Henry Fock

The China Market: Strategic Implications of Guanxi

This article examines the differing perceptions of the nature of guanxi –“personal connection”– among business executives in Hong Kong and the different ways in which they use it. In the process, it contrasts views of relationship marketing in China and the West and suggests that the importance of guanxi for success in China may be waning. It substantiates the view that personal links and absence of commitment are major elements differentiating relationship marketing in China from that in the West. Major disadvantages of guanxi are perceived as being the extra time and cost this approach involves. For western managers involved in the China market, the research reported here has three strategic implications. First, in some form or other, they need to include the guanxi approach in their relationships with Chinese partners; second, they should be aware that guanxi may not involve commitment; and, finally, they should mount sustained efforts to build up guanxi to give them a competitive edge in their search for an insider position in the China business arena, whilst being aware that guanxi cannot eliminate threats and competition.

Retaining and divesting customers: an exploratory study of right customers, “at‐risk” right customers, and wrong customers

The axiom that “the customer is always right” is no longer valid when companies realize that some of their customers are not right at all. Paying too much attention to these so‐called “wrong” customers may jeopardize a companys survival and profitability. Right customers have to be retained, “at‐risk” right customers have to be recovered, and wrong customers have to be divested. This study attempts to operationalize the concept of customer “rightness” and “wrongness” in terms of different configurations of attribute satisfaction and overall satisfaction. Based on the result of a discriminant analysis of satisfaction survey data, customers with different configurations of attribute satisfaction and overall satisfaction are re‐examined in terms of switching intention, behavioral patterns and demographic characteristics in order to highlight any significant descriptor.

Moderation Effects of Power Distance on the Relationship Between Types of Empowerment and Employee Satisfaction

Previous research concludes that empowerment is ineffective with employees from societies high in power distance. The present study examines this conclusion across three types of empowerment: discretion empowerment, psychological empowerment, and leadership empowerment (or empowerment leadership behaviors). To assess the effects of power distance on these three types of empowerment, employee surveys were conducted in Canada (a society low in power distance) and in China (a society high in power distance). Results showed that the effect of discretion empowerment on employee satisfaction was less pronounced in China, just as previous literature had concluded about the dynamics of societies high in power distance. However, the effect of the leadership empowerment on employee satisfaction via the competence facet of psychological empowerment was found to be more pronounced in Canada, a society lower in power distance. These conclusions at the cultural level were also confirmed at the psychological level. We thus advocate that empowerment remains an advantageous strategy to organizations in both societies and individuals high and low in power distance, depending on the type of empowerment involved.

Retail outlet location decision maker – franchisor or franchisee?

This study focuses on a unique retail outlet location decision‐making problem found in business format franchising industries. The problem is derived from the latent conflict in the relationship between franchisor and franchisees. An empirical study was carried out to compare benefits of two different outlet allocation decision modes: centralised planning mode (locations allocated by the franchisor) and decentralised planning mode (franchisees given autonomy to select the location of their own outlets). Research findings revealed that the decentralised location decision mode is more beneficial to the franchise system with a lower level of customer loyalty.

The role of cultural tightness–looseness in the ethics of service recovery

ABSTRACT This research was intended to examine the moderating role of cultural tightness–looseness orientation (i.e., how strongly or weakly people pursue standardized social norms) in influencing consumers’ postrecovery behaviors at an individual level. Results of two studies demonstrated that the differential level of tightness–looseness orientation of consumers to societal norms influences their perceptions of service recovery efforts, which in turn affects their postrecovery complaint behaviors. Specifically, study 1 showed that overcompensation for service failure reduced postrecovery complaint tendency among “loose” consumers but not among “tight” consumers. Study 2 revealed that while either tangible compensation or an apology might ameliorate the dissatisfaction from the failure and alleviate complaint intention among loose consumers, tight consumers seek an apology rather than tangible compensation when a service failure occurs. These findings affirmed the vital role of tightness–looseness orientation of consumers in their responses to service failures and recovery efforts.

Is Trust a Pre-Requisite or Outcome of Corporate Social Responsibility? A Stakeholder Theoretical Perspective

Corporate social responsibility (CSR) has been garnering increasing momentum among academic researchers and business practitioners. Previous studies have shown that positive impacts of CSR on consumers’ buying behaviors are contingent upon a number of factors. This paper extends this stream of research and proposes that trust in a company is another important pre-requisite condition (moderator), as well as a desirable outcome, of successful CSR campaigns. In particular, we disentangle trust into two distinct concepts, pre-trust and post-trust, and drawing from stakeholder theory, we explicate the role of trust in stakeholders’ CSR evaluation process in a more fine-grained manner. A conceptual model is presented, along with its implications for research and managerial practices.

Effects of Job Embeddedness on Salesperson Customer Orientation: The Roles of Organization-Based Self-Esteem and Collectivism

In today’s age of relational selling, customer orientation (CO) takes on augmented importance for salespeople who strive to perform better and nurture long-term customer relationships. While previous research has revealed many interesting antecedent variables to salesperson CO, relatively less is known about the influence of personal variables on the salesperson CO. In this study, we endeavor to examine an important, yet under-researched, personal-level variable, job embeddedness, and understand its effects on the salespeople’s CO. Data were collected from business-to-business salespeople, and a moderated mediation analysis revealed that job embeddedness and collectivism interacted to affect organization-based self-esteem, which in turn was related to CO. Results were discussed.