Business Transformation and Innovation Management
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- Beschaffung (1)
- Case Research (1)
- China (1)
- Directed Sourcing (1)
- Eskalation (1)
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- Information load (1)
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This study analyzes how information influences decision making in escalation of situations. In those situations decision makers follow a losing course of action and invest further resources even when accounting information indicates that the project is performing poorly and should be discontinued. We conducted two experiments with Chinese participants and used a replication of Staw's (1976) often cited case. Our study investigates how different levels of information load influence escalation of commitment of Chinese participants. Contrary to the prior findings in Germany, we find that Chinese decision makers do not escalate when facing different levels of information load. These results, in light of prior studies that find a comparatively strong escalation tendency of Chinese decision makers, are explained along with the limitations and further research. Abstract This study analyzes how information influences decision making in escalation of situations. In those situations decision makers follow a losing course of action and invest further resources even when accounting information indicates that the project is performing poorly and should be discontinued. We conducted two experiments with Chinese participants and used a replication of Staw's (1976) often cited case. Our study investigates how different levels of information load influence escalation of commitment of Chinese participants. Contrary to the prior findings in Germany, we find that Chinese decision makers do not escalate when facing different levels of information load. These results, in light of prior studies that find a comparatively strong escalation tendency of Chinese decision makers, are explained along with limitations and further research.
Firms experience that an increasingly complex supply base is a costly investment. In order
to keep specialized suppliers but to reduce the effort of managing it, OEMs contract
second-tier firms and direct them to first-tier suppliers. We conduct four embedded case
studies in the international automotive industry to record types and possible motivations
of directed sourcing. Our findings show that directed sourcing triads may be set up to
achieve operational efficiencies but also for strategic reasons such as to gain access to
foreign markets. This research contributes to literature on triadic supply chains in general
and network buyer-supplier relationships specifically.