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Open Access
Article
Publication date: 13 June 2022

Julie Krogh Agergaard, Kristoffer Vandrup Sigsgaard, Niels Henrik Mortensen, Jingrui Ge and Kasper Barslund Hansen

The purpose of this paper is to investigate the impact of early-stage maintenance clustering. Few researchers have previously studied early-stage maintenance clustering…

Abstract

Purpose

The purpose of this paper is to investigate the impact of early-stage maintenance clustering. Few researchers have previously studied early-stage maintenance clustering. Experience from product and service development has shown that early stages are critical to the development process, as most decisions are made during these stages. Similarly, most maintenance decisions are made during the early stages of maintenance development. Developing maintenance for clustering is expected to increase the potential of clustering.

Design/methodology/approach

A literature study and three case studies using the same data set were performed. The case studies simulate three stages of maintenance development by clustering based on the changes available at each given stage.

Findings

The study indicates an increased impact of maintenance clustering when clustering already in the first maintenance development stage. By performing clustering during the identification phase, 4.6% of the planned work hours can be saved. When clustering is done in the planning phase, 2.7% of the planned work hours can be saved. When planning is done in the scheduling phase, 2.4% of the planned work hours can be saved. The major difference in potential from the identification to the scheduling phase came from avoiding duplicate, unnecessary and erroneous work.

Originality/value

The findings from this study indicate a need for more studies on early-stage maintenance clustering, as few others have studied this.

Details

Journal of Quality in Maintenance Engineering, vol. 29 no. 5
Type: Research Article
ISSN: 1355-2511

Keywords

Open Access
Article
Publication date: 13 April 2022

Marcielle Anzilago and Ilse Maria Beuren

This study aims to analyze the effects of interorganizational cost management and opportunism on the reflexes of relational norms on satisfaction with interorganizational…

Abstract

Purpose

This study aims to analyze the effects of interorganizational cost management and opportunism on the reflexes of relational norms on satisfaction with interorganizational cooperation in franchised companies. The collective synergy arising from these relationships mainly seeks to increase competitiveness and commercial development. Windolph and Moeller observed that interorganizational cost management increases satisfaction in the relationship with partners, while relational norms attenuate the negative effect on supplier satisfaction.

Design/methodology/approach

A survey was carried out with managers of franchised companies in the food industry. The managers were identified on the social network Linkedin. After that, an invitation was sent to participate in the research. A total of 88 valid responses were obtained. The questionnaire consists of 40 extracted assertions. A pre-test was carried out to verify the comprehensibility of the wording of the assertions. Structural equation modeling with partial least squares (PLS-SEM) was used for data analysis. For analysis, validation and adequacy tests of the model were carried out, and executed in the software SmartPLS.

Findings

Survey results reveal that interorganizational cost management increases franchisor relationship satisfaction. Relational social norms mitigate the negative effect of opportunism on satisfaction with cooperation. And interorganizational cost management plays an important role in the relationship between relational norms and satisfaction with cooperation between franchisor and franchisees.

Research limitations/implications

However, limitations resulting from the methodological design of the research must be considered in the interpretation of the results, at the same time that they provide opportunities for new research. As for the methodological aspects, the study cannot be generalized to other branches of companies, because it is a sector with franchises with specific characteristics. It should also be considered that the study was limited to investigating the proposed model, but other constructs can be observed in the literature. Finally, to empirically assess the constructs of the theoretical model, research instruments from studies other than those considered here can be used.

Practical implications

This study contributes with relevant literature and the management practice of interorganizational cooperation by empirically demonstrating the importance of interorganizational cost management as a management control mechanism and to mitigate the effects of opportunism between franchisor and franchisees.

Social implications

It also contributes to the inclusion of social norms in the relationship between franchisor and franchisees with a view to increasing franchisee satisfaction with their franchisor, which also aims to mitigate the impacts of opportunism in this relationship. It contributes to the social order, as they reveal ways to mitigate possible conflicts between franchisor and franchisee and generate greater transparency in the relationship.

Originality/value

This study is justified by the fact that it investigates relational aspects of cooperation between franchisor and franchisees, a form of interorganizational cooperation that is growing in the market. It is also justified by highlighting the importance of interorganizational cost management as a means of mitigating the opportunistic effects between franchisor and franchisees, proving to be an important management mechanism. Research is especially important because interorganizational strategies have been spreading in corporate environments (Dekker, Ding & Groot, 2016) and the maintenance of the relationship is dependent on satisfaction with cooperation.

Details

RAUSP Management Journal, vol. 57 no. 3
Type: Research Article
ISSN: 2531-0488

Keywords

Open Access
Article
Publication date: 29 June 2020

Alessia Zoppelletto, Ludovico Bullini Orlandi and Cecilia Rossignoli

This article aims to understand whether and how a digital transformation strategy (DTS) can strengthen the relationship between network organizations and the…

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Abstract

Purpose

This article aims to understand whether and how a digital transformation strategy (DTS) can strengthen the relationship between network organizations and the generation/regeneration of their business network commons (BNC). Further, it investigates the role of the DTS in managing the BNC, a critical source of business network success.

Design/methodology/approach

A two-year longitudinal case study of an Italian business network operating in the wine sector was conducted.

Findings

This study provides theoretical insights into the digital, sustainable shift of a business network. On combining a network's business strategy and its DTS, digital resources are a key driver to promote BNC regeneration. A DTS undertaken to manage, regenerate and preserve the BNC can positively affect organizational variables, such as participatory architecture, and the network-level organizational integration and can help in preventing opportunistic behaviors affecting the BNC. Moreover, the DTS supports quality and social responsibility.

Research limitations/implications

This study focuses on an Italian case and its findings are hence not generalizable. It would be interesting to study sustainable business networks' digital shift in different socioeconomic contexts as well as in different industry settings.

Practical implications

Network SMEs and other stakeholders (institutions, competitors and consumers) can foster the transition from a “business-as-usual” strategy to a long-term strategy for digitalized management of common resources.

Originality/value

The study is at the intersection of, and contributes to, several research streams. It contributes to the digital transformation literature by adding information on the positive externalities of digitalization in the social and economic environment. It also contributes to the early streams of organizational and managerial literature on the BNC.

Open Access
Article
Publication date: 29 April 2021

Roberto Sala, Marco Bertoni, Fabiana Pirola and Giuditta Pezzotta

This paper aims to present a dual-perspective framework for maintenance service delivery that should be used by manufacturing companies to structure and manage their maintenance

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Abstract

Purpose

This paper aims to present a dual-perspective framework for maintenance service delivery that should be used by manufacturing companies to structure and manage their maintenance service delivery process, using aggregated historical and real-time data to improve operational decision-making. The framework, built for continuous improvement, allows the exploitation of maintenance data to improve the knowledge of service processes and machines.

Design/methodology/approach

The Dual-perspective, data-based decision-making process for maintenance delivery (D3M) framework development and test followed a qualitative approach based on literature reviews and semi-structured interviews. The pool of companies interviewed was expanded from the development to the test stage to increase its applicability and present additional perspectives.

Findings

The interviews confirmed that manufacturing companies are interested in exploiting the data generated in the use phase to improve operational decision-making in maintenance service delivery. Feedback to improve the framework methods and tools was collected, as well as suggestions for the introduction of new ones according to the companies' necessities.

Originality/value

The paper presents a novel framework addressing the data-based decision-making process for maintenance service delivery. The D3M framework can be used by manufacturing companies to structure their maintenance service delivery process and improve their knowledge of machines and service processes.

Details

Journal of Manufacturing Technology Management, vol. 32 no. 9
Type: Research Article
ISSN: 1741-038X

Keywords

Open Access
Article
Publication date: 28 September 2018

Cristian Baú Dal Magro, Roberto Carlos Klann and Vanessa Edy Dagnoni Mondini

CEOs’ (chief executive officer) term of office may explain discretionary accruals as a result of opportunistic behavior arising during certain periods of the term of office…

Abstract

Purpose

CEOs’ (chief executive officer) term of office may explain discretionary accruals as a result of opportunistic behavior arising during certain periods of the term of office. Therefore, CEOs, in their early years of office, have incentives to report results that meet market expectations. In turn, CEOs in their senior year may be motivated to use discretionary accruals to gain private benefits. In this scenario, corporate governance mechanisms play an important role in monitoring relationships. Hence, the purpose of this study is to verify the influence of monitoring mechanisms on the relationship between CEOs’ term of office and discretionary accruals.

Design/methodology/approach

Descriptive statistics, multiple cross-sectional regression to estimate the accruals and regression of panel data to test the hypotheses were used. The sample comprised 195 companies listed on BM&FBovespa.

Findings

The results indicated that CEOs’ long term of office has a negative impact on the level of discretionary accruals, and thus, Brazilian CEOs with a longer term of office tend to establish a certain reputation in the stock market. On the other hand, it is concluded that CEOs’ intentions, in the first years of term, are positively related to the use of accruals and that the monitoring mechanisms can minimize these CEOs’ opportunistic practices.

Originality/value

The results broaden the literature on corporate governance, pointing that different systems of variable remuneration may influence CEOs’ willingness to manage results in their last year of term.

Details

RAUSP Management Journal, vol. 53 no. 4
Type: Research Article
ISSN: 2531-0488

Keywords

Open Access
Book part
Publication date: 30 April 2019

S. J. Oswald A. J. Mascarenhas

Building trust and living interpersonal trust are crucial corporate executive virtues that are needed today. Once you have developed and solidified a high level of genuine…

Abstract

Executive Summary

Building trust and living interpersonal trust are crucial corporate executive virtues that are needed today. Once you have developed and solidified a high level of genuine interpersonal trust with all your stakeholders, especially customers, suppliers, and employees, then you are on the right path of managing and transforming your company. A high level of interpersonal trust between all stakeholders and corporates in a business situation will break down communication barriers, foster serious conversation and sharing of ideas, and will eliminate corporate transactional anxieties of fear, mistrust, guilt, rigidity, blame, and resentment. When stakeholders trust you and you trust them, then you speak freely, they speak freely, and your mutual sustained transparency is a gateway to survival, revival, and sustained corporate recovery and transformation, and steady growth and prosperity. Conversely, when there is low trust, high mistrust, and high distrust among stakeholders in a business situation, communications and conversations are stressed and fragmented, teamwork and team spirit are very low, and the company is heading toward its ruin and extermination. Such is the crucial role of interpersonal trust in business. This chapter explores the crucial phenomenon of corporate interpersonal trust. We review various cases, models, concepts, definitions, and theories of trust from the management literature in general, and from the marketing field in particular, to derive psychological, behavioral, ethical, and moral principles of corporate trust, trusting relations, and trusting strategies.

Details

Corporate Ethics for Turbulent Markets
Type: Book
ISBN: 978-1-78756-192-2

Open Access
Article
Publication date: 11 October 2021

Nassim Ghondaghsaz and Sven Engesser

The main purpose of this paper is the identification of the conceptualization of trust as well as its factors and outcomes in interorganizational relations in mobile supply chains…

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Abstract

Purpose

The main purpose of this paper is the identification of the conceptualization of trust as well as its factors and outcomes in interorganizational relations in mobile supply chains (MSCs) in which multiple stakeholders collaborate.

Design/methodology/approach

The authors first used a comprehensive literature review to extract related factors and outcomes of trust. Second, the authors conducted semi-structured interviews in chemical and pharmaceutical companies in Germany. These organizations stand out as leaders in the concept of MSCs and have developed collaborations with various stakeholders.

Findings

Based on the results, a conceptual model has been developed that elaborates on the nature of trust and its factors and outcomes for cultivating trustful stakeholder collaboration. The study identifies six factors or approaches for building trust and two outcomes resulting from mutual trust.

Practical implications

The conceptual model presented in this study can serve as a basis for developing trust in MSCs. Interorganizational collaborations in MSCs are more successful when saturated with trust. The collaboration systems must allow the innovative organizations to create value through the adaptation of advanced technologies without failure.

Originality/value

The study adds to the body of knowledge in building trust in multiple stakeholder collaboration, particularly in innovative organizations which are involved with disruptive technologies.

研究目的

由眾多股東共同協作的移動供應鏈内存在著一定的互信。本文主要的目的在闡明這種互信的概念,並確定就組織間之關係而言,帶來互信的因素及因互信而產生的效果。

研究設計/方法/理念

作者們首先透過全面的文獻探討,從中提取帶來互信的相關因素,和因互信而產生的效果。作者們接著在位於德國的化工及製藥公司內進行半結構式訪談。這些組織及公司就移動供應鏈的概念而言,在同業中脫穎而出,成為領導者,並與各股東建立了合作夥伴的關係。

研究結果

作者們根據研究結果、建立了一個概念模型。這模型闡述了互信的性質,互信的因素,以及在股東間培育互信合作關係的效果。研究亦確定了建立互信六個相關因素/方法,和兩個因互信而產生的效果。

研究的原創性/價值

本研究在現時相關的領域上、加深了我們對多個股東共同協作上建立互信的瞭解,特別是涉及破壞式技術的創新型組織。

實務方面的啓示

本研究所展示的概念模型可作為在移動供應鏈內建立互信的基礎和依據。若移動供應鏈內的各個組織間充滿著互信,則相互的協作定必更成功。共同協作的機製必須能為創新型組織透過無誤地改編先進技術去創造價值。

Details

European Journal of Management and Business Economics, vol. 31 no. 3
Type: Research Article
ISSN: 2444-8451

Keywords

Open Access
Article
Publication date: 27 March 2018

Rafael Araújo Sousa Farias and Valmir Emil Hoffmann

The present study seeks to answer the following research question: what is the profile of the academic production related to the interorganizational networks in the period between…

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Abstract

Purpose

The present study seeks to answer the following research question: what is the profile of the academic production related to the interorganizational networks in the period between 2006 and 2016? Thus, this study aims to characterize the academic production about the subject interorganizational networks available in national journals with Concept “A” (Qualis Capes), in the period between 2006 and 2016.

Design/methodology/approach

This paper uses national journals with Concept “A” of the Qualis classification (2016) for journal selection. In total, 12 “A” concept journals were identified. However, it was decided to analyze ten of them. The procedures suggested by Crossan and Apaydin (2010) for conducting bibliometric studies were adopted. It has been identified that 77 articles were published in eight journals. The R 3.3.2 and R Studio 1.0.136 software were used. The IGRAPH 0.5.5-2 extension (package) was used to analyze graphs and co-authorship networks (Csárdi and Nepusz, 2006). This extension is able to manipulate networks with millions of vertices and edges and provides a series of functions to analyze the properties of social networks, such as subnetworks, intermediation, centrality, among other characteristics (Csárdi and Nepusz, 2006). Correspondence analysis (CA) was also performed. CA is a multivariate exploratory technique that converts a data matrix into a graphical representation, so that rows and columns are represented by points in a graph (Greenacre and Hastie, 1987). This extension is dedicated to the multivariate analysis of data and allows the manipulation of different types of variables (quantitative or categorical). In the present research, multiple CA (MCA) was applied – indicated when the elements are described as categorical variables (et al., 2008). The characteristics considered for carrying out MCA were the “main term”, “research approach”, “type of research”, “constructs” and “research strategies”. By using the FactoMineR 1.34 extension, the hierarchical clustering on principal components (HCPC) function was used (Husson et al., 2007; et al., 2008). This function allows creating clusters from the characteristics of the articles analyzed and highlights the justifications for the groupings created. The function allows forming as many clusters the researcher wishes, being of its attribution to analyze a division that best represents the characteristics of the data (Husson, Josse, and Pagès, 2010). Husson et al. (2010) suggest that an analysis should be performed from the hierarchical tree, thus the number of clusters can be defined considering the overall appearance (or shape) of the tree formed. At last, a word cloud was created using the Wordcloud 2.5 extension (Fellows, 2013). The noticed advantage of using this extension is that it does not separate the terms that form a keyword when generating the cloud. It has been used for the keywords of the 77 articles analyzed; however, it has been decided to keep those that presented frequency greater than or equal to two. By avoiding occasional terms, a more intelligible cloud was obtained.

Findings

The present study was not able to verify if the journals analyzed by Andrighi et al. (2011) have influenced others to publish on the subject, as suggested by the Bradford’s Law. The standard “success breeds success”, suggested by the Bradford’s Law, was not confirmed. The so-called nuclear zone (Brookes, 1969; Novaretti et al., 2015) is composed of the journals Brazilian Administration Review (BAR), Revista de Administração Contemporânea (RAC), Revista de Administração Pública (RAP) and Revista Brasileira de Gestão de Negócios (RBGN). The journal RAC stands out for having been the one that has increased its annual average of publication in relation to the theme, when compared with the findings of Andrighi et al. (2011). The journals BAR and RBGN stand out because they are in the nuclear zone, even though they were not considered in the work of Andrighi et al. (2011). It should be noted that all the analyzed journals have in common the fact of addressing the themes of management and administration and, more specifically, making room for the “competitiveness” and “cooperation” constructs. These constructs are related to the theme of networks and were the most recurrent in the articles analyzed. “Cooperation” (29), “competitiveness” (27), “knowledge” (12), “learning” (6) and “trust” (3) were the “constructs” used to compose the 77 articles analyzed. In turn, “network” (49), “alliance” (18) and “cluster” (9) were the “main term” most used in the articles. This implies that the topic of cooperation is more linked to a vision of strategy. As occurred in the research of Andrighi et al. (2011), the term “network” is the most recurrent; in addition, the growth of space obtained by the term “alliance” stands out. The terms “network” and “alliance” were the most used by the articles, being predominant in 87 per cent of the research. In the present research, the predominance of the term “network” may have occurred because its concept is broader and it is used in the literature in different ways, even in contradictory ways (Andrighi et al., 2011; Schommer, 2001). In turn, the term “alliance” may have been recurrent because it has a wide dispersion of published issues, such as governance structure, cooperation, knowledge transfer and trust (Lima and Campos Filho, 2009). By using the HCPC function of the FactoMineR extension, the articles were grouped according to their characteristics, and then three clusters were formed. By analyzing the generated results, it is assumed that the division into three clusters was the one that best represented the data. Cluster 1 is characterized by descriptive, quantitative, half documentary and half survey research studies, being “cluster” the main term. Cluster 2 is characterized by exploratory case studies with qualitative–quantitative analyzes. Cluster 3 is characterized by theoretical tests. The Zipf’s law points out that a small group of words occurs many times; however, when considering the most recurrent words Networks (9), Strategic Alliances (8), Cooperation (8), Interorganizational Networks (8) and Alliances (6) show that they were present in only about 10 per cent of the works. Lotka’s Law, which states that few authors publish much and many authors publish little, was not confirmed. The authors who presented the highest number of publications, T. Diana L. v. A. de Macedo-Soares (6); Jorge Renato Verschoore (6); Alsones Balestrin (5); Douglas Wegner (4); Humberto Elias Garcia Lopes (4), participated in less than 10 per cent of the works. Thus, the authorship was characterized by many researchers publishing few works, what can be an effect of the behavior of these authors, who prefer to publish in network. The centrality of the relations between the authors was analyzed and, in addition, the intermediation points of the network were identified. The present study also analyzed all the references used by the 77 articles that compose the study. The main author of each of the references used was identified. Among the 30 identified authors, Yin and Hair Jr. stand out for books related to fundamentals and research methodologies. Borgatti and Eisenhardt developed research on the topic of interorganizational networks and also created works for methodological foundations. Powell was the most frequently mentioned author (28) and had more different works referenced (9). Powell stands out for the production of articles published in periodicals, not books. Porter’s situation is the opposite. Most of the quotations made to the author come from his books, especially the work “Competitive strategy” (Porter, 1980). All authors identified are foreigners, with the exception of Balestrin. Marshall, Polanyi, Granovetter and Williamson are authors of works considered seminal, being them, respectively, “Principles of economics” (Marshall, 1890), “Personal knowledge: towards a post critical philosophy” (Polanyi, 1958) and “The strength of weak ties” (Granovetter, 1973) and “Markets and hierarchies, analysis and antitrust implications” (Williamson, 1975).

Research limitations/implications

Like all research, it has limitations. The first one derives from the selection criteria of the periodicals to be analyzed. The cut referring to the journals of greater impact excludes most of the national articles. These studies may contain important contributions to the knowledge of the national publication profile. In addition, the choice to analyze the journals disregards other types of work, such as books, scientific events, dissertations and thesis and reports. The choice of articles published in journals is based on the fact that these are a “certified knowledge”, as the studies are peer-reviewed, and in the case of the Qualis “A” stratum, a review of exogenous quality is supposed on this production. Despite its flaws, this system can be considered reliable to evaluate scientific knowledge (Bedeian, 2004; Shugan, 2007). The analysis of the most recent articles may have been hampered by a temporal issue. In addition, the choice of keywords, a necessary step, leaves out other studies. Another limitation refers to the fact that the articles have been analyzed and classified by the authors, which presupposes the use of their value judgments, at least to some extent. Other limitations refer to the bibliometric techniques employed. The main authors referenced in the studies were demonstrated, that is, those authors who have been used as a theoretical reference for studies of interorganizational networks. However, the circumstances under which these citations occurred were not analyzed. For example, an author may be quoted to use the contribution of his/her study, to be criticized or just to be another reference in the text. The lack of this analysis can be considered a fragility of the study.

Practical implications

This text was started talking about the dispersion of the studies on networks in the country. Previous work has been used, theoretically and empirically demonstrating this fact. Zipf’s Law applied to bibliometrics, as described by Guedes and Borschiver (2005), Novaretti et al. (2015) and Pao (1978), was not confirmed in this study, which seems to be an indicative fact that the research on this theme in Brazil presents fragmentation as an intrinsic characteristic. That is, it must remain fragmented, as this would be its own way to evolve. This is evident especially when comparing the study of Andrighi et al. (2011) and its results. With several but continuous temporal cut-outs, and the same keywords, the maintenance of this dispersion is evident. This is also a contribution of this study.

Social implications

The study contributed to updating the research profile, mainly after the triennium 2013-2015 of Qualis Capes’ evaluations. It also added to the mapping of recent Brazilian academic production related to interorganizational networks, completing studies by Alves et al. (2013), Andrighi et al. (2011), Balestrin et al. (2010), Cunha and Carrieri (2003) and Mascena et al. (2013). Thus, it is believed that the research reached the proposed objectives, despite its limitations.

Originality/value

The present research is also justified by helping to understand the subject being useful for researchers, educators and students, in general, in the task of demonstrating gaps and opportunities of future researches and collaborating with the elaboration of a research agenda (Baumgartner and Pieters, 2003). The work has updated bibliometrics on the subject and allows comparisons with previous bibliometric studies (Alves et al., 2013; Andrighi et al., 2011; Balestrin et al., 2010; Cunha and Carrieri, 2003; Ferreira et al., 2014; Lima and Campos Filho, 2009; Mascena et al., 2013). It is believed that the present study differs from the others because of the analysis performed, the way the data were treated, with techniques that are rarely used simultaneously, going beyond the descriptive statistics.

Details

Innovation & Management Review, vol. 15 no. 1
Type: Research Article
ISSN: 2515-8961

Keywords

Open Access
Article
Publication date: 5 March 2021

Rodrigo Soares Santana, Gustavo Hermínio Salati Marcondes de Moraes and Hermes Moretti Ribeiro da Silva

This study aims to evaluate the influence of factors attributed to relationship attractiveness between supplier and customer, from the supplier’s perspective.

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Abstract

Purpose

This study aims to evaluate the influence of factors attributed to relationship attractiveness between supplier and customer, from the supplier’s perspective.

Design/methodology/approach

The empirical exercise was based on the use of multivariate data analysis with confirmatory factor analysis and a partial least squares approach to structural equation modeling.

Findings

The study resulted in a robust model, with a high explanatory factor for the latent variable relational attractiveness and commitment was the most influential factor, followed by expected value and interorganizational trust.

Research limitations/implications

Some limitations of the study can be highlighted: conducting research in a single cooperative and with a single audience; choosing a short-cycle supply chain, which may make it difficult to generalize to other industries; the cross-section nature of data also hinders the analysis to understand how the association between variables of interest may vary over time.

Practical implications

The negative influence of interpersonal trust reinforces the importance of developing collaborative attitudes between parties, whereas the non-significant value for dependence (financial and volume dependence) shows this is not a risk factor for relational attractiveness in a supply chain. Such results provide evidence on how to develop relationship management between suppliers and customers that are part of the same supply chain.

Social implications

It offers a new perspective for research in cooperatives, which still have no consensus on the motivating factors for members’ participation, including as evidence the results of the largest flower producing center in Latin America. The more a cooperative succeeds in increasing relational attractiveness, the greater the cooperative power and the ability to adapt to shocks and changes, which are fundamental factors for the success and longevity of the cooperative.

Originality/value

The research presents a model that is comprehensive enough to fit in different contexts and consider its specific characteristics. Additionally, this paper has added in-depth information on the relational attractiveness relationships in the context of a developing country.

Details

RAUSP Management Journal, vol. 56 no. 1
Type: Research Article
ISSN: 2531-0488

Keywords

Open Access
Article
Publication date: 2 June 2020

Palitha Konara, Zita Stone and Alex Mohr

The authors combine options logic with transaction cost economics to explain why firms maintain, divest or buy out their international joint ventures (IJVs). It is suggested that…

1978

Abstract

Purpose

The authors combine options logic with transaction cost economics to explain why firms maintain, divest or buy out their international joint ventures (IJVs). It is suggested that a decline in environmental risk and higher partner-related risk makes a firm more likely to acquire an IJV but less likely to divest an IJV. The study also investigates how IJV age moderates the effects of a decline in environmental risk and higher partner-related risk.

Design/methodology/approach

The study employs competing risks analyses to examine the drivers of different termination outcomes using a dataset consisting of 459 IJVs in the People's Republic of China, of which 110 were either acquired or divested by their foreign parent.

Findings

The study finds that changes in environmental risk and partner-related risk affect how firms terminate their IJVs in the People's Republic of China. Specifically, the authors find that the effect of exogenous and endogenous risk are more pronounced for the acquisition of IJVs than for the divestment of IJVs.

Research limitations/implications

The study contributes to international marketing research by complementing options logic with transaction cost economics to provide a theoretical explanation of the different ways in which IJVs in the People's Republic of China are terminated.

Practical implications

IJVs continue to be an important yet often unstable method to serve international markets. Our findings increase managers' awareness of the effect that two important sources of risk may have on the termination of IJVs in the People's Republic of China.

Originality/value

The study provides novel insights into the effect that changes in exogenous and endogenous risk have on a firm's choice of termination mode drawing on novel data on the different ways in which foreign firms have terminated their IJVs in the Peoples' Republic of China.

Details

International Marketing Review, vol. 37 no. 6
Type: Research Article
ISSN: 0265-1335

Keywords

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