Opportunism in Distribution Networks: The Role of Network Embeddedness and Dependence

Abstract

P rior research documents the value of network relationships to firm behavior but is relatively silent on how networks influence opportunism in distribution channels. Focusing on a common type of distribution networks in which multiple distributors serve a single, dominant supplier, this study moves beyond a dyadic view to examine how a focal distributor's relational and structural embeddedness in such a distribution network influences its opportunism toward the dominant supplier. In particular, we postulate that a distributor's relational embeddedness in the network curbs its opportunism, whereas its network centrality, as a form of structural embeddedness in the network, promotes its opportunism. Moreover, we propose that relational embeddedness magnifies the role of a focal distributor's dependence on the supplier in suppressing the distributor's opportunism, whereas network centrality buffers such a role. We first empirically test these hypotheses using data collected from car dealers in China; the results provide support for the hypotheses. We then develop an analytical model to validate and further explain the underlying mechanisms of the network effects. Our analytical results not only validate the empirical results but also provide guidance for managers on controlling opportunism in distribution networks.

Multi‐Methodological Research in Operations Management

“…He further showed that the aforementioned effects, however, are moderated by the buyer's psychological benefits. Dong et al (2015) used both survey data and analytical models to show that a focal distributor's embeddedness in the distribution network does directly and indirectly affect its opportunism toward the network's dominant supplier. They classified network embeddedness into relational and structural aspects.…”

Supply Network Position and Firm Performance: Evidence From Chinese Listed Manufacturing Companies

“…Specifically, scholars have analyzed the intrinsic value of network structure to the firm (Autry & Griffis, 2008), proposed SNA measures to quantify that value (Borgatti, Mehram, & Labianca, 2009), studied the dynamics of complete networks, and demonstrated the utility of SNA in understanding corporate risk (Basole & Bellamy, 2014;Kim, Chen, & Linderman, 2015) By contrast, due to the difficulty in obtaining network data, only a few empirical studies have been conducted into supply networks. Among them, some scholars focused on specific industry to construct supply networks (Choi & Hong, 2002;Kim et al, 2011;Bellamy, Ghosh, & Hora, 2014;Dong et al, 2015). Choi and Hong (2002) used case studies to map the supply networks of the American automotive industry.…”

“…First, this paper enriches the dataset used to construct supply network. Specifically, empirical research on supply networks is relatively limited -a few researchers have established supply networks based on industrylevel data (Ahern & Harford, 2014) or firm-level data that only includes a single industry such as the automobile industry (Kim et al, 2011;Dong et al, 2015) or the electronics industry (Bellamy, Ghosh, & Hora, 2014). Sharma et al (2019) used manual collecting data to establishe supply networks of international business.…”

Gestão de Riscos Relacionais, Confiança, Custos de Transação e Relacionamentos Colaborativos: Proposta de Modelo

“…Assim, caso o parceiro viole as normas da parceria, será detectado e advertido ou punido (El Akremi, Mignonac, & Perrigot, 2010). Na segunda direção, tem-se que o aumento do comportamento oportunista eleva a necessidade de salvaguardas, mecanismos de controle e vigilância, pois representa um risco relacional que pode minar os benefícios esperados com a parceria (Dong, Liu, Yu, & Zheng, 2015). Falta de sinergia e coesão em relação aos objetivos Página204 entre parceiros comerciais é comummente associada a comportamentos oportunistas.…”

“…Assim o parceiro assume uma postura de vigilância, avaliando com mais cuidado cada investimento em ativos que porventura possa ser feito nessa relação (Dong et al, 2015). Essa vigilância excessiva é um mecanismo de proteção que inibe o compartilhamento de informações e a colaboração entre os parceiros.…”