Moderating and contextual effects of trust mechanisms on interorganizational co-opetition strategy: Using CPA partnership firms as examples
Date Issued
2008
Date
2008
Author(s)
Huang, Hao-Chen
Abstract
In complex and uncertain competitive environments, organizations usually employ both aggressive and collaborative strategies that develop into a state of competitive interaction. This is not only beneficial to promoting higher managing efficiency but also helpful in increasing profit. This research models after small and medium-sized accounting firms whose market structure is categorized as monopolistic. With extreme expertise heterogeneity on non-audit services, small and medium-sized accounting firms must sometimes cooperate with one another to retain market share when competing with international firms and local tax agents. This research will closely examine the “co-opetitional” strategies among the small and medium-sized firms. Moreover, since the collaborations among firms are seldom regulated by contract, simple trust usually becomes the deciding factor for alliance. This research intends to explore: a) how trust among individuals and/or organizations affects the co-opetitional relationship, b) what role trust mechanism takes in conducting cross-organizational co-opetition, and c) how co-opetition affects organizational performance. This research employs questionnaire for data collection and the questionnaire is filled out by accountants registered to the Taiwan CPA Association. In regard to empirical analysis, this research utilizes several methods for evaluation: 1) structural equation modeling, SEM; 2) hierarchical linear modeling, HLM; 3) mediated moderation model; 4) polynomial regression models; and 5) ANOVA. This research first examines the hypothetical model with LISREL to test for goodness-of-fit. Then OLS regression model is applied to test the moderating model and the significance of the trust mechanism. To raise the validity of the results, polynomial regression is employed to further assess the moderating effect and the result is presented with a 3-D moderating effects plot graph. Finally, ANOVA is applied for analysis on co-opetitonal strategy’s effects on organizational performance.he results of analysis clearly indicate that: (1) a positive relationship between resource heterogeneity and price competitive action; (2) a positive relationship between resource heterogeneity and non-price competitive action; (3) a positive relationship between resource complementarity and joint action; (4) a positive relationship between joint action and organizational performance; (5) the relationship between resource heterogeneity and price competitive action is weaker when organizations exist interpersonal trust; (6) the relationship between resource heterogeneity and non-price competitive action is weaker when organizations exist interpersonal trust; (7) the relationship between resource complementarity and joint action is stronger when organizations exist interpersonal trust; (8) the relationship between resource heterogeneity and price competitive action is weaker when organizations exist interorganizational trust; (9) the relationship between resource heterogeneity and non-price competitive action is weaker when organizations exist interorganizational trust; (10) a positive relationship between interorganizational trust and joint action; (11) a negative relationship between interorganizational trust and price competitive action; and (12) a negative relationship between interorganizational trust and non-price competitive action. In the last part of this research, a matrix demonstrating the relationship between resource characteristics and co-opetition strategy is constructed to form strategic implications and practical applications. In addition to evidence from the empirical studies, this research also incorporates case studies as complementary supports. Four distinctive case studies are included to demonstrate the interaction and selections in co-opetition strategies, and the findings are termed “Co-opetitional Model for Accountants.” Several practical implications can be drawn from this investigation. This study develops the co-opetitional model for accountants. Also, this study shows the matrix relationship between resource and co-opetition strategy. Finally, the findings from this study and their implications are discussed.
Subjects
Resource-based view
resource-dependency view
trust
co-opetition
CPA firm
mediated moderation
Type
thesis
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