Inter-Organisational Relations

Question 1

Coase 1937 Nature of the Firm

Answer 1

Firms exist to economise on the cost of coordinating economic activity
Firms are characterised by the obscene of the price mechanism
Transaction costs make it hard to interact with the market

Question 2

Examples of transaction costs

Answer 2

Effort in negotiating, writing enforceable contracts, search costs

Question 3

TC three stage process

Answer 3

Nooteboom (1993)
Contact
Contract
Control

Question 4

Isomorphic pressures that influence Make or Buy Decision

Answer 4

Coercive
Normative
Mimetic
(DiMaggio and Powell 1983)

Question 5

Coercive Isomorphic pressures

Answer 5

Formal and informal

excepted by one organisation onto another

Question 6

Normative isomorphic pressures

Answer 6

values and professional norms

Question 7

Mimetic isomorphic pressures

Answer 7

imitation, conform to best practice

Question 8

Sources of TC

Answer 8

Bounded rationality - brain is limited to the amount of information it can retain and process
Opportunism - taking advantage of bounded rationality, market inefficiencies
Asset specificity - extent to which assets deployed are customised to a particular environment

Question 9

Asset Specificity

Answer 9

Site/Location
Physical Asset
Specific investment
Human asset
Brand name capital
Temporal specificity
How often is it used?

Question 10

Drivers of value webs/hybrid organisations

Answer 10

globalisation
Product life cycles becoming shorter
technological advancements

Question 11

Williamson 1985

Answer 11

three discrete structural governance mechanisms

Market (Buy), Hierarchal (Make), Hybrid