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Relational governance as an interorganizational strategy: an empirical test of the role of trust in economic exchange

Article Abstract:

Both economic and sociological perspectives are used to identify the factors determining relational governance. The study explores the proposition that noneconomic, sociological variables such as trust complement economic factors in the governance of exchange relationships. A research model is developed which characterizes relational governance as a distinct form of interorganizational strategy that differs significantly from the traditional modes of markets and hierarchies. It also conceptualizes relational governance as being incorporated in the structure and the process of an interorganizational relationship. The model is tested empirically in the American property and casualty insurance industry. Findings support the conclusion of earlier studies that the exchange relationship has an important social component that may be overshadowed by its economic component.

Corporate governance, Interorganizational relations, Trust (Psychology)

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Research on corporate diversification: a synthesis

Article Abstract:

An overview of strategic management research (SMR) into corporate diversification, the entry of a business into new lines of activity by internal development or acquisition, reveals that research falls into two categories: studies of relevant phenomena illustrating developing concepts; and linkage-exploring studies. The three dominant themes of SMR literature are: the effect or direction of diversification on market structure and performance; interrelationships among diversity status, market structure and performance; and the relationship between diversity status and structure. The theoretical bases for why diversified business organizations develop are: profit maximization behavior; managerial growth-maximization; and financial gamesmanship. Major economic, finance, and strategy studies emphasize market power effects, market efficiency, and synergy.

Management, Corporations, Diversification in industry, Industrial diversification

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Planning system characteristics and planning effectiveness

Article Abstract:

Canonical correlation analysis is used to examine the multivariate relationship between planning system characteristics and planning effectiveness. The characteristics that have the most impact on planning effectiveness are resistance to planning and resources provided for planning. Together these two characteristics make up the organizational context of the planning system. Individual design characteristics of the planning system such as planning techniques used and external orientation have a lesser impact on planning effectiveness.

Management science, Analysis, Organizational research

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