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The Effectiveness Of Issue Selling By Subsidiary Managers:an Attention-Based View

Posted on:2015-11-24Degree:DoctorType:Dissertation
Country:ChinaCandidate:Q WangFull Text:PDF
GTID:1109330467474877Subject:Business Administration
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With the improvement of the market economy system, acceleration of the internationalization process, and development of science and technology, organizations are facing increasingly severe environment in China. Business groups which are popular organizational arrangements in China have also been experiencing network evolution with the development of information technology and knowledge economy. In this process, the roles of subsidiaries are changing. They begin to be equal with the parent company, and gradually contribute to competitive advantage of business group. The major contribution of subsidiaries is help to enhance the group’s adaptability to such aforementioned complex and dynamic environment. This can be realized through the behavior of issue selling by subsidiary managers.Specifically, subsidiary managers often act as the boundary spanners between the subsidiary, the headquarters and the other units of the business group. They identify the issues, such as the events, developments, and trends that have implications for organizational performance through environmental scanning and evaluation. And then they attract headquarters’attention to these issues through issue selling, thereby influencing the organizational strategic agenda. However, the attention of top executives at headquarters is recognized to be a scarce and critical resource. This means, on the one hand, issue selling by subsidiary managers contribute to improving the bounded rationality of top executives at headquarters, and prompt them capturing the opportunities and threats in the environment more comprehensively and timely which would improve organizational decision. On the other hand, not all issues could gain attention from top executives at headquarters, and issue selling by subsidiary managers would not always be successful.In this context, how to improve the effectiveness of subsidiary managers’issue selling in business groups is the research focus in the paper. Existing literatures have focus mostly on the willingness and strategies of issue selling. However, few studies have examined the effectiveness of issue selling. If any, the majority have often discussed the different influences of selling strategies. To provide a deeper understanding of issue selling effectiveness, this study used headquarters’attention as the measure of this important variable in line with Dutton and Ashford’s (1993) suggestion. From the attention-based view, this study discusses the key success factors of issue selling by analyzing two complementary processes through which headquarters’attention is shaped.Firstly, there is a top-down process through which headquarters’attention is allocated according to the issue itself. Headquarters executives, as the potential recipients of the issue and decision-makers of the business groups, have their own perceptions of the issue. And they allocate their attention according to these perceptions. In this interaction, issue itself not only carries the content of corporate strategic agenda, but also act as the attention focus of the both parties, Issues present different characteristics in organization, which can be distinguished in terms of benefit and risk, play an important role in this top-down attention process. However, extant studies have not paid much attention to how variation in issue characteristics my draw headquarters’attention. Most research in this stream instead focus on single issues such as gender equality, without taking into account their varying organizational benefit and risk.Secondly, there is a bottom-up process whereby attention is earned according to subsidiary managers’issue selling in business groups. Subsidiary managers, as the initiator of an issue, can also win headquarters’attention through bottom-up selling process. In this process, it is important to select the appropriate selling strategies, which has been more discussed in previous studies. However, top executives at headquarters who are decision-makers have always been in a specific organizational context. Thus, contextual factors must be considered to grab the attention by subsidiary managers in this bottom-up process, which is also the emphasis of the attention-based view. In the field of issue selling, although Dutton et al (2001:730) had called for more research into how sellers learn to determine appropriate timing for action with greater attention to organizational and contextual factors, there has been little research. This study draws on the notion of "policy windows" from the public agenda setting literature, and proposes that different environmental threats help open a window of opportunity for moving different issues onto formal agenda in organization. Thus, we can provide a theoretical guidance for subsidiary managers to determine when and how to sell their issues to top executives at headquarters.In summary, based on the review of issue selling research, we draw on the attention-based perspective to analyze the two processes in terms of top-down and bottom-up through which headquarters’attention is shaped. We attempt to study the effectiveness of subsidiary managers’issue selling by answering the following questions:What are the key characteristics of issues that affect the allocation of headquarters’attention? Why do top executives at headquarters pay attention to these issues but not others? And in which circumstances do top executives at headquarters pay more attention to these rather than other issues, and vice versa? To answer these questions, we propose a conceptual model and related theoretical hypotheses. To test these hypotheses, a hierarchical regression approach has been applied to analyze the data through a questionnaire survey of81headquarters-subsidiary dyads in China. This empirical analysis provides quantitative evidence for related research. The major research contents and conclusions are as follows:(1) We identified two critical characteristics of issues in terms of benefit and risk, and discussed the relationship between these characteristics and headquarters’ attention. First, headquarters’attention is greater when the organizational benefits of the proposed issue are believed high. Second, when the extent of legitimacy and novelty which are the two risk characteristics of an issue is increasing, headquarters’ attention shows an inverted U-shaped curve.(2) The curvilinear relationships between issues’risk characteristics with headquarters’attention are further moderated by two specific categories of environmental threats which are perceived in terms of likely loss and control-reducing. Specifically, threats of likely loss moderate the inverted U-shaped relationship between an issue’s novelty and headquarters’attention such that high perception of threats of likely loss mitigates the decline in headquarters’attention at higher levels of novelty. A similar interpretation is applicable to the moderating role of control-reducing threats to the relationship between an issue’s legitimacy and headquarters’attention.
Keywords/Search Tags:Business group, Subsidiary managers, Issue selling, Effectiveness ofissue selling, Issues’ characteristics, Environmental threats, Headquarters’ attention
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