Price Delegation in Sales Organizations: An Empirical Investigation
نویسندگان
چکیده
The allocation of decision rights is an integral component of designing organizational architecture. Economists have long understood the importance of co-locating decision rights with the knowledge that is valuable to those decisions. Following this prescription, marketing scholars have developed strong theoretical arguments in favor of delegating pricing authority to the sales force. Empirical work, however, reveals a significant number of sales organizations yielding only minimal authority to their salespeople. Given this divergence between theory and practice, we develop and empirically test two mitigating factors that could potentially explain why firms restrict pricing authority. We test our hypotheses on a sample of 222 German sales organizations and find that the data are generally consistent with our conceptualization.
منابع مشابه
Relationship Organization and Price Delegation: An Experimental Study
Price delegation to the sales force is a practice widely adopted by firms. This paper examines the relationship between price delegation and managerial profits using a laboratory economics experiment. A novel feature of our experiment is that we study how varying the relationship organization of the sales manager and salesperson to allow for 1) requests by the salesperson for the manager to cho...
متن کاملG-COE GLOPE II Working Paper Series Subsidization in Mixed Oligopoly with Managerial Delegation: Price Competition
This paper studies optimal production subsidy in a mixed duopoly with separation between ownership and management. Although many existing literature shows that the first best production allocation is achieved under several economic environments (so-called irrelevance result), we find that this result holds in the following two cases. (1) The owners simultaneously/sequentially decide their sales...
متن کاملAn Empirical Investigation of Fluctuations in Manufacturing Sales and Inventory withing a Sticky-Price Framework
T he macroeconomics literature has recently witnessed a resurgence of interest in issues related to nominal price rigidities. In particular, advances in computational methods have allowed for the analysis of fully articulated quantitative general equilibrium models with inflexible prices.1 Because nominal price rigidities create predictable variations in sales, these models provide a natural se...
متن کاملHow Word-of-mouth Moderates Room Price and Hotel Stars for Online Hotel Booking an Empirical Investigation with Expedia Data
Information cues about products influence consumer purchase decisions. Online review can enhance communication among consumers while affecting consumer perception by increasing awareness and reducing uncertainty. However, little is known on how Word-of-Mouth (WOM) and information cues interact, especially on experience goods like hotel rooms. To bridge this gap, we analyze data collected from E...
متن کاملAn Empirical Investigation of the Relation between Corporate Sustainability Performance (CSP) and Corporate Value: Evidence from Iran
This study provides an empirical evidence on how Corporate Sustainability Performance (CSP), is reflected in the corporate value. Using a theoretical framework combining Legitimacy theory, Stakeholder theory and Agency theory, a set of hypotheses that relate the corporate value to CSP is examined. For a sample of Iranian firms, 28 components with four dimensions as Community, Environment, Emplo...
متن کامل