Constraint absorption in emerging economies: the role of business groups

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mueen Ahmed ◽  
Sankalp Pratap
Keyword(s):  
Emerging Economies ◽  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Power Imbalance ◽  
Resource Based View ◽  
Content Type ◽  
Mutual Dependence ◽  
Dependence Theory ◽  
The Relationship

Purpose The purpose of this paper is to highlight the motivation for firms in emerging economies to engage in constraint absorption. It illustrates the mechanisms that enable business group (BG) affiliated firms to manage interdependencies vis-à-vis standalone firms in emerging economies. Design/methodology/approach The propositions outlined in this study are rooted in the theoretical lens of resource dependence theory (RDT). The authors integrate RDT with the resource-based view and institutional theory to explain the effect of BG affiliation on the relationship between the two types of interdependence (i.e. mutual dependence and power imbalance) and the likelihood of constraint absorption. Findings This paper theorizes that BG affiliation influences the relationship between mutual dependence/power imbalance and the likelihood of constraint absorption. However, if both the firms in a dyad are affiliated to a BG, the likelihood of constraint absorption is likely to be low owing to a process called “co-optation” even if mutual dependence or power imbalance between the firms is high. Originality/value This paper highlights how BG affiliated firms are better at managing contingencies in the external environment vis-à-vis standalone firms. This paper also advises managers that the type of organizational form is an important factor to be considered while engaging in constraint absorption in an emerging economy.

Power Imbalance, Mutual Dependence, and Constraint Absorption: A Closer Look at Resource Dependence Theory

2005 ◽  
Vol 50 (2) ◽  
pp. 167-199 ◽  
Author(s):  
Tiziana Casciaro ◽  
Mikolaj Jan Piskorski
Keyword(s):  
Mergers And Acquisitions ◽  
Resource Dependence ◽  
Resource Dependence Theory ◽  
External Control ◽  
Power Imbalance ◽  
Public Companies ◽  
Mutual Dependence ◽  
Model Account ◽  
Dependence Theory ◽  
Powerful Explanation

Despite ubiquitous references to Pfeffer and Salancik's classic volume, The External Control of Organizations, resource dependence theory is more of an appealing metaphor than a foundation for testable empirical research. We argue that several ambiguities in the resource dependence model account in part for this and propose a reformulation of resource dependence theory that addresses these ambiguities, yields novel predictions and findings, and reconciles them with seemingly contradictory empirical evidence from past studies. We identify two distinct theoretical dimensions of resource dependence, power imbalance and mutual dependence, which in the original theory were combined in the construct of interdependence and yet have opposite effects on an organization's ability to reduce dependencies by absorbing sources of external constraint. Results from a study of interindustry mergers and acquisitions among U.S. public companies in the period 1985–2000 indicate that, while mutual dependence is a key driver of mergers and acquisitions, power imbalance acts as an obstacle to their formation. We conclude that our reformulation of the resource dependence model contributes to realizing the potential of resource dependency as a powerful explanation of interorganizational action.

Impact of open innovation on organizational performance in different conflict management styles: based on resource dependence theory

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ting Wang ◽  
Jianlin Wu ◽  
Jibao Gu ◽  
Lingyu Hu
Keyword(s):  
Conflict Management ◽  
Organizational Performance ◽  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Management Styles ◽  
Conflict Management Styles ◽  
Content Type ◽  
Dependence Theory ◽  
The Impact ◽  
The Relationship

Purpose Firms often encounter complicated external relationships and conflicts in inbound and outbound open innovation (OI). Conflict management significantly affects innovation results. Guided by resource dependence theory (RDT), this study aims to examine the moderating effects of conflict management styles in the relationship between OI and organizational performance (OP). Design/methodology/approach This study focuses on manufacturing and service firms in China, with the respondents composed of senior managers. Using hierarchical regression analysis, data from 270 firm samples are used to empirically test the hypotheses. Findings Inbound and outbound OI openness positively affects OP. Cooperative conflict management positively moderates the relationship between inbound OI openness and OP, whereas it negatively moderates the impact of outbound OI openness on OP. By contrast, competitive conflict management positively moderates the relationship between outbound OI openness on OP. Research limitations/implications Guided by RDT, this study explores the relationship between OI and OP and the moderating role of conflict management styles. However, it does not measure the level of resource dependence, which is among the future research directions for further validating the results of this study. Originality/value This study is among the first to investigate the impact of OI on OP in different conflict management styles. Findings suggest that choosing a suitable conflict management style may strengthen the positive effects of OI on OP.

DECIDING TO DISCOVER ENTREPRENEURIAL OPPORTUNITIES: A MULTI-LEVEL INVESTIGATION BASED ON INFORMATIONAL ECONOMICS AND RESOURCE DEPENDENCE THEORY

2016 ◽  
Vol 21 (02) ◽  
pp. 1650009 ◽  
Author(s):  
SHANSHAN QIAN ◽  
DALONG MA ◽  
CHAO MIAO
Keyword(s):  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Power Imbalance ◽  
Specific Knowledge ◽  
Policy Makers ◽  
Entrepreneurial Opportunities ◽  
Dependence Theory ◽  
Multi Level ◽  
The Relationship ◽  
Practical Implications

Under what circumstance do entrepreneurs decide to discover entrepreneurial opportunities to start new businesses? Informational economics suggests when entrepreneurs possess prior specific knowledge, they decide to discover opportunities. This paper contributes to informational economics perspective by taking resource dependence theory into consideration. Utilizing a conjoint experiment and a multilevel analysis of 66 student entrepreneurs, we found that students’ prior specific knowledge significantly influences students’ decision to discover opportunities. Further, we found that power imbalance moderates the relationship between prior specific knowledge and students’ decisions to discover opportunities. Our paper has theoretical implications and practical implications for entrepreneurs, educators and policy makers.

scholarly journals The effect of female participation in top management teams on the growth performance of small and medium-sized enterprises (SMEs)

2017 ◽  
Vol 11 (1) ◽  
pp. 108-119 ◽  
Author(s):  
Peiyan Wu ◽  
Xiaofang Yao ◽  
Shakeel Muhammad
Keyword(s):  
Growth Performance ◽  
Design Methodology ◽  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Top Management Teams ◽  
Top Management ◽  
Female Participation ◽  
Content Type ◽  
Dependence Theory ◽  
The Relationship

Purpose This paper aims to examine the relationship between the female participation in top management team (TMT) and the growth performance of small and medium-sized enterprises (SMEs) in the Chinese economic environment. Design/methodology/approach Adopting resource dependence theory, this paper tests the hypotheses using panel data from 469 Chinese-listed SMEs during the period of 2011 to 2013. Findings The results show that female participation in TMT significantly promotes the growth performance of SMEs, and there is significantly inverted U-shaped relationship between these two variables. Originality/value This paper finds that education level weakens the inverted U-shaped relationship between the female’s participation in TMT and the growth performance of SMEs.

Does it pay to bribe? The influence of bribery on new venture disbanding in China

2021 ◽  
Vol 46 (3) ◽  
pp. 185-196
Author(s):  
Jintong Tang ◽  
Zhi Tang
Keyword(s):  
Economic Development ◽  
Resource Dependence ◽  
Local Economic Development ◽  
New Ventures ◽  
Resource Dependence Theory ◽  
Theory And Practice ◽  
New Venture ◽  
Resource Based View ◽  
Dependence Theory ◽  
Chinese Entrepreneurs

This research extends bribery research toward entrepreneurial theory and practice by examining how bribery impacts new venture disbanding in China. Existing research suggests that bribery may enhance firms’ competitive advantage; however, building off of resource-based view and taking into consideration the institutional context in China, the current study proposes that firm bribery activity hurts new ventures by increasing the hazard of venture disbanding. Further, guided by resource dependence theory, this study examines how local economic development and organizing activity moderate the relation between bribery and disbanding. In particular, it is proposed that when local economic development is suffering, or when firms are not engaging in appropriate organizing activities, bribery will lead to higher chance of new venture disbanding. Data from Chinese entrepreneurs support these hypotheses.

The effect of supplier globalization on firm innovation: a resource dependence theory perspective

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Yibo Wang ◽  
Bai Liu
Keyword(s):  
Resource Dependence ◽  
Positive Impact ◽  
Market Competition ◽  
Effective Means ◽  
Resource Dependence Theory ◽  
Institutional Distance ◽  
Foreign Firms ◽  
Firm Innovation ◽  
Content Type ◽  
Dependence Theory

PurposeEither buying or making is predicted by the existing literature for firms to reduce dependence. However, firms in the rapid globalization are found to adopt a pattern of buying and making. Specially, they critically rely on foreign firms for needed materials and goods, and invest in innovation against the uncertainty of potential supply disruptions simultaneously. Therefore, this paper seeks to investigate how the depth and width of supplier globalization shape firm innovation together. Moreover, the moderating effects of institutional distance and market competition are also examined in the paper.Design/methodology/approachGrounded on the resource dependence theory, this paper develops a theoretical framework and tests the proposed hypotheses by Poisson model using secondary data from 502 Chinese listed firms with foreign suppliers.FindingsThe depth of supplier globalization has a positive impact on firm innovation, while the width of supplier globalization weakens firm innovation. The depth and width of supplier globalization further interact negatively to influence firm innovation. Moreover, this relationship is enhanced when firms establish relationships with foreign firms with greater institutional distance and is weakened when firms face fiercer product competition.Originality/valueThe authors contribute to the literature by evidencing that the existence of foreign suppliers results in firms' enhancement of innovation to secure their operations and showing that diversifying the country origins of foreign suppliers is an effective means to reduce firms' uncertainty about supply disruption. We also advance the understanding regarding the contextual factors in which firms are more likely or less likely to manage the uncertainty about supplier globalization.

Retail atmospherics and retail store patronage of supermarkets in emerging economies: mediating role of perceived service quality

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Charles Dokcen ◽  
Vincent Obedgiu ◽  
Gideon Nkurunziza
Keyword(s):  
Service Quality ◽  
Emerging Economies ◽  
Retail Store ◽  
Content Type ◽  
Perceived Service Quality ◽  
Patronage Behavior ◽  
Store Patronage ◽  
Retail Atmospherics ◽  
The Relationship

PurposeThe purpose of the study is to establish the mediating role of Perceived Service Quality on the relationship between Retail Atmospherics and Retail Store Patronage of Supermarkets in Emerging Economies using empirical evidence from Uganda.Design/methodology/approachThe study used a cross-sectional research design and quantitative approach to understand stand the structured reality of Retail Store Patronage of supermarkets in context of emerging economies. In the context of this study, the data were drawn from Uganda's supermarkets. A sample of 1,504 customers were selected from 136,270 customers. Data was collected from supermarket customers using closed ended questionnaire. Descriptive and inferential statistics were derived to describe the behavior of customers and draw conclusions on population using sample statistics. Correlation analysis was used to establish the degree of association between the variables. Hierarchical regression was applied to assess the unique contribution of each variable; control variables-income and age, predictor variables – Retail Atmospherics and Perceived Service Quality on dependent variable – Retail Store Patronage. Mediation was done following the four-step procedures of mediation of Baron and Kenny (1986).FindingsThe results revealed significant positive relationship between Retail Atmospherics, Perceived Service Quality and Retail Store Patronage, confirming the direct hypotheses. Perceived Service Quality partially mediated the relationship between Retail Atmospherics and Retail Store Patronage. The findings depict that Retail Store Patronage is influenced directly by Retail Atmospherics and indirectly through Perceived Service Quality as a mediating variable. However, in situations where the atmospherics is good but perceived service quality is poor, Retail Store Patronage may not be fully realized.Originality/valueThe study provides information that is relevant for filling the practical and theoretical gap in the Retail Store Patronage in Ugandan supermarkets. Previous research studies investigated patronage behavior of shoppers in single retail units yet there is paucity of research on patronage behavior across different retail formats in the world. This study can be generalized and have strategic implications to developing economies that seek to grow and sustain their businesses. It points to the gaps that are normally overlooked and could lead business failure. The focus of most previous studies were on developed economies more especially Europe and America. This study in particular focused on the role of perceived service quality in the relationship between retail atmospherics and customer retail store patronage in emerging economies like Uganda as a testing ground.

scholarly journals Falsification of Theorizing in Operations Management Research

2018 ◽  
Vol 6 (1) ◽  
pp. 102
Author(s):  
Abdul Salam Khan ◽  
Iqbal Muhammad Khan ◽  
Muhammad Sadiq ◽  
Imran Ahmed Khan
Keyword(s):  
Operations Management ◽  
Resource Dependence ◽  
Transaction Cost Economics ◽  
Resource Dependence Theory ◽  
The Body ◽  
Theory And Practice ◽  
Management Research ◽  
Resource Based View ◽  
Dependence Theory ◽  
Practice Approach

The practices of operations management research have been inclined towards practicality and pragmatism. Induction is core background of research in operations management. However, there are certain biases and critiques on the generalizability of data using the approach of Induction, of which falsification is more prominent. This study takes upon three major theories used in Operations Management (OM) research such as Resource Based View (RBV), Transaction Cost Economics (TCE) and Resource Dependence Theory (RDT) and discusses the falsification critiques such as tautology on the theories and theorization of Operations Management (OM) and how the body of research in operations management responds to the criticism. Our study suggests that there needs to be a domain limitation of the theorizing process wherein the theory is posit to hold and thus exposing the theory at hand to the critique of falsification. The theory needs not to capture every facet of the phenomena under examination. This study also highlight the importance of developing field specific theories and the improvement brought into the process of theorization and towards the end we describe courses of action for improving the balance between theory and practice approach in the field.

Politicians on the Board of Directors: Do Connections Affect the Bottom Line?

2005 ◽  
Vol 31 (3) ◽  
pp. 464-481 ◽  
Author(s):  
Amy J. Hillman
Keyword(s):  
Board Of Directors ◽  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Bottom Line ◽  
Dependence Theory ◽  
The Board Of Directors ◽  
Regulated Industries ◽  
The Government ◽  
The Relationship

Resource dependence theory emphasizes the importance of linking firms with external contingencies that create uncertainty and interdependence. A critical source of external interdependency and uncertainty for business is government. One way to link a firm to the government is appointing ex-politicians to the board of directors. This study compares the boards of two groups of firms—those from heavily and less regulated industries—and finds the former group has more politician directors. Firms with politicians on the board are associated with better market-based performance across both groups, although the relationship is more pronounced within heavily regulated industries.

The Effect of Board Characteristics on Firm Environmental Performance

2011 ◽  
Vol 37 (6) ◽  
pp. 1636-1663 ◽  
Author(s):  
Charl de Villiers ◽  
Vic Naiker ◽  
Chris J. van Staden
Keyword(s):  
Environmental Performance ◽  
Resource Dependence ◽  
Resource Dependence Theory ◽  
Sensitivity Analyses ◽  
Board Independence ◽  
Board Characteristics ◽  
Dependence Theory ◽  
The Board Of Directors ◽  
Board Roles ◽  
The Relationship

This study investigates the relationship between strong firm environmental performance and board characteristics that capture boards’ monitoring and resource provision abilities during an era when the natural environment and the related strategic opportunities have increased in importance. The authors relate the proxy for strong environmental performance to board characteristics that represent boards’ monitoring role (i.e., independence, CEO-chair duality, concentration of directors appointed after the CEO, and director shareholding) and resource provision role (i.e., board size, directors on multiple boards, CEOs of other firms on the board, lawyers on the board, and director tenure). The authors provide evidence consistent with both theories of board roles. Specifically, consistent with their agency theory–driven predictions, the authors find evidence of higher environmental performance in firms with higher board independence and lower concentration of directors appointed after the CEO on the board of directors. Consistent with resource dependence theory, they show that environmental performance is higher in firms that have larger boards, larger representation of active CEOs on the board, and more legal experts on the board. Their findings are generally robust to a number of sensitivity analyses. These findings have implications for managers, firms, shareholders, and regulators who act on behalf of shareholders, if they are interested in influencing environmental performance.

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