Kenneth H. Wathne wins international award

28 January 2008

Professor Kenneth H. Wathne from BI Norwegian School of Management has won the 2008 Louis W. Stern Award.

This is an international research prize for research into opportunistic behaviour among companies that collaborate with each other.

It is far from every day that Norwegian researchers achieve the feat of getting into print in the Journal of Marketing, which is reckoned to be the foremost and most prestigious publication for the study of marketing.

BI professor Kenneth H. Wathne has not only managed to pass through the eye of the needle, he has also won a highly esteemed research prize, the 2008 Louis W. Stern Award, which is given for an outstanding article which has had a great impact in the research literature on marketing and distribution channels.

The articles under consideration by the jury must have been published in an international professional journal at least three years and maximum of eight years ago. The prize will be awarded during the American Marketing Association Winter Conference, which will be held on 15-17 February 2008 in Austin, Texas.

Wathne has won the 2008 Louis W. Stern Award for an article he published together with Jan B. Heide in the Journal of Marketing in October 2000, which looks at opportunistic behaviour in inter-firm relationships.

Active and passive opportunism

In this article, the authors present a totally new analysis of what opportunistic behaviour is, being one of the most widespread concepts in research into collaborative relationships in business. Companies are driven by economic self-interest, and may therefore behave opportunistically in relation to one another.

Kenneth H. Wathne and Jan B. Heide from the University of Wisconsin-Madison identify two main types of opportunistic behaviour: passive and active.

An example of passive opportunism is a situation in which a franchise dealer fails to comply with the franchise giver’s quality requirements (for example, with regard to hygiene) in order to save money.

Active opportunism may manifest itself as a dealer breaking a distribution contract which forbids him from selling in a particular geographical area.

Active or passive opportunism may take different forms depending on whether the opportunism occurs under new or existing circumstances.

Strategies to counteract opportunism

Wathne and Heide use two dimensions (active/passive and new/existing circumstances) to describe four different types of opportunistic behaviour.

The researchers take this as the starting point for developing four different strategies that companies can use to control active and passive opportunistic behaviour in relation to the partners with whom they collaborate.

“However in some cases,” maintains Wathne, “it can be more effective for companies working together to tolerate a certain amount of opportunism rather than try to eliminate it completely.”

Impressive work

In giving the reasons for its decision, the jury considering the candidates for the 2008 Louis W. Stern Award said that they had been impressed by the originality of the work and by the great influence it had had on the literature on collaborating relationships between companies.

The jury maintained that the article had forced both researchers and practitioners to rethink completely what opportunism is. They also emphasised that Wathne and Heide gave clear illustrations of how opportunism occurs, as well as making various suggestions on how to deal with the different types that may be encountered.

The prize jury consisted of Shankar Ganesan from the University of Arizona, Yunchuan Frank Liu from the University of Illinois at Urbana-Champaign, and Aric Rindfleisch from the University of Wisconsin-Madison.

Reference:
Kenneth H. Wathne and Jan B. Heide (2000): "Opportunism in Inter-firm
Relationships: Forms, Outcomes, and Solutions," Journal of Marketing, Vol. 64, No. 4 (October 2000).

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