“Vertical coopetition”: The key account perspective

Why do key accounts combine opposing types of relationship with their suppliers? The author has chosen to term this new hybrid form of supplier relationship management, which combines cooperation and price-competitive transactions and reflects the tension between value creation and value appropriation, “vertical coopetition.” She investigates the use of this concept in the context of an in-depth qualitative study, involving, firstly, an exploratory field study and, secondly, four case studies involving leading industrial MNCs. The results indicate that “vertical coopetition” occurs in two forms: when the price-competitive approach is predominant but some cooperation features are still to be found; and when cooperation is predominant, but appeals to competition are still made. Mutually opposed aspects of each form are linked and explained by three pivotal mechanisms, which the author calls, “strengthening”, “correction” and “commuting”. Finally, the study reveals that, increasingly, the key account's brands or Business Unit value¹ are explanatory forces of “vertical coopetition”.     

Decomposition analysis of the telecommunications sector in Indonesia: What does the cellular era shed light on?

Indonesia is currently enjoying rapid development in the telecommunications sector despite the economy having been heavily dependent for almost four decades on the two largest sectors: the manufacturing industry and trade. The telecommunications sector has played an important role in stimulating economic growth in the country during the last few years, with an annual growth rate higher than that of other sectors. This contribution is supported to a great extent by the rapid diffusion of telephony, in particular cellular telephony, as the number of subscribers increased from just 2.1 million in 1999 to 170 million in 2011. Previous studies investigating the impact of the telecommunications sector on the economy aggregate the impact of the sectors on Gross Domestic Product (GDP) without further scrutiny of what sources of growth telecommunications has contributed. Hence, an interesting question arises as to whether the achievement of cellular diffusion is also followed by structural change in the telecommunications sector. That said, this study aims to decompose the output of telecommunications into several sources of growth: domestic final demand, export effect, import substitution effect and technological coefficient effect. A particular interest in this study is to compare the source of growth concerning domestic final demand and the technological coefficient effect. The main tool for analysis in this study is the Input–Output (IO) method, while the time series of the investigation covers the period 1975–2008, allowing comparison of structural changes in the telecommunications sector between the pre- and post-cellular eras. The study found that the coefficient multiplier of the telecommunications sector, which was approximately 1.8 during the 1980s, had decreased to only 1.3 by the end of 2008. Consequently, the final demand from the telecommunications sector contributed less to economic output in the late 2000s compared to the impact in the 1980. Moreover, the cellular era that started in the early 2000s also brought about a trend of changes in telecommunications output. While final demand remains very dominant, the technological coefficient effect has diminished as the source of telecommunications output. This finding indicates a lower ability of the telecommunications sector to build an inter-industry relationship with other sectors. A possible explanation for this result is the cellular uses which are much less related to business activities than that of fixed telephony dating back to the 1970s in Indonesia.     

The role of epistemic communities in the “constitutionalization” of internet governance: The example of the European Commission High-Level Expert Group on Artificial Intelligence

In the last few years, digital constitutionalism has emerged as a novel, alternative, Internet Governance approach aiming at ordering and limiting the exercise of power by both states and private operators, as well as at promoting people's control over digital technology development.Although digital constitutionalism is encountering growing popularity, the prevalent non-binding nature of its initiatives, the discrepancy between the jurisdictional border and transnational digital processes, and the technological embedment of governance mechanisms, have hindered the effectiveness of its impact.This paper identifies epistemic communities as a crucial factor for the constitutionalization of the digital technologies since they have the necessary technical expertise and policy commitment to create norms and standards at transnational level, informing the policy choices of both state and non-state actors.In order to illustrate this nexus, the article performs an in-depth investigation on the case of the European Commission High-Level Expert Group on Artificial Intelligence (HLEG-AI). The analysis revealed that the HLEG-AI effectively gathered an epistemic community strongly committed with fundamental rights promotion and capable to influence the following policy-making activities of the European Commission, as well as of other non-state stakeholders, whose involvement is essential in order to embed digital constitutionalism principles within the design of AI systems.     

“Data localization”: The internet in the balance

There is a steady global trend towards “Data Localization,” laws by which data is required to be maintained and processed within the geographic boundaries of its state of origin. This development has raised concerns about its possible adverse impacts on emerging data-intensive technologies such as Cloud services/E-commerce, Big Data, Artificial Intelligence and the Internet of Things (collectively, the Embedded Infosphere). The inability to reach an international agreement on rules for cross-border data flows may have significant adverse consequences for all future users of the Internet.The basis of Data Localization is grounded in two distinct but inter-related policy models: Data Sovereignty and Trans-Border Data Flows. These two concepts have different origins. “Data Sovereignty” is derived from the historic power of a state of absolute and exclusive control within its geographic borders. Policies behind TBDFs arose in Europe following World War II, primarily motivated by Nazi use of early proto-computers to help round up Jews and others. As they have evolved, TBDF policies have been directed primarily at protecting personal data and privacy.This article first examines the issues of: 1) “Information Sovereignty” and 2) TBDFs. It then describes the arguments for and against “Data Localization,” offers some examples of strong localization policies (Russia, China), and summarizes contesting policy proposals. It then contextualizes TBDF with issues of human rights (free flow of information) and privacy.While the utility of an international agreement on TBDFs is clear, the differences in approaches are tenacious. For the free-market developed world (e.g, EU, OECD), the path forward seems to lead through policy convergence to compatible rules, with differentiated levels of data protection and accountability. It is far from clear whether these rules will address, in a mandatory way, issues of the “free flow” of information in the human rights sense. At the same time, there are countries (e.g., BRICS), representing a majority of the world's population, in which political and cultural resistance will produce stringent Cyber Sovereignty and Data Localization policies with few if any human rights components.The article concludes that the more the Internet is “localized”, the more attenuated its benefits will become. The negative consequences of Data Localization will become increasingly obvious as new, data-intensive technologies become ubiquitous, creating a condition of “Data Dependence”. It is projected that in the future the nations with the least amount of Data Localization and the most open flow of information will be the most successful in benefiting from new data-intensive embedded, networked technologies. This will most likely be characterized by values adopted as policies and practices in the EU.     

The Year in Review: Economics at the Antitrust Division 2013–2014

During 2013–2014, the Antitrust Division of the U.S. Department of Justice brought a wide range of matters to successful conclusions. The three matters that are discussed below demonstrate the diverse set of issues that the division examines every year.     

The Year in Review: Economics at the Antitrust Division, 2009–2010

This paper covers the activities of the Economic Analysis Group of the Antitrust Division, U.S. Department of Justice, during 2009–2010. It describes the economic analysis undertaken by EAG in several important investigations and other activities as an advocate for competition.     

Are OECD-prescribed “good corporate governance practices” really good in an emerging economy?

This paper examines whether adopting OECD-prescribed corporate governance principles can solve the major corporate governance problem in an emerging economy—controlling-shareholder expropriation. We argue that “good governance practices” in OECD countries (e.g., an active board of directors, separation of chairperson and the CEO, significant presence of outside directors, and a two-tier board) cannot mitigate the negative effect of controlling-shareholder expropriation on corporate performance for two main reasons. First, most good governance practices are mainly designed to resolve conflicts between shareholders and the management but not conflicts between controlling and minority shareholders. Second, board directors are typically not independent to controlling shareholders, and supervisory directors often have low status and weak power in a firm. Using a panel of over 1,100 Chinese listed firms between 2001 and 2003, we find supportive evidence for our arguments. We discuss the implication of our study for public policy and strategies of investors.     

Path dependencies versus efficiencies in regulation: Evidence from “old” and “new” broadband markets in the EU

This paper examines the determinants of sector-specific regulation imposed on broadband markets related both to efficiency objectives of regulators and to those of narrowly defined interest groups. We test hypotheses derived from the normative and positive theoretical literature employing recent panel data on 27 European Union member states taking into account endogeneity of the underlying regulation and market structure variables. Our empirical specification employs three different estimators based on instrumental variables in order to identify causal effects. We find evidence supporting both regulators pursuing normative objectives and inefficiencies related to regulatory path dependence, bureaucracy goals and an inadequate consideration of competition from mobile broadband networks. Our results call for adjustments in the institutional design of the decision-making process under the current European Union regulatory framework.     

Growth in the “new economy”: US bandwidth use and pricing across the 1990s

An acceleration in the growth of communications bandwidth in use and a rapid reduction in bandwidth prices have not accompanied the US economy's strong performance in the second half of the 1990s. Overall US bandwidth in use has grown robustly throughout the 1990s, but growth has not significantly accelerated in the second half of the 1990s. Average prices for US bandwidth in use have fallen little in nominal terms in the second half of the 1990s. Policy makers and policy analysts should recognize that institutional change, rather than more competitors of established types, appears to be key to dramatic improvements in bandwidth growth and prices. Such a development could provide a significant additional impetus to aggregate growth and productivity.     

Extending the “P” perspective: An institutional account of management research in Australia

In commenting Meyer’s article “Asian management research needs more self-confidence” in APJM (2006), Yang and Terjesen (Asia Pacific Journal of Management, 24(4):497–507, 2007) described ground realities in Australia that may have inhibited the development of a robust management research community. As an Australia-trained and Australia-based Asian management scholar, I extend the “P” perspective by exploring how the formal and informal institutions interact in shaping Australia-based scholars’ publication strategies and research performance. Reflecting on my experience in Australia, I argue that like in any other businesses, institutions matter in our business of research and publication. They matter because they can shape the local “rule of the game” within which a country’s or a region’s scholars conduct and publish their research. A full institutional account of the current state of management research in the Asia Pacific region requires a deeper understanding of both formal and informal local institutions. From such an institutional perspective, this commentary concentrates on why Australian management research lags behind that in the US and Europe and yet leads the Asia Pacific region.

Challenges in reducing food losses at producers’ level: the case of Greek agricultural supply chain producers

Food losses need to be reduced throughout the Agricultural Supply Chain (ASC). In the EU producers’ food losses are substantial. Different ways have been suggested to reduce food losses at producers’ level such as investments in technology, changing regulations, and development of collaborative relationships. However, food loss reduction has not been yet achieved as it seems that producers are facing certain challenges which have not been yet identified. Thus, this study aims to explore the challenges that the EU ASC producers are facing in their efforts to reduce food losses using Contingency Theory. In the Greek ASC of peaches food loss levels of producers are substantial. Twenty-six in-depth semi-structured interviews have been conducted with Greek ASC producers. The analysis uncovered five major categories of challenges in reducing food losses at producers’ level which are: lack of technology adoption, lack of understanding of the changing market requirements and the changing regulations, lack of farm-related skills and the need for modern agricultural practices, collaboration issues, and the impact of climatic change. The impact of climatic change as well as collaboration were found to be the main challenges for reducing food losses. Future research directions as well as policy implications are provided in the end.     

“I want you back”: On the strategic roles of boundary spanners in supplier switching-back processes

This paper builds upon literature addressing boundary spanners and switching suppliers in order to explore an under-examined aspect of buyer–supplier relationships: how different individuals at multiple organisational levels affect processes by which firms return, or “switch back”, to former suppliers after breaches in their relationships. Our study followed a qualitative approach by applying an abductive research methodology to make sense of 85 semi-structured interviews with executives involved in the erstwhile buyer–supplier relationships that we investigated. We found that supplier switching-back processes (SSBPs) can be understood as constituted by a set of alignments and misalignments between boundary spanners (i.e. top management, purchasing and sales agents, engineers and technicians) in the organisations involved. Thus, peoples' interactions, or lack thereof, directly affect the possibility for buyers and suppliers to restore their severed relationships. We conclude that boundary spanners pursue seven distinct roles during different periods in SSBPs, roles that relate to three identified functions of boundary spanners in such processes. The paper closes by highlighting what our findings imply for business managers, limitations and some possible directions for future research.     

“If I was going to design a chair,the last thing I would look at is a chair”: product analysis and the causes of fixation in students’ design work 11–16 years

Creativity is acknowledged to be important for economic growth and as an everyday life-skill, however several influential reports have suggested that education could do more to harness creative talent. Creative cognition literature suggests the lack of creativity is at least partly the result of ‘fixation’ (difficulty in generating novel ideas due to imagination being ‘structured’ by existing knowledge). This paper focuses on the secondary (students aged 11–16 years) design and technology (D&T) context in the UK. Here we examine whether teacher practice can contribute to fixation by focusing on one specific facet of teacher practice in D&T; the use of product analysis to inform the generation of creative design ideas. Data is drawn from the preliminary phase of a research and intervention project from interviews with D&T teachers (N = 14), students (N = 126) and lesson observations (N = 10) and an analysis of documents and student work. Product analysis is widely used at different points in design projects but, as is shown, in all cases current practice can lead to fixation, as thinking is constrained down specific paths and tasks are at best at procedural rather than comprehension level. The implications of these findings and tentative ways forward for practitioners are discussed.     

Strategic development of third-party logistics providers (TPLs): “Going under the floor” or “raising the roof”?

Contemporary (third-party logistics providers) TPLs are in danger of being stuck in the middle, unable to perform customer adaptation as well as before and unable to achieve sufficient economies of scale. This conceptual paper aims to explore challenges facing the strategic development of TPLs within a context of increased digitalization, e-commerce and servitization.There are two apparent strategic paths. Under circumstances of strong price pressure, there is demand for standardized TPL services offering simplicity, minimalism and functionality based on digitalization, e-commerce and servitization. Alternatively, with market developments responsive to supply chain complexity, digitalization, e-commerce and servitization enable development towards innovation and change.We conclude that these developments do not invalidate existing frameworks for TPL strategies but contribute alternative strategies. We formulate three propositions for each strategic path. To avoid being stuck in the middle, TPLs are encouraged to either develop efficient services through servitized logistics chains and digital solutions or develop advanced solutions to integrate the consumer into the logistics network system through competencies to control increased levels of complexity.     

Price Spikes in Energy Markets: “Business by Usual Methods” or Strategic Withholding?

There is considerable controversy whether price spikes in energy markets represent demand shifts in the presence of inelastic supply or strategic withholding by suppliers. This paper sets out a new method for distinguishing the two possible explanations, namely, determining whether supply shifts to the left during periods of high demand. Such behavior would be inconsistent with ordinary profit-maximization, that is, “business by usual methods.” This approach is applied to a period of unusually high prices in the New York wholesale electricity market in 2001. There is evidence of strategic withholding for one brief period.     

Adaptive marketing capabilities,dynamic capabilities,and renewal competences: The “outside vs. inside” and “static vs. dynamic” controversies in strategy

Three streams of strategic thought, (1) the “adaptive marketing capabilities” works, (2) the “dynamic capabilities” view, and (3) resource-advantage (R-A) theory, are converging on the view that, in today's dynamic, hypercompetitive, global economy, strategy must focus on firms' constantly renewing themselves in the marketplace. In turn, these three streams have implications for the controversies over whether strategy's focus should be “outside-in or inside-out” and whether strategy should be static or dynamic. This article addresses the three streams of strategic thought and the two controversies by (1) explicating their nature, (2) showing how strategies related to them have evolved through time, and (3) pointing toward the controversies' resolution. The article argues that all theories of strategy assume a theory of how competition works. In turn, theories of competition are housed within disciplinary research traditions. Therefore, understanding the controversies in contemporary strategy is furthered by understanding both the theories of competition that underlie each strategic approach and their respective research traditions.     

“Green” supply chain management: The role of trust and top management in B2B and B2C markets

“Green” supply chain management (GSCM) has often been associated with highly visible companies (Bowen, 2000) and firms within consumer-focused industries (Buysse & Verbeke, 2003; Hall, 2000; Roht-Arriaza, 1996). As such, GSCM has partly been led by development of consumer awareness of environmental issues (Beamon, 1999; Zhu et al., 2005). This suggest that firms operating in business-to-consumer (B2C) markets have strong incentives to implement GSCM, due to both institutional and stakeholder pressure. However, this leaves the role of GSCM in business-to-business (B2B) sectors relatively unexplored and to-date little is known about: 1) the relative engagement with GSCM among firms in business-to-consumer and business-to-business sectors; 2) the conditions that are necessary for successful implementation of “green” practices in B2B supply chains. This study addresses these issues within the context of 340 buyer–supplier relationships in the United Kingdom, using an innovative research methodology that captures firms' engagement with GSCM practices and minimizes social desirability and common source biases. Our results show that GSCM is relatively limited among firms in B2B markets compared to firms in B2C markets. At the same time, we show that developing trust with supply chain partners, while also having top management support, is a crucial driver of engagement with GSCM among firms in B2B sector but less important among firms in B2C sector. These findings provide considerable insights to managers and marketers of B2B supply chains that seek to respond to a growing interest of environmental performance of supply chain.