Bertrand Quelin

Complexity of Outsourcing Contracts and Ex Post Transaction Costs: An Empirical Investigation

In this article, we use Transaction Cost Economics (TCE) and the Resource-Based View (RBV) of the firm to study outsourcing agreements. We develop an original approach of contract complexity and analyse the links among exchange hazards (i.e. specificity and environmental uncertainty), the contractual aspects of outsourcing (control, incentives, penalties, price and flexibility clauses) and the level of ex post transaction costs. Both contract complexity and ex post transaction costs are operationalized and measured. Our empirical research analyses 82 outsourcing contracts. This article uses three different dimensions (proximity to the core business, switching costs and adaptation costs) to assess the strategic importance of an outsourced activity. Our findings extend TCEs validity for the outsourcing of activities with a strategic value. Finally, this study offers an indirect measurement of ex post transaction costs. In short, to restrict vendor opportunism, contracts must contain incentives and penalties, as well as pricing and monitoring clauses

An Empirical Investigation of Interorganizational Opportunism and Contracting Mechanisms

This study investigates contracting mechanisms in situations of opportunistic disputes between organizations. The authors specifically explore the relationships between the formal versus informal nature of opportunism and the formal versus informal nature of contractual governance. They use a unique data set of 102 buyer–supplier disputes to explore in depth different types of opportunism – that is, strong form versus weak form opportunism – and different types of contracting mechanisms – that is, the controlling and coordinating functions of formal contracts and the cooperative and competitive sides of relational contracts. The authors’ detailed empirical analysis suggests distinct relationships between the different contracting mechanisms, the different types of opportunism, and the level of legal fees necessary to deal with the dispute. From these findings the authors derive implications for research on the role of contractual mechanisms in dealing with interorganizational opportunism.

The Changing Landscape of the European Financial Services Sector

The European financial services sector is confronted with major forces that have changed its competitive dynamics and the strategic context. Firstly, we investigate the pace of the diffusion of two forces for strategic renewal (technological innovations and regulatory changes); secondly, we assess similarities in the pace of diffusion across countries; and thirdly, we assess the impact of these developments on the European financial landscape, focusing on five EU countries from 1990 to 1999. Preliminary findings suggest that country-specific patterns of diffusion have decreased substantially, indicating the emergence of industry-generic patterns of diffusion, while the speed of diffusion is increasing within the sector. This will give rise to a hyper-competitive landscape in the beginning of this century. Understanding the emergence of such landscapes creates important managerial challenges for the strategic renewal journeys of both incumbent firms and new entrants, in the financial services sector and in sectors confronted with similar developments

Resource creation and partnership in R&D consortia

In this article, we examine, through an analysis of characteristics specific to both the partner firm and the consortium, the process of creating new resources and competencies in research and development (RD we attempt here to fulfill the insufficiencies in empirical analysis. Since we are interested in how individual participating companies succeed in creating resources, our research is focused on the partner firm itself and not on the consortium as a whole. Our statistical analysis of 317 firms enables us to examine the different types of technological developments that can be achieved through EUREKA R&D consortia. We study the impact that partner characteristics and the choice of a consortiums organizational form can have on the types of resources created by a partner. Our findings, which detail the factors that affect the creation of competencies in R&D consortia, strongly support the resource-based theory of the firm

An empirical study of hybrid forms of governance structure: the case of the telecommunication equipment industry

This article examines hybrid forms of governance structures as defined in transaction cost theory. It demonstrates that these hybrid forms can be split into a small number of discrete categories instead of being distributed evenly on a continuum between market and hierarchy. The analysis is based on a sample of strategic partnerships set up by telecommunication equipment manufacturers, either among themselves or with firms of related industries. The taxonomy of strategic partnerships presented in this paper underlines the importance of the organization of tasks and the symmetry of the contributions of the partner firms as discriminating factors of hybrid forms.

Personal networks and knowledge transfer in inter‐organizational networks

Purpose – The purpose of this paper is to test the transfer of good practices under the effect of various aspects of personal networks. Whereas, the majority of former work considers a direct effect of networks on knowledge transfer, the authors examined two intermediate mechanisms: the access to strategic resources and the individuals absorptive capacity.Design/methodology/approach – A quantitative study was used to collect data, via a face‐to‐face questionnaire with key individuals in small and medium entreprises members of consortia in Tunisia. Data were analysed with a structural equations approach, based on partial least squared‐path modelling techniques.Findings – Results emphasize the impact of network size, strength of ties and absorptive capacity on the strategic resource access and the impact of indirect ties, strength and range of ties on the absorptive capacity. Moreover, while absorptive capacity positively impacts good practice transfer, no support was found to the effect of resource access...

Does Regulation Impact the Entry in a Mature Regulated Industry? An Econometric Analysis of MVNOs

Since 1998, the European telecommunications industry is entered into a liberalization phase. In mobile markets, the liberalization policy induces the introduction of competition between a larger number of competitors and a decrease in retail prices. However, the assessment of national markets reveals insufficient competition between network operators and a new regulation was proposed to facilitate private investments into this mature industry.This paper investigates the determinants of the fringe entry into European mobile telecommunications markets between 1998 and 2005. More precisely, we intend to answer the following question: how do cross-national differences in the market structure and the regulatory design (regulatory incentives and governance) affect the number of Mobile Virtual Network Operators’ (MVNOs) in mobile markets? We test a set of hypothesis using internationally comparable variables of economic and regulatory determinants and allowing for ten European Member States and temporal fixed effects on 8 years. We infer the hypotheses to predict cross-national variations in the number of MVNOs entries. We then control for the potential effects of the contractual governance of the MVNOs’ access to the incumbents’ mobile networks. We demonstrate that the amount of fringe entry into a mature industry is the result of both the strategic behavior of the incumbents towards hosting MVNOs on their networks and the adoption of credible regulations to prevent the exercise of strategic entry-deterring activities. Our findings are salient for policymakers and practitioners alike.

Regulation and transaction costs in telecommunications: A research agenda

Antitrust and regulatory policies influence the vertical and horizontal integration of firms and the characteristics of their contractual arrangements. This paper examines the relevance of transaction cost economics for the analysis of regulatory policy in telecommunications. It explores the impact of changes in national telecommunications regulation on the level of transaction costs. After building a new theoretical framework based upon previous transaction cost contributions, the paper sets out a research agenda concerning the importance of transaction costs for antitrust and regulatory policies.

Network ties and absorptive capacity for learning and decision-making

The decision-making literature emphasizes that social ties play an important role in high-stake decisions. However, research on small- and medium-sized enterprises has only partially covered these influences by focusing on the direct link between social ties and the effectiveness of decision-making. In this paper, we focus on absorptive capacity of decision-makers as a critical mechanism that gives social ties their potency in explaining collaborative decision-making in an inter-organizational network (ION) context. In a sample of key individuals in 13 export consortia, this study identifies the extent to which the characteristics of personal network affect individuals’ absorptive capacity. Our results suggest that weak and heterogeneous ties between key individuals in an ION are central mechanisms that influence their ability to access, assimilate, transform and utilize information. However, indirect ties do not show a positive impact on absorptive capacity, as it was hypothesized. Our findings add to the literature on the role of network ties in collaborative decision-making by making explicit a mechanism through which personal network of individuals in an ION influence their information-processing capabilities for effective decision-making. We show that decision-making in interfirm networks is not only a political process but also a learning process.

Why For-profit Firms Compete with Non-profit Organizations to Access Development Aid Contracts?

Today, private for-profit firms capture an ever-larger share of aid service contracts competitively allocated by world’s major public aid agencies, such as USAID, UK’s Department for International ...