The containment of opportunism in the post formation period of inter-organizational relationships (original) (raw)
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Safeguarding Interorganizational Performance and Continuity Under Ex Post Opportunism
Management Science, 2003
O pportunism is a central construct in exchange theory. Economists contend that despite the firm's best efforts to erect governance structures that reduce opportunism and preserve outcomes, there is always some opportunism that remains once the transaction is in place. Despite this, there are few studies that systematically investigate the safeguarding efficacy of relationship attributes in the presence of such ex post opportunism. In this research, we develop a theoretical framework and provide a longitudinal test of the ability of various relationship safeguards to preserve performance outcomes and future expectations given varying levels of ex post opportunism in the relationship. Our survey results from over 300 buyers and suppliers indicates that given lower levels of opportunism, bilateral idiosyncratic investments and interpersonal trust enhance performance outcomes and future expectations, while goal congruence has no discernable effect. However, at higher levels of opportunism, goal congruence becomes a more powerful safeguard, while interpersonal trust becomes less effective. Bilateral idiosyncratic investments continue to preserve performance outcomes and future expectations even at higher levels of opportunism. Implications for the long-term management of interorganizational alliances are discussed.
Opportunism and trust in joint venture relationships: an exploratory study and a model
Scandinavian Journal of Management, 1995
This paper discusses two approaches towards managing interorganizational relationships, based on opportunism and trust respectively. Data is presented from interviews conducted with four managers to investigate the relevance of these two approaches in their joint venture relationships. Both the approaches are found to be important but play different roles at different stages of the relationship. A conceptual model is then developed to represent the relationship process in terms of its formation and sustenance. In spite of differences between the two approaches, they share common objectives of efficiency and flexibility. It is useful to consider them as complementary to one another, with transaction costs being viewed more broadly to incorporate both the opportunism-avoidance as well as the trust-creation dimensions of interorganizational relationships.
Developmental processes of cooperative interorganizational relationships
Academy of management review, 2015
This article examines the developmental process of cooperative interorganizational relationships (IORs). Framework is focuses on formal, legal, and informal socialpsychological processes by which organizational parties jointly negotiate, commit to and execute their relationship. 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. IORs include strategic alliances, partnerships, coalitions, joint ventures, franchises, research consortia, and various forms of network organizations. Most research been focused on the antecedent conditions or structural properties of interorganizational relationships in comparison with other governance forms. Framework present useful insight about conditions leading to formation of IORs. Research was provided with assumptions trough four concepts for explaining how cooperative IORs emerge, grow, and terminate over time. Knowing the inputs, structure, and desired outputs of a relationship provides a useful context, where process is central to managing IORs. Managers need to know more about input conditions, investments, and types of governance structures required for a relationship. The ways in which agents negotiate, execute, and modify of an IOR strongly influence the degree to which parties judge it to be equitable and efficient. These processes also influence motivations to continue in, or terminate, the relationship over time (Friedman, 1991). CONCEPTUAL BACKGROUND Ring and Van de Ven (1994) assume that business conditions and motivations exist, which are sufficient to cause two or more organizations to explore exchange using a cooperative IOR governed by a relational contract. Organizational parties desire to create a cooperative IOR that facilitates high commitment relations (Helper & Levine, 1992), but produces efficient and equitable solutions to conflicts as they arise. starting conditions was in assumed with four key concepts: (a) uncertainties inherent in a cooperative IOR, (b) assessments based on efficiency and equity, (c) need for internal resolution of disputes, and (d) importance of role relationships in cooperative IORs.
Relational capabilities as effectiveness fundamentals in inter-firm cooperation
2013
The aim of this article is to broaden exploratory perspective of the problem of interorganizational cooperation. Economists often pay greater attention to economic (e.g. transaction costs, access to new capabilities) and market (e.g. increasing market power) factors underlying the decision to cooperate with other organizations and seem to neglect the so-called soft factors determining eventual success or failure of cooperation. The article presents a theoretical study in which on the basis of a broad literature study, the author examines selected factors highly influencing the shape and efficiency of interfirm alliances, that are mentioned not only by economists but are subjects of sociological and psychological analyses as well. Among all, the so-called relational capabilities may be of greatest importance. Partnering experience, social embeddedness, interorganizational trust, learning ability, as well as relational mechanisms may be considered as critical success factors in cooper...
This paper discusses two approaches towards managing interorganizational relationships, based on opportunism and trust respectively. Data is presented from interviews conducted with four managers to investigate the relevance of these two approaches in their joint venture relationships. Both the approaches are found to be important but play different roles at different stages of the relationship. A conceptual model is then developed to represent the relationship process in terms of its formation and sustenance. In spite of differences between the two approaches, they share common objectives of efficiency and flexibility. It is useful to consider them as complementary to one another, with transaction costs being viewed more broadly to incorporate both the opportunism-avoidance as well as the trust-creation dimensions of interorganizational relationships.
Determinants of Partner Opportunism in Strategic Alliances: A Conceptual Framework
Journal of Business and Psychology, 2010
Purpose We present a comprehensive framework of the key determinants of partner opportunism in strategic alliances. Design/methodology/approach We propose an extended definition of partner opportunism and three categories of the determinants of partner opportunism based on a review of the literature. These categories comprise economic factors (equity involvement, asymmetric alliance-specific investments, mutual hostages, and payoff inequity), relational factors (cultural diversity and goal incompatibilities), and temporal factors (alliance horizon and pressures for quick results). Findings The framework of determinants makes clear how the various determinants of partner opportunism may be differentially salient in the three major alliance types, namely, equity joint ventures, minority equity alliances, and nonequity alliances. Implications Based on the framework, a number of propositions are developed to facilitate empirical research on partner opportunism. Managerial implications flowing from the proposed framework are also discussed.
EUROPEAN RESEARCH STUDIES JOURNAL, 2020
Purpose: A company's relational potential expresses the sum of all relations with the entities in the environment and their combinations used to achieve the company's objectives. This cooperation can be assessed in terms of the relationship's duration, repeatability, degree of maturity, and benefits. The aim of this article is to assess the importance of these features for building and maintaining inter-organizational relations in various forms. Design/Methodology/Approach: This article presents findings from the research conducted using a sample of 66 relations developed by 10 companies operating in different sectors. The correlations between individual pairs of variables were analyzed using chi-square statistics at α = 0.05. The strength of relations was determined using Cramer's V coefficient and Pearson's C (contingency) coefficient. Findings: The research results indicate a significant correlation between the examined relationship characteristics (benefits, duration, maturity, and repeatability). We have shown that the more diverse the company's relational potential is, and the more benefits individual relations provide, the more often the company repeats the relations (co-operates) with external entities. Simultaneously, the most advantageous relations are those maintained for up to one year or over 7 years. Enterprises are most often willing to repeat the relations that have reached the stage of maturity. Practical Implications: The results of this research can help modern companies to plan the duration and repeatability of relationships with selected entities considering the expected benefits and the degree of maturity of the cooperation. Originality/Value: Understanding the correlation between the repeatability of the relationship and its benefits, as well as between the duration of the relationship and its maturity, and linking it to the types (forms) of cooperation with other entities contributes to the current state of knowledge.
This conceptual paper examines post-International Strategic Alliance establishment processes by exploring the interrelationships surrounding utilization as a resource coordinating activity, two communication dimensions (four communication factors) as the antecedents of utilization, and the implications of utilization for ISA performance. A conceptual model is developed utilizing variables derived from a literature rich in evaluating the beginning and the end of the ISA relationship interactions but very poor in studying the middle ISA process. From the model, propositions are delineated and future research directions are discussed. The implications of the derived paradigm will have a significant impact on the establishment, communication, and performance of international strategic alliances.
Interorganizational cooperation: a new view of strategic alliances
Industrial Marketing Management, 2002
Looking at the rate at which organizations/firms are entering into strategic alliances these days, one can understand and/or appreciate the increased research in the area of strategic alliances. The tremendous amount of research on this type of interorganizational cooperation, more or less, have one thing in common. Thus, all seek to increase our knowledge and/or understanding of the potentialities, as well as the challenges inherent in the formation of strategic alliances. What is missing in the existing literature on strategic alliances is an emphasis on the importance of the interacting parties' (i.e., parties in any strategic alliance) interconnected exchange relationships with third parties (i.e., actors who are not officially regarded as partners in an alliance). There is a lack of empirical studies on the nature of and the extent to which networks (third parties) may affect and be affected by the achievement of goals pursued by some focal strategic alliance partners. The paper presents case studies that shed light on this issue. The purpose of this paper, therefore, is to deepen our understanding of the relevance of third parties in a strategic alliance formed between specific focal actors. One important conclusion of the study is that the achievement of the focal actors' goals is affected, in large, by third parties. D