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Unformatted text preview: rgue, is the GDP of a country.
Vida and Fairhurst (1998) propose a conceptual framework for retail internationalisation.
The framework depicted in Figure 5 postulates that the interphase between the firm’s
external environment, the firm’s characteristics and decision -maker characteristics
(antecedents) serve as promoters or inhibitors to whether or not it will internationalise,
and the extent of such internationalisation (process). Such a process leads to decisions
on resource allocation and mode of entry (outcomes). 24 Figure 5: A model of factors influencing the retail internationalisation process ANTECEDENT PROCESS OUTCOMES EXTERNAL ENVIRONMENT Market characteristics
Foreign market idiosyncrasies;
socio-cultural, legal, political, economic PROPROMOTORS/
Alternatives DECISION-MAKER CHARACTERISTICS Knowledge Experience Perceptions/attitude INITIATE INTERNATINAL RETAIL
MAINTAIN A CONSTANT LEVEL
OF INTERNATIONAL RETAIL
INVOLVEMENT FIRM CHARACTERISTICS Resource commitment Differential advantages INCREASE THE LEVEL OF
INVOLVEMENT DECREASE THE LEVEL OF
INVOVOLVEMENT MODE MARKET Retail Management
Considerations DISCONTINUE INTERNATIONAL
Operations Source: Vida and Fairhurst (1998) Arnold and Luthra (2000) examine the effects of the entry of a large retailer, Wal-Mart,
into a small market, weighing the costs and benefits of such an entry to local
communities. Wal-Mart’s influence on retail sales levels in local communities has been
analysed by Davidson and Rummel (2000) and commented on by Stiglitz (2006). Other
studies on Wal-Mart include the analysis of its entry into, and effect on, the UK market
(Whysall, 2001; Arnold & Fernie, 2000; Uusitalo & Rokman, 2004), the effects on local
labour markets (Neumark, Zhang and Ciccarella, 2008) and the effects on consumers
(Arnold, Handelman, Tigert, 1998). Research covering the histories of other individual
firms also exists (Uusitalo and Rokman, 2004). 25 2.3 Stakeholder Management
In the words of ‘the father of modern stakeholder theory’, Freeman, stakeholder theory
seek to address the problems of “…understanding and managing a business in the
world of the twenty first century (the problem of value creation and trade); and putting
together thinking about questions of ethics, responsibility, and sustainability with the
usual economic view of capitalism (the problem of ethics capitalism) …” (Freeman,
Harrison, Wicks, Parmar, & Colle, 2010, p.28).
Organising literature and integrating methodological trends on stakeholder theory to
achieve a convergent theory has been identified as a particular challenge (Friedman &
Miles, 2002). Stakeholder literature has primarily been concerned with defining the
stakeholder concept and classifying stakeholders into categories on the basis of the
nature of the relationships (Rowley, 1997). The stakeholder theory of a firm should
determine how the firm will operate under various conditions (Brenner & Cochran, cited
in Rowley, 1997). Before examining literature on stakeholder management and retail
internationalisation, various permutations of the stakeholder theory are explored.
2.3.1 Evolution of Stakeholder Theory in Management
Stakeholder management has become an important part of management literature and
practice today (Cooperrider & Fry, 2010; Freeman, 2010; Reed, Graves, Dandy,
Posthumus, Hubacek, Morris, Prell, Quinn & Stringer, 2009; Freedman & Miles, 2002;
Elias & Cavana, 2000). Tracking the origins of the concept of “stakeholder” has proved
elusive and sometimes controversial.
Freeman’s (1984) account of the concept as originating from the 1960s at the Stanford
Research Institute (now SRI International Inc.) has been widely recognised in literature
(Elias & Cavana, 2000). However, later research shows that even though SRI
26 researchers contributed immensely to bringing the concept into corporate planning in the
early sixties, the intellectual history of the concept and the main ideas of stakeholder
theory is much richer than Freeman’s (1984) original account (Freeman et al, 2010;
In Stakeholder Theory: the State of the Art, Freeman et al (2010) demonstrate
remarkable fidelity to this intellectual heritage in what constitutes an update of
Freeman’s earlier work. In it they acknowledges that a more in-depth research into the
history of the concept was undertaken by Slinger in an unpublished doctoral thesis, in
which, amongst other things, a connection is made between the stakeholder idea and
human relations. They further acknowledges that the concept also evolved in other parts
of the world, notably Scandinavia, years before the SRI adopted it.
Schilling (2000) argues for the recognition of Marry Parker Follett’s contribution to
stakeholder theory, citing Parker’s 1918 work, The New State, in which she calls upon
people to recognise their interconnectedness to...
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This document was uploaded on 01/24/2014.
- Winter '14