• Title/Summary/Keyword: Firm failure

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Differential Effects of Recovery Efforts on Products Attitudes (제품태도에 대한 회복노력의 차별적 효과)

  • Kim, Cheon-GIl;Choi, Jung-Mi
    • Journal of Global Scholars of Marketing Science
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    • v.18 no.1
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    • pp.33-58
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    • 2008
  • Previous research has presupposed that the evaluation of consumer who received any recovery after experiencing product failure should be better than the evaluation of consumer who did not receive any recovery. The major purposes of this article are to examine impacts of product defect failures rather than service failures, and to explore effects of recovery on postrecovery product attitudes. First, this article deals with the occurrence of severe and unsevere failure and corresponding service recovery toward tangible products rather than intangible services. Contrary to intangible services, purchase and usage are separable for tangible products. This difference makes it clear that executing an recovery strategy toward tangible products is not plausible right after consumers find out product failures. The consumers may think about backgrounds and causes for the unpleasant events during the time gap between product failure and recovery. The deliberation may dilutes positive effects of recovery efforts. The recovery strategies which are provided to consumers experiencing product failures can be classified into three types. A recovery strategy can be implemented to provide consumers with a new product replacing the old defective product, a complimentary product for free, a discount at the time of the failure incident, or a coupon that can be used on the next visit. This strategy is defined as "a rewarding effort." Meanwhile a product failure may arise in exchange for its benefit. Then the product provider can suggest a detail explanation that the defect is hard to escape since it relates highly to the specific advantage to the product. The strategy may be called as "a strengthening effort." Another possible strategy is to recover negative attitude toward own brand by giving prominence to the disadvantages of a competing brand rather than the advantages of its own brand. The strategy is reflected as "a weakening effort." This paper emphasizes that, in order to confirm its effectiveness, a recovery strategy should be compared to being nothing done in response to the product failure. So the three types of recovery efforts is discussed in comparison to the situation involving no recovery effort. The strengthening strategy is to claim high relatedness of the product failure with another advantage, and expects the two-sidedness to ease consumers' complaints. The weakening strategy is to emphasize non-aversiveness of product failure, even if consumers choose another competitive brand. The two strategies can be effective in restoring to the original state, by providing plausible motives to accept the condition of product failure or by informing consumers of non-responsibility in the failure case. However the two may be less effective strategies than the rewarding strategy, since it tries to take care of the rehabilitation needs of consumers. Especially, the relative effect between the strengthening effort and the weakening effort may differ in terms of the severity of the product failure. A consumer who realizes a highly severe failure is likely to attach importance to the property which caused the failure. This implies that the strengthening effort would be less effective under the condition of high product severity. Meanwhile, the failing property is not diagnostic information in the condition of low failure severity. Consumers would not pay attention to non-diagnostic information, and with which they are not likely to change their attitudes. This implies that the strengthening effort would be more effective under the condition of low product severity. A 2 (product failure severity: high or low) X 4 (recovery strategies: rewarding, strengthening, weakening, or doing nothing) between-subjects design was employed. The particular levels of product failure severity and the types of recovery strategies were determined after a series of expert interviews. The dependent variable was product attitude after the recovery effort was provided. Subjects were 284 consumers who had an experience of cosmetics. Subjects were first given a product failure scenario and were asked to rate the comprehensibility of the failure scenario, the probability of raising complaints against the failure, and the subjective severity of the failure. After a recovery scenario was presented, its comprehensibility and overall evaluation were measured. The subjects assigned to the condition of no recovery effort were exposed to a short news article on the cosmetic industry. Next, subjects answered filler questions: 42 items of the need for cognitive closure and 16 items of need-to-evaluate. In the succeeding page a subject's product attitude was measured on an five-item, six-point scale, and a subject's repurchase intention on an three-item, six-point scale. After demographic variables of age and sex were asked, ten items of the subject's objective knowledge was checked. The results showed that the subjects formed more favorable evaluations after receiving rewarding efforts than after receiving either strengthening or weakening efforts. This is consistent with Hoffman, Kelley, and Rotalsky (1995) in that a tangible service recovery could be more effective that intangible efforts. Strengthening and weakening efforts also were effective compared to no recovery effort. So we found that generally any recovery increased products attitudes. The results hint us that a recovery strategy such as strengthening or weakening efforts, although it does not contain a specific reward, may have an effect on consumers experiencing severe unsatisfaction and strong complaint. Meanwhile, strengthening and weakening efforts were not expected to increase product attitudes under the condition of low severity of product failure. We can conclude that only a physical recovery effort may be recognized favorably as a firm's willingness to recover its fault by consumers experiencing low involvements. Results of the present experiment are explained in terms of the attribution theory. This article has a limitation that it utilized fictitious scenarios. Future research deserves to test a realistic effect of recovery for actual consumers. Recovery involves a direct, firsthand experience of ex-users. Recovery does not apply to non-users. The experience of receiving recovery efforts can be relatively more salient and accessible for the ex-users than for non-users. A recovery effort might be more likely to improve product attitude for the ex-users than for non-users. Also the present experiment did not include consumers who did not have an experience of the products and who did not perceive the occurrence of product failure. For the non-users and the ignorant consumers, the recovery efforts might lead to decreased product attitude and purchase intention. This is because the recovery trials may give an opportunity for them to notice the product failure.

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서비스실패에 대한 귀인지각과 서비스복구노력에 대한 공정성지각이 고객만족에 미치는 영향 - 복합엔터테인먼트 쇼핑몰을 중심으로 -

  • Kim, Jin-Gu;An, Gil-Sang
    • Proceedings of the Korean DIstribution Association Conference
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    • 2006.02a
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    • pp.187-227
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    • 2006
  • To attain competitiveness in the severe competition of retailing, retailing firm like Aekyung department store composites multiplex entertainment shopping mall with other firms as key tenants like LG supermarket, Books Libro, and CGV. But in multiplex entertainment shopping mall customers who have experienced a service failure in key tenant's shops usually ask a compensation of service failure to the lessor like department store. Even though customers of multiplex entertainment shopping mall know that key tenants use different service strategy, personnel management system and operation system and so on, they do not rare of it. Why they do that? How can we explain this situation? This study explains customer's complaining behaviors in multiplex entertainment shopping mall using attribution theory and justice theory. The study presents a comprehensive model about the effects of the perceived attribution and fairness on customer satisfaction and suggests practical implications for retailing firms composing multiplex entertainment shopping mall.

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A Study on the Regression Models of Success and Failure of Tenders for Plant and Construction Exports (플랜트 및 건설수출 입찰의 성공 및 실패모델에 관한 연구)

  • You, Kyou-Yeol
    • Journal of the military operations research society of Korea
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    • v.29 no.1
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    • pp.88-111
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    • 2003
  • This paper is to suggest strategic options for improving the export performance of the plant and construction industry. The overall objective of this study is to explore the feasibility of a sustained export performance in the plant and overseas construction industry by an analysis of its international competitiveness and technological competence. The empirical work of this study relates to a chosen sample of Korean and non-Korean firms in the plant and construction industry sector. Primary data was collected through a comprehensive questionnaire survey administered to plant and construction firms in twelve countries, including Korea. The actual number of firms for which full information at a sufficient level of disaggregation was obtained was 62, a response rate of 44.6%. Of these, 42 firms were drawn from Korean plant and construction firms and the remaining 20 firms from 11 other countries. The structure of responding firms by industry shows a total of 29 plant exporters and 33 construction firms. Data analysis was carried out using SPSS statistical technique such as Multiple Regression in order to examine the linear relationship among variables. The findings of the study indicate that export success and failure in plant and construction export markets is determined by firm size and by various qualitative variables. The high export volume (export success) of Plant and construction exporters is more strongly influenced by mutual economic cooperation and number of employees than by sales volume and competent knowledge of the plant and construction markets. It was also found that weak political and diplomatic relation between countries, low sales volume and lack of bid experience have an adverse effect and represent serious barriers to exports.

The failure case of the knowledge transfer in an international joint venture : focusing on car engine control system (국제 합작회사의 지식이전 실패사례 연구: 자동차 엔진제어시스템 기술을 중심으로)

  • Yoo, Hyeongjune;Ahn, Joon Mo
    • Journal of Technology Innovation
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    • v.29 no.2
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    • pp.1-30
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    • 2021
  • Recent years have witnessed various attempts of firms to acquire new knowledge. Purchasing intellectual property or merger and acquisition (M&A) can be such attempts, but joint venture can also be an effective way internalizing new complementary assets from external partners. However, due to difficulties in the formation and implementation of learning strategies, many joint ventures have failed to acquire necessary knowledge. In this respect, based on contingency theory and dynamic capability, the current research aims to investigate the failure case of knowledge transfer in an international joint venture - KEFICO established by Hyundai motors and BOSCH. Case firm optimized for hardware technology but did not establish a differentiated learning strategy and organizational structure to acquire software skills, which are intellectuals of different natures. Due to this inconsistency, it was not able for KEFICO to absorb new type of knowledge (skills related to engine control system). This study suggests the theoretical framework illustrating the case and provides some important implications for organizational learning.

Development of Technological Innovation System in an Emerging Economy - A Study of the Malaysian Biodiesel Innovation System -

  • H., Maziar;Avvari, Mohan V.
    • Asian Journal of Innovation and Policy
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    • v.1 no.2
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    • pp.168-199
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    • 2012
  • Studies on innovation point towards the need for both in-house research and development (R&D) capabilities along with collaborations with external organisations or linkages with other firms, universities and research institutes. The argument is that innovation is not just a firm specific factor but requires support from several other factors which in turn involves developing linkages with various actors/institutions as sources of resources and/or knowledge for innovation. This paper presents findings from an exploratory study about the Malaysian biofuel sector as an innovation system. Instead of using the neo-classical approach and proposing policy interventions based on traditional market failure rationale (Bergek et al., 2008a), the functional analysis of the technological innovation systems (TIS) approach is used to analyse the biofuel sector in Malaysia to help reveal the strengths and weaknesses in terms of its fulfillment of seven critical functions which are necessary for the generation and commercialization of a product. In addition an attempt is made to reveal the inducement and blocking mechanisms affecting the Malaysian biofuel TIS and the seeking of improved poor functionality. These functional aspects of the Malaysian biofuel sector are analysed in different phases of its development to gain an understanding of the different institutions and their functions at different phases of the development of the innovation system.

Development of new MCFC application products (MCFC 전략제품 개발)

  • Hwang, Jung Tae
    • 한국신재생에너지학회:학술대회논문집
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    • 2010.06a
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    • pp.129.1-129.1
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    • 2010
  • Since the commencement of the fuel cell business in 2007, POSCO POWER has been the major supplier of the MCFC (Molten Carbonate Fuel Cell), which is the most commercialized stationary fuel cell system in the world. With its quite, yet active movement, more than 20MW MCFC systems have been installed and are operating in Korea. While trying to localize the components and set up a firm supply chain in Korea to provide more reliable and cost-competitive products to its customers, POSCO POWER is also devoting itself to developing new MCFC application products. One such product is a back-up power system, in which a back-up algorithm is embedded to the present system so that the product can work as a back-up generator in case of grid failure. The technology to enhance load following capability of a stack module is also being developed with the back-up algorithm. Another example is a building application, the goal being to make the present Sub-MW product suitable for urban area. For this, downsizing and modularization are the main R&D scope. The project for developing ship service fuel cell for APU application will launch soon as well. In the project, a system which can operate in marine environment, and reforming technology for liquid logistic fuel will be developed.

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Surgical Treatment of Acute Necrotizing Klebsiella Pneumonia -Two cases report- (급성 괴사성 클렙시엘라 폐렴의 외과적 치료 -2례 보고-)

  • 류경민;김삼현;박성식;류재욱;최창휴;박재석;서필원
    • Journal of Chest Surgery
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    • v.32 no.5
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    • pp.484-488
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    • 1999
  • Massive lung gangrene is a rare but very rapidly progressing fatal complication of lobar pneumonia. Etiologic agents are Klebsiella pneumoniae, Pneumococcus and Aspergillus, etc. Chest X-ray shows firm consolidation of the involved pulmonary lobe and bulging fissure due to the volume expansion of involved lung. CT-scan shows extensive lung parenchymal destructions with multiple small cavitary lesions. Recommended treatment is the early surgical intervention combined with antibiotics. Without surgical intervention, lung gangrene is known to progress toward sepsis, multiorgan failure, and high mortality. We report two cases of rapidly progressing massive lung gangrene by Klebsiella pneumonia treated by the resectional surgery.

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Contractors' Perception towards Safety and its Consequences on Construction Workers in Cape Coast Metropolis

  • Mustapha, Zakari
    • The Korean Journal of Food & Health Convergence
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    • v.5 no.6
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    • pp.11-16
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    • 2019
  • The construction environment has been declared as a hazard prone area due to high number of accident and death. The study aims to identify influential factors that contribute to poor safety practices and its consequences on construction workers in Cape Coast Metropolis. Seventy respondents were taken as the sample size for the study. Descriptive analysis was used to analyze the data obtained from the field. Findings show that poor site management, working without safety gadgets, failure to use their Personal Protective Equipment (PPE) and negligence of workers were the main causes of accidents on sites. Poor site management had the highest ranking among the seven variables. Effects of poor safety practices on building construction site and delays in work execution were due to injury of workers, extra cost due to payment of compensation to injured victims, not motivated due to injury of worker and declined reputation of firm. Management team should motivate workers for safe work done, provide adequate PPE for their workers on site and have documented health and safety policy on site. Site authorities and management team should be on site regularly to ensure proper safety practices on construction site.

Board Structure and Likelihood of Financial Distress: An Emerging Asian Market Perspective

  • UD-DIN, Shahab;KHAN, Muhammad Yar;JAVEED, Anam;PHAM, Ha
    • The Journal of Asian Finance, Economics and Business
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    • v.7 no.11
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    • pp.241-250
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    • 2020
  • This study examines the relationship between the attributes of board structure and the likelihood of financial distress for the non-financial sector of an emerging market characterized by concentrated ownership and family-controlled business. The present study utilized panel logistic regression to estimate the relationship between board structure attributes and the likelihood of financial distress. We used Altman Z-Score as a proxy for firm financial distress, as this tool measures the financial distress inversely. The study finds a significant relationship between board size and the likelihood of financial distress. The results show that a one-unit increase in board size would decrease the probability of financial distress by 3.4%. Further, we observe that a greater level of board independence is associated with a lower likelihood of financial distress. A one-unit increase in board independence would decrease the probability of financial distress by 20.4%. We also find a significant positive impact of leverage on the likelihood of financial distress. The present study contributes to the body of literature on board structure attributes and likelihood of financial distress in emerging markets, like Pakistan. Furthermore, the findings would be beneficial for corporate policymakers and investors in formulating corporate financial strategy and predicting business failure.

An Exploratory Study of Longewity of Strategic Alliances : Effects of Partner Firm's Nationality and Environmental Volatility (기업의 국가문화와 산업 환경 변수가 전략적 제휴의 존속에 미치는 엉망에 관한 실증연구)

  • Kim, Joong-Wha
    • Korean Business Review
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    • v.14
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    • pp.45-62
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    • 2001
  • This study examines the factors that affect longevity of strategic alliances, highlighting environmental volatility, nationality, and previous experience with strategic alliances. In general, successful strategic alliances are more likely to continue to exist than unsuccessful ones. Therefore, it is argued that studying on factors affecting the continuance of strategic alliances indirectly confirms the factors of success and failure in strategic alliances. In order to conduct this study, the needed data were collected from CATI(Cooperative Agreements and Technology Indicators) Data Base, which was gathered by a group of researchers in the University of Limburg in the Netherlands. Cox's Regression was used to analyze the data. Implications for research and practice are discussed.

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