Safeguarding investments and creation of transaction value in asymmetric international subcontracting relationships: The role of relationship learning and relational capital

This study examines how suppliers who do not have bargaining power to protect relationship-specific investments (RSIs) can use safeguarding mechanisms to create transaction value in the context of asymmetric international subcontracting partnerships. From a supplier perspective, two different types of bilateral safeguarding mechanisms, relationship learning and relational capital, play discrete roles in the process of creating transaction value. Drawing on a resource-based view (RBV) of the firm, this study proposes that RSIs (a firm's resources), can enhance relationship learning (capabilities), which in turn, facilitates dyadic capability enhancing (joint competitive advantage). In addition, from a social capital perspective, relational capital facilitates relationship learning and strengthens the positive relationship between RSIs and relationship learning. Relationship learning plays the key role, and acts as the catalyst in transforming RSIs and relational capital into dyadic capability enhancing. The hypotheses are tested using data from a survey of 118 Taiwanese supplier–international buyer relationships in information technology industries. The study finds that relationship learning mediates the relationship between RSIs and dyadic capability enhancing, and that relational capital moderates the relationship between RSIs and relationship learning.     

Matching governance mechanisms with transaction-specific investment types and supplier roles: An empirical study of cross-border outsourcing relationships

Drawing from transaction cost economics (TCE) and relational view (RV), we develop a contingency framework that matches governance mechanisms with different types of supplier transaction specific investments (TSIs) in cross-border outsourcing relationships. We further examine the three-way interaction effects between governance mechanisms, TSI types, and supplier roles in cross-border outsourcing relationships. Using data collected from 324 managers of local suppliers in China and 162 managers working for international buyers located in 15 different OECD countries, we find that while relational governance is more effective at safeguarding supplier human TSIs, it is not an effective solution for safeguarding supplier physical TSIs. In contrast, formal contracts help safeguard supplier physical TSIs against international buyer opportunism, but they are ineffective at safeguarding local supplier human TSIs. Moreover, we find that the interaction effect between formal contracts and supplier physical TSIs is stronger for original equipment manufacturers (OEMs) than for original design manufacturers (ODMs), whereas the interaction effect between relational governance and supplier human TSIs is stronger for ODMs than for OEMs. Theoretical and managerial implications of the findings follow.     

What Makes Logistics Integration More Effective? Governance from Contractual and Relational Perspectives

Third-party logistics (3PL) user–provider integration is attracting increasing attention from both academics and practitioners. However, it remains unclear how best to adopt governance mechanisms to safeguard 3PL user–provider integration (e.g., information sharing and process coordination). Based on transaction cost economics and social exchange theory, this study examined the individual and joint effects of contractual (e.g., detailed contracts and contract application) and relational governance (e.g., trust and relational norms) on 3PL user–provider integration for operational performance. We conducted a survey involving 247 3PL service users and analyzed the conceptual model using the method of structural equation modeling. The results showed that process coordination improved operational performance, while information sharing alone did not significantly improve operational performance but complemented the role of process coordination in improving operational performance. In addition, having detailed contracts was positively related to process coordination, while contract application was positively related to information sharing. Trust was not significantly related to information sharing or process coordination, while relational norms were positively related to both. Finally, three joint effects on 3PL user–provider integration were found. Two of them were substitutional (detailed contracts and relational norms; contract application and trust), and one was complementary (detailed contracts and trust). This study makes several theoretical contributions and provides novel guidelines for 3PL relationship development.     

Host country institutional pressures and cross-border relationship governance

This study examines the effects of transaction cost, strategic positioning and institutional factors on the governance of international relationships. A firm's product differentiation strategy and export market ethnocentricity are identified as antecedents to specific investments, whereas state influences in the export market are identified as an antecedent to relationship governance. The hypotheses are empirically tested on a sample of 160 international business-to-business relationships. The results show that both product differentiation and export market ethnocentricity impact the level of specific investments, and state influences make it difficult to use both formal contracting and relational norms as governance mechanisms. Furthermore, specific investments made by the supplier are positively related to formal contracting, and product differentiation is positively related to relational norms.     

Trust,Decision Rights Delegation,and Performance—The Case of Franchising

Previous research has not examined the relationship between trust, decentralization, and franchisor performance. Complementary to the literature on autonomy and relational governance from franchisees’ perspective, this study focuses on the franchisor's perspective on the impact of decentralization and trust on performance. Consistent with the embeddedness view, the results show that trust is a facilitator of decentralization in franchise networks, thereby increasing the positive performance effect of decision rights delegation. Overall, the study offers a new perspective on the relationship between formal governance—through decision rights allocation—and trust as a relational variable in interorganizational networks.     

Influence behaviors and employees’ reactions: An empirical test among six societies based on a transactional–relational contract model

Organizational and task commitment are central drivers of firm performance as they affect employees’ willingness to exert effort for the organization. This paper argues that supervisors who consistently use socio-emotional and supportive influence strategies are likely to enhance subordinates’ immediate commitment to the tasks as well as their psychological attachment to the organization. Drawing on the transactional–relational contracts framework, we develop and empirically examine the effects of supervisors’ influence behaviors on two types of commitment. Data collected from 1150 respondents from China, Hong Kong, Taiwan, Germany, United States and Brazil provided support for the positive relationship between the persuasive influence strategy and both immediate task and organizational commitment. Exploratory analyses of the cultural differences in our sample reveal differences in assertive and relationship-based individual tactics. We thus identified potentially universally endorsed as well as culturally contingent influence tactics in predicting the two types of commitment.     

Interaction effects of formal and social controls on business-to-business performance

Marketing and Strategy studies have treated relational governance as a critical factor of business-to-business (B2B) performance. Extant studies offer contrasting views on whether formal or social control is a better control mechanism, with little known about their interaction effect. In this study, the authors aim to investigate the interaction effect of these two control mechanisms by dividing a B2B contract (formal control) into two provisions (transactional and relational) and to examine the specific interaction effect of social control on each provision. The authors also seek to investigate the moderating effects of environmental dynamism, prior ties, and buyer lock-in. The measure of B2B performance reflects relational quality and financial outcome. The results show significantly different interactions between each provision of the contract and social control depending on the level of environmental dynamism and buyer lock-in, and suggest that the environmental condition of the transactions is reflective of managers' optimal control mechanisms.     

Buyer Loyalty in Business Markets: Can the Firm and Salesperson Get What They Truly Desire?

Purpose: Prior literature has acknowledged multi-foci customer loyalties (loyalty to the selling firm and salesperson-owned loyalty) and argued that both entities (selling firms and salespersons) foster customer loyalty through respective loyalty-capturing efforts (relationship investments). However, scholars have not investigated the influences of different types of interfirm relationship-specific investment (RSI) activities and salesperson behaviors (brand-building and guanxi behavior) on customer loyalty to the selling firm and salesperson-owned loyalty, especially their simultaneous (interaction) effects. The current research attempts to address this issue and examines the impacts that RSIs and salesperson behaviors have on customer loyalties.

Methodology/approach: A survey of seller–buyer dyads was conducted to test the proposed theoretical model and hypotheses. Using 192 dyadic data from customers and salespersons in the Chinese business-to-business contexts, this study specifies the direct and interactive effects of sellers’ RSIs and salespersons’ behaviors on customer loyalties.

Findings: Results indicate that selling firms’ loyalty-capturing efforts—property-based and knowledge-based RSIs—have different influences on two types of customer loyalty. Salespersons’ relationship investments—brand-building and guanxi behaviors—also have asymmetric impacts on customer loyalty. Counterintuitively, salespersons’ loyalty-capturing efforts weaken the relationships between firms’ RSIs and customer loyalties.

Originality/value/contribution: This study specifies different types of relationship investments and examines their respective and interactive impacts on two types of customer loyalty—loyalty to the selling firm and salesperson-owned loyalty. The findings indicate that firms’ and salespersons’ efforts may lead to unexpected and unintended effects on multi-foci loyalties. Therefore, the current study enriches our knowledge about multi-foci loyalty management and relationship marketing.

Practical implications: Because firms’ and salespersons’ loyalty-capturing strategies exert positive direct influences on loyalty to the selling firm and salesperson-owned loyalty, both entities may actively leverage relationship investments’ impact on customer loyalty. However, as the interactive effects derived from concurrent loyalty-enhancing activities are negative, firms need to clearly assess the nature and

characteristics of their relationship with buyers and properly design relationship investments and guide salesperson behaviors. Managers should use property-based RSIs as a primary safeguard of customer loyalty to the selling firm. Meanwhile, internal branding and training programs can help salespersons develop brand building behaviors and better understand the potential unintended outcomes that different behaviors may induce. Aligning a branding goal between the firm and salespersons can benefit both parties while avoiding counter-productive outcomes.     

Antecedents and consequences of psychological contracts: Does organizational culture really matter?

Exploring the role of psychological contracts, this study proposes that different organizational cultures are associated with relational psychological contracts compared to transactional contracts while both types of contracts serve as mediators. While clan cultures positively impact relational contracts and are negatively associated with transactional contracts, hierarchical cultures have the reverse effect. In addition, psychological contract types mediate the two culture types' relationship to both organizational commitment and employee yearly earnings. In sum, clan cultures relate to more positive organizational outcomes than hierarchical cultures, a finding which as implications for future research and practice.     

供应商角色绩效与经销商感知公平：社会互动及合同的调节作用

文章探讨了由供应商—经销商构成的渠道关系中,供应商角色绩效对经销商感知公平（分配公平和程序公平）的影响及社会互动与合同对上述关系的调节作用,并进一步考察了经销商感知公平对其绩效的影响。实证研究结果显示：供应商角色绩效可以显著地提高经销商对分配公平的感知,但在提高经销商感知程序公平方面作用不显著;社会互动可以强化供应商角色绩效在提高经销商感知公平方面的作用;合同可以强化供应商角色绩效在提高经销商感知分配公平方面的作用,但无法强化供应商角色绩效对经销商感知程序公平的作用;经销商感知的分配公平可以显著地提高其绩效,但感知的程序公平对其绩效无显著影响。研究结论从渠道情境的角度解释了以往实证研究与理论观点不一致的原因,丰富了现有渠道公平的研究,也为供应商如何有效利用其角色绩效以提高经销商的感知公平提供指导意见。     

Social Capital,Informal Governance,and Post-IPO Firm Performance: A Study of Chinese Entrepreneurial Firms

Social capital can serve as informal governance in weak investor-protection regimes. Using hand-collected data on entrepreneurs’ political connections and firm ownership, we construct several original measures of social capital and examine their effect on the performance of entrepreneurial firms in China after their initial public offerings. Political connections or a high percentage of external investors tend to enhance firm performance, but intragroup related-party transactions commonly lead to performance decline. These forms of social capital have a strong influence on the performance of Chinese firms, whereas formal governance variables such as board size or board independence have little effect. Although social capital may serve as an informal governance mechanism and effectively substitute for formal governance mechanisms in an emerging market, this role of social capital raises several ethical concerns, notably the development of rent-seeking and crony capitalism.     

The Relationship between Mutual TSI and Interfirm Contracts: The Moderating Effect of Strong Ties

ABSTRACT

Purpose: This study examines the influence that tie strength has on contractual relationships between exchange parties with specific investments and also explores the role of network intensity in contractual relationships between buyers and suppliers. We hypothesize that the relationship between transaction-specific investments (TSIs) and contracts is moderated by network intensity.

Methodology: An empirical test is carried out by analyzing buyer–supplier relationships of manufacturing companies. The construct measures were based on those obtained from prior research, and the reliability and validity were established using exploratory and confirmatory factor analysis. The overall measurement model was then assessed with structural equation modeling using AMOS.

Findings: We focus primarily on contract variables as a governance mechanism that can be affected by the strength of ties among firms and the results of our empirical study indicate that supplier TSIs improve the use of informal contracts while the use of formal contracts undermines the effect on supplier TSIs. In addition, we found that firms with weak ties with their partners in the network are more likely to use both formal and informal contracts than those with strong ties.

Contribution: Our study has several contributions. First, our research improves the understanding of the relationship between TSIs and the choice of contracts as a governance mechanism, especially for mutual TSIs. Second, our research improves our understanding of the network strength in the context of business-to-business relationships extending the understanding of the relationship intensity among firms in a network. Third, we focused on the effects of network intensity on contractual relationships.     

Employing brand governance mechanisms with export channel partners: What are the performance consequences and contingent effects?

For decades leading international business scholars have assessed the benefits accruing from successful governance mechanisms. Although the critical importance of initiating and maintaining good relationships with export channel partners is recognized within the literature, there has been little research focus placed on the optimal approach for governing intangible aspects of these relationships. We offer the first integrated definition of export brand governance of channel partners (EBGoCP) and investigate its influence on export performance. Drawing from relational governance theory and contingency theory, we develop and test a model of the contingent effects of different country specific advantages and firm characteristics on the performance upshots of EBGoCP. Using survey data from UK exporters, our findings validate the hypothesized enhancing effects of EBGoCP on export performance outcomes. Furthermore, consistent with our contingency based predictions, we find country-of-origin-image, firm size and scope of exporting moderate the impact of EBGoCP on export performance. Along with providing fresh insights from the results, this study opens up a new stream of international business governance research and offers productive future research paths to follow.     

Strategic fit, contractual, and procedural governance in alliances

This paper focuses on the simultaneous mediating and moderating effects of different governance mechanisms on the relationship between conditions for alliance formation and outcome. Alliance governance takes two distinct forms: contractual integration and procedural coordination. While contracts may help set the legal parameters of the alliance agreement, it is day-to-day coordination of activities and processes that determine the effectiveness of such contracts. The proposed framework explains how knowledge outcome of collaborative relationships may be determined by the match of partner motives, influenced by the mix of contractual and procedural governance. A series of testable propositions helps answer the following question. Do combinations of contractual and procedural governance mechanisms, given specific strategic fit, explain knowledge performance differentials?     

Effects of relationship climate, control mechanism, and communications on conflict resolution behavior and performance outcomes

In this two-year study we develop and test a comprehensive model of conflict management. The conceptual model commences by demonstrating the importance of channel members’ past history of interactions as ‘setting the stage’ for members’ present ability to interact, that is, communicate, resolve conflict disputes, and ultimately, culminate in performance outcomes (financial as well as relational). In effect, we track the full gamut of conflict management related constructs in the conceptual model, from antecedent conditions to the consequents of conflict management. Empirical results, utilizing a sample of 282 retailing agents affiliated to a large North American supplier (principal) across two years, indicate strong evidence for fourteen of the eighteen hypotheses drawn from our conceptual model. Specifically, among other effects, data reveal that past history of cooperative versus conflictive orientations and bureaucratic versus trust-based governance mechanisms significantly influence the communication strategies adopted, which in turn determine whether the distributive or integrative conflict resolution behaviors are adopted. Further, the choice of conflict resolution behaviors adopted commensurately influences relational performance, and the type of communication strategy adopted influences financial performance. The paper concludes with a series of managerial implications and an agenda for future research.     

The Impact of Relational Governance on Relational Exchange Performance: A Case of the Taiwanese Automobile Industry

Relational governance affects manufacturers’ ability to adapt flexibly to uncertainty in manufacturer–supplier relationships. Enhancing manufacturer–supplier relationships requires considering supplier willingness and opinions on the relational governance of their focal manufacturer and the effect of relational governance on relational exchange performance. After reviewing the related literature, I identified the antecedents of relational governance affecting suppliers’ relationships with their focal manufacturers and explored the effect of relational governance on relational exchange performance, taking relationship value and relationship norms as the intervening constructs. Data were collected from 241 usable questionnaires that had been completed by suppliers for all Taiwanese automobile manufacturers. The hypotheses were tested with respondent data by using a structural equation model. The results indicated that relational governance directly and positively relates to relationship value and relationship norms, relationship value and relationship norms directly and positively relate to relational exchange performance, and customer focus and competitive priorities directly and positively relate to relational governance.     

Knowledge transfer in the context of buyer–supplier relationship: An analysis of a supplier's customer portfolio

In the context of buyer–supplier relationship, the present study will not only analyse the role of formal and informal mechanisms to transfer knowledge but also the direct and moderating effect of trustworthiness, as relational dimensions, to understand how customers acquire knowledge from suppliers. The results related to a sample of 105 customers belonging to a medium-sized Italian manufacturer's customer portfolio show that both formal and informal transfer mechanisms positively impact knowledge acquisition. Trustworthiness positively moderates the effect of informal transfer mechanisms and negatively moderates the effect of formal transfer mechanisms on knowledge transfer. Some considerations regarding the customer portfolio are suggested to enhance our understanding of the effectiveness of knowledge transfer mechanisms in relation to different trustworthiness contexts.     

产权结构、企业契约和治理结构相互关系研究

文章指出,产权是一系列权利的集合体,可分为剩余索取权和剩余控制权两项。产权结构不仅便于明确各产权主体间的责、权、利关系,也是企业成为市场主体与企业契约有效达成的前提条件。企业契约对产权分析具有重要意义,是公司治理结构赖以产生的条件,剩余控制权与剩余索取权的配置是公司治理结构的决定性因素。企业产权结构的变化制约着公司治理结构的发展变迁,也制约着公司治理模式和治理绩效。公司治理结构的有效运作需要若干机制共同作用,才能满足公司治理的全部需求,保证公司治理的高效运行。     

Exploring the governance mechanisms of quasi-integration in buyer-supplier relationships

This article deals with quasi-integration governance mechanisms in the context of business-to-business buyer-seller relationships. Based on transaction cost analysis and resource dependence theory, the authors identify four key elements of quasi-integration: legal contract, joint problem solving, joint planning, and collaborative communication. From the perspective of resource dependence theory, the authors examine the effects of interdependence on these four elements. Empirical evidence derived from a study of 398 Chinese companies indicates that (1) the four governance mechanisms of quasi-integration are driven by inter-firm dependence; and that (2) legal contract serves as an important foundation of joint problem solving. In addition, the authors examine the distinct effects of the four elements on two critical exchange outcomes: supplier performance and buyer commitment. Their analysis shows that legal contract, joint planning, and collaborative communication positively affect supplier's performance, while joint problem solving and collaborative communication significantly enhance the buyer's commitment to the relationship.     

供应商专项投资与感知的合作风险:关系发展阶段与控制机制的调节作用研究

This study examines the dynamic nature of suppliers’ perceived relational risks arising from transaction-specific investments (TSIs) in their relationship with manufacturers, and the moderating effects of contracts and relational norms, during the developmental process of manufacturer-supplier relationship. An empirical study was conducted with data collected from 261 suppliers and manufacturers in the Chinese consumer electronic appliances sector. We found that suppliers’ TSIs have a positive effect on their perceived relational risks, and in different phases of a relationship effect varies significantly. Results of the research also show that both contracts and relational norms have negative moderating effects on the relationship between suppliers’ TSIs and their perceived relational risks, and moderating effects during are different across various phases of a relationship. Translated from Zhongguo Guanli Kexue 中国管理科学 (Chinese Management Science), 2006, 14(1): 30–36