Institutional Distances in International Marketing Channels: Governance Strategies That Engender Legitimacy and Efficiency, the researchers posit that firms doing business in foreign institutional environments face significant pressure to gain social acceptance (which they term as “legitimacy”) and to compete in meaningful ways that only result from being well-informed about the host market (which they term “efficiency”). They explain that obtaining legitimacy may incur additional costs of adaptation and market assessment that tends to undercut firm efficiency. Firms must invest to understand the local market and position themselves to work cooperatively with local partners. The managerial dilemma becomes how to gain legitimacy while safeguarding efficiency (Yang et. al, 2012).
The past solution, as the article highlights, was to conform to gain social acceptance for survival — even if was detrimental to the firm and compromised self-interests. The authors suggest that the more effective method is to minimize institutional distance through regulatory, normative and cultural-cognitive means (Yang et al., 2012). The goal is to significantly decrease market ambiguity and legitimacy pressure. They cite contract customization and relational governance — combined — as the best way to achieve this.
The article defines the three pillars of institutional distance as regulatory (laws and sanctions that dictate what an organization can or cannot do), normative (societal beliefs and norms that outline what people should or should not do), and cultural-cognitive (what people typically do). Understanding how all of these play out in the international market is critical because it enables firms to understand the applicable rules, routines, conventions and expectations in the host market — all of which impact efficiency. Further, potential host partners may be distrustful of foreign partners or view them as less socially fit because of their lack of understanding of customary business practices, standards, values and norms (Lin, 2012). This often means less access to resources, social support and insider knowledge about the market, exerting a legitimacy pressure on the firm.
Contract customization can offset the legitimacy-efficient challenge by enhancing organizational learning and cultural assimilation. It creates a tailored set of obligations, roles and benefits that help prevent misunderstandings. Contracts also help protect against opportunism. It is much harder for host partners to take advantage of unwitting foreign partners when contracts are involved. They help establish standards and clarity for both parties and discourage self-seeking behaviors. Similarly, relational governance helps create a sense of trust that turns foreign firms into “insiders” with access to information that eliminates market ambiguity (Yang et. al, 2012). Cooperative actions, joint planning, information sharing, flexibility, and feelings of solidarity enhance the foreign firm’s position in the eyes of local businesses and offer opportunities to learn, understand and adapt to doing business in a new country (Lin, 2012). Firms can mimic their channel partners to gain legitimacy.
To prove their hypothesis, the researchers conducted personal interviews with two senior managers from Chinese firms that manufacture and export goods to various countries through foreign distributors. A total of 436 managers from 218 firms were asked to answer survey questions pertaining to their relationship with the distributor with which they conducted the highest volume of business. The multi-choice survey questions were designed to measure institutional distance at the organizational level, including regulatory, normative, and cross-cultural. Measurements were also taken of perceived legitimacy pressures and market ambiguity. The authors also measured the use of governance strategies to combat legitimacy-effectiveness challenges — contract customization and relational governance. The research design also included measures of strategic, selling and economic performance within the channel. Firm size, transaction history and frequency with the distributor, asset specificity, environmental volatility, and the effects of state-owned manufacturers, an important institutional factor in China, were set as controls. All measurements were tested to ensure adequate convergent validity, limited bias, and satisfactory reliability.
Flaws in procedural design include, as the researchers discussed, the fact that only manufacturers were interviewed. Admittedly, a study that includes distributors would offer more breadth of insight and reveal the dynamic relationship between both parties. In addition, only direct exporters were included, not indirect. Studies in the future should explore those manufacturers who also face dual institutional pressures from business and consumer markets in foreign countries. Only organizational-level measures of institutional distance were explored. Including national-level measurements would open up the scope of this study and certain reveal cross-level effects of institutional distance. Finally, those manufacturers surveys tended to have positive relationships with their distributors. It would be interesting to survey those who are new entrants to foreign markets without established relationships, or those having less than ideal ones.
An analysis of the findings supports the hypothesis that firms can design governance strategies to deal with both legitimacy and efficiency issues when entering international markets. Participants who employed both contract customization and relational governance with host partners faired the best, again suggesting that a using a dual approach can work to improve a firm’s competitive advantage. Employing governance strategies can allow firms to accomplish two goals — safeguard performance while seeking social acceptance. This study supports this specific conclusion.
Lin, H. (2012). Strategic Alliances for Environmental Improvements. Business & Society, 51(2), 335-348. doi:10.1177/0007650312437918.
Yang, Z., Su, C., & Fam, K. (2012). Dealing with Institutional Distances in International Marketing Channels: Governance Strategies That Engender Legitimacy and Efficiency. Journal of Marketing, 76(3), 41-55. doi:10.1509/jm.10.0033.
Get Professional Assignment Help Cheaply
Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?
Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.
Why Choose Our Academic Writing Service?
- Plagiarism free papers
- Timely delivery
- Any deadline
- Skilled, Experienced Native English Writers
- Subject-relevant academic writer
- Adherence to paper instructions
- Ability to tackle bulk assignments
- Reasonable prices
- 24/7 Customer Support
- Get superb grades consistently
Online Academic Help With Different Subjects
Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.
Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.
While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.
Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.
In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.
Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.
We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!
We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.
Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.
What discipline/subjects do you deal in?
We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.
Are your writers competent enough to handle my paper?
Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.
What if I don’t like the paper?
There is a very low likelihood that you won’t like the paper.
- When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
- We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.
In the event that you don’t like your paper:
- The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
- We will have a different writer write the paper from scratch.
- Last resort, if the above does not work, we will refund your money.
Will the professor find out I didn’t write the paper myself?
Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.
What if the paper is plagiarized?
We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.
When will I get my paper?
You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.
Will anyone find out that I used your services?
We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.
How our Assignment Help Service Works
1. Place an order
You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.
2. Pay for the order
Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.
3. Track the progress
You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.
4. Download the paper
The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.
PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET A PERFECT SCORE!!!