The mode choice and change decision process and its impact on international performance

Calof, Jonathan

doi:10.1016/0969-5931(93)90007-j

Cited by 67 publications

(49 citation statements)

References 31 publications

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“…While most studies have devoted their attention to understand performance implications of other entry modes such as export (Cadogan, Sundqvist, Puumalainen, & Salminen, 2012;Calof, 1993;Oliveira, Cadogan, & Souchon, 2012), several studies have provided great insights into the link between the performance of this entry mode, i.e. M&A, and employees' commitment suggesting a significant and positive association between the two (Ahammad, Glaister, Weber, & Tarba, 2012;Chatterjee, Lubatkin, Schweiger, & Weber, 1992;Glaister & Ahammad, 2010;Gomes, Weber, Brown, & Tarba, 2011;Krug & Aguilera, 2005;Mathieu & Zajac, 1990;Weber & Fried, 2011a;Weber, Shenkar, & Raveh, 1996;Weber, Tarba, & Reichel, 2009).…”

Section: Introductionmentioning

confidence: 99%

Perceptions of justice and organisational commitment in international mergers and acquisitions

Gomes

Mellahi

Sahadev

et al. 2017

IMR

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Purpose Although there is substantial and accumulating evidence on the link between market entry modes and performance, evidence regarding their impact on employee’s perceptions and thereby their commitment is scarce. This is more so in mergers and acquisitions (M&As) where employee’s commitment has a significant impact on post-entry performance. The purpose of this paper is to examine the association between perceptions of justice and organisational commitment in cross-border M&As. Design/methodology/approach The authors draw on market entry and M&As’ literature and studies on the link between perception of justice and commitment to develop the hypotheses. The authors test the hypotheses with survey data from a merger of two culturally different partners – British and Japanese. A total of 128 responses were received, out of a sample of 151 non-managerial employees within the firm. Findings The results show a strong association between employees’ perceptions of justice during the merger and commitment to the new organisation. Surprisingly, the results do not support the widely reported interaction effects between different organisational justices and employees’ commitment. Research limitations/implications Obtaining data from a single M&A is a potential limitation of this study. Practical implications The study underscores the importance of post-market entry. The results suggest that particular attention needs to be paid to the way employees of the acquired firm are treated during their interactions with their counterparts. Originality/value The link between market entry and performance is well documented. However, little progress has been made in understanding the antecedents/factors that influence commitment in foreign market entry and in particular cross-border M&As. This study helps close this gap.

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Section: Introductionmentioning

confidence: 99%

Perceptions of justice and organisational commitment in international mergers and acquisitions

Gomes

Mellahi

Sahadev

et al. 2017

IMR

View full text Add to dashboard Cite

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“…The motives for market-to-market replacements may be different from the motives for market-to-hierarchy replacements. Some studies focus on operation mode change only (Gomes-Casseres, 1987;Calof, 1993;Calof and Bemisch, 1995;Pedersen et al, 2002;Chetty and Agndal, 2007;Agndal and Chetty, 2007). Of those studies, only Pedersen et al (2002) is directed specifically toward market-to-hierarchy replacements of independent intermediaries, while the other studies in the group pertain to all kinds of operation mode changes (e.g., distribution, production, licensing, etc.).…”

Section: Review Of the Intermediary Replacement Literaturementioning

confidence: 99%

“…Whether growth in the host market stimulates switch to a more hierarchical operation mode has mixed support. Gomes-Casseres (1987) found that economic growth in the host market was a driver of switching operation mode from joint venture to wholly owned subsidiaries, and Calof (1993) found most mode changes were influenced by changed perceptions of sales potential. Benito et al (2005), on the other hand, found export market growth not to be a significant predictor of intermediary replacements for either market-tomarket replacements or market-to-hierarchy replacements.…”

Section: Review Of the Intermediary Replacement Literaturementioning

confidence: 99%

“…Benito et al (2005), on the other hand, found export market growth not to be a significant predictor of intermediary replacements for either market-tomarket replacements or market-to-hierarchy replacements. The change process seems to be only partly rational, and "gut feel" seems to play a role in most changes (Calof, 1993).…”

Section: Review Of the Intermediary Replacement Literaturementioning

confidence: 99%

“…Their respective designs have longitudinal elements, but those designs do not encompass analysis of outcomes of intermediary replacements. The inferences from Gomes-Casseres (1987), Calof (1993), Calof and Bemisch (1995), are based on analysis of post-change data of actual changes only. Their designs may suffer from problems because of the time span between the problems studied and the data collection (e.g., human memory).…”

Section: Review Of the Intermediary Replacement Literaturementioning

confidence: 99%

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Antecedents and consequences of replacing international independent intermediaries

Nes

2014

European Business Review

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Purpose – What characterizes the relationships with intermediaries that are soon to be replaced, and are the replacements successful? The paper aims to discuss these issues. Design/methodology/approach – The study applies a longitudinal design. The paper conducted a survey among a sample of exporters concerning their relationships with independent intermediaries in terms of trust, commitment, communication, control and two performance variables; financial performance and strategic goal achievement. Five years thereafter the author contacted the same companies again and questioned which independent intermediaries had been replaced in the period. The author then compared the replaced intermediaries with the extended intermediaries before they were replaced and analysed changes in the evaluations of the relationships and of the performance after the replacement. Findings – The relationships with terminated intermediaries that were replaced by sales subsidiary or home-based direct sales were characterized having higher trust, communication and control than extended relationships before replacement. While it may be surprising that these quite successful relationships were terminated, this is in line with internationalization process theories. The replacements, both intermediaries that were replaced by other intermediaries and by sales subsidiary/home-based direct sales, were highly successful in terms of improvement in performance and behavioural relationship variables. Research limitations/implications – The empirical findings are limited by the sample and by data collection from the principal only in the dyadic relations. Practical implications – International independent intermediaries should analyse the likelihood of being replaced by the principal because the relationship or the performance is unsatisfactory, but also because of satisfactory evaluations. Terminations of satisfactory relationships tend to be accompanied by change in operation mode to internal organization. The independent intermediary should in such cases build a defence structure against unwanted termination and/or prepare for buyout. The success of the replacements suggests that international marketers benefit from being proactive in replacing intermediaries with new intermediaries or with a hierarchal entry mode. Originality/value – This is the first study that applies most of these variables from interorganizational relations theory in the study of international independent intermediary replacements. It is also the first to give insight into the consequences of intermediary terminations.

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Export channel dynamics: an empirical investigation

2005

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We investigate the dynamics of export channel arrangements by modelling foreign operation method decisions as the interplay between factors that motivate switches and factors that deter them. Our model extends previous analyses by looking simultaneously at (1) no change of channel arrangement, (2) replacements of foreign intermediaries (within-mode shifts), and (3) integration of the sales function abroad (between-mode shifts). We use a multinomial logit model on longitudinal data from a sample of Danish exporters that had entered foreign markets through intermediaries. The results suggest that the decision to carry out within-mode shifts (i.e. to replace an existing intermediary) is driven by a different set of factors than the decision to switch to another foreign operation mode (i.e. to in-house operations). Copyright INTRODUCTIONInternational firms commonly service foreign markets through local, independent operators, such as sales agents, merchant distributors, licensees, and franchisees. By 'externalizing' their foreign market activities international firms may avoid costs of foreignness, the penalty costs due to investments in underutilized local marketing or manufacturing capacity, and the deployment of scarce management resources. Previous studies of international distribution channels have focused on the modes of entry into foreign markets (e.g. Anderson and Coughlan, 1987;Klein et al., 1990). Nevertheless, there is ample empirical evidence that with the passage of time many firms change their arrangements with the local operators (e.g. Johanson and Wiedersheim-Paul, 1975;Calof, 1993;Clark et al., 1997;Pedersen et al., 2002). Although various reasons for making changes have been pointed out, our knowledge about change of foreign operation modes remains sketchy and unsystematic.In this paper we develop and test a model of mode-switch decisions. Specifically, we look at switches related to one particular foreign operation mode; namely, exporting through a foreign intermediary such as a sales agent or merchant distributor. Changes in an export channel arrangement that involves an intermediary can basically be one of two types: either the foreign intermediary is replaced by another (within-mode switches) or the principal switches to another operation mode (between-mode switches). Studies of between-mode and within-mode switches have been reported in the international business literature, but previous studies have several shortcomings. The studies of Calof (1993) and Clark et al. (1997) are largely exploratory studies. Although they *Correspondence to: Department of International Economics and Management, Copenhagen Business School, Frederiksberg DK-2000, Denmark. E-mail: gb.int@cbs.dk y E-mail: tp.int@cbs.dk z E-mail: bp.int@cbs.dk provide valuable insights on the occurrence of switches and of firms' motives for making them, the studies are only loosely grounded on theory and do not present actual tests of hypotheses. Fina and Rugman (1996) present an in-depth study of the pharmaceutical company UpJohn. T...

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The mode choice and change decision process and its impact on international performance

Cited by 67 publications

References 31 publications

Perceptions of justice and organisational commitment in international mergers and acquisitions

Perceptions of justice and organisational commitment in international mergers and acquisitions

Antecedents and consequences of replacing international independent intermediaries

Export channel dynamics: an empirical investigation

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