becomes the optimal coordination mechanism. Surprisingly, our results show that compared to both the offline service to the retailer and the online price coordination, this combination coordination mechanism does show a dominant competitive advantage to bring highest profits to all parties.     

Regulating smart contracts: Legal revolution or simply evolution?

Blockchain-based smart contracts have triggered polarised discussions. They have been applauded as a significant technological achievement, but also criticised as a dumb idea. Their application is rapidly expanding in the financial sector, public sector, supply chain management, and the automobile, real estate, insurance, and health care industries. With the growing use of smart contracts and an increasing variety of smart contracts applications, the debate over the legal implications of this phenomenon has intensified and many legal issues related to smart contracts are being examined. Legal scholars have highlighted potential legal pitfalls, controversies and incompatibilities with existing legal frameworks. Blockchain technology and smart contracts have also been fuelling an interest of legislators, who have begun to recognise regulatory uncertainties and are making the first attempts to introduce legislative solutions to address them. This paper aims to highlight the fervour of the scholarly debate surrounding smart contracts and contrast it with a rather modest response from the legislators thus far. The paper reiterates that smart contracts represent the future. Even though they challenge practitioners, scholars, and legislators, current legislative initiatives indicate that under most legal systems there are no major obstacles for smart contracts and to accommodate smart contracts within the existing legal frameworks we should expect legal evolution rather than revolution.     

What is dark about the dark-side of business relationships?

Over the last decade or so, the term ‘dark-side’ in referring to business relationships has been increasingly used in academic discourse. Despite such a growth in the number of studies, relatively little critique has been offered among scholars. The fact that effectively managing the dark side of business relationships has potentially greater influence of contributing to inter-organizational success beyond more focus on the positive side necessitates an urgent critique surrounding ‘what is dark about the dark side of business relationships?’ Thus, we aim to provide an overview relating to the ‘dark side’ of business relationships in a quest to generate greater debate on the subject.     

Spillover effects of investment in big data analytics in B2B relationships: What is the role of human capital?

Economy-wide investment in Big Data Analytics (BDA) offers retailers a number of opportunities and while there is some evidence that new technologies have been widely adopted by retailers, it also transpires that many retailers have yet to fully exploit the benefits of BDA. Most research on Big Data and productivity (or performance) tends to focus on internal factors that prevent retailers from fully exploiting their investment in BDA. Research has paid scarce attention to the benefits that can accrue to the focal firm from the upstream investment in BDA and the features of the B2B marketing environment that may hamper (or enhance) these benefits. Unlike the previous literature, the paper tests the extent to which retailers, by having access to larger share of graduate workforce at regionally, can benefit more from inter-industry upstream investment in BDA than retailers located in areas where such workforce is scarce. Using data from ORBIS, KLEMS and QLFS, we show that retailers located in regions with a larger proportion of graduate workforce benefit more from inter-industry upstream investment in BDA as they tend to be more efficient on average. Equally, upstream investment in BDA is positively associated to frontier shifts over time (i.e. technical progress).     

Benefit or damage? The productivity effects of FDI in the Chinese food industry

We investigate the impact of foreign direct investment (FDI) on the total factor productivity of Chinese food firms using firm-level census data between 1998 and 2007 (174,940 sample food firms). We test for within-firm, within-industry, and vertical effects. We find that the effect of FDI on the productivity of Chinese food firms depends significantly on the type of FDI and its countries of origin. FDI from non-HMT (Hong Kong, Macaw and Taiwan) regions can improve the productivity of the invested firm, and also increases the productivity of domestic food firms through vertical industry linkages. However, domestic food firms may be crowded out by non-HMT investment in the same industry. HMT investment can generate positive within-industry productivity spillovers, but negative vertical spillovers. Our findings have immediate implications for policymakers in China, as well as for governments of less developed countries that are formulating foreign investment policies.     

What does it take to make the most of supplier relationships?

The supply context of companies has changed substantially during the past two decades because of outsourcing, globalisation and digitalisation, and through growing concern for sustainability and public procurement. These changes, combined with recognition of the potential benefits to be derived from more extensive involvement with suppliers, have made the task of purchasing and supply management broader and more complex. This paper's aim is to examine how the evolving supply context affects the scope of purchasing and supply management and what the consequences for management are. We argue that effective use of supplier relationships involves three main issues – interacting in supplier relationships, dealing with supply network interdependences and handling dynamic changes in the supply context. Coping with these matters requires: (i) conceptual tools that support monitoring and sense-making of what is on-going at the supply side of the firm; (ii) the individual and organisational skills and capabilities required to develop workable solutions; and (iii) organisational arrangements to support the development of these solutions.     

Dynamics of contention in the gig economy: Rage against the platform,customer or state?

Protest in the gig economy has taken many forms and targets (platforms, customers and state officials). However, researchers are yet to adequately account for this diversity. We use a European survey of Upwork and PeoplePerHour platform workers to investigate worker orientation towards different forms of protest. Results reveal that worker anger, dependence and digital communication shape contention in the remote gig economy. Support for collective organisation is associated with anger at platforms as well as their dependence on the platform and communication with other workers. Individual action against clients is associated with anger and communication but not dependence. Support for state regulation is associated only with anger but not dependence or communication. We conclude that the relational approach entailed by Mobilisation Theory can aid explanation in the gig economy by shedding light on the dynamic process by which solidarity and dependence alter the perceived cost/benefits of particular remedies to injustice.     

Exchange or Covenant? The Nature of the Member-Union Relationship

Drawing on a study of members of the U.K. National Union of Teachers, this article considers the extent to which economic exchange, social exchange, and covenantal considerations underpin union members' willingness to continue membership and to participate actively in their union through union citizenship behaviors (UCB). Findings suggest that the more activist forms of UCB were motivated primarily by a perceived covenantal relationship with the union. In contrast, exchange, particularly social exchange, motivations played more of a role in motivating less demanding "rank and file" UCB and intent to quit the union. Union instrumentality appeared to be a necessary but insufficient condition for union viability, having an indirect effect on UCB and intent to quit the union and also moderating the effects of pro-union attitudes. Implications for union strategy are considered.     

Lone wolf or social monkey? The role of marketing outsourcing in the development of second-order marketing competences

Marketing outsourcing has been increasing for decades due to its well-known benefits, even though the development of dynamic marketing capabilities can be severely damaged as a result. This study focuses on the conditions under which marketing outsourcing favors organizational learning. We found that the relationship between marketing outsourcing and second-order marketing competences resembles an inverted U curve. The first-order marketing competences and absorptive capacity positively moderate this relationship both individually and jointly, by shifting the U-curve to the right. Thus, any firm has an optimum level of beneficial outsourcing that depends on how skilled it is in the outsourced marketing function and its ability to assimilate and apply new knowledge. Our findings provide learning-related criteria for the outsourcing decision. Firms that will consider them can develop a knowledge-based competitive advantage while still enjoying the benefits of outsourcing. Against the common wisdom, we show that the development of new marketing capabilities is an equally challenging task for marketing functions with both low and high knowledge intensity.     

Relevance of culture in studies of leadership: ignored or dismissed?

Asia Pacific Journal of Management - Until recently, conclusions drawn about leadership have been made from a decidedly Western perspective, primarily based on theory developed in the U.S. using...     

Do resource differences between manufacturers and suppliers help or hinder product innovation of manufacturers? The moderating role of trust and contracts

It is a common practice of manufacturers to involve suppliers in new product development (NPD). Extant literature indicates that supplier integration has mixed effects on manufacturers' NPD and the contradicting findings result from either the external contingent factors or the tactical integration practices. We argue instead that the mixed effects are rooted in resource differences between manufacturers and suppliers. Further, we examine the functions of trust and contracts as the resource integration and coordination mechanisms to manage the effects of resource differences on product innovation of manufacturers. Based on a survey among 189 manufacturing firms, our research shows that resource differences follow an inverted U-shaped effect on product innovation of manufacturers and that trust strengthens while contract complexity attenuates the curvilinear relationship. As such, our research extends the existing body of literature to account for the divergent outcomes of supplier integration from the perspective of resource differences. Moreover, it demonstrates the double-edged effects of trust and contracts as devices of resource integration and coordination. Our research offers useful research and managerial implications.     

Collusion or Competition? Interfirm Relationships in the Chinese Auto Industry

The Chinese passenger‐vehicle industry contains a large number of manufacturers. Some of them are members of big corporate groups centered around state owned enterprises. These corporate relationships may facilitate collusion. This paper applies the non‐nested hypothesis test methodology to data on passenger vehicles to identify whether price collusion exists within corporate groups or across groups. Our empirical results support the assumption of Bertrand Nash competition in the Chinese passenger‐vehicle industry: We find no evidence for within or cross‐group price collusion. Our policy experiments show that indigenous brands will gain market shares and profits if within‐group companies merge.     

Lighting the way or stealing the shine? An examination of the duality in star scientists' effects on firm innovative performance

Do star employees enhance or constrain the innovative performance of an organization? Using data from 456 biotechnology firms between 1973 and 2003, we highlight the duality of the effects that stars have on firm performance. We show that while stars positively affect firms' productivity, their presence constrains the emergence of other innovative leaders in an organization. We find that firm productivity and innovative leadership among non‐stars in a firm are greatest when a star has broad expertise and collaborates frequently. We offer cross‐disciplinary insights into the role of human capital as a source of competitive advantage, suggesting that the value of human capital in a firm is contingent on the mutual dependence inherent in high‐status employees' relationships with other individuals in a firm. Copyright © 2014 John Wiley & Sons, Ltd.     

Is the future static or dynamic? The role of culture on escalation of commitment in new product development

Escalation of commitment in new product development has been studied extensively for the last four decades but the impact of culture on the escalation phenomenon remains largely unexplored. This study investigates how culture impacts the decision to escalate or deescalate commitment to new products. Americans are analytic thinkers whereas Chinese tend to be holistic thinkers. When it comes to decision making, analytic thinkers focus on field independent and abstract factors and believe that future is linear and static, whereas holistic thinkers focus more on contextual factors and believe that future is dynamic and nonlinear. Hence, Chinese are more likely to escalate their commitment relative to Americans on receiving a negative performance report in the new product development process. A lab experiment using weekend MBA students and managers was used to test this underlying hypothesis. The findings confirmed that analytical thinkers use fewer factors than holistic thinkers in making new product decisions, and that Chinese managers are more likely to escalate their commitment relative to American managers. The decision to escalate or de-escalate was moderated by perceived product innovativeness.     

The origins of power in buyer–seller relationships

Who, or what, holds power in business-to-business buyer–seller relationships is a debate at the heart of power theory. Power in buyer–seller relationships is variously seen as the property of organizations, individuals or relationships yet to be theoretically valid and useful to management, integration of these schools of thought needs to be operationalized. This paper opens up future research avenues through identifying how buyers and sellers understand the origins of power and the nature of self perceived and countervailing power. The paper presents results from 10 focus groups of both buyers and sellers revealing the underlying origins of experienced power. The results support the proposition that power in buyer–seller relationships is a pluralistic concept and that extant theories focused on organizational, individual or relational elements of power are independently too narrow in their reflections of the power construct; rather, they are all part of the same broad construct.     

When do formal control and trust matter? A context-based analysis of the effects on marketing channel relationships in China

Formal control and trust are two typical governance mechanisms employed to safeguard business transactions. Yet the effectiveness of each mechanism for firm relationship outcomes remains unclear. Some relevant literature suggests that formal control and trust simultaneously can help secure transactions, whereas other research argues the two control mechanisms can substitute for each other. This study applies social embeddedness theory and differentiates strong tie from weak tie relationships. In so doing, it reveals the role of strong versus weak social ties in leading to parallel conclusions about the relationship between formal control and trust and their effects on relationship outcomes. On the basis of empirical tests in a Chinese marketing channels context, this study finds that the joint effects of formal control and trust on governing transactions depends on the relational tie that the focal partners share. Specifically, formal control and trust complement each other only in weak tie relations. On the basis of this new perspective, the authors offer theoretical and managerial implications for managing interfirm governance mechanisms in transitional economies such as China.     

Causal or effectual? Dynamics of decision making logics in servitization

This study explores servitization as an innovative market strategy for manufacturers and investigates how the decision making logics change over time in the servitization transformation process. Effectuation theory is applied to examine servitization as a new theoretical exploration. A longitudinal case study of a global heavy vehicle manufacturer's servitization process in China reveals that the decision makers adjust their decision making logics depending on the stage of the servitization process and associated risk patterns. As the servitization process evolves into a more sophisticated stage, decision makers will change their decision making logics from a causation dominant logic to an effectuation dominant logic in order to cope with the increased risks. Effectuation theory originally developed from entrepreneurship research is found to be a valid theory for the explanation of the risk and uncertainty control behaviors in the servitization transformation process of manufacturing firms.     

A Switch or a Process? Disentangling the Effects of Union Membership on Political Attitudes in Switzerland and the UK

The paper examines the effects of union membership on individual political attitudes using panel data for Swiss and British workers. Considering union membership as an on/off switch (member vs. non-member), as it is often done, it is only possible to distinguish between a selection effect (unions attract like-minded individuals) and a molding effect (the experience of membership has a transformational impact on the individual). Exploiting the longitudinal structure of the data reveals that union membership is best characterized not as a switch, but as a dynamic process involving anticipation effects (which start well before becoming affiliated) and maturation effects (which become noticeable only after a certain duration of membership and may not dissipate after leaving the union). Empirically, the selection effect appears the most important in the two countries we focus on, while the molding effect is less pronounced. Anticipation and maturation effects are also non-negligible and hitherto unexplored.