The influence of culture and market orientation on services brands:insights from Irish banking and retail firms

Purpose: This paper aims to examine the influence of the culture of the service firm on its interpretation of the role of the brand and on the development and implementation of its brand values. Design/methodology/approach: A grounded theory approach was used. Interviews were conducted with 20 managers within two leading banking firms in Ireland and two leading grocery retailers in Ireland. Findings: The development of the brand, and its role within the firm, is closely related to the firm's culture. The research shows obstacles and opportunities created by the cultural context of firms wishing to disseminate and embed a set of brand values. The paper presents an "involvement model" of brand values implementation and outlines changes required to implement brand values. Research limitations/implications: The study was bound by access to firms, and managers' availability. The authors sought an insight into the relationship between each firm's culture and its brands. They advocate quantitative research to further investigate the findings within these service sectors and to test proposed antecedents (transformational leadership, employee involvement) and outcomes (employee-based brand equity and consumer-based brand equity) of values adoption. Practical implications: The paper identifies aspects of retail and banking cultures which support or detract from brand development. In particular, it presents the learnings from successful brand values implementation in a clan culture, aspects of which are applicable across other cultures. Originality/value: The paper provides valuable insights into the role of the brand within the service firm and the positive and negative influence of context on brand values and their development and implementation. © Emerald Group Publishing Limited.

Market reform and fiscal laxity in Communist and post-Communist Hungary: A path-dependent approach

Purpose – The purpose of this paper is to present a conceptual framework in order to analyse and understand the twin developments of successful microeconomic reform on the one hand and failed macroeconomic stabilisation attempts on the other hand in Hungary. The case study also attempts to explore the reasons why Hungarian policymakers were willing to initiate reforms in the micro sphere, but were reluctant to initiate major changes in public finances both before and after the regime change of 1989/1990. Design/methodology/approach – The paper applies a path-dependent approach by carefully analysing Hungary's Communist and post-Communist economic development. The study restricts itself to a positive analysis but normative statements can also be drawn accordingly. Findings – The study demonstrates that the recent deteriorating economic performance of Hungary is not a recent phenomenon. By providing a path-dependent explanation, it argues that both Communist and post-Communist governments used the general budget as a buffer to compensate the losers of economic reforms, especially microeconomic restructuring. The gradualist success of the country – which dates back to at least 1968 – in the field of liberalisation, marketisation and privatisation was accompanied by a constant overspending in the general government. Practical implications – Hungary has been one of the worst-hit countries of the 2008/2009 financial crisis, not just in Central and Eastern Europe but in the whole world. The capacity and opportunity for strengthening international investors' confidence is, however, not without doubts. The current deterioration is deeply rooted in failed past macroeconomic management. The dissolution of fiscal laxity and state paternalism in a broader context requires, therefore, an all-encompassing reform of the general government, which may trigger serious challenges to the political regime as well. Originality/value – The study aims to show that a relatively high ratio of redistribution, a high and persistent public deficit and an accelerated indebtedness are not recent phenomena in Hungary. In fact, these trends characterised the country well before the transformation of 1989/1990, and have continued in the post-socialist years, too. To explain such a phenomenon, the study argues that in the last couple of decades the hardening of the budget constraint of firms have come at the cost of maintaining the soft budget constraint of the state.

A piaci normák sérülése, üzleti döntések és a vállalati hatékonyság (Violation of market norms, business decisions and firms’ efficiency)

Az üzleti vállalkozások környezetére vonatkozó előfeltevések és ezek érvényesülése keretet szab az üzleti döntésekhez és hat a teljesítményre. A cikkben (a feltételezett, illetve elvárt) piaci normák sérülésének hatékonysági következményeit vizsgálja a szerző. Kiindulásként értelmezi a vállalati hatékonyság fogalmát és külső befolyásoló tényezőit. Ezt követően rendszerezi a nem normasértő üzleti döntéshozók lehetséges válaszait a piaci szereplők (versenytársak, üzleti partnerek) normasértéseire, kitérve arra is, hogy ez milyen hatást gyakorol a hatékonyságra. _______ The decisions and the performance of business corporations are not independent of their environment. The assumed norms provide a framework for the business decisions and the existing norms affect the firms’ performance. The article focuses on the efficiency consequences of the violation of the market norms. It presents the concept of corporate efficiency and its influencing factors. Then the decision makers’ possible answers to the violation of norms are investigated and the efficiency consequences are analyzed.

The integraton by trade and FDI of emerging economies: The ASEAN example

The paper investigates the role of regionalization and regional identity in the endeavours of emerging economies to connect successfully to the global world economy. It addresses the question of whether the Association of Southeast Asian Nations (ASEAN), with its loose institutional integration framework, has contributed to the global integration of its very heterogenous members in the first decade of the 21st century – and, if so, what are the drivers behind this. The paper summarizes connecting theories, using a multidisciplinary approach, and uses descriptive statistical analysis to identify the achievements of the ASEAN-6 countries within global trade and foreign direct invesment (FDI) flows in the given time period. We suggest that ASEAN countries, with their efforts to initiate interconnecting regional organizations in Asia, most specifically the ASEAN+3 (APT) construction, did contribute to greater integratedness of member countries; and they have created a regional image with a common market and production base. Such achievements, however, can be in great part attributed to the micro-level activities of international and regional firms wishing to establish cross-border production networks in these countries.

The integration by trade and FDI of emerging economies: The Asian example

The paper investigates the role of regionalization and regional identity in the endeavours of emerging economies to connect successfully to the global world economy. It addresses the question of whether the Association of Southeast Asian Nations (ASEAN), with its loose institutional integration framework, has contributed to the global integration of its very heterogenous members in the first decade of the 21st century – and, if so, what are the drivers behind this. The paper summarizes connecting theories, using a multidisciplinary approach, and uses descriptive statistical analysis to identify the achievements of the ASEAN-6 countries within global trade and foreign direct invesment (FDI) flows in the given time period. We suggest that ASEAN countries, with their efforts to initiate interconnecting regional organizations in Asia, most specifically the ASEAN+3 (APT) construction, did contribute to greater integratedness of member countries; and they have created a regional image with a common market and production base. Such achievements, however, can be in great part attributed to the micro-level activities of international and regional firms wishing to establish cross-border production networks in these countries.

The role of market knowledge in recognizing and exploiting entrepreneurial opportunities in technology intensive firms

Entrepreneurial opportunity recognition is an increasingly prevalent phenomenon. Of particular interest is the ability of promising technology based ventures to recognize and exploit opportunities. Recent research drawing on the Austrian economic theory emphasizes the importance of knowledge, particularly market knowledge, behind opportunity recognition. While insightful, this research has tended to overlook those interrelationships that exist between different types of knowledge (technology and market knowledge) as well as between a firm’s knowledge base and its entrepreneurial orientation. Additional shortfalls of prior research include the ambiguous definitions provided for entrepreneurial opportunities, oversight of opportunity exploitation with an extensive focus on opportunity recognition only, and the lack of quantitative, empirical evidence on entrepreneurial opportunity recognition. ^ In this dissertation, these research gaps are addressed by integrating Schumpeterian opportunity development view with a Kirznerian opportunity discovery theory as well as insights from literature on entrepreneurial orientation. A sample of 85 new biotechnology ventures from the United States, Finland, and Sweden was analyzed. While leaders in all 85 companies were interviewed for the research in 2003-2004, 42 firms provided data in 2007. Data was analyzed using regression analysis. ^ The results show the value and importance of early market knowledge and technology knowledge as well as an entrepreneurial company posture for subsequent opportunity recognition. The highest numbers of new opportunities are recognized in firms where high levels of market knowledge are combined with high levels of technology knowledge (measured with a number of patents). A firm’s entrepreneurial orientation also enhances its opportunity recognition. Furthermore, the results show that new ventures with more market knowledge are able to gather more equity investments, license out more technologies, and achieve higher sales than new ventures with lower levels of market knowledge. Overall, the findings of this dissertation help further our understanding of the sources of entrepreneurial opportunities, and should encourage further research in this area. ^

The role of market knowledge in recognizing and exploiting entrepreneurial opportunities in technology intensive firms

Entrepreneurial opportunity recognition is an increasingly prevalent phenomenon. Of particular interest is the ability of promising technology based ventures to recognize and exploit opportunities. Recent research drawing on the Austrian economic theory emphasizes the importance of knowledge, particularly market knowledge, behind opportunity recognition. While insightful, this research has tended to overlook those interrelationships that exist between different types of knowledge (technology and market knowledge) as well as between a firm’s knowledge base and its entrepreneurial orientation. Additional shortfalls of prior research include the ambiguous definitions provided for entrepreneurial opportunities, oversight of opportunity exploitation with an extensive focus on opportunity recognition only, and the lack of quantitative, empirical evidence on entrepreneurial opportunity recognition. In this dissertation, these research gaps are addressed by integrating Schumpeterian opportunity development view with a Kirznerian opportunity discovery theory as well as insights from literature on entrepreneurial orientation. A sample of 85 new biotechnology ventures from the United States, Finland, and Sweden was analyzed. While leaders in all 85 companies were interviewed for the research in 2003-2004, 42 firms provided data in 2007. Data was analyzed using regression analysis. The results show the value and importance of early market knowledge and technology knowledge as well as an entrepreneurial company posture for subsequent opportunity recognition. The highest numbers of new opportunities are recognized in firms where high levels of market knowledge are combined with high levels of technology knowledge (measured with a number of patents). A firm’s entrepreneurial orientation also enhances its opportunity recognition. Furthermore, the results show that new ventures with more market knowledge are able to gather more equity investments, license out more technologies, and achieve higher sales than new ventures with lower levels of market knowledge. Overall, the findings of this dissertation help further our understanding of the sources of entrepreneurial opportunities, and should encourage further research in this area.

Value creation in a reregulated market : Divestments, firms and dynamic processes

This thesis makes use of the unique reregulation of pharmaceutical monopoly in Sweden to critically examine intraindustry firm heterogeneity. It contributes to existing divestiture research as it studies the dynamism in between reconfigurations of value constellations and its effects on value creation of divested pharmacies. Because the findings showed that the predominant theory of intraindustry firm heterogeneity could not explain firm performance, the value constellation concept was applied as it captured the phenomena. A patterned finding informed how reconfigurations of value constellations in a reregulated market characterized by strict rules, regulations, and high competition did not generate additional value for firms on short term. My study unveils that value creation is hampered in situations where rules and regulations significantly affect firms’ ability to reconfigure their value constellations. The key practical implication is an alternative perspective on fundamental aspects of the reregulation and how policy-makers may impede firm performance and the intended creation of new value for not only firms but for society as a whole.

Export Behavior and Board Independence in Colombian Family Firms: The Reverse Causality Relationship

In the context of greater market liberalization in Latin America, one issue that merits greater attention for empirical investigation is the international expansion of family-owned business. Specifically, the relationship between export behavior, family control and board composition in the Latin American context is absent in the literature. Using a large and unique database from Colombian firms (33,249 firms in the period of 2008 to 2013), we provide insightful information on the determinants of export behavior of family firms in emerging markets. Our empirical test confirms an endogenous relation between boards’ composition (specifically the presence of independent members) and export behavior in family firms. Firms with a higher participation of independent board members are more likely to exhibit higher levels of exports. A "virtuous cycle" was also detected whereby the introduction of independent members on the board can be expected to boost export behavior, which in turn will encourage the increase of independent members on the board of private firms.

Tribes under threat : the collective behavior of firms during the stock market crisis

Due to their unpredictable behavior, stock markets are examples of complex systems. Yet, the dominant analysis of these markets as- sumes simple stochastic variations, eventually tainted by short-lived memory. This paper proposes an alternative strategy, based on a stochastic geometry defining a robust index of the structural dynamics of the markets and based on notions of topology defining a new coef- ficient that identifies the structural changes occurring on the S&P500 set of stocks. The results demonstrate the consistency of the random hypothesis as applied to normal periods but they also show its in- adequacy as to the analysis of periods of turbulence, for which the emergence of collective behavior of sectoral clusters of firms is mea- sured. This behavior is identified as a meta-routine.

Age diversity and firm performance in an emerging economy: Implications for cross-cultural human resource management

This study tests the effect of age diversity on firm performance among international firms. Based on the resource-based view of the firm, it argues that age diversity among employees will influence firm performance. Moreover, it argues that two contextual variables—a firm's level of market diversification and its country of origin—influence the relationship between age diversity and firm performance. By testing relevant hypotheses in a major emerging economy, that is, the People's Republic of China, this study finds a significant and positive effect of age diversity and a significant interactive effect between age diversity and firm strategy on profitability. We also find a significant relationship between age diversity and firm profitability for firms from Western societies, but not for firms from East Asian societies. The paper concludes by discussing the implications of this study's findings. © 2011 Wiley Periodicals, Inc.

A Markovian model market-Akerlof`s lemons and the asymmetry of information

In this work we study an agent based model to investigate the role of asymmetric information degrees for market evolution. This model is quite simple and may be treated analytically since the consumers evaluate the quality of a certain good taking into account only the quality of the last good purchased plus her perceptive capacity beta. As a consequence, the system evolves according to a stationary Markov chain. The value of a good offered by the firms increases along with quality according to an exponent alpha, which is a measure of the technology. It incorporates all the technological capacity of the production systems such as education, scientific development and techniques that change the productivity rates. The technological level plays an important role to explain how the asymmetry of information may affect the market evolution in this model. We observe that, for high technological levels, the market can detect adverse selection. The model allows us to compute the maximum asymmetric information degree before the market collapses. Below this critical point the market evolves during a limited period of time and then dies out completely. When beta is closer to 1 (symmetric information), the market becomes more profitable for high quality goods, although high and low quality markets coexist. The maximum asymmetric information level is a consequence of an ergodicity breakdown in the process of quality evaluation. (C) 2011 Elsevier B.V. All rights reserved.

A technological and organisational explanation for the size distribution of firms

This paper combines insights from the literature on the economics of organisation with traditional models of market structure to construct a theory of equilibrium firm size heterogeneity under the assumption of a homogenous product industry. It is possible that configurations consisting entirely of small firms (run by entrepreneurs with limited attention) and with larger firms (using managerial techniques to substitute away these limits to allow increasing returns technologies to become profitable) can arise in equilibrium. However, there also exist equilibrium configurations with the co-existence of large and small firms. The efficiency properties of these respective equilibria are discussed. Finally, the implications of an expanding market size are considered.

Economic performance of Brazilian manufacturing firms: a counterfactual analysis of innovation impacts

This article assesses if innovators outperform non-innovators in Brazilian manufacturing during 1996-2002. To do so, we begin with a simple theoretical model and test the impacts of technological innovation (treatment) on innovating firms (treated) by employing propensity score matching techniques. Correcting for the survivorship bias in the period, it was verified that, on an average, the accomplishment of technological innovations produces positive and significant impacts on the employment, the net revenue, the labor productivity, the capital productivity, and market share of the firms. However, this result was not observed for the mark-up. Especially, the net revenue reflects more robustly the impacts of the innovations. Quantitatively speaking, innovating firms experienced a 10.8-12.5 percentage points (p.p. henceforth) higher growth on employment, a 18.1-21.7 p.p. higher growth on the net revenue, a 10.8-11.9 p.p. higher growth on labor productivity, a 11.8-12.0 p.p. higher growth on capital productivity, and a 19.9-24.3 p.p. higher growth on their market share, relative to the average of the non-innovating firms in the control group. It was also observed that the conjunction of product and process innovations, relative to other forms of innovation, presents the stronger impacts on the performance of Brazilian firms.

Testing for Market Power in Multiple-Input, Multiple-Output Industries: The Australian Grains and Oilseeds Industries

Recent empirical studies have found significant evidence of departures from competition in the input side of the Australian bread, breakfast cereal and margarine end-product markets. For example, Griffith (2000) found that firms in some parts of the processing and marketing sector exerted market power when purchasing grains and oilseeds from farmers. As noted at the time, this result accorded well with the views of previous regulatory authorities (p.358). In the mid-1990s, the Prices Surveillence Authority (PSA 1994) determined that the markets for products contained in the Breakfast Cereals and Cooking Oils and Fats indexes were "not effectively competitive" (p.14). The PSA consequently maintained price surveillence on the major firms in this product group. The Griffith result is also consistent with the large number of legal judgements against firms in this sector over the past decade for price fixing or other types of non-competitive behaviour. For example, bread manufacturer George Weston was fined twice during 2000 for non-competitive conduct and the ACCC has also recently pursued and won cases against retailer Safeway in grains and oilseeds product lines.