Article

The many faces of trust and guanxi behavior: Evidence from marketing channels in China

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Abstract

This study examines how a trusting relationship influences firm boundary agents' guanxi behavior which involves saving face (wei hu mianzi), and affect investment (ganqing tou zi). At the individual level, we decompose trust into its competence and goodwill forms and examine their relative and interactive effects on guanxi behavior. A study conducted among 354 Chinese purchasing managers reveals that both competence trust and goodwill trust promote guanxi behavior, and these two types of character trust are substitutive for each other in terms of motivating the use of guanxi. At the firm level, calculative trust directly affects guanxi behavior and also negatively moderates the effect of competence trust on guanxi behavior. These results imply that calculative trust may substitute for competence trust in facilitating economic transactions and thereby reduce the use of guanxi in business interactions.

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... Chinese business organization relationships, which typically involve personal gifts, shared meals, and introductions to its members, are also involved in guanxi . Prior evidence has suggested that guanxi can facilitate economic transactions by providing tacit knowledge, strengthening inter-firm cooperation via exploiting information sharing (Shou et al., 2011). Thus, guanxi as a complex, enormously rich and dynamic concept, has been viewed as a Chinese equivalent of social capital for organizations managing business relationships (Ding & Jie, 2021), it also provides a convenient way of sharing information and knowledge that could facilitate ambidextrous learning. ...
... Furthermore, whether the explorative learning or exploitative learning would enhance product quality, is largely dependent on social ties of guanxi . Prior evidence has also found a significant negative moderating effect of guanxi on the relationship between information sharing and positioning competency, between information sharing and distribution support competency, and between relationship-specific investment and positioning competency within logistics firms in China (Shou et al., 2011). That being said, how one associates with another is largely depend on how strong the guanxi played in between. ...
... Following the prior literature (Hwang, 1987;Shou et al., 2011;Su & Feng, 2013), that guanxi is comprised of two dimensions-favor (renqing) and face (mianzi)-, we adopted a 4-item subscale for favor and a 3-item subscale for face, as proposed by Shou et al. (2011). Favor (Renqing) being associated with the abstract affection of the emotional feelings, is related to the enduring and emotional commitments found in long-term and intimate social bonds, such as those among acquaintances, organizational members, and partnerships across organizations. ...
Article
Ambidextrous learning plays an essential role for organizations striving to learn how to survive and compete. However, extant studies provide few ambidextrous learning strategies for construction engineering project partnerships. According to absorptive capacity theory, we argue that ambidextrous learning can be achieved by formal control (behavioral and outcome control) and social control (e.g., Chinese guanxi), therefore, we present a conceptual model to depict the role of both control strategies in ambidextrous learning. Empirical tests based on 431 survey responses from construction engineering project managers found that: both formal control and guanxi are positively and significantly associated with ambidextrous learning; the joint effects of outcome control and guanxi have positive interaction effects on ambidextrous learning, while the joint effects of behavioral control and guanxi have negative interaction effects on ambidextrous learning. Findings contribute to extant research in ambidextrous learning and provide a basic framework to understand how an organization can survive, develop and grow through ambidextrous learning via guanxi and different formal control strategies.
... Overall, face can be seen as a sort of moral norm whereby all members of a group seek to gain it in order to maintain the group's dignity. In Chinese guanxi, face plays a major role in the preservation of networks (Chen, 2001;Shou, Guo, Zhang, & Su, 2011;Tsang, 1998), and has clear relevance in the business context as well as in social and moral spheres. This is no less true in Middle Eastern culture, where it plays a key role in relationship building by emphasizing the notions of continuity and collaboration (Berger et al., 2015). ...
... The significance of affection is not limited to Chinese networks; it is to be found across cultures and countries, including those in the Middle East. While its most intimate forms can expect to be found within families (Bian, 2018), it is possible to create affection even in a business relationship by investing in its development (Shou et al., 2011;Wang, 2007). ...
... Moreover, in Middle Eastern culture, face plays a key role in relationships by emphasizing the notions of continuity, collaboration, and satisfaction (Berger et al., 2015). Affection also exists in the business relationship (Shou et al., 2011;Wang, 2007). It can be a sentiment-driven instrumental business tie with expectations of reciprocity and relationship retention (Bian, 2018;Butt, Shah, & Sheikh, 2020). ...
Article
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Relationships are widely recognized as key to business success in the form of both informal interpersonal networks and formal organizational relationships. While Chinese personal networks ( guanxi ) have attracted scholars’ interest, the concept has not been fully investigated or understood in other contexts, especially the Middle East, where personal networks fulfill some of the same roles. The underlying socio-cultural formulae of the distinctive cultural dimensions that influence relationship formation in the Middle East also remain under-explored. This research therefore investigates the dimensions of guanxi -type relationships in the Middle East and introduces a new model integrating these relationships into the existing relationship marketing framework, enabling firms to harness personal networks for organizational gain, in turn generating customer satisfaction and retention. Using empirical data from a survey of 637 hotel guests in 17 countries – drawn from a unique target population of guests introduced to Middle Eastern hotels via personal relationships – we show how guanxi -type relationships influence organizational relationships and improve satisfaction and retention. Our significant contributions to theory and practice include extending a holistic understanding of guanxi , enhancing knowledge of its dimensions in the Middle East, and providing managers with clear evidence for a hybrid system of guanxi -type and organizational relationships.
... When a firm is highly dependent on its partner, the firm has less motivation to build relationships on affective ground (Wetzels et al., 1998;Hibbard et al., 2001) and has a high calculative commitment to its partner (Chang et al., 2012). This notion of calculation resembles guanxi, which is based entirely on utilitarian attachment instead of emotional attachment (Park and Luo, 2001;Shou et al., 2011) and is one of the drivers for achieving legitimacy (Yang and Wang, 2011). Therefore, firms with few resources are inclined to eagerly develop guanxi networks with the boundary personnel (e.g. ...
... This is because both sides do not need to calculate their gain and loss and even sacrifice their own benefits for maintaining the relationship if necessary (Bendapudi and Berry, 1997). Institutional environments provide both constraints and facilitation (Scott, 2008;Suchman, 1995). Firms evaluate whether the institutional environments, they are embedded in, are a liability or capital and make a trade-off between efficiency and legitimacy (Yang and Su, 2014). ...
... Institutional environments rely on three distinct pillars, namely, regulative, normative and cultural-cognitive institutions, to influence the legitimacy of organizational members (Scott, 2008). The regulative institutions stress the legal bases for gaining legitimacy. ...
Article
Purpose The research indicates that relatively powerful firms exploit their advantages to damage their weaker partners. However, how power can be abused by advantaged firms remains unclear. This study aims to examine the relationship between power advantage and abuse of power and whether the power advantage mediates the relationship between dependence and personal interests and between trust and company performance. Design/methodology/approach A total of 130 retailers in Taiwan were investigated. Partial least squares regression was performed to test the proposed hypotheses. Findings The results of this study show that power-advantaged firms are more likely to abuse their power; however, the purposes are more for their company performance than for personal interests. Power advantage has different mediating effects on the dependence–personal interests and trust–company performance relationships. Research limitations/implications Considering both time and cost limitations, this study investigated one aspect of the retailer–supplier dyad in northern Taiwan. The samples collected may be influenced by the nature of the industry and sampling method, possibly limiting the generalizability of the research results. Practical implications This study can help channel managers with a power advantage to have an improved understanding of their salespersons’ behavioral patterns, particularly gaining personal interests from customers. Originality/value This study expands the understanding of the antecedents and consequences of power advantages in supplier–retailer relationships. It also highlights in specific institutional arrangements, the weaker parties’ efforts to endure their counterparts’ use of their power advantage to serve their personal interests. Future research may analyze abuse of power by expanding research to other industries and different cultural contexts.
... Calculative trust has been shown to be prevalent in risk-averse industries such as banking (Tyler & Stanley, 2007) and has been shown to have a stronger effect on performance than relational trust (Poppo et al., 2016). Within contractual business relationships, calculative trust can alleviate the need for favor exchange as a facilitator of transactions (Shou, Guo, Zhang, & Su, 2011) or improve the effectiveness of the contracts themselves (Susarla, Holzhacker, & Krishnan, 2020). In the construction industry, the findings on the effect of calculative trust compared to relational trust vary, with different types of trust impacting different constructs and with different magnitudes (Jiang, Lu, & Le, 2016;Jiang & Lu, 2017;Wu, Zhao, & Zuo, 2017). ...
... While there is much discussion on the positive impacts of long-term relationships (Akrout, 2015;Claro & Claro, 2008;Geyskens et al., 1996;Jiang & Lu, 2017;Jiang & Zhao, 2021;Morgan & Hunt, 1994;Shou et al., 2011;Tyler & Stanley, 2007;Wang et al., 2020;Wu et al. 2017), there is also some discussion on the negative impact or the so-called "dark side" of long-term relationships (Abosag et al., 2016). Anderson and Jap (2005) proposed three different mechanisms for the rise of the dark side of long-term B2B relationships: the tradeoffs between long-and shortterm goals, the strong interpersonal relationships between agents of the two firms, and the adaptation specific to the relationship and their industries. ...
Article
Trust has been shown to be a key component of a successful business-to-business (B2B) relationship. However, recent studies have pointed to the potential adverse effects on different aspects of the relationship, with a lack of knowledge on how calculative trust and relational trust interact and their ramifications for long-term relationships, particularly in the agri-food context. Fifteen semi-structured interviews were conducted among different members of the rainbow trout and lamb supply chains in Canada. The data indicated that both types of trust can coexist in a long-term relationship, and while calcula-tive trust can give rise to adverse effects such as complacency and payment delays, relational trust can help alleviate some of those impacts.
... Conceptual papers discuss similarity from a general perspective, but do not explicitly postulate an overarching "general similarity" construct. There are, however, several empirical papers that employ a measurement scale that is based on the overarching principle of general similarity (Doney and Cannon, 1997;Coulter and Coulter, 2002;Shou et al., 2011). ...
... Other studies do not differentiate between dimensions, and measure overall similarity (Coulter and Coulter, 2002;Palmatier et al., 2006;Shou et al., 2011) and expect that when people assess similarity, that relevant dimensions of similarity will influence the overall assessment more than less relevant dimensions. In two studies (Doney and Cannon, 1997;Coote et al., 2003), specific items, both measuring relevant dimensions, as well as overall similarity were combined. ...
Thesis
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During initial business-to-business encounters, salespeople try to enhance buyers’ future interaction intentions. A common belief is that increasing buyers’ similarity perceptions increases the chances of future interaction. This study assesses the impact of the similarity-attraction effect on future interaction. By synthesising social psychology and marketing literature, a conceptual framework is proposed, in which perceived similarity influences salesperson trust. This relationship is mediated by task-related and social assessments of buyers. Task-related assessments comprise willingness (benevolence and integrity) and competence (power and expertise). Social attraction is conceptualised as likeability. Salesperson trust drives anticipated future interaction, together with organisational trust and anticipated added value. The conceptual framework was empirically tested through a cross-sectional survey. Dutch professional buyers assessed recent initial sales encounters. A sample of 162 dyads was analysed, using PLS-SEM, including FIMIX segmentation. This study demonstrates support for a third willingness construct: willingness behaviour. This construct implies that buyers are more influenced by expectations regarding behaviour, than assessments of salespeople’s attitudes. A homogeneous analysis supports the influence of perceived similarity on salesperson trust, both directly and through willingness behaviour. However, model-based segmentation uncovers a segment of cost-oriented dyads and a segment of more profit-oriented dyads. In cost-oriented dyads, there is no significant direct effect between perceived similarity and salesperson trust, and willingness behaviour nearly fully mediates this relationship. In more profit-oriented dyads, the similarity-attraction effect is not present. Theoretical and methodological contributions and managerial implications of these findings are discussed.
... Many studies argue the dominant position of trust in BSR and its importance in relation to financial and operational performance (Ha, Park, and Cho 2011;Delbufalo 2012;Li, Ye, and Sheu 2014;Fawcett et al. 2017). However, while different types of trust are recognized (Lee and Dawes 2005;Wang 2007;Chen, Huang, and Sternquist 2011;Shou et al. 2011), in-depth research is needed to establish how types of trust differently influence SCP (Fawcett et al. 2017). Therefore, our study attempts to establish links between SCP and two types of trust (affect-based trust and cognition-based trust) separately. ...
... Furthermore, we build on previous studies associating guanxi with trust (Wang 2007;Cai, Jun, and Yang 2010;Shou et al. 2011;Wang, Wang, and Zheng 2014), but our findings go one step further by establishing the links between expressive guanxi and affect-based trust, and between instrumental guanxi and cognition-based trust. Our research contributes to early studies by not only developing Chen and Chen's (2004) conceptual ideas through Hwang's (1987) theory, but also providing the first empirical evidence of the positive effect from EG to ABT, and from IG to CBT. ...
Article
With the intensification of Sino-Western trade, an increasing number of studies recognise the importance of guanxi (Chinese interpersonal relations) in international supply chain management. However, there are different types of guanxi, and this study aims to deepen our understanding of the effects of expressive and instrumental guanxi on supply chain performance among buyers with different cultural orientations. Drawing on survey data from 200 Chinese manufacturers conducting overseas business, we find that the mediated relationship between expressive guanxi and supply chain performance through affect-based trust is stronger for collectivist buyers, whereas the mediated relationship between instrumental guanxi and supply chain performance through cognition-based trust is stronger for individualist buyers. Therefore, this study not only sheds light on the effects of two types of guanxi on supply chain performance, but unveils the moderating role of individualist/collectivist culture on the mediated relationship between guanxi and supply chain performance through affect-based and cognition-based trust.
... In the East, particularly in Chinese markets where guanxi is the lifeblood of business, research consistently shows that such interpersonal ties or connections facilitate economic transactions by providing pooled resources, tacit knowledge, and joint solutions to business problems (Lovett, Simmons, & Kali, 1999;Park & Luo, 2001). Although guanxi is considered costly and risky (Iyer, Sharma, & Evanschitzky, 2006), it is surprising that there is little understanding of the key factors that affect its behaviors (Shou, Guo, Zhang, & Su, 2011). Thus, it is important to understand the indirect effect of SCA on WTP through calculative commitment in Eastern and Western markets. ...
... Research evidence suggests that although guanxi incorporates the notion of affective attachment and emotional commitment (Wang, 2007), its fundamental premise involves "exchanges of favors, both emotional and economical, following certain social norms and behavioral rules" (Yang & Wang, 2011, p.493). The notion of calculative commitment resembles the economic commitment that is present in guanxi networks (Low & Li, 2019) and is grounded mainly on utilitarian attachment (Park & Luo, 2001;Shou et al., 2011). Further, collectivist cultures predominantly found in the East, such as in China, value cooperation and group interdependence (Fock, Yim, & Rodriguez, 2010;Wong, Tjosvold, & Zhang, 2005). ...
Article
The aim of this study is to examine the underlying mechanism that explains the effects of supplier firms' sustained competitive advantage (SCA) on customer firms' willingness-to-pay a price premium (WTP) across Eastern and Western settings. Drawing upon the relationship marketing (RM) paradigm, we posit that SCA influences WTP via calculative commitment and relationship quality (RQ). A survey involving executives from Australian (n = 336) and Chinese (n = 360) firms was conducted to test the theoretical model. The findings reveal that the effect of SCA on WTP is mediated by RQ and calculative commitment among Chinese firms. Among Australian firms, however, the effect of SCA on WTP is mediated only by RQ and not calculative commitment. The study contributes to the literature by distinguishing the role of 'rational' (i.e., calculative commitment) and 'emotional' (i.e., affective commitment and RQ) relationship factors in influencing WTP, and by validating a multidimen-sional RQ model that is applicable to culturally diverse contexts. To marketing practitioners, this research helps to identify the conditions under which RM practices can be effective for B2B firms that operate across diverse cultures.
... In emerging markets, an informal network's social capital is manifested in the way suppliers exhibit their friendship, express a willingness to reciprocate and demonstrate trust to potential buyers (Shou et al., 2011). Guidelines and frameworks for relational behavior become institutionalized and accepted by participating members. ...
... In China, guanxi establishes much of the social norms practiced within business relationships. It is characterized by a high degree of goodwill trust, established friendships and favor-exchange that serve both social and utilitarian means in business communities (Shou et al., 2011). Social norms of guanxi (e.g. ...
Article
Full-text available
This study drew from Social Capital Theory and the literature on guanxi to develop a framework to examine and compare a buyer’s willingness to commit to a supplier in the context of informal social-capital networks in the two largest emerging markets of China and India. The two main objectives of the study included an examination of the influence of communication behavior and conflict resolution on the development of social-capital networks and a comparison of the influence of distinct dimensions of social-capital networks on a buyer’s commitment to a supplier.
... In emerging markets, an informal network's social capital is manifested in the way suppliers exhibit their friendship, express a willingness to reciprocate and demonstrate trust to potential buyers (Shou et al., 2011). Guidelines and frameworks for relational behavior become institutionalized and accepted by participating members. ...
... In China, guanxi establishes much of the social norms practiced within business relationships. It is characterized by a high degree of goodwill trust, established friendships and favor-exchange that serve both social and utilitarian means in business communities (Shou et al., 2011). Social norms of guanxi (e.g. ...
Preprint
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Purpose This study aims to develop a framework based on drew social capital theory and the literature on guanxi to examine and compare a buyer’s willingness to commit to a supplier in the context of informal social-capital networks in the two largest emerging markets of China and India. The two main objectives of the study included an examination of the influence of communication behavior and conflict resolution on the development of social-capital networks and a comparison of the influence of distinct dimensions of social-capital networks on a buyer’s commitment to a supplier. Design/methodology/approach Data was collected in China and India from random samples of buyers. The model was tested using structural equation modeling. Findings Findings revealed that communication and conflict resolution contribute significantly to build trust, increase social benefits and promote mutual collaboration between buyers and suppliers in both China and India. However, social benefits were found to have a greater influence on commitment in India, whereas collaboration was found to have a greater influence on commitment in China. Practical implications The study demonstrates the importance of social capital theory to explain the informal social capital network and commitment development. Results provide practitioners with specific strategies to build social capital in China and India and improve committed relationships with buyers. Originality/value This study advances theory development within the context of emerging markets. It is unique as it includes the two most populous and fast-growing emerging markets in one study.
... Guanxi, which focuses on the importance of developing and sustaining personal relationships, plays a crucial role in both business and social contexts, shaping how organizations interact with stakeholders and manage their public image (Lee & Dawes, 2005). The concept of "face," which involves maintaining one's reputation and dignity, is critical in many Asian societies and significantly impacts crisis communication and reputation management strategies (Shou et al., 2011). Moreover, Confucian values like respect for hierarchy, filial piety, and a collective orientation guide public relations professionals in building trust and loyalty among their audiences (Koptseva & Reznikova, 2017). ...
Conference Paper
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This article explores the significant impact of Asian cultural influences on advertising and public relations strategies, emphasizing the need to understand the region's distinctive cultural dynamics for both local enterprises and multinational corporations. Through a comparative analysis of successful and unsuccessful campaigns, it delves into how cultural values, communication styles, and social norms shape marketing strategies, utilizing theoretical frameworks like Hofstede's Cultural Dimensions and Hall's High and Low Context Cultures for a nuanced understanding. Case studies from East Asia, Southeast Asia, and South Asia illustrate the importance of tailoring messages to fit cultural contexts. The article also addresses the challenges marketers encounter in navigating Asia's diverse cultural landscape, including language barriers and societal norms, while highlighting the opportunities presented by cultural diversity for greater consumer engagement and brand loyalty. It underscores the necessity of cultural sensitivity and localized approaches in developing effective marketing communications, offering practical guidance for professionals and laying the groundwork for future research in the field.
... Specifically, Guanxi has long existed as a purposive behavior for cultivating, strengthening, and capitalizing on social networks, which is instrumental in acquiring resources and legitimacy (Chen & Wu, 2011;Chen et al., 2015;Yoon & Sung, 2019). Guanxi development is based on mutual trust and dyadic obligation, which result from frequent favor exchange and affective investment (Shou et al., 2011). ...
Article
Research shows that paradoxical leadership has a strong positive but inconsistent relationship with firm performance. Drawing on leadership contingency theory, we provide a theoretical model explaining how business unit level (BU‐level) paradoxical leadership positively impacts BU‐level performance mediated by BU‐level corporate entrepreneurship (CE). However, we also show that this relationship can turn negative when the degree of firm‐level Guanxi on human resource development (Guanxi HRD) practices is high. By relying on the responses from 276 BUs and performance archival data from the Taiwan Economic Journal database, we found that BU‐level CE mediates the relationship between BU‐level paradoxical leadership and BU‐level performance. Firm‐level Guanxi HRD practices diminish this effect and turn the positive relationship between BU‐level paradoxical leadership and BU‐level performance through BU‐level CE negative. Our study reveals the dark side of firm‐level Guanxi HRD practices and provides new theoretical and empirical insights that reconcile the relationship between paradoxical leadership and firm performance.
... Calculative trust Shou et al. (2011). The supplier realizes that violating our trust will certainly be sanctioned. ...
Article
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Buyer-seller relationships play a pivotal role in relationship marketing, as their effective management can yield significant benefits for companies. Satisfaction is the linchpin that sustains these business relationships over time, yet it can be influenced by various factors, particularly negative behaviors known as "dark side" behaviors. These behaviors encompass actions such as concealing information, opportunism, exploiting the counterparty, causing confusion, sharing customer information without consent, providing misleading information, breaching privacy, levying unjustified charges, and withholding information from customers. The primary objective of this research is to explore the link between dark-side behaviors and satisfaction in business relationships among companies. To achieve this goal, we conducted a comprehensive systematic literature review, scrutinizing 43 articles that aligned with our search criteria. After careful selection, we focused on 30 articles published between 2010 and 2023. Within these articles, we identified the prevailing theories, authors, research methodologies, and limitations, and we also unearthed promising avenues for future research. In conclusion, our findings indicate that there isn't a singular interpretation of the term "dark side" in commercial relationships. Thus, there is a pressing need to develop tools and frameworks that can pinpoint specific manifestations of dark side behaviors, especially those driven by personal or corporate gain, regardless of the potential harm they may inflict on a business partner within a collaborative relationship.
... Chinese societies are considered highly collectivistic (Hofstede & Bond, 1988), and guanxi, as a culture-specific construct, is a key factor for the success of businesses (Herbig & Martin, 1998;Rong et al., 2021). At times, guanxi is more crucial than legal contracts in that it characterizes strong in-group favoritism, a system of the reciprocal exchange of favors (Gu et al., 2008;Shou et al., 2011;Zhang & Zhang, 2006). Chinese people care about harmony and long-term relationships with ingroup members (Hui & Triandis, 1986). ...
Article
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This study examines three moderators—product life cycle, relationship duration, and guanxi—for their effects on the use of subtle coercive power in supplier–distributor dyads. Based on data from Computer, Communication, and Consumer Electronics (3C) distributors in northern Taiwan, these factors are shown to moderate the relationships between coercive influence strategies and two types of satisfaction. Specifically, if a product is in its mature stage and the firm has a short-duration relationship with its channel partners, the use of coercive actions strengthens the economic satisfaction of the channel members. A low level of guanxi with a supplier firm weakens the negative relationship between coercive strategies and both economic and social satisfaction. The findings of this study suggest that in channel management, punitive acts can achieve economic and social outcomes through informal interactions outside of exchange relationships.
... This allows future research to use perspectives from different theories. Contingency theory 2 [64,65] Organizational learning theory 1 [66] Resource dependence theory 4 [67][68][69] Organizational fairness theory 1 [70] Social exchange theory 8 [71][72][73][74][75][76][77][78] The theory of power and conflict 3 [79][80][81] Institutional theory 2 [82,83] Social identity theory 1 [84] Acquisition-Transaction Utility Theory 1 [85] Diffusion of innovation theory 3 [86][87][88] Service dominant logic 2 [89,90] Theory of planned behavior 1 [91] Entrepreneurship theory 2 [92,93] Resource based theory 4 [94][95][96][97] Agency theory 2 [98,99] Information processing theory 1 [100] Theory of regulatory focus 1 [101] Conservations of resources Commitment-Trust theory 4 [106][107][108][109] Prospect theory 1 [110] Theory of reasoned action 2 [111,112] Deterrence theory 1 [113] Theory of distribution channel 1 [114] Cognitive consistency theory 1 [115] Theory of inter-organizational relationship 1 [116] Source: developed by the authors (2021) ...
... In the differential pattern, the social network of Chinese people consists of four levels centered on personal connections, from close to far, and four personal ties: family, acquaintances, people with vague impressions, and strangers. The closer the recipient is to the giver's core personal ties, the more socially similar the parties are in terms of operating habits and cultural background, and the easier it is to trust mutual trust [35]. Whether the owner and the PMC contractor are in the same circle of acquaintances, have relatives in common, or have received favors, these social similarities are the most influential factors in determining the level of trust between the two parties. ...
Article
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Based on the theory of system dynamics, we investigated the factors influencing the trust relationship between owners and PMC contractors in a Chinese management scenario, and proposed effective management strategies to increase the level of trust between the two parties. In the early stages of PMC project implementation, calculative trust between the owner and the PMC contractor predominated, while relational trust predominated in the middle and late stages. The applicability of the PMC model and the control configuration between the owner and the PMC contractor are also vital factors influencing the trust level. Principal determinants of calculative trust are the management capability and reputation of the PMC contractor, the sufficiency of the owner’s authorization, and the efficacy of the owner’s supervisory measures. There are four factors that influence relational trust, in order of decreasing influence: the sufficiency of the owner’s authorization, the effectiveness of the owner’s supervisory measures, the social similarity between the owner and PMC contractor, and the management capability and reputation of the PMC contractor. The research can be used as a guide for enhancing PMC project management performance and achieving PMC project success.
... The hypothesized effect finds further theoretical grounding in the B2B research on inter-organizational trust (e.g., Yu, Chen, Guan, & Zhang, 2021). This body of work suggests that competence trust (i.e., beliefs about a partner organization's professional expertise) and affective or goodwill trust (i.e., faith in a partner organization's intentions) facilitate inter-organizational collaboration and knowledge sharing (Shou, Guo, Zhang, & Su, 2011; and contribute positively to alliance performance (Jiang, Jiang, Cai, & Liu, 2015). Thus, we hypothesize that: ...
Article
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In B2B markets, vendor companies increasingly rely upon influential individuals in the digital environment to communicate information about their offerings to client organizations. Given the growing B2B digital engagement, cues that help to differentiate highly impactful digital influencers are crucial for vendor companies. Drawing from Stereotype Content Model, we analyze competence and warmth as relevant cues of digital influencers. Employing experimental studies, we examine how competence and warmth influence B2B purchasing managers' evaluation and selection of vendors' solutions. We find that the digital influencers' competence enhances purchasing managers' intention to buy the advocated vendor's offering. When compared with warmth, competence minimizes capability and relational concerns associated with the purchase decision. Further, we show that such effect of competence is prominent when manager-influencer identification is low. Our research advances knowledge on the characteristics of digital influencers that shape B2B purchasing managers' evaluation and selection of vendors. We identify concern-based psychological mechanisms underlying the effect of influencers' characteristics, and related boundary conditions. Our findings provide implications for digital influencers seeking to expand reach in B2B markets, and for vendor companies and marketing agencies in the selection of digital influencers.
... The obligation is a commitment or a duty to carry out an activity in the future (Chen et al., 2011). Trust in interorganizational relationships has been defined as the extent to which a company believes its trading partner is reliable (Shou et al., 2011). ...
Article
Purpose The purpose of this study is to investigate empirically whether the presence of dependence influences the strength and direction of the relationship between social capital and operational performance. Design/methodology/approach The authors tested two effects, moderator and mediator, of the dependence between social capital and operational performance in the buyer–supplier relationship in the supply chain. The authors use dependence as a dichotomous variable and empirically test the hypotheses using hierarchical linear regression from data collected from 117 industrial companies in Brazil. Findings The results show that although dependence does not have a mediating effect on social capital shares in operational performance, it moderates the strength of trust actions in relation to cost, delivery, flexibility and innovativeness of the buyer. Practical implications As for the practical implications, in a buyer–supplier relationship, managers may not be fully capable of decreasing dependence and thus increasing the effect of trust actions on operational performance. Originality/value For management practices in the textile and clothing industry, social capital actions contribute to strategic objectives, increasing collaboration between supply chain partners, and for operations, offering more options in managing social ties.
... Moreover, the business literature contains wide variation in assumptions regarding the relationship between guanxi and trust. For example, scholars have also posited trust as an antecedent to guanxi (Shou et al., 2011), and equated trust and guanxi (e.g., Burt et al., 2018). In sum, a variety of conceptualizations of trust and suppositions about the relationship between trust and guanxi exist in the literature. ...
Article
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Guanxi is important for career and organizational success in Chinese societies. Although guanxi has received a lot of research attention, most studies explore business outcomes rather than guanxi itself, meaning that many guanxi measures are ad hoc or assess static guanxi ties instead of guanxi quality, which is inherently dynamic. We analyzed existing measures and conceptual models of workplace guanxi to provide a foundation for developing the 15-item guanxi quality scale (GQS) as an effective and accurate way to operationalize evaluation of guanxi quality in the workplace. We demonstrated that guanxi quality is best represented with three dimensions: reciprocal favor (renqing), affection (ganqing), and trust (xinren), and that reciprocal favor encompasses face (mianzi). We also demonstrated the incremental validity of the GQS over two measures of guanxi quality with respect to 3 outcome variables: commitment, trust in the partner’s organization, and satisfaction. We discuss application of the GQS in the context of boundary spanner relations, which have been highlighted in the literature due to their potential for corruption. By grounding our measure squarely in past research and resolving conflicting conceptualizations in the literature, we expect that the GQS can provide a unified starting point for future investigation of workplace guanxi.
... H. Dyer & Chu, 2003). As in research conducted by Shou, Guo, Zhang, & Su (2011) regarding Guanxi (literally, interpersonal relationships or connections) are the lifeblood of business in China, this study is aimed at investigating the consequences, especially in the Chinese market, where it is found that Guanxi is utilitarian in developing friendships to share resources in the business community. The result is that goodwill trust is positively related to guanxi agents' behavior in the Chinese marketing channel. ...
Article
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The alliance strategy is one solution to the speed of competition in the business or business world. Strategic alliances are cooperative strategies in the form of partnerships that help unify each party's strengths to mutually benefit in the form of benefits and long-term competitiveness in the market. The alliance's strategy can be assessed as successful or not by measuring the strategic alliance's performance because the most commonly used alliance measure is performance. Whether or not an alliance strategy adopted by a company is healthy is to evaluate its alliance strategy's implementation. This research was conducted using non-sampling or census methods as many as 132 (one hundred and thirty-two) branches in DKI Jakarta in one of the companies in the education sector originating from Japan and developing an alliance strategy in Indonesia. Data collection was carried out using a questionnaire and met with the owners or direct branch leaders. From this study, it is concluded that Goodwill trust, Competence Trust, and Tangible & Intangible Resources Sharing positively influence the performance of the alliance strategy. Also, Tangible & Intangible Resources Sharing as an intervening variable can mediate the relationship between Goodwill trust and Competence Trust on the alliance's strategy's performance.
... They turn to guanxi to "break the queue" to obtain resources (Agelasto, 1996). All these factors imply that an institutional hole exists in current China while shortages continually diminish and a market economy is established (Gamble, 2007;Gu, Hung, & Tse, 2008;Shou, Guo, Zhang, & Su, 2011). examined the Chinese workplace, specifically job procedures, based on a 1988 survey of Tianjin residents. ...
... Common to Western studies in relationship marketing, the practice of guanxi centers on trust-building (Shou, Guo, Zhang, & Su, 2011). But, it is also rooted in friendship and an understood obligation for partners to exchange favors. ...
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The RM literature demonstrates the impact relationship marketing strategies have on boosting the retention and lifetime value of customers. But applying these concepts globally has been culturally challenged as buyers from Eastern and Western cultures view relationship building in very different ways. Western cultures, characterized by buyer-supplier relationship marketing, expect their business transactions to create relationships; whereas guanxi-oriented partnerships based in Eastern cultures see relationships as fundamental to conducting business transactions. This paper bridges the two fields of research (RM and Guanxi) by testing a model in the US and China.
... Common to Western studies in relationship marketing, the practice of guanxi centers on trust-building (Shou, Guo, Zhang, & Su, 2011). But, it is also rooted in friendship and an understood obligation for partners to exchange favors. ...
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Purpose: This study examines the commitment-building process between buyers and suppliers from a guanxi quality perspective in two BRIC countries (China and Brazil). It explores the influence of mutual self-disclosure, supplier performance, socialization and conflict resolution in improving the levels of friendship, reciprocity and trust in the relationship and the buyer’s allegiance and loyalty to the supplier. Design: The conceptual model is tested on data from a survey of 100 Chinese and 110 Brazilian buyers. Structural equation modeling is used to test the relationships in the model. Findings: Results suggest that the quality of guanxi drives affective commitment more in Brazil than in China. This is attributed to the nuclear characteristic of particularized trust and high degree of uncertainty in Brazil. Conflict resolution drives affective commitment more in China. This is attributed to the emphasis in harmony and face-saving in China. Mutual self-disclosure and conflict resolution are found to positively influence guanxi quality in both countries alike. Socialization influences guanxi quality more in Brazil while supplier performance influences guanxi quality more in China. Research and Practical Implications: The conceptual model demonstrates a level of commonalities in the two countries. Researchers are encouraged to test the quality of buyer-supplier relationships in other emerging countries from a guanxi perspective. Practitioners are given greater insight into how common or different committed business relationships are formed in emerging markets.
... Goodwill trust increases confidence that the counterparty is pursuing mutually compatible interests [34] and respecting reciprocity norms [89]. The high-dependence party shares as much information as necessary to meet the low-dependence party's needs, but the high-dependence party also fears that the lowdependence party would take speculative actions by using the information provided. ...
Article
It is difficult to avoid conflict in interorganizational relationships, and information exchange is critical for resolving conflict. This article reveals a mechanism that shows the separate and joint influences of different dimensions of trust and interdependence on information exchange in the process of conflict resolution. Based on survey data from the construction industry, the empirical results suggest that competence trust, total interdependence, and interdependence asymmetry positively affect information exchange when trust and interdependence act separately. When they act together, in the case of symmetric interdependence, competence trust plays a positive mediating role in the relationship between total interdependence and information exchange, whereas goodwill trust plays a negative mediating role. In the case of asymmetric interdependence, competence trust below the average level strengthens the positive impact of interdependence asymmetry on information exchange. Only when goodwill trust is above, the average level can strengthen the positive effect of interdependence asymmetry on information exchange. This article expands the research on information exchange, trust, and interdependence, which helps practitioners address conflict.
... People in Chinese society prefer dealing with old friends in their guanxi network, and to avoid outsiders (wai-ren) to prevent losses due to the counterparty's trustworthiness and credit [51]. The trust in seller results from a strong social tie, which in turn increases the recommendation and purchase intention on the social media platform [47,52]. ...
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This study aims to explore if traditional guanxi facets (i.e., ganqing, renqing and mianzi) between buyer and seller affect buyer’s trust in seller, recommendation and purchase intention in social commerce. It also investigates the mediating effects of recommendation intention and trust in seller on the relationship between guanxi facets and purchase intention. This study used an online survey in Taiwan and the partial least squares (PLS) model to test the hypotheses. Drawing on a sample of 323 respondents in Taiwan, the results show that (a) ganqing, renqing and trust in seller have positive effects on recommendation intention, (b) all guanxi facets exert positive effects on trust in seller, (c) ganqing and mianzi contribute to recommendation intention via trust in seller, (d) renqing benefits directly purchase intention but also via recommendation intention, and (e) trust in seller facilitates purchase intention via recommendation intention. This study might be the first to investigate the vital roles of traditional guanxi facets, rather than swift guanxi, in social commerce. This study also clarifies the mediating effects of buyer’s recommendation intention and trust in seller on transferring traditional guanxi facets into purchase intention.
... Participation in the DiDi platform requires drivers to bear high risks and uncertainties associated with opportunistic behaviors, and these negative perceptions make them hesitant to participate (Jones & Leonard, 2008). Calculative-based trust is generally considered an effective social mechanism that helps reduce the complexity and vulnerability felt by participants in the sharing economy and drives them to choose positive behaviors (Shou et al., 2011). Akrout and Diallo (2017) also found that calculative-based trust promotes 'trust-related behaviors' in economic markets, such as sharing information or participating. ...
Article
Although trust is a key factor in overcoming uncertainty and mitigating risk in a sharing economy, we do not have a thorough understanding of how users' trust in service providers develops in this context. This study focuses on drivers enrolled in China’s DiDi platform as the research object and investigates the effects of institutional and calculative mechanisms on their trust and intention to participate in the sharing economy. The empirical results reveal that feedback mechanism, driver protection, and dispute resolution positively affect institution-based trust, and perceived risks and benefits are significantly related to calculative-based trust. Furthermore, institution based trust and calculative-based trust, in turn, promote the driver’s intention to participate in the sharing economy. The study also finds that both institution-based trust and calculative-based trust play mediating roles, and calculative-based trust is more important for drivers.
... One could earn "face" by performing one or more specific social roles that others recognize easily, or by proactive impression management. A person may lose face if he/she fails to meet the essential requirement of their social roles (Shou et al., 2011). Essentially, the Chinese notion of face emphasizes not only the accommodation of individual desires, but the harmony of individual conduct with the views and judgement of the community (Ji, 2000). ...
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Purpose This paper aims to examine the effect of self-reflection on employee creativity in China. The authors identify individual intellectual capital (IIC) as a mediator and concerns for face as a moderator for this relationship. Design/methodology/approach A sample of 351 dyads of full-time employees and their immediate supervisors from various Chinese companies were surveyed. Regression analysis and structural equation modeling were used to test the research model. Findings Three dimensions of self-reflection significantly affect IIC and subsequently lead to employee creativity; IIC mediates the relationship between three dimensions of self-reflection and employee creativity; concern for face negatively moderates the effect of IIC on employee creativity. Practical implications Managers can facilitate employees’ creativity by motivating them to conduct self-reflection and develop IIC, and by nurturing a safe atmosphere that allows individuals to take risks without losing face. Originality/value This is one of the first empirical studies to investigate the mediating effects of IIC and the moderating effects of concerns for face on the relationship between self-reflection and creativity.
... The collectivist inclination of the Chinese society contributes to heighten the emphasis buyers placed on personal relationships as a precursor to business dealings. Cultivating social bond becomes a matter of necessity for Chinese buyers and suppliers and a part of the guanxi development process (Shou, Guo, Zhang, & Su, 2011) essential in committed business relationships. Our findings are supported by other guanxi scholars; Jukka et al. (2017) found that "the Chinese managers emphasized relationship-specific personalized trustworthiness […] personalized communication, commitment, and personalized benevolence" (p. ...
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This study investigates the antecedents and outcomes of cognitive trust during the expansion phase in buyer–supplier relationships. It takes a global approach and examines cultural nuances between developed nation and emerging market firms by including participants from the United States, China, and Brazil. The results demonstrate the importance of trust in building social capital and the central role which trust plays in shaping business relationships in all studied cultural contexts. There are similarities and differences across countries. Results support relationship marketing theory by demonstrating the importance of conflict resolution, communication frequency, and social bond in building buyer–supplier relationships in the United States, which in turn increase cooperation between partners. Results also indicate that in China, social bond plays a much greater role in building trust, which in turn increases cooperation only to the extent that it serves as a mechanism to secure committed relationships. In Brazil, results show that conflict resolution is the most important factor in building trust. It also mediates the relationship between communication frequency and trust, as well as drives cooperation positively. Overall, trust is found to influence exchange of confidential communication and increases commitment between partners in all three countries.
... To measure the key constructs proposed in our model, we adapted scales developed by previous studies (see Appendix B). Because most of the original scales were developed in English, we follow previous studies (e.g., Abosag, 2015;Shou, Guo, Zhang, & Su, 2011) to use a standard back-translation technique to translate the questionnaire into Chinese (Brislin, 1980). To ensure the quality of the survey design, we invited 25 informants to conduct a pre-test in which they were asked to provide feedback on the questions included in the survey. ...
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Due to the inefficiency in utilizing the rich resources they have, state-owned firms in China are generally not competitive as private firms in developing innovation-related organizational capabilities. This study contributes to the existing literature by identifying an alternative mechanism that can potentially explain the negative association between state ownership and innovation capability. Specifically, this study suggests that state-owned firms have less competitive advantage in innovation because they lack entrepreneurial orientation. To provide a potential solution for this problem, this study examines an important but understudied firm strategy, high commitment HR practices (HCHR), and investigates the roles it plays on enhancing innovation capability by promoting an entrepreneurial orientation in state-owned firms. More importantly, by studying the contingent effect of firm business nature, this study identifies the boundaries of the positive effect of HCHR.
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This study examines the influence of managerial network communities (MNCs) on corporate collaborative innovation. Based on the sample of Chinese A-share listed firms, we demonstrate that embedding in dense MNCs benefits corporate collaborative innovation. This is associated with the information and knowledge exchange and trust establishment. Moreover, firms with managers occupying a position more at the core of MNCs benefit more than firms with peripheral members. In regions with high intellectual property rights protection, firms are more inclined to engage in collaborative innovation through MNCs. Mechanism tests show that cross-regional collaborative innovations benefit more from MNCs, and MNCs’ positive effect on collaborative innovation is more outspoken in regions characterized by low social trust. Our findings enrich the understanding of the managers’ social network from the meso-level network community perspective and provide managerial guidelines for more fully releasing MNCs’ positive role in facilitating corporate collaborative innovation.
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Background: Due to the Jammu and Kashmir conflict, many teenagers are involved in disputes with the law. The conflict made generations suffer for decades. Such children made the mobs; being involved in life-threatening situations and the risk they confront develop psychiatric disorders. As a result of the various tense conditions when applied in multiple anti-social activities, aberrant children sent to correctional homes have to encounter numerous psychological disorders. Aim: The motive of the study is to explore the level of awareness, availability of services, stigma and obstacles to seeking assistance. Method: Due to the open-ended interview questions and a small sample size of 15 respondents, this study employed a qualitative methodology – a thematic analysis was done. Results: The findings revealed that, although the stigma is not publicly acknowledged, children who break the law and seek mental health services (MHS) are stigmatised. It was also shown that minor offenders fear that when they receive services provided by the staff of the observation home (OH), there will be a violation of their privacy and fear unforeseen repercussions. Conclusion: Collaborative action must proactively raise appropriate awareness to lessen the stigma linked with mental health problems, especially regarding MHS among these teenagers.
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In today’s dynamic business environment, leveraging innovative supply chain (SC) solutions is critical for increasing competitive advantage. While numerous studies have considered the potential of SC innovation (SCI) in the face of growing new problems and challenges, not much is known about the effect of suppliers’ promotive voice behavior (PVB) in this process. This study extends the current research on SCI by investigating the underlying mechanisms by which firms exploit the suggestions and ideas they gain from SC interactions. Building on the relational view (RV) we develop hypotheses that identify the effect of suppliers’ PVB as an important mediator in the relationship between incentives and SCI. Further, we suggest that incentives and two contextual factors (i.e., unlearning reputation and transparency) interact to predict SCI through suppliers’ PVB. For the purpose of testing the proposed hypothesis a survey was administrated to managers involved in SC relationships. The analysis provides the evidence that suppliers’ PVB has a positive influence on SCI. In addition, the association between incentives and SCI was empirically demonstrated to be mediated by suppliers’ PVB. Furthermore, it was determined that incentive’s effect on SCI through suppliers’ PVB was conditional such that unlearning reputation’s effect depended on transparency. In this regard, this study extends the discussion of factors that influence SCI and provides some theoretical and managerial contributions by examining the interplay between incentives, transparency, and unlearning reputation on the suppliers’ PVB and SCI.
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Purpose Based on a review of the Chinese ethic of bao (reciprocity), this paper aims to study the issue of reciprocity of trust at firm level by analyzing multiple-source data while controlling for the effects of several contextual variables. Design/methodology/approach The authors collected data from the supplier–buyer partnerships in China’s automotive industry. Hierarchical linear regression approach is adopted to test the hypotheses. Findings The data show that reciprocity of trust between parties involved has a significantly positive effect on the stability of the supplier–buyer partnership, and that this reciprocity also moderates the relationship between trust itself and stability. In addition, several contextual variables, i.e. the suppliers’ sensitiveness to their buyer’s need, personal contact of top managers, motivation to develop symbiotic partnership and firm location, can also have significant and positive effects on the stability of the supplier–buyer partnership. Originality/value This study presents empirical evidence on how the Chinese ethic of bao may influence the stability of the supplier–buyer partnerships, suggesting that examining this Chinese cultural element is a useful exercise. Related to this issue, the data show that the level of trust between the parties in business transactions differs, and that this difference influences the stability of the partnership. In addition, the study suggests that several other factors have significant and positive effects on the stability of the partnership. Interestingly, the data suggest that these effects are more likely to be observed when the reciprocity of trust or bao between the partners is taken into account. By demonstrating empirically the significant direct and moderating effect of bao or reciprocal trust, this study makes an important contribution to the literature on trust and the stability of the supplier–buyer partnership.
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The literature rarely explores sales gatekeeping strategies empirically and fails to provide sufficient understanding of how and when this strategy can be effectively employed. This study aims to examine these issues by examining the impact on sales performance of using relational gatekeepers in the B2B sales process as well as the moderating effects of gatekeeper-salesperson and gatekeeper-buyer guanxi on the above-mentioned link. Based on a questionnaire survey of 245 pairs of sales managers from Chinese B2B manufacturing and service companies and their sales gatekeepers, the research results indicate that employing relational gatekeepers helps develop sales managers–purchasing manager guanxi, which in turn generates better sales performance. In addition, the gatekeeper's affective commitment to his/her relationship with the sales manager and relational power over the purchasing manager reinforces the sales gatekeeping strategy's effectiveness. These research findings significantly contribute to the theory development of gatekeeping strategy in B2B sales management and also provide insightful managerial implications for B2B sales managers on how to more effectively use relational gatekeepers to facilitate achieving their sales goals.
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Las relaciones comerciales son un elemento esencial del marketing relacional pues su adecuada gestión permite a las empresas obtener beneficios. Estas relaciones pueden verse afectadas por distintos factores, entre los cuales están los comportamientos del lado oscuro o conductas como el ocultamiento de información, el oportunismo, la intención de generar confusión, la venta de información, el engaño, el irrespeto a la privacidad y los cobros injustificados. El objetivo de este artículo fue identificar investigaciones cuyo enfoque fueran los comportamientos del lado oscuro y su relación con la satisfacción en las relaciones comerciales entre empresas. Para lograr este propósito, se realizó una revisión sistemática de la literatura de documentos redactados en el periodo 2010-2022. Se identificaron teorías, autores, metodologías.
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Purpose Chinese marketing scholars have been studying marketing channel strategies for the past 20 years. However, the emergence of the internet and the digital economy has led to new marketing channels and practices that question the usefulness of this existing body of research, challenging Chinese marketing scholars specialized in channel strategy who are limited by path-dependent foundations and methods. This article reviews the research on marketing channel strategies by Chinese scholars, identifies the challenges posed by new channels and practices, and proposes some strategies for addressing these challenges. Design/methodology/approach This study systematically summarizes the research on marketing channel strategies published by Chinese scholars in English or Chinese in the past 20 years. Including articles published in either English-language or Chinese-language marketing journals allows this review to summarize the overall current state of marketing channel strategy research. Findings The theory and research methods used in studies of marketing channel strategies are relatively mature, and the field is saturated. However, the development of e-commerce and online channels have changed the structure of offline marketing channels, making Chinese scholars of marketing channel strategies to necessarily change Chinese scholars' thinking, methods, and research topics. Scholars from the fields of e-commerce, information system management, and big data are now conducting research on marketing channels. Chinese scholars who study marketing channel strategies need to establish and develop novel approaches to researching these new phenomena and practices. Originality/value This article analyzes the challenges faced by Chinese scholars who study marketing channel strategies and provides suggestions for future research in the area. The findings will assist in the development of research on new online and offline channel phenomena in the era of the internet and the digital economy.
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Guanxi, which literally means interpersonal relationship or social connections, plays an important role in achieving business success in China. This study investigates the effect of interpersonal relationship on trust and trustworthiness in four regions in China. Eighty pairs of close friends participated in the experiment: 20 pairs from Beijing, 20 pairs from Guangdong, 20 pairs from Shanghai, and 20 pairs from Chongqing. A cooperation experiment based on a two-tier simulated supply chain was conducted, in which the participant who played as a supplier solicited demand forecast information from the participant who played as a retailer to plan production. Participants were instructed to perform two tasks: one with a "friend" counterpart and one with a "stranger" counterpart. The results demonstrated regional differences in the effects of interpersonal relationship on trust and trustworthiness: the effect of interpersonal relationship was greater in Guangdong than in the other regions. Additionally, a quantified classification of trustworthiness-trust was proposed by clustering analysis. The type of self-protective trustworthiness and altruistic trust occupied an overwhelming majority in each region, followed by the type of altruistic trustworthiness and self-protective trust, the type of altruistic trustworthiness and altruistic trust, and the type of self-protective trustworthiness and self-protective trust. Regional differences in the distribution proportions in the four types were discovered.
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The relation between guanxi (particularistic dyadic ties) and trust in the workplace is widely assumed in the management and organization literature, but little research attention has been given to directly examining the nature of this relationship, or the ways in which Chinese and Western workplace trust development might differ. I suggest two overlooked factors, culture and conceptualization, that have influenced past studies and explore their impact through an analysis of the literature. Given the nature of Chinese trust, I conclude that the division between affective and cognitive aspects of trust common in the Western organizational literature is not an appropriate model for the Chinese context. Instead, I apply a distinction between rapid trust and process trust that together form a path to development of two forms of workplace guanxi: working guanxi and backdoor guanxi. I then propose a dynamic process model of the social and psychological process of guanxi and trust development in the context of the workplace that incorporates the Chinese indigenous concepts of renqing (favor), ganqing (affection), mianzi (face/reputation), xinren (trust) and xinyong (social credit). This model aligns with the Chinese metaphysical process orientation, and has implications for trust research not only in Chinese societies but also the international community.
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This study investigates the hitherto largely neglected effects of contract enforcement in interfirm relationship. Based on contract functions, we conceptualize contract enforcement as a two-dimensional construct comprising contractual control enforcement and contractual coordination enforcement. We examine how the effects of these two enforcements differ as the level of interfirm guanxi varies. The findings from a survey of 190 buyers in China suggest that both contractual control enforcement and contractual coordination enforcement mitigate sellers' opportunism. Moreover, contractual coordination enforcement is more effective in reducing opportunism when the interfirm guanxi is strong, whereas contractual control enforcement is more effective in reducing opportunism when the interfirm guanxi is weak. Our research contributes to both theory and practice by revealing the complex and paradoxical moderating role of interfirm guanxi.
Chapter
Trust has been defined as the mutual and exchange of confidence between parties, established through expectations of good intentions and reasonable competence and with the expectation that no party will exploit the vulnerabilities of the other. It has been described as the glue that holds and smooths the process of societal functions, such as the development of interpersonal or economic relationships. Research has demonstrated the impact of culture and societal norms on the formulation, development and maintenance of trust. For example, research has demonstrated the impact of Confucianism, as well as the importance of the concept of guanxi, on the construction of trust in East Asian countries. This chapter will first introduce and discuss the cultural influences of Confucianism and guanxi, along with their impact on the formulation, development and maintenance of trust in Taiwan. Furthermore, this chapter will illustrate how trust is manifested in general, as well as trust in specific relationships and referent points in Taiwan. Finally, this chapter will discuss the implications and applications of trust research in a cross-cultural context.
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Purpose Considering strategic information sharing (SIS), this paper aims to develop a better understanding of how relation-specific investments (RSIs) influence cooperative innovation performance (CIP) in downstream channel relationships. This paper also examined that the moderating effect of relational trust in the indigenous practice of guanxi is especially critical in China. Design/methodology/approach Data were collected through a questionnaire in Chinese high-tech industries, with a valid response from 310 companies. A hierarchical regression analysis was used to test the conceptual model and hypotheses, combining mediation and moderation analysis. Findings Results show that the influences of specific investments vary according to the specificity dimensions examined. Specifically, human RSI influences CIP and SIS most significantly, and the impact of procedural RSI is, relatively, the weakest. Relational trust’s moderating role is confirmed, and SIS plays a partially mediating role in enhancing vertical cooperative innovation. Practical implications Managers should know clearly different roles of RSIs in inter-firm cooperative innovation and prioritize human RSI and brand RSI when investing into channels. More importantly, the findings reveal that strategy-level information sharing should be valued more. It is also recommended that relational ties are vital, especially in Chinese business context. Originality/value To the best of the authors’ knowledge, this paper is among the first few to investigate how the effects of disaggregated RSIs in inter-firm cooperative innovation vary and the importance of SIS in vertical relationships. The results provide insightful guidance for researchers and managers in how to better manage RSIs to improve CIP.
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Distintos autores sostienen la idea de que la mera presencia de sistemas de control en una organización genera desconfianza entre sus miembros. En la práctica, sin embargo, es posible observar distintas organizaciones donde operan sistemas de control y, al mismo tiempo, existe un elevado nivel de confianza organizacional. A partir de una investigación bibliográfica, el presente estudio postula que esta aparente contradicción puede ser superada si se toma en consideración el posible rol que desempeñan los sistemas de control cuando se aplican en las distintas etapas del proceso de desarrollo de la confianza. Más específicamente, el estudio postula que, en la primera etapa de la relación entre un líder y sus colaboradores, el líder debe aplicar el control haciendo un uso más intenso del control sobre el comportamiento; en la segunda etapa, utilizando de manera más intensa el control por resultados; y en la tercera etapa, haciendo un uso más intensivo del control cultural.
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This paper contributes to our understanding of xinren within buyer-seller relationships. Xinren is often translated to trust and is critical for the development of strong business relationships. Previous conceptualizations and measurements of xinren have been inconsistent and questionable. Through a novel methodology, prototyping analysis, this research outlines a foundational structure for xinren. A series of 4 studies were conducted on xinren in buyer-seller relationships in China involving a total of 311 participants who were employed in sourcing and procurement (33.23%) or marketing and sales (31.29%), and had spent less than one year working outside China. Central prototypical features include high arousal emotions highlighting the importance of affect-based aspects when developing xinren. Negative features indicate that both trust and distrust may be synergistically operating within xinren. Contributions are also made by outlining both universal trust features and more culturally-nuanced trust features. Suggestions for managers indicate how both Eastern and Western partners may use these results to build deeper trust within their relationships. Future research includes undertaking further prototyping analysis on trust within other cultures to develop foundational structures that may include both universal and culturally-nuanced trust features.
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Exploitative learning and exploratory learning are of great significance to the survival and long-term development of an organization. The former refers to the improvement of existing knowledge, skills and paradigms. The latter refers to the search for new knowledge, technology and experience. Therefore, the dual learning equilibrium (balance between exploitative learning and exploratory learning) is very important. However, for the engineering project organization, due to the pressure of cost and time cycle assessment, the engineering project organization is often more inclined to exploitative learning rather than exploratory learning. Therefore, how to realize the dual learning equilibrium (balance between exploitative learning and exploratory learning) of engineering project organization has become an urgent problem to be solved. Through formal control structures (outcome control vs. behaviour control) and guanxi (affect vs. face) can get the information needed by organizational dual learning (exploratory learning vs. exploitative learning), but whether the balance (formal control structures vs. guanxi) is still an effective strategy to promote dual learning equilibrium (balance between exploratory learning and exploitative learning) is still lack of theoretical and empirical support. It was examined assumptions related to how dual learning equilibrium is influenced by Guanxi and formal control structures equilibrium in project partnerships. Practically, this paper investigates the extent to which distinct components of Guanxi (i.e., affect and face) are differentially and interactively associated with outcome and behavioural controls on influencing ambidextrous learning equilibrium. Survey data were collected from 221 construction project partnerships in China. The results showed that both of the affect and behavioural controls have a positive impact on the ambidextrous learning equilibrium. Besides, the equilibrium between formal control structures and Guanxi can promote the ambidextrous learning equilibrium of the engineering project team. Compared with behavioural controls, the equilibrium between the affect and outcome controls has a stronger positive correlation with the ambidextrous learning equilibrium of the engineering project team. Compared with the outcome controls, the equilibrium of face and behavioural controls has a stronger positive correlation with the ambidextrous learning equilibrium of the engineering project team. However, the equilibrium between the affect and behavioural controls has no significant impact on the ambidextrous learning of the project team. On the whole, the two-pronged and balanced strategy is still effective for dual learning equilibrium, but it should avoid the balanced use of affect and behavioural controls. In addition, the affect plays a negative moderating role in the process of behavioural controls affecting ambidextrous learning equilibrium. Face plays a positive moderating role in the influence of formal control structures on ambidextrous learning equilibrium. These findings have important implications for firms hoping to facilitate the dual learning equilibrium in China and other countries.
Article
Purpose This study aims to examine distinct influences of two dimension job stress on job satisfaction and the moderating effects of guanxi-oriented attitude on the relationship between job stress and job satisfaction under cognitive appraisal theory and transactional theory. Design/methodology/approach In this study, surveys are conducted among state-owned younger bank employees. The author uses the scale of job challenge stress and hindrance stress developed among Chinese younger bank employees to measure the two dimension job stress. After demonstrating guanxi-relative concepts, the moderating effects of guanxi-oriented attitude are examined in this study. Findings The results demonstrate that guanxi-oriented attitude does not significantly moderate the influence of challenge stress on job satisfaction, while it significantly moderates the noxious influence of hindrance stress on job satisfaction. Theoretical contributions are also discussed. Originality/value First, this study suggests specific procedures to conduct hierarchical regression analysis and confirms the effects by parameters. It also proposes and summarizes specific procedures on how to calculate regression equations and draw regression lines to check the interaction received from the hierarchical regression analysis visually. Second, based on cognitive appraisal theory, guanxi-oriented attitude, a Chinese indigenous cognitive concept, was verified in this study. According to the importance of guanxi in Chinese society, the paper shows that employees who value guanxi more will buffer the noxious effects of job stress. Trainings and counseling should be designed to regulate the normal guanxi-oriented-related cognition.
Chapter
This chapter aims at addressing the role of informal contract law in the current Chinese society; its main focus is to provide an analysis of the role of “guanxi” (so called “relations”) in the phase of negotiations of a “B2B contract” involving a foreign company on one side and a Chinese company on the other. After an overview of the main characteristics of guanxi (Sect. 1), this contribution continues with an examination of the Chinese contracting mechanism using the “lens” of law and society scholarship (Sect. 2); it then provides some recent trends noticed by business players acting within the Chinese market. Section 3 is focused on what happens when “things go wrong” and guanxi is no longer useful as a tool to resolve or “amicably consult” (using a Sino-English expression) a potential claim or a potential dispute arising between the contracting parties. The conclusions drawn could be used as a “trans-cultural” instrument to analyze the current Chinese market and its possible future trends.
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Foreign managers often perceive cultural practices, such as gift giving and guanxi, as being unethical. This can leave them at a disadvantage when negotiating in China. This study describes a concept for the benefit of MNEs so they can leverage performance through acquiring insider status. The study suggests that foreign managers should aim to build a solid reputation to facilitate reciprocal exchange when doing business in China. Such reciprocity can help to establish affective ties to cement a relationship. Establishing affection can also lead to greater interpersonal trust and, subsequently, some degree of loyalty can then emerge as a mechanism for generating ethical cronyism and performance advantages.
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Cross-sectional studies of attitude-behavior relationships are vulnerable to the inflation of correlations by common method variance (CMV). Here, a model is presented that allows partial correlation analysis to adjust the observed correlations for CMV contamination and determine if conclusions about the statistical and practical significance of a predictor have been influenced by the presence of CMV. This method also suggests procedures for designing questionnaires to increase the precision of this adjustment.
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Interview data from China are used to test an argument that executives develop personal connections in societies with underdeveloped legal support for private businesses. In China, such connections are called guanxi. An underdeveloped legal framework makes private-company executives more dependent on guanxi than executives in state-owned or collective-hybrid companies. Compared to the other executives, private-company executives considered business connections more important, depended more on connections for protection, had more government connections, gave more unreciprocated gifts, and trusted their connections more.
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This paper studies the causal relationship between dependence and power in the context of marketing channels in China in the setting of department stores and their suppliers. The hypothesized relationship that a channel member's power is derived from the other's dependence in the channel dyad, which is based on existing Western literature on channel behavior, did not fit well with our data. Some dimensions of dependence did not have a significant influence on channel members' perception of power. The empirical data fits better with a reversed relationship inferred from the Chinese psychoculture.
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In this article, we provide guidance for substantive researchers on the use of structural equation modeling in practice for theory testing and development. We present a comprehensive, two-step modeling approach that employs a series of nested models and sequential chi-square difference tests. We discuss the comparative advantages of this approach over a one-step approach. Considerations in specification, assessment of fit, and respecification of measurement models using confirmatory factor analysis are reviewed. As background to the two-step approach, the distinction between exploratory and confirmatory analysis, the distinction between complementary approaches for theory testing versus predictive application, and some developments in estimation methods also are discussed.
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We present a view of trust in boundary spanners as explained by the extent of role autonomy, a multidimensional concept that reflects the discretion that agents have in interpreting and enacting their roles. We argue that, in a buyer-supplier context, purchasing managers will be trusted to a greater extent by supplier representatives when they are free from constraints that limit their ability to interpret their boundary-spanning roles. We conceptualize and measure three key components of role autonomy: Functional influence, tenure, and clan culture. Taken together, these components of role autonomy shape and define the purchasing manager's willingness and capacity to make and uphold commitments to supplier representatives. Role autonomy permits purchasing managers to engage in discretionary behaviors that allow supplier representatives to learn about their underlying motives and intentions. We test hypotheses linking the components of role autonomy to trust on a sample of 119 buyer-supplier relationships. We use a dyadic research design that combines data from purchasing managers and supplier representatives. The results suggest that granting purchasing managers greater autonomy enhances supplier representative trust in purchasing managers. By drawing attention to role autonomy as a feature of organizations that influences trust we highlight the importance of organizational context in contributing to a deeper understanding of trust.
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This article contributes to the debate on the relation between trust and control in the management of inter-organizational relations. More specifically, we focus on the question how trust and formal contract are related. While there have been studies on whether trust and contract are substitutes or complements, they offer little insight into the dynamic interaction between the two. They fail to answer, first, whether contract precedes trust or follows it, in other words, what causal relationship exists between the concepts; second, how and why trust and contract can substitute or complement each other; and third, how the various combinations of trust and contract affect a relationship's development and outcome. In search of answers, we conducted longitudinal case studies to reveal the relationship between trust, contract and relationship outcome in complex inter-firm relationships. We find trust and contract to be both complements and substitutes and find that a close study of a contract ' s content offers alternative insight into the presence and use of contracts in inter-firm relationships.
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This article examines the developmental process of cooperative interorganizational relationships (IORs) that entail transaction-specific investments in deals that cannot be fully specified or controlled by the parties in advance of their execution. A process framework is introduced that focuses on formal, legal, and informal social-psychological processes by which organizational parties jointly negotiate, commit to, and execute their relationship in ways that achieve efficient and equitable outcomes and internal solutions to conflicts when they arise. The framework is elaborated with a set of propositions that explain how and why cooperative IORs emerge, evolve. and dissolve. The propositions have academic implications for enriching interorganizational relationships, transaction cost economics. agency theories, and practical implications for managing the relationship journey.
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Examines the antecedents and consequences of close business relationships (guanxi) in China. We hypothesize that decision-making uncertainty and perceived similarity positively affect guanxi, whereas opportunism negatively affects guanxi. We also hypothesize that guanxi positively affects business performance, mediated by relationship quality and interdependence. An empirical study of Hong Kong and mainland China business relationships generally supports the model. The managerial implications are discussed.
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This article develops a conceptual framework of roles in marketing relationships. Drawing on emerging theory from economic sociology and March's (1994) notion of decision "logics," the authors discuss two prototypical relation- ship roles, namely (1) a "friend," who uses a "logic of appropriatene ss" and follows established rules, and (2) a "businessperson," whose decisions are guided by utility-maxim izing considerations under a "logic of conse- quences." Next, they use extant theories of intertirm governance to suggest that firms' relationship strategies can be used both to create different relationship roles in the first place and to activate them over time. The authors posit that activation can have several different outcomes, including reinforcement of an existing dominant role or actual switching to a new one. Theoretically, the conceptual framework allows for integration of different perspec- tives on interfirm relationships, some of which have provided seemingly inconsistent accounts of firm behavior. From a managerial perspective, the framework identifies specific matches between particular relationship roles on the one hand and firms' governance strategies on the other hand. In general, the framework suggests that an in-depth understanding of roles is a prerequisite for the deployment of relationship management initiatives toward resellers, customers, and suppliers.
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This study addressed the nature and functioning of relationships of interpersonal trust among managers and professionals in organizations, the factors influencing trust's development, and the implications of trust for behavior and performance. Theoretical foundations were drawn from the sociological literature on trust and the social-psychological literature on trust in close relationships. An initial test of the proposed theoretical framework was conducted in a field setting with 194 managers and professionals.
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Related the points in C. E. Osgood's (1974) graduated and reciprocated initiatives in tension reduction (GRIT) proposal for reducing conflict through a program of conciliatory initiatives to theory and concepts concerned with developing trust and the attribution of trustworthiness. A framework for organizing and making meaningful the results of experimental game studies of conciliatory approaches to conflict management is provided. In general, support for the steps in the GRIT proposal was provided by these studies. The steps may be viewed as effective means for inducing attributions of trustworthiness and, because trust is essential to the resolution of mixed-motive conflict, for bringing about cooperation. It is suggested that some ambiguity remains concerning the requirements that the initiator precisely match the conciliatory and escalatory actions of the target. (4 p ref) (PsycINFO Database Record (c) 2012 APA, all rights reserved)
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trust in intimate and professional relationships / types of trust / dynamics of trust development / what causes trust to decline (PsycINFO Database Record (c) 2012 APA, all rights reserved)
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The applicability of 5 conventional guidelines for construct measurement is critically examined: (1) Construct indicators should be internally consistent for valid measures, (2) there are optimal magnitudes of correlations between items, (3) the validity of measures depends on the adequacy with which a specified domain is sampled, (4) within-construct correlations must be greater than between-construct correlations, and (5) linear composites of indicators can replace latent variables. A structural equation perspective is used, showing that without an explicit measurement model relating indicators to latent variables and measurement errors, none of these conventional beliefs hold without qualifications. Moreover, a "causal" indicator model is presented that sometimes better corresponds to the relation of indicators to a construct than does the classical test theory "effect" indicator model. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
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When one becomes an official, the entire family prospers … they host banquets and send presents ( ch'ing-k'o sung-li ). … One can see no organization. Personal acquaintances ( ssu-jen ) are employed, factions are active, and there are feudal relationships ( kuan-hsi ) … Why were the big and small “fleets” [of Lin Piao's anti-party group] openly able to carry out the schemes of forming cliques, engaging in factionalism, and carrying out conspiracies by such acts as hosting banquets ( ch'ing-k'o ), sending gifts ( sung-li ), offering official positions and making promises? In addition to providing himself with extravagant pleasures, Wang Hungwen used the illegally obtained money and goods to host banquets ( ch'ing-k'o ), and send presents ( sung-li ) in order to recruit corrupt cadres and conduct anti-party factional activities. So many filthy political exchanges are just so happily arranged in an atmosphere of wine and women. Eat, Eat, Drink, Drink had already become a gauge by which Wang Hung-wen and his “little brothers” measured political relationships ( kuan-hsi ).
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The authors of Informal Politics in East Asia, first published in 2000, argue that political interaction within the informal dimension (behind-the-scenes politics) is at least as common and influential, though not always as transparent or coherent, as formal politics, and that this understudied category of social interaction merits more serious and methodical attention from social scientists. This book is a pioneering effort to delineate the various forms of informal politics within different East Asian political cultures and to develop some common theoretical principles for understanding how they work. Featured here are contributions by political scientists specializing in the regions of China, Taiwan, Japan, the Korean peninsula, and Vietnam. The authors apply to this dynamic region the classic core questions of politics: who gets what, when, how, and at whose expense?
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This article develops a conceptual framework of roles in marketing relationships. Drawing on emerging theory from economic sociology and March's (1994) notion of decision “logics,” the authors discuss two prototypical relationship roles, namely (1) a “friend,” who uses a “logic of appropriateness” and follows established rules, and (2) a “businessperson,” whose decisions are guided by utility-maximizing considerations under a “logic of consequences.” Next, they use extant theories of interfirm governance to suggest that firms’ relationship strategies can be used both to create different relationship roles in the first place and to activate them over time. The authors posit that activation can have several different outcomes, including reinforcement of an existing dominant role or actual switching to a new one. Theoretically, the conceptual framework allows for integration of different perspectives on interfirm relationships, some of which have provided seemingly inconsistent accounts of firm behavior. From a managerial perspective, the framework identifies specific matches between particular relationship roles on the one hand and firms’ governance strategies on the other hand. In general, the framework suggests that an in-depth understanding of roles is a prerequisite for the deployment of relationship management initiatives toward resellers, customers, and suppliers.
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Guanxi refers to the durable social connections and networks a firm uses to exchange favors for organizational purposes. This study examines how and when guanxi operates as a governance mechanism that influences firm marketing competence and performance in the transitional economy of China. Drawing on social capital theory, the authors propose an integrative framework that unbundles the benefits and risks of guanxi and delineates the organizational processes to internalize guanxi as a corporate core competence. The authors surveyed senior executives in 282 firms in China's consumer products industries. The findings confirm guanxi's direct effects on market performance and its indirect effects mediated through channel capability and responsive capability. The authors also confirm that technological turbulence and competition intensity can be effective structure-loosening forces, thus reducing the governance effects of guanxi. The findings suggest that firms can improve market access and growth through guanxi networks, but managers need to capitalize on them from the personal to the corporate level. In addition, managers should be aware of guanxi's dark sides, which include reciprocal obligations and collective blindness. This study shows that personal networks are popular universally, but in China, they have unique, distinct ways of operation.
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The authors seek to understand which of three different strategic orientations of the firm (customer, competitive, and technological) is more appropriate, when, and why it is so in the context of developing product innovations. They propose a structural model of the impact of the strategic orientation of the firm on the performance of a new product. The results provide evidence for best practices as follows: (1) A firm wishing to develop an innovation superior to the competition must have a strong technological orientation; (2) a competitive orientation in high-growth markets is useful because it enables firms to develop innovations with lower costs, which is a critical element of success; (3) firms should be consumer- and technology-oriented in markets in which demand is relatively uncertain—together, these orientations lead to products that perform better, and the firm will be able to market innovations better, thereby achieving a superior level of performance; and (4) a competitive orientation is useful to market innovations when demand is not too uncertain but should be de-emphasized in highly uncertain markets.
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Multiple regression analysis is one of the most widely used statistical procedures for both scholarly and applied marketing research. Yet, correlated predictor variables—and potential collinearity effects—are a common concern in interpretation of regression estimates. Though the literature on ways of coping with collinearity is extensive, relatively little effort has been made to clarify the conditions under which collinearity affects estimates developed with multiple regression analysis—or how pronounced those effects are. The authors report research designed to address these issues. The results show, in many situations typical of published cross-sectional marketing research, that fears about the harmful effects of collinear predictors often are exaggerated. The authors demonstrate that collinearity cannot be viewed in isolation. Rather, the potential deleterious effect of a given level of collinearity should be viewed in conjunction with other factors known to affect estimation accuracy.
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To function, a marketing channel must have a certain amount of consensus and coordinated decision making among its members. Marketing channel theory has emphasized the “internal” mechanisms of achieving integrated actions. However, channels consist of exchanging organizations that are affected not only by their collective interests, but also by forces “external” to the relationship. Internal coordination mechanisms are likely to be less effective to the extent channel members are faced with uncertainties emanating from external sources. The authors examine the external or environmental factors affecting decision-making uncertainty in channels. The findings indicate that four dimensions—diversity among consumers, dynamism, concentration, and capacity—should be included in future research on the effects of environments on intrachannel variables.
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Marketing managers must know the time orientation of a customer to select and use marketing tools that correspond to the time horizons of the customer. Insufficient understanding of a customer's time orientation can lead to problems, such as attempting a relationship marketing when transaction marketing is more appropriate. The author suggests that long-term orientation in a buyer/seller relationship is a function of two main factors: mutual dependence and the extent to which they trust one another. Dependence and trust are related to environmental uncertainty, transaction-specific investments, reputation, and satisfaction in a buyer/seller relationship. The framework presented here is tested with 124 retail buyers and 52 vendors supplying to those retailers. The results indicate that trust and dependence play key roles in determining the long-term orientation of both retail buyers and their vendors. The results also indicate that both similarities and differences exist across retailers and vendors with respect to the effects of several variables on long-term orientation, dependence, and trust.
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The statistical tests used in the analysis of structural equation models with unobservable variables and measurement error are examined. A drawback of the commonly applied chi square test, in addition to the known problems related to sample size and power, is that it may indicate an increasing correspondence between the hypothesized model and the observed data as both the measurement properties and the relationship between constructs decline. Further, and contrary to common assertion, the risk of making a Type II error can be substantial even when the sample size is large. Moreover, the present testing methods are unable to assess a model's explanatory power. To overcome these problems, the authors develop and apply a testing system based on measures of shared variance within the structural model, measurement model, and overall model.
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A critical element in the evolution of a fundamental body of knowledge in marketing, as well as for improved marketing practice, is the development of better measures of the variables with which marketers work. In this article an approach is outlined by which this goal can be achieved and portions of the approach are illustrated in terms of a job satisfaction measure.
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In this article, we provide guidance for substantive researchers on the use of structural equation modeling in practice for theory testing and development. We present a comprehensive, two-step modeling approach that employs a series of nested models and sequential chi-square difference tests. We discuss the comparative advantages of this approach over a one-step approach. Considerations in specification, assessment of fit, and respecification of measurement models using confirmatory factor analysis are reviewed. As background to the two-step approach, the distinction between exploratory and confirmatory analysis, the distinction between complementary approaches for theory testing versus predictive application, and some developments in estimation methods also are discussed.
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The authors integrate theory developed in several disciplines to determine five cognitive processes through which industrial buyers can develop trust of a supplier firm and its salesperson. These processes provide a theoretical framework used to identify antecedents of trust. The authors also examine the impact of supplier firm and salesperson trust on a buying firm's current supplier choice and future purchase intentions. The theoretical model is tested on data collected from more than 200 purchasing managers. The authors find that several variables influence the development of supplier firm and salesperson trust. Trust of the supplier firm and trust of the salesperson (operating indirectly through supplier firm trust) influence a buyer's anticipated future interaction with the supplier. However, after controlling for previous experience and supplier performance, neither trust of the selling firm nor its salesperson influence the current supplier selection decision.
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Marketing managers must know the time orientation of a customer to select and use marketing tools that correspond to the time horizons of the customer. Insufficient understanding of a customer's time orientation can lead to problems, such as attempting a relationship marketing when transaction marketing is more appropriate. The author suggests that long-term orientation in a buyer/seller relationship is a function of two main factors: mutual dependence and the extent to which they trust one another. Dependence and trust are related to environmental uncertainty, transaction-specific investments, reputation, and satisfaction in a buyer/seller relationship. The framework presented here is tested with 124 retail buyers and 52 vendors supplying to those retailers. The results indicate that trust and dependence play key roles in determining the long-term orientation of both retail buyers and their vendors. The results also indicate that both similarities and differences exist across retailers and vendors with respect to the effects of several variables on long-term orientation, dependence, and trust.
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Multiple regression analysis is one of the most widely used statistical procedures for both scholarly and applied marketing research. Yet, correlated predictor variables-and potential collinearity effects-are a common concern in interpretation of regression estimates. Though the literature on ways of coping with collinearity is extensive, relatively little effort has been made to clarify the conditions under which collinearity affects estimates developed with multiple regression analysis-or how pronounced those effects are. The authors report research designed to address these issues. The results show, in many situations typical of published cross-sectional marketing research, that fears about the harmful effects of collinear predictors often are exaggerated. The authors demonstrate that collinearity cannot be viewed in isolation. Rather, the potential deleterious effect of a given level of collinearity should be viewed in conjunction with other factors known to affect estimation accuracy.
Article
The concept of face is clarified and distinguihed from other closely related constructs: authority, standards of behavior, personality, status, dignity, honor, and prestige. The claim to face may rest on the basis of status, whether ascribed or achieved, and on personal or nonpersonal factors; it may also vary according to the group with which a person is interacting. Basic differences are found between the processes involved in gaining versus losing face. While it is not a necessity for one to strive to gain face, losing face is a serious matter which will, in varying degrees, affect one's ability to function effectively in society. Face is lost when the individual, either through his action or that of people closely related to him, fails to meet essential requirements placed upon him by virtue of the social position he occupies. In contrast to the ideology of individualism, the question of face frequently arises beyond the realm of individual responsibility and subjective volition. Reciprocity is inherent in face behavior, wherein a mutually restrictive, even coercive, power is exerted upon each member of the social network. It is argued that face behavior is universal and that face should be utilized as a construct of central importance in the social sciences.
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Transaction cost economics (TCE) as developed by Williamson (1975, 1979, 1985, 1991) focuses on the relationship between attributes of transactions and characteristics of the governance structures used to accommodate these transactions. Transactions vary in many dimensions, the most important of which is the degree of asset specificity. A party incurring relation-specific investments will demand safeguards to prevent its counterpart from attempting to appropriate the quasi-rents associated with these assets (Klein et al., 1978).l These safeguards can take the form of formal, legally enforceable contracts, or of extra-legal private ordering arrangements.
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In this paper a process and control model is developed for the analysis and design of inter-firm relations, in which both opportunism and trust play a role. Its aim is to develop a tool for the analysis, diagnosis and design of inter-firm partnerships. It takes into account the value of the partner, relative to alternatives, and the risk of the relation. Risk depends on the incentives that the partner may have towards opportunism, his opportunities for opportunism and his 'propensity' towards opportunism. The latter is related to trust. A partner's incentives towards opportunism depend on the uniqueness of the value that he offers, on one's own switching costs and on the partner's dependence on the relation. The underlying theory employs both transaction cost economics and social exchange theory. On the basis of the model, values and risks can be balanced in different ways: there are adversarial strategies that jeopardize value, and cooperative strategies that build value. The model can be used to explore viable sequences of strategies of governance, depending on different conditions. As an illustration, it is used for an analysis of ways to initiate a relation.
Article
This study examines how personal attachments between boundary spanners within cross-cultural international cooperative ventures (ICVs) are established and their association with venture performance. Results of analysis of 282 ICVs in an emerging market (People's Republic of China) show that the development of personal attachment depends on factors at three levels. At the individual level, attachment is an increasing function of overlap in tenure between boundary spanners. At the organizational level, attachment is heightened by goal congruity between the parent firms but is impeded by cultural distance. At the environmental level, market disturbance and regulatory deterrence lead to strong attachments. Such attachments stimulate an ICV's process performance and increase financial returns.
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Customers are influenced not only by how much they trust a company and its representatives but also by how much they trust the broader context in which the market exchange is taking place. In this article, the authors test two rival sociological perspectives regarding the influence of customer trust in the broader context. One perspective proposes that trust in the context replaces trust in individual firms and their representatives. This view suggests that firm/representative trust is not always critical, especially for customers with high trust in the context. An alternative perspective is that trust in the context fosters and legitimates trust in firms and their representatives. This view implies that firm/ representative trust is a necessary mediator of the influence of trust in the context. The authors test predictions based on both perspectives, using empirical results from two studies implemented in two countries. The results from both studies support the proposition that trust in firms and their representatives is a necessary mediator of trust in the broader context.
Article
The authors seek to understand which of three different strategic orientations of the firm (customer, competitive, and technological) is more appropriate, when, and why it is so in the context of developing product innovations. They propose a structural model of the impact of the strategic orientation of the firm on the performance of a new product. The results provide evidence for best practices as follows: (1) A firm wishing to develop an innovation superior to the competition must have a strong technological orientation; (2) a competitive orientation in high-growth markets is useful because it enables firms to develop innovations with lower costs, which is a critical element of success; (3) firms should be consumer- and technology-oriented in markets in which demand is relatively uncertain - together, these orientations lead to products that perform better, and the firm will be able to market innovations better, thereby achieving a superior level of performance; and (4) a competitive orientation is useful to market innovations when demand is not too uncertain but should be de-emphasized in highly uncertain markets.
Article
To function, a marketing channel must have a certain amount of consensus and coordinated decision making among its members. Marketing channel theory has emphasized the "internal" mechanisms of achieving integrated actions. However, channels consist of exchanging organizations that are affected not only by their collective interests, but also by forces "external" to the relationship. Internal coordination mechanisms are likely to be less effective to the extent channel members are faced with uncertainties emanating from external sources. The authors examine the external or environmental factors affecting decision-making uncertainty in channels. The findings indicate that four dimensions-diversity among consumers, dynamism, concentration, and capacity-should be included in future research on the effects of environments on intrachannel variables.
Article
The present paper attempts to explore the underlying mechanism between Western relationship marketing and Chinese guanxi by examining the construct equivalence of the two concepts. First, it distinguishes guanxi from relationship marketing in terms of the personal and particularistic nature of the relation. Second, it differentiates trust from xinyong, its counterpart in Chinese, based on a comparison of their roles in relationship building and maintenance. Third, it discusses the unique meaning of renqing, which is proposed as an underlying mechanism that guides behavior norms in guanxi and a mediator between trust or xinyong and long-term orientation. Finally, it concludes by discussing the managerial implications for international marketers who wish to succeed in the Chinese business market and the importance of adapting Western relationship marketing principles to guanxi marketing.
Article
Highlighting an important facet of diversity among organizations operating in different institutional environments, this article presents a model of the growth strategy of the firm in planned economies in transition such as Eastern Europe, the former Soviet republics, and China. Focusing on the stylized state-owned enterprises, we explore the interaction between institutions and organizations in these countries. Given the institutional constraints, neither generic expansion nor acquisitions, two traditional strategies for growth found in the West, are viable for firms in these countries. Instead, firms settle on a network-based strategy of growth, building on personal trust and informal agreements among managers. The institutional environment that leads to this unique strategy of growth is examined, and boundary conditions, limitations, and implications of this model are discussed.
Article
The statistical tests used in the analysis of structural equation models with unobservable variables and measurement error are examined. A drawback of the commonly applied chi square test, in addition to the known problems related to sample size and power, is that it may indicate an increasing correspondence between the hypothesized model and the observed data as both the measurement properties and the relationship between constructs decline. Further, and contrary to common assertion, the risk of making a Type II error can be substantial even when the sample size is large. Moreover, the present testing methods are unable to assess a model's explanatory power. To overcome these problems, the authors develop and apply a testing system based on measures of shared variance within the structural model, measurement model, and overall model.
Article
A critical element in the evolution of a fundamental body of knowledge in marketing, as well as for improved marketing practice, is the development of better measures of the variables with which marketers work. In this article an approach is outlined by which this goal can be achieved and portions of the approach are illustrated in terms of a job satisfaction measure.
Article
Scholars in various disciplines have considered the causes, nature, and effects of trust. Prior approaches to studying trust are considered, including characteristics of the trustor, the trustee, and the role of risk. A definition of trust and a model of its antecedents and outcomes are presented, which integrate research from multiple disciplines and differentiate trust from similar constructs. Several research propositions based on the model are presented.
Article
The Chinese word for connections, guanxi, implies that connections with the right people, rather than the price or quality of the tendered product or service, are often the more important consideration in business decision making. The authors conducted semistructured interviews with the heads of China operations of 19 companies to investigate the role of guanxi in business relationships. Findings suggest that there is, indeed, a correlation between possessing the "right" and "strong" connections and a firm's long-term financial performance. The authors explain how the guanxi principle differs from friendship and networking patterns in the West and why guanxi assumes such an important role in Confucian societies, then use their research as a framework for suggesting specific strategies to build and maintain guanxi. (PsycINFO Database Record (c) 2012 APA, all rights reserved)