The impact of culture on the relationship between governance and opportunism in outsourcing relationships
Article first published online: 18 AUG 2014
Copyright © 2014 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 36, Issue 9, pages 1412–1434, September 2015
How to Cite
Handley, S. M. and Angst, C. M. (2015), The impact of culture on the relationship between governance and opportunism in outsourcing relationships. Strat. Mgmt. J., 36: 1412–1434. doi: 10.1002/smj.2300
- Issue published online: 15 JUL 2015
- Article first published online: 18 AUG 2014
- Accepted manuscript online: 4 JUN 2014 12:23PM EST
- Manuscript Accepted: 28 MAY 2014
- Manuscript Revised: 27 MAY 2014
- Manuscript Received: 14 MAY 2013
- contractual governance;
- relational governance;
To address concerns of opportunism, outsourcing firms are encouraged to deploy contractual and relational governance. The individual and collective effects of these mechanisms have been previously examined but not in specific contexts. This study examines the effects of contractual and relational governance on provider opportunism, incorporating the moderating influence of a “shift parameter”—national culture. Our results reveal that contractual governance is more effective in individualistic and low uncertainty avoidance cultures. Relational governance is more effective in collectivist and high uncertainty avoidance societies. The individualism–collectivism dimension also moderates the joint effect of these mechanisms. While the mechanisms are generally complementary in mitigating opportunism, a singular focus on either contractual or relational can be just as effective under situations of high individualism and collectivism, respectively. Copyright © 2014 John Wiley & Sons, Ltd.