A Cross National Study Of The Effect Of Group Orientation Culture On Inter-Organizational Relationship

Exchange parties from diverse cultures need to maintain good quality relationships with their partners. Based on the existing literature, however, it remains unclear as to how culture affects the quality of relationships. The principal contention of this study is that an exchange party’s adoption of a group orientation culture will improve relationship quality. The results of a survey research effort fielded among manufacturing companies in Korea and the USA demonstrate that group orientation culture positively influences the continuation of interfirm relationships and commitments. Specifically, manufacturers that adopt group orientation cultures can expect continued relationships with their suppliers, and they are also more likely to want to maintain these relationships, due to the presence of positive emotional bonds with their partners.  &nbsp

The Effect Of LTO Culture On International Supply Chain Contracts

Effective management of international supply chain relationships is critical in determining the success of the ever-growing cadré of international businesses where small cost differentials separate profitable enterprises from failed ones.   Because inter-organizational contractual arrangements define expectations and standards for supply chain transactions, they may play a role in determining relationship efficiencies (and thus costs.)  Although the effect of culture on the functioning of interfirm relationships in the supply chain has been an active area of scholarly investigation in the past decade, most studies have focused on organizations in Western societies, particularly in the US and Europe.  Increasingly, global supply chains include at least one Asian partner so that cultural patterns predominant in the East must also be considered.  This study examines the cultural factor of time orientation and seeks to understand how the long-term orientation (LTO) characterizing many Eastern cultures may affect supply chain contracts.  Specifically, it investigates the influence of cultural time-orientation on the formation of soft (implicit, general) and hard (written, detailed) contracts. The results underscore the importance of culture in managing effective interfirm relationships in the supply chain: Long-term orientation culture tends to rely upon and function successfully with soft contracts, but does not depends on hard contracts

The Moderating Effect Of Long-Term Orientation On The Relationship Between Interfirm Power Asymmetry And Interfirm Contracts: The Cases Of Korea And USA

The purpose of this study is to enhance our understanding of the effects of LTO culture on the contractual relationship between exchange parties under conditions in which varying levels of asymmetrical power structures exist. This study attempt to determine the validity of projecting conclusions originating from studies conducted in low LTO cultures such as U.S. and Western Europe to contractual relationships in the high LTO cultures of Asia. Therefore, investigations into the influence of LTO may be helpful in understanding contractual relationships formed in countries with differing levels of long-term orientation. Survey research was conducted to collect data from manufacturers, Structural Equation Modeling was used to purify measurement scales, and Multiple Regression was conducted to test the hypotheses. The findings show that LTO companies tend to prefer “soft” contracts, although they enjoy a power advantage over their suppliers; whereas low LTO partners with asymmetrical power advantages prefer “hard” contracts with explicitly detailed written requirements

It Takes Two To Tango Buyer-Supplier Relationship Building

The purpose of this case is to demonstrate how industrial norms influence the relationship between exchange parties. Deeply entrenched industrial norms serve as guidelines for behavior within permissible limits for exchange parties in a given industry. They form a common ground for action and constitute an implicit understanding upon which a cooperative relationship can be built. Industrial norms therefore play an important role in reducing conflict in the early stages of the interfirm relationship as they help exchange parties develop successful relationships. In the absence of industrial norms, exchange parties at the initial stages of a relationship may be faced with conflict. Even a detailed contract is usually not sufficient to prevent conflict. However, a contract does help exchange parties pursue the relationship and this continuity will foster the development of relational norms. Relational norms tend to govern long-term relationships and they are unique to the specific relationship, as opposed to industrial norms, which hold for an entire industry. The contribution of this article is as follows: (1) It offers a more extensive discussion of the interfirm relation in a macro social context than has previously been explored in inter-organization research literature, and (2) presents a useful premise for understanding interfirm relationships. This case can be used in conjunction with discussion on marketing topics such as the design of marketing channels (Chapter 6, Designing the Marketing Channel, Marketing Channels: A Management View, 7th Edition by Bert Rosenbloom, South-Western College Pub, 2003) for senior level marketing seminar

E-Commerce Transaction Mechanisms And Buyer-Supplier Relationship

Information exchange between the buyer and supplier is an important aspect of supply chain management. B2B e-commerce helps firms to share information, maintain relationships, and conduct transactions more efficiently. The choice of B2B e-commerce transactions will influence, and as well as affect, the relationships between exchange parties. Thus, the choice of e-commerce transaction mechanisms has a relational context. An appropriate choice of a transaction mechanism can affect a firm’s strategy, procurement decisions, and performance. It had been argued that e-commerce facilitates both discrete and relational exchanges, and it has a dual impact on business relationships. In this paper, we examine a collection of diverse studies on EDI and e-marketplace from marketing and information systems literatures. We assimilate these findings for managers considering choices on e-commerce transaction mechanisms. We hope that this will provide managers a more consistent understanding of buyer-supplier relationships in the B2B e-commerce context

Long-Term Orientation As A Determinant Of Relationship Quality Between Channel Members

This study assesses the effects of Long-Term Orientation culture on inter-organizational trust and conflict. This research examines the role of one important cultural factor, namely long-term orientation, as it relates to contractual relationships between manufacturers and their suppliers. As LTO cultures have become accepted as a crucial factor for describing nations, this study should prove invaluable to our understanding of inter-organizational relationships affected by differing levels of long-term orientation. The authors investigate the effects of LTO in the relationship between a manufacturer and its supplier. These results reveal that, LTO culture significantly affects the relationships between channel members. In particular, high LTO culture positively affects the generation of trust. Whereas high LTO culture suppresses the conflict between channel members, low LTO cultures do not suppress conflict between channel members

The Effect Of Group-Orientation Culture On Inter-Organizational Cooperation Mechanisms

Cooperation between exchange parties becomes a center for inter-organizational relationship. Cooperation reduces the attractiveness of opportunistic behavior that seeks short-term benefits, so it has been identified as a key factor for inter-organizational cooperation. Although several factors affecting cooperative relationship have been studied, the majority of inter-organizational studies are conducted on the basis of an individualistic perspective view of Western culture. This study introduces group-orientation culture and tries to enhance the understanding the effect of group-orientation culture on inter-organizational cooperation in the relationship between exchange parties. This study suggests that group-orientation culture influences the generation of informal cooperation between exchange parties. When a party expects harmonious relationship with its partner, the party develops the relational norm through accepting short-term disadvantages that are expected to be balanced out by longer-term advantages. However, exchange parties with a low group-orientation culture do not rely on formal cooperation mechanisms

The Influence of Interfirm Trust on Monitoring and Performance in Uncertain Environments

An important question for manufacturers is the extent to which control over the suppliers should be maintained when the interaction occurs in an uncertain environment. It is proposed in this paper that the level of trust(high and low) affect the manufacturers level of monitoring and perceived supplier performance in uncertain environments. The empirical results from US manufacturers indicate the following: 1) When the trustworthiness of exchange partners is questionable, manufacturers tend to increase the level of monitoring over the supplier as they feel environmental uncertainty. On the other hand, those who place a high level of trust in a partner may need to rely on monitoring to a lesser extent regardless of environmental uncertainty. 2) Supplier performance, as perceived by manufacturers, is negatively associated with environmental uncertainty when a manufacturers trust in its supplier is low, but it has no relationship with environmental uncertainty when there is high trust

An Apparel Brands Channel Strategy: The Case of Oliver in Korea

The purpose of this case study was to describe the development of a channel strategy for an apparel brand, BoKids, designed to distribute its brand, Oliver, efficiently to customers. Bokids launched its childrens apparel brand, Oliver, in Korea by signing a brand license contract with Oliver of USA. When the brand was launched in 2005, Oliver was positioned as a brand with a reasonable price and a high quality product, which was sold primarily through department stores. In 2007, Oliver was suffering from sluggish sales volumes, and switched its main distribution channel from department stores to discount stores, which are the number 1 retail format in Korea. Oliver was compelled to adjust the price range of its main products to $20 30 in order to satisfy the needs of discount store customers. However, Oliver has considered Internet shopping as another channel for the Oliver brand, as Internet shopping is rapidly gaining popularity in Korea. This case can be used in conjunction with discussions on marketing topics, such as the design of marketing channels (Chapter 6, Designing the Marketing Channel, Marketing Channels: A Management View, 7th Edition by Bert Rosenbloom, South-Western College Pub, 2007) for senior level marketing seminars

China Market Entry Strategy Of Paris Baguette

This case study analyzes the global strategy of Paris Baguette, a leading bakery franchise in Korea. Because of stricter regulations in the local market, Paris Baguette has encouraged franchises to target overseas markets. The company made first inroads into the Chinese market in 2004 with a bakery cafe in Shanghai. The main point of Paris Baguette’s global strategy is summarized by high quality, style, diversification, and localization. Also, Paris Baguette directly operates its flagship store from headquarters, due to the poor legal environment in China. In this study, we analyze strategies of China market and suggest considerations for future business expansion