Examining the Antecedents and Consequences of CIO Strategic Decision‐Making Authority: An Empirical Study*

Despite the strategic importance of information technology (IT) to contemporary firms, chief information officers (CIO) often still have varying degrees of strategic decision‐making authority. In this study, we apply the theory of managerial discretion to define CIO strategic decision‐making authority and argue that the CIO's level of strategic decision‐making authority directly influences IT's contribution to organization performance. We also draw on the power and politics perspective in the strategic decision‐making literature to identify the direct antecedents to the CIO's strategic decision‐making authority. A theoretical model is presented and empirically tested using survey data collected from a cross‐industry sample of 174 matched pairs of CIOs and top business executives through structural equation modeling. The results suggest that organizational climate, organizational support for IT, the CIO's structural power, the CIO's level of strategic effectiveness, and a strong partnership between the CIO and top management team directly influence the CIO's level of strategic decision‐making authority within the organization. The results also suggest that the CIO's strategic decision‐making authority in the organization directly influences the contribution of IT to firm performance and that effective CIOs have a greater influence on IT's contribution when provided with strategic decision‐making authority.     

Distribution Channel Strategies for a Manufacturer with Complementary Products

In this article, we consider distribution channel strategies for an incumbent manufacturer who produces two complementary products and must determine whether or not to have another company to sell its products. We identify factors that affect the manufacturer's motivation to use dual‐channel distribution. Our results show that both complementarity between complements and product substitutability between firms influence the manufacturer's channel strategy. We find that if the potential entrant does not produce the complement of the primary product, a higher complementary effect for the complement will weaken the motivation of the incumbent to add an indirect channel. We also find that the incumbent has a stronger incentive to add the indirect channel when a product's substitutability is high. Furthermore, we show that when the two channels have the same pricing power, the incumbent has a stronger incentive to sell through the indirect channel in a higher pricing power environment.     

Strategic Motive for Introducing Internet Channels in a Supply Chain

Rapid advances of information technology in recent years have enabled both the manufacturers and the retailers to operate their own Internet channels. In this study, we investigate the interaction between the capabilities of introducing the Internet channels, the pricing strategies, and the channel structure. We classify consumers into two segments: grocery shoppers attach a higher utility from purchasing through the physical channel, whereas a priori Internet shoppers prefer purchasing online. We find that when the Internet shoppers are either highly profitable or fairly unimportant, the manufacturer prefers to facilitate the channel separation either through his own Internet channel or the retailer's. In the intermediate region, however, the manufacturer encroaches the grocery shoppers and steals the demand from the retailer's physical channel. With horizontal competition between retailers, a priori symmetric retailers may adopt different channel strategies as a stable market equilibrium. The manufacturer may willingly give up his Internet channel and leverage on the retailer competition. When the manufacturer sells through an online e‐tailer, Internet shoppers may be induced to purchase through the physical channel. This reverse encroachment strategy emerges because selling through the e‐tailer leads to a more severe double marginalization problem.     

Reordering Spatial and Social Relations: A Case Study of Professional and Managerial Flexworkers

Research on flexible work practices has focused primarily on social relationships, individual identity, work/work–life balance experience and performance. This paper aims to add another dimension by focusing on space and, specifically, the performance of space by professional flexworkers as they reorder their home and work lives through the process of becoming flexworkers. Drawing on Law's ‘modes of ordering’ and Latourian actor network theory, as well as on Beyes and Steyaert's recent contribution on ‘performing space’, the paper considers how flexworkers themselves reorganize space(s) as an ongoing accomplishment. The purpose and contribution is to offer an alternative to the view that the home and work are rigid containers fixed in social structure, to one that views them as self‐referential space(s), reordered by flexworkers as they seek to ‘keep the social moving’. The paper is based on an empirical study of employees in a Canadian subsidiary of a large hi‐tech multinational corporation. It examines organizational policy documents and interviews with managerial and non‐managerial flexworkers to identify how social and spatial relations are reordered and performed.     

Operations Risk Management: Overview of Paul Kleindorfer's Contributions

This paper reviews Paul Kleindorfer's contributions to Operations Management (OM), with a special focus on his research on risk management. An annotated bibliography of selected other contributions reviews the breadth of topics that have occupied Kleindorfer's research attention over his now 45 + years of research. These include optimal control theory, scheduling theory, decision sciences, investment planning and peak load pricing, plus a number of important applications in network industries and insurance. In the area of operations risk management, we review recent work that Kleindorfer and his colleagues in the Wharton Risk Center have undertaken on environmental management and operations, focusing on process safety and environmental risks in the chemical industry. This work is directly related to Kleindorfer's work in the broader area of “sustainable operations”, which he, Kal Singhal and Luk Van Wassenhove recently surveyed as part of the new initiative at POMS to encompass sustainable management practices within the POMS community. Continuing in the area of supply chain risks, the paper reviews Kleindorfer's contributions to the development of an integrated framework for contracting and risk hedging for supply management. The emphasis on alignment of pricing, performance and risk management in this framework is presaged in the work undertaken by Kleindorfer and his co‐authors in the 1980s on after‐sales support services for high‐technology products. This work on supply chain risk, and its successors, is reviewed here in light of its growing importance in managing the unbundled and global supply chains characteristic of the new economy.     

Multichannels Strategy Implementation: The Role of Channel Alignment Capabilities*

A firm's distribution channels represent a key portfolio of resources that can be leveraged for competitive advantage. One approach to this portfolio that has become increasingly important in recent years is multichannel distribution (MCD). While this strategy has important benefits in terms of market coverage and firm performance, the use of multiple channels seriously affects downstream channel roles such as service delivery, as the financial rewards to channel members and the services they offer are separated. A channel member who offers poor or no service can free‐ride on the services offered to the same customer from a different channel. We draw on agency theory to explain these negative consequences. Additionally, the resource‐based view of the firm along with capabilities theory provides two key means of alleviating these consequences: channel tracking capabilities and reward alignment capabilities. The study, conducted in an industry facing serious MCD issues (the outdoor sporting goods industry), used key informant data matched to secondary data. Our results show that managers can reap the performance rewards of MCD strategies while minimizing its negative consequences. In particular, monitoring practices such as frequent site visits and phone contact with customers develop the firm's channel tracking capabilities, allowing managers to better monitor downstream activities. This becomes particularly important as the complexity from having multiple channels increases. Likewise, reward alignment capabilities such as retail price maintenance agreements and cooperative advertising enable the manager to minimize conflict among channel participants by ensuring sufficient profitability for all channel members.     

Competition Between Banks and Building Societies in the Retailing of Financial Services

Within the financial services sector there has been diversification on a vast scale, with varying degrees of success. Financial services are increasingly viewed as products, the various branch networks as channels of distribution. The competition between banks and building societies has become a major battleground in the war for consumers' financial services expenditure. Both types of organization have a strong presence in the high street and have become major users of media advertising and other marketing weaponry. Historically, they have both enjoyed strong but different forms of relationship with their customers; these differences are rapidly diminishing as each invades the other's trading territory. This paper presents results from a study of bank-building society competition, illustrating the attributes and dimensions upon which consumers tend to base their choices. Financial services retailers are urged to base their marketing strategies upon a clear understanding of consumer needs and motives, not upon ‘me-too’ responses to competitors' moves. As many product retailers have discovered to their cost, heavy marketing expenditure cannot be a substitute for a well founded retail marketing strategy.     

The Management of Circulations: Biopolitical Variations after Foucault

This paper provides a review of the reception of Foucault's later work on biopolitics within management and organization studies and contrasts this with the reception of these ideas in sister fields of research in the social sciences. In his later work, Foucault developed original conceptions of power, including ‘biopolitics’, ‘the apparatus of security’ and ‘neo‐liberal governmentality’, which marked a departure from his conception of disciplinary power. This paper explores these concepts and elaborates the implications of these ideas for management studies. The structure of this argument is divided as follows. The first section outlines Foucault's concept of biopolitics and neo‐liberal governmentality, distinguishing these systems of control clearly from the concept of disciplinary power. The second section then undertakes a synthesis and evaluation of the extent to which these ideas have been developed within the field of management and organization studies. The final section provides a discussion of how these concepts have been used within other social sciences, distinguishing between three key approaches to their development in terms of: (a) the concept of governmentality; (b) the concept of immaterial labour; and (c) the concept of biocapital. Based on this analysis, a framework is developed which can serve as a basis for future research into the significance of these new biopolitical systems of control for management studies.     

Examining Organic and Mechanistic Structures: Do We Know as Much as We Thought?

Burns and Stalker's theory of organic/mechanistic structures (1961, The Management of Innovation. London: Tavistock) has been widely used. However, review of the empirical literature revealed inconsistencies in how the concepts have been operationalized. These inconsistencies may interfere with the ability to consolidate knowledge. This paper reviews the various ways in which researchers have operationalized the concepts, and summarizes the empirical findings derived from these operationalizations. In doing so, it highlights gaps and opportunities for future empirical and methodological work, suggesting the need to further our theoretical conceptualization of the concepts and to draw attention to Burns and Stalker's ( 1961 ) largely neglected corollary of the employee experience. As such, this review provides a road map for future exploration of the wide‐ranging implications associated with organic and mechanistic structures.     

Optimal Contract Design for Mixed Channels Under Information Asymmetry

The mixed‐channel model is becoming increasingly popular in the marketplace. In this model, a firm selling through the traditional supply chain of wholesaler and retailer opens a direct channel to the customer through Internet sales. Because both channels have their respective advantages, the manufacturer is attracted to this business model. However, it also leads to channel conflict, with the retailer feeling threatened by direct competition. One way of eliminating the possibility of this channel conflict, where the retailer is allowed to add value to the product to differentiate its offering to the customers, is proposed in this paper. The retailer is also given full authority to make pricing decisions. This paper presents a model, under this scenario, of obtaining optimum pricing decisions by both parties, the amount of value added by the retailer, and the manufacturer's wholesale price to the retailer. Our model incorporates information asymmetry, where the manufacturer has incomplete information about the retailer's cost of adding value. We obtain closed‐form contracts with incomplete information and compare them with those with complete channel coordination. We also develop a number of managerial guidelines and identify future research topics.     

Buying is marketing too—Japan's influence on the Australian coal trade

The Australian-Japan coal trade represents one of the largest single commodity trade flows in the Oceanic basin. The marketing functions of the three principal institutions (producer, trading house, user) are described. The theory of power and conflict in distribution channels is then used to help interpret the behavior of channel members. This analysis suggests that coal users and the Japanese trading houses understand and implement modern marketing strategy more effectively than Australian producers.     

The Digital Journey: Reflected Learnings and Emerging Challenges

This paper identifies and examines the four stages of marketing's digitalization journey to date and the points of interest along the way. The metaphor of a journey provides a narrative through which to understand the complex changes that are occurring within the digitalization of marketing. The digital journey has no final destination yet, but it is possible to identify an origin and chart its route thus far. In reflecting on this journey, insights emerge, which pose ongoing challenges for businesses and for the marketing discipline. The digitalization of marketing provides new options for routes to markets, communication, brand building, relationship development, trialling pricing, product development, sourcing insights, as well as a platform for innovation. But, only if businesses embark on this journey, and then keep up with the pace once en route. The implications for business stemming from marketing's digital journey are detailed along with avenues for future research, to develop further understanding of digitalization. The theoretical contributions made by this paper include both a novel mapping of the complex trajectory of marketing's digitalization through a visualization and an articulation of the main four gaps in current research and practice knowledge within marketing. The gaps include the need for a strategic view, the issue of technical silos, the changing conceptions of time, and the tension between empowered consumers and their reliance on pre‐filtered information. This paper provides a critical appraisal of the digital journey so far, resulting in a distilled conceptualization and route map, which should help guide future researchers.     

Consumer Attitudes Revisited: A Review of Attitude Theory in Marketing Research

Few concepts in the marketing literature have proliferated like the concept of attitude. However, a closer look at studies investigating attitudes as consumers' responses to marketing efforts reveals a considerable diversity in perspectives about the concept of attitude and its formation. Attitudes are considered either relatively stable object–associations, or temporarily constructed evaluations, which are formed through memory (cognitive)‐based information processing or contextual and affect‐based information processing. The current paper discusses and organizes these different theoretical viewpoints on what attitudes are and how they are formed. By approaching the topic through an integrative lens, the paper provides a solid conceptual foundation and roadmap for marketing researchers.     

Customer Learning Processes,Strategy Selection,and Performance in Business‐to‐Business Service Firms*

Learning about customers takes place through relevant dialogues with those customers, also known as customer relationship management (CRM). As relationships develop, information about the customer is gathered in the firm's customer information systems (CIS): the content, processes, and assets associated with gathering and moving customer information throughout the firm. This research develops a measure of CIS management capabilities based on learning organization theory and measured by the ability to get, store, move, and use information throughout the business unit. This measure is then used to analyze customer learning processes and associated performance in the context of marketing strategic decision making. This study of 209 business services firms finds that generic marketing strategy positioning (low‐cost and differentiation) and the marketing tactics of personalization and customization are related to CIS development. Customer information systems development in turn is associated with higher levels of customer‐based performance, which in turn is associated with increased business growth. Since the strongest association with customer‐based performance is strategy selection, the long‐term benefits of the knowledge gained from the CIS may be in the ability to assist in measuring customer‐based performance, rather than in the ability to immediately contribute to performance. Finally, for these firms, customization and personalization are not directly associated with performance and thus may not be necessary to support every firm's marketing strategy.     

On the Power and Poverty of Critical (Self) Reflection in Critical Management Studies: A Comment on Ford,Harding and Learmonth

Ford, Harding and Learmonth in their paper in the March 2010 special issue of the British Journal of Management ask ‘who is it that would make business schools more critical?’ Commenting on their paper, I argue that although they raise a very important question they do not deliver rigorous answers because their critical reflexive gaze fails to fall upon the mechanisms of hierarchy and exclusion that operate within the critical management studies (CMS) community. First the reflexivity debate in CMS and Ford, Harding and Learmonth's contribution to this debate is explored. Next institutionalized orthodoxies in CMS, such as the tendency to close ranks for those with different perspectives and the lack of demographic diversity, are problematized, and Ford, Harding and Learmonth's contribution is situated across these orthodoxies. Finally, the commentary offers some alternatives and solutions for CMS to take the step further from verbalism to critical praxis. It is suggested that the solution lies in exercising critical self‐reflection which acknowledges the embeddedness of CMS in structures and relations of power and hegemony and recognizes the role of CMS scholars in sustaining and reproducing these structures in their own institutions and communities.     

Are Self‐Service Customers Satisfied or Stuck?

This paper investigates the impact of self‐service technology (SST) usage on customer satisfaction and retention. Specifically, we disentangle the distinct effects of satisfaction and switching costs as drivers of retention among self‐service customers. Our empirical analysis examines 26,924 multi‐channel customers of a nationwide retail bank. We track each customer's channel usage, overall satisfaction, and retention over a 1‐year period. We find that, relative to face‐to‐face service, customers who use self‐service channels for a greater proportion of their transactions are either no more satisfied, or less satisfied with the service they receive, depending on the channel. However, we also find that these same customers are predictably less likely to defect to a competitor if they are heavily reliant on self‐service channels characterized by high switching costs. Through a mediation model, we demonstrate that, when self‐service usage promotes retention, it does so in a way that is consistent with switching costs. As a robustness check, we examine the behavior of channel enthusiasts, who concentrate transactions among specific channels. Relative to more diversified customers, we find that self‐service enthusiasts in low switching cost channels defect with greater frequency, while self‐service enthusiasts in high switching cost channels are retained with greater frequency.     

A Mobile Platform's In‐App Advertising Contract Under Agency Pricing for App Sales

Unlike advertising in traditional media, a mobile platform's in‐app advertising market exhibits two unique features—split structure of the mobile platform with a platform owner and an app developer jointly provisioning in‐app advertising, and agency pricing for app sales. We develop a two‐sided market model to analyze the role of these two unique features in determining the platform owner's optimal advertising revenue‐sharing contract. Our results reveal an interesting N‐shaped dynamic regarding the platform owner's optimal choice of her ad revenue share with respect to the overall advertisers’ valuation of in‐app ads. We identify a between‐agent subsidization strategy for the platform owner, where she finds it optimal to subsidize the developer via the advertising channel, leading to greater profits for both of them. We find that the advertising revenue‐sharing contract under agency pricing for app sales leads to a higher app price than would be offered by the integrated platform found in traditional advertising. However, the ad price is coordinated under the platform owner's optimal choice of ad revenue share when she obtains revenue from both the advertising and app sales channels, leading to an alignment of her interest with the app developer's on ad level.     

Aspirations and Inequality

This paper develops a theory of socially determined aspirations, and the interaction of those aspirations with growth and inequality. The interaction is bidirectional: economy‐wide outcomes determine individual aspirations, which in turn determine investment incentives and social outcomes. Thus aspirations, income, and the distribution of income evolve jointly. When capital stocks lie in some compact set, steady state distributions must exhibit inequality and are typically clustered around local poles. When sustained growth is possible, initial histories matter. Either there is convergence to an equal distribution (with growth) or there is perennial relative divergence across clusters, with within‐cluster convergence. A central feature that drives these results is that aspirations that are moderately above an individual's current standard of living tend to encourage investment, while still higher aspirations may lead to frustration.     

The Impact of Product Returns and Retailer's Service Investment on Manufacturer's Channel Strategies*

We study the distribution channel decision of a manufacturer who considers whether to add an online channel (direct channel) to its brick‐and‐mortar retailer (indirect channel). The retailer faces the opportunity to invest in store assistance to help consumers choose products and thus reduce product returns. Special attention is given to the impact of product returns and retailer's store assistance investment on manufacturer's dual channel decision. We examine conditions under which the manufacturer uses dual channels and how various relevant factors affect its channel decision under two settings, depending on whether the retailer has its own online store or not. When the retailer does not have its online store, we find that (i) the addition of the direct channel raises the wholesale price; (ii) the direct channel addition hurts the retailer if the nonreplacement rate is low; (iii) the manufacturer has a lower incentive to add the direct channel when the retailer's service cost is lower or its returns reduction rate from service investment is higher; and (iv) the manufacturer should treat its own returns handling cost as a key factor in its channel structure decision. In addition, when the retailer operates an online store, we find that the manufacturer may have an incentive to add a direct channel such that both firms own direct channels.     

Sustainable Luxury Marketing: A Synthesis and Research Agenda

Sustainability has become a pervasive issue for the luxury sector, gaining traction with brand managers, scholars, policy‐makers, the media, and academia. The purpose of this paper is to examine the state of sustainable luxury research in marketing and consumer behaviour by critically reviewing and synthesizing the growing but fragmented body of scholarly work on sustainable‐luxury marketing. The paper critically assesses where, how and by whom research on sustainable luxury is being conducted, and it identifies gaps for future investigation. The paper reviews research published between 2007 and 2018 within major peer‐reviewed English‐language scholarly publications in business, marketing, ethics, fashion, food and tourism journals. The research is identified using the keywords sustainable luxury, green luxury, eco‐luxury and organic luxury. Three core themes emerge from this review: (1) consumer concerns and practices; (2) organizational concerns and practices; and (3) international and cross‐cultural issues. The review confirms that research on sustainable luxury is significantly underdeveloped. This paper provides the first critical and comprehensive assessment and categorization of the emergent literature streams on sustainable luxury. The authors argue for a broader, deeper and more critical research agenda on the relationship between sustainability and luxury. Potential avenues for future research on sustainable luxury are proposed, with calls for theoretical and cross‐cultural reflections that tackle broader systemic and institutional issues within the field.