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Advances in Marketing Proceedings of the Annual Meeting of the ASSOCIATION OF COLLEGIATE MARKETING EDUCATORS Dallas, Texas March 1-5, 2005 Edited by: Timothy C. Johnston The University of Tennessee at Martin Copyright 2005 © Association of Collegiate Marketing Educators. All rights reserved. No part of this publication or compilation may be reproduced, stored in retrieval systems, or transmitted in any form or by any means electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. All correspondence concerning purchase of copies of this CD, any portion of its contents or copyright release should be addressed to: Timothy C. Johnston The University of Tennessee at Martin 554 University Street, Room 218 Martin, TN 38238 (731) 881-7354 [email protected] Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) MESSAGE FROM THE CONFERENCE PROGRAM CHAIR It gives me great pleasure to welcome all the participants to the 2005 Association of Collegiate Marketing Educators (ACME) Conference being held in Dallas, TX. I would also like to welcome you not only on behalf of the ACME but also the Federation of Business Disciplines (FBD) of which ACME is a small but significant part. You and all the participants have helped in making the conference a wonderful place of learning marketing related issues by way of sharing your knowledge and experience with participants with diverse backgrounds. This conference would not have been such a success if it were not for the wonderful and hardworking team of track chairs. They are the ones who played an active role in the solicitation of quality papers, having the papers reviewed in a timely manner, as well as the recruitment of several presenters for special sessions. Regarding the recruitment of presenters, the special session chairs Nancy Miller and Carolyn Tripp have established absolutely fabulous research and education related workshops respectively. The ACME will provide certificates of participation to all attendees of these sessions. I can confidently state that these sessions will go a long way in enhancing the skills of current and future marketing educators. The ACME is also fortunate to have Tim Johnston as the Proceedings Editor of this year’s conference proceedings. His patience and generosity in extending the submission deadline to several participants helped presenters get a publication which no doubt will be of value in their professional careers. His tireless work in coming out with a high quality proceedings speaks for it self. Another group of individuals which played a key role in the success of the conference are the officers of the ACME. They all have played a key role in helping me in the conference sessions organizing process as well as in recruiting several key experts in the field of marketing. I am particularly thankful to the past ACME Presidents Nancy Miller, Bert Kellerman, and Peter Gordon who came to my rescue in time of needed special presenters. In a nutshell, there are several people such as the participants, track chairs, and officers who really deserve the credit for making this a successful conference. I would like take this opportunity to encourage the faculty participants to get students involved in paper presentations and participation at future ACME conferences. This organization embraced me when I was a student and it has helped me tremendously in my professional career as well as in becoming a part of a wonderful circle of friends. I believe it will do the same for your students as well. I look forward to interacting with you all during this as well as future ACME and FBD conferences. Thank you everyone for a job well done! Ashish Chandra 2005 ACME Program Chair Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) MESSAGE FROM THE PROCEEDINGS EDITOR Advances in Marketing: Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators was made possible by the efforts of many authors, track chairs, workshop coordinators, reviewers and the leadership of ACME. I thank them for their service to the profession. A special thanks goes to Ashish Chandra for organizing the March, 2005 conference program in Dallas that yielded this fine collection of 43 papers and abstracts. Thanks also to The University of Tennessee at Martin and Marshall University for administrative support. Timothy C. Johnston 2005 Editor, Advances in Marketing Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) 2004 - 2005 OFFICERS President Craig A. Conrad, Western Illinois University Program Chair Ashish Chandra, Marshall University Vice President David P. Paul, III, Monmouth University Secretary Kimball P. Marshall, Alcorn State University Treasurer Maxwell Hsu, University of Wisconsin-Whitewater Past President Nancy D. Albers-Miller, Berry College 2004 - 2005 PROGRAM LEADERSHIP TEAM Advertising & Promotion Gordon Mosley, Troy State University Business to Business & Industrial Marketing Geoffery Stewart, University of Louisiana-Lafayette Consumer Behavior Jill K. Maher, Robert Morris University Kishwar Joonas, Prairie View A&M University Electronic Commerce James L. Thomas, Jacksonville State University Entrepreneurship David K. Amponsah, Troy State University Healthcare Marketing Madhu Agrawal, St. John’s University International/Cross-Cultural Peter J. Gordon, Southeast Missouri State University Marketing Education Patrick D. Fountain, East Central University Marketing Research Dennis Emmett, Marshall University Marketing Strategy Eric G. Harris, University of South Florida Public Policy and Ethics Bert J. Kellerman, Southeast Missouri State University Retailing & Services Marketing Ruth Lesher Taylor, Southwest Texas State University Selling and Sales Management Rajesh Srivastava, University of Louisiana-Lafayette Student Track Caroline M. Fisher, Loyola University-New Orleans Jianwei Hou, University of Mississippi Special Program Chair – Educator’s Workshops Carolyn Tripp, Western Illinois University Special Program Chair – Research Workshops Nancy D. Albers-Miller, Berry College Proceedings Editor Timothy Johnston, The University of Tennessee at Martin Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) ACME 2005 Paper Reviewers David Amponsah Troy University Tom Smith Texas Wesleyan University Gwen Fontenot University of Louisiana - Lafayette Geoffrey Stewart University of Louisiana - Lafayette Rajesh Srivastava, Ph.D. University of Louisiana - Lafayette Ashish Chandra Marshall University Norman Schnurr Robert Morris University John Clark Robert Morris University Alan Smith Robert Morris University Kurt Schimmel Robert Morris University Jeanne Hill Prairie View A&M University Shahid Bhuian Louisiana Tech University Kishwar Joonas Prairie View A&M University Theresa Flaherty James Madison University Eric Karson Villanova University Lawrence Marks Kent State University Kenneth Heischmidt Southeast Missouri State University Peter Gordon Southeast Missouri State University Willie Redmond Southeast Missouri State University John Cherry Southeast Missouri State University Bert Kellerman Southeast Missouri State University Dennis Emmett Marshall University Jack Walters University of South Florida James Lee University of Tampa Anne Keaty University of Louisiana - Lafayette Chinna Natesan, Ph.D. Texas State University Jack Eure Texas State University Gail Zank Texas State University Lucy Henke University of Louisiana - Lafayette Kate Lawrence Loyola University New Orleans John Barnes SUNY Institute of Technology Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) Award-winning papers Recipients of the 2005 McGraw-Hill/Irwin Distinguished Paper Award Sarath A. Nonis, Arkansas State University Melodie Philhours, Arkansas State University Gail I. Hudson, Arkansas State University Recipient of the 2005 Prentice Hall Outstanding Educator Award Bert J. Kellerman, Southeast Missouri State University Recipients of the 2005 O. C. Ferrell Award Nancy D. Albers-Miller, Berry College Caitlyn A. Miller, Rome GA “Best of Track” Paper Award Winners Advertising & Promotion Track: Sylvia A. Miller, Cameron University M. Suzanne Clinton, Cameron University John Camey, University of Central Oklahoma Consumer Behavior Track: Henry B. Dunn, Stephen F Austin State University Charlotte Allen, Stephen F Austin State University International/Cross Cultural Track: Albert J Milhomme, Texas State University at San Marcos Marketing Strategy Track: Prashant Srivastava, Oklahoma State University Gary L. Frankwick, Oklahoma State University Selling and Sales Management: Thomas W. Lanis, East Central University Patrick D. Fountain, East Central University Karla Peterson, East Central University Best Student Paper: My Bui, Loyola University New Orleans Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) Table of Contents PRESCRIPTION DRUGS FROM CANADA: WHY ARE THEY CHEAPER? Madhu Agrawal, St. John’s University . . . . . Page 1 ADULT ROLE MODEL PORTRAYAL IN ADVERTISEMENTS DIRECTED TOWARD CHILDREN: THE GRIM, THE BAD AND THE UGLY Nancy D. Albers-Miller, Berry College Caitlyn A. Miller, Rome, Georgia . . . . . Page 2 USING FEDERAL INTERNATIONAL INFORMATION ENHANCED MARKETING COURSES IN THE REAL WORLD Karin Cuda Baker – Zachry Construction Company Ruth Lesher Taylor - Texas State University . . . . . Page 17 ENVIRONMENTAL MARKETING: A MODEL OF CONSUMER BEHAVIOR My H. Bui, Loyola University New Orleans . . . . . Page 20 EVALUATING CONSUMER’S CONCERNS REGARDING THE WAY THEIR PATIENT RECORDS ARE MAINTAINED Brenda Reagan Bundy, Marshall University Ashish Chandra, Marshall University . . . . . Page 29 PREPARING FOR PRIVACY: A MODULE FOR MARKETING EDUCATORS IN AN ERA OF ELECTRONIC COMMERCE E. Vincent Carter, Oakland University Rajni Goel, Howard University . . . . . Page 34 HEALTH CARE MARKETING AFTER SEPTEMBER 11, 2001 Tony Carter, William Paterson University . . . . . Page 60 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) THE VALUES FRAMEWORK: CORE VALUES AND CULTURE John Cherry, Southeast Missouri State University Peter J. Gordon, Southeast Missouri State University . . . . . Page 64 CAREER PLATEAUS IN RETAIL MANAGEMENT James W. Clark, Southern Arkansas University . . . . . Page 77 RUMORS, URBAN LEGENDS AND INTERNET HOAXES Henry B. Dunn, Stephen F. Austin State University Charlotte A. Allen, Stephen F. Austin State University . . . . . Page 85 PROVIDING BETTER PATIENT SERVICES UTILIZING SMART CARD TECHNOLOGY: A CASE EXAMPLE Dennis Emmett, Marshall University Reagan Bundy, Marshall University . . . . . Page 92 HOFSTEDE’S CULTURE FRAMEWORK: CAN IT BE USED IN SALES RECRUITING Amitesh Gir, University of Louisiana Rajesh Srivastava, University of Louisiana . . . . . Page 98 A PRELIMINARY INVESTIGATION INTO THE IMPACT OF ASSERTIVENESS AND AGGRESSIVENESS ON THE COMPLAINT BEHAVIOR OF PURCHASING MANAGERS Lynn R. Godwin, The University of St. Thomas . . . . . Page 99 AN INTERNATIONAL COMPARISON OF ETHICS: A PILOT STUDY Peter J, Gordon, Southeast Missouri State University Bert J. Kellerman, Southeast Missouri State University . . . . . Page 109 INTERNATIONALIZING THE STUDENT BODY: A POST 9/11 PERSPECTIVE Peter J. Gordon, Southeast Missouri State University Willie J. Redmond, Southeast Missouri State University . . . . . Page 114 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) THE ROLE OF INDIVIDUAL GOAL ORIENTATION IN ORGANIZATIONAL LEARNING AND PERFORMANCE: IMPLICATIONS FOR MARKETING STRATEGY Eric G. Harris, University of South Florida . . . . . Page 118 ASSESSING SKILLS AND KNOWLEDGE: A QUALITATIVE INVESTIGATION OF ADVERTISED MARKETING RESEARCH POSITIONS Edmund K. Hershberger, Southern Illinois University Edwardsville Madhav N. Segal, Southern Illinois University Edwardsville . . . . . Page 120 THE FOG OF OECD AND NON-OECD COUNTRY EFFICIENCY: A DATA ENVELOPMENT ANALYSIS APPROACH Maxwell Hsu, University of Wisconsin at Whitewater Xueming Luo, University of Texas at Arlington Gary Chao, Northwestern University . . . . . Page 121 FEDERAL INTERNATIONAL RESOURCES: PREPARING GRADUATES FOR SURVIVAL IN TOMORROW’S GLOBAL WORLD Erin M. Hurley, Texas State University . . . . . Page 132 AN EMPIRICAL INVESTIGATION OF A MODEL OF ENVIRONMENTALLY CONCERNED CONSUMER BEHAVIOR AND ITS DETERMINANTS: THE MODERATING ROLE OF MARKET MAVENSHIP AND PRODUCT INVOLVEMENT Kishwar Joonas, Prairie View A&M University Shahid Bhuian, Louisiana Tech University . . . . . Page 143 FORMALIZATION OF SALES FORCE MARKET INFORMATION GENERATION Thomas W. Lanis, East Central University Patrick D. Fountain, East Central University Karla Peterson, East Central University . . . . . Page 145 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) A LOGIC DEDUCTION OF ATTRIBUTE LEVEL-VALUE LINKAGES Chin-Feng Lin, National Chin-Yi Institute of Technology, Taiwan . . . . . Page 153 VARIATIONS IN THE PERCEIVED IMPORTANCE OF SERVQUAL DIMENSIONS: A COMPARISON BETWEEN RETAIL BANKING AND A MUSEUM Jill K. Maher, Robert Morris University John Clark, Robert Morris University . . . . . Page 161 A CONCEPTUAL FRAMEWORK FOR RESEARCH INTO FINE ARTS MARKETING Kimball P. Marshall, Alcorn State University William S. Piper, Alcorn State University . . . . . Page 163 INTERACTIVE WEB-BASED MAPPING IN THE TOURISM INDUSTRY: A CASE STUDY OF UK AND MALAYSIA Dr. Sanjay S. Mehta, Sam Houston State University Mark R. Leipnik, Sam Houston State University Subhash C. Mehta, University of Southern Maine . . . . . Page 165 MARKETING THE MILITARY: EVALUATING THE MOTIVATIONAL APPEALS OF RECRUITMENT SLOGANS Sylvia A. Miller, Cameron University M. Suzanne Clinton, Cameron University John Camey, University of Central Oklahoma . . . . . Page 167 COURSE EVALUATIONS AND TECHNOLOGY MEDIATED LEARNING ENVIRONMENTS Alma Mintu-Wimsatt, Texas A & M University – Commerce Kendra Ingram, Texas A & M University – Commerce Mary Anne Milward, Texas A & M University – Commerce Courtney Russ, Texas A & M University - Commerce Theresa Sadler, Texas A & M University – Commerce . . . . . Page 169 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) GROUP PROJECTS IN MARKETING CLASSES: A FACTOR-ANALYTIC STUDY OF STUDENT REACTIONS Gordon G. Mosley, Troy University David K. Amponsah, Troy University . . . . . Page 176 PATTERNS OF COPING OF HEALTH-CARE PERSONNEL: THEIR RELATIONSHIPS WITH PERSONAL CHARACTERISTICS, ROLE STRESS, AND WORK OUTCOMES Sarath A. Nonis, Arkansas State University Len Frey, Arkansas State University . . . . . Page 185 PROFILING COLLEGE STUDENTS BASED ON TIME-USE: RELATIONSHIP WITH PERSONAL , SITUATIONAL AND ACADEMIC OUTCOME VARIABLES Sarath Nonis, Arkansas State University Melodie Philhours, Arkansas State University Gail Hudson, Arkansas State University . . . . . Page 188 MARKETING EDUCATION AND VIRTUAL REALITY: THE VIRTUAL REALITY GROCERY PROJECT Charles H. Patti, Queensland University of Technology . . . . . Page 190 STRATEGIC REPOSITIONING FOR RURAL REGIONAL HOSPITALS Karla Peterson, East Central University Patrick D. Fountain, East Central University Thomas W. Lanis, East Central University . . . . . Page 201 THE MEDICAL MALPRACTICE CRISIS: AN ECONOMIC ISSUE OR AN ETHICAL ISSUE? Phil Rutsohn, Marshall University Andrew Sikula Sr., Marshall University . . . . . Page 207 THE UTILITY AND EFFECTIVENESS OF TIERED COPAYMENTS FOR HEALTHCARE BENEFITS Michaeline Skiba, Monmouth University . . . . . Page 210 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) MARKETING METRICS: A PUSH FOR TEACHING THE VALUE OF MARKETING AS AN ASSET Shane D. Smith, University of South Carolina Thomas J. Madden, University of South Carolina . . . . . Page 217 TOP MANAGEMENT ATTITUDE AND INTER-ORGANIZATIONAL LEARNINIG: THE MODERATING EFFECT OF ENVIRONMENTAL UNCERTAINTY Prashant Srivastava, Oklahoma State University Gary L. Frankwick, Oklahoma State University . . . . . Page 228 UNDERSTANDING & USING FEDERAL TECHNOLOGY/INFORMATION RESOURCES IN THE MARKETING CLASSROOM (Educators’ Workshop Overview) Ruth Lesher Taylor – Texas State University Crystal M. Aguilar – Texas State University Rebecca C. Alvarez – Texas State University Karin Cuda Baker – H.B. Zachry Company Sandra L. Griffin – Texas State University Erin M. Hurley – Texas State University Sean P. O’Connor – Texas State University . . . . . Page 237 THE NEW MANDATORY QSS FOR SERVICES PROVIDERS EVOLUTIONARY NEED FOR CHANGE IN MEASURING INTERNATIONAL SALES IN SERVICES (MARKETING EDUCATORS’ GRASS-ROOTS BRIEFING) Ruth Lesher Taylor, Texas State University . . . . . Page 241 A LEADERSHIP APPROACH FOR MARKETING MANAGERS Dillard B. Tinsley, Stephen F. Austin State University . . . . . Page 243 ATTITUDES OF PERSONAL SELLING STUDENTS TOWARD THE USE OF REAL BUSINESS PEOPLE AS “BUYERS” IN ROLE PLAY PRESENTATIONS Jeff W. Totten, Southeastern Louisiana University . . . . . Page 251 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) DEVISING AN INSTRUMENT FOR FACULTY PERFORMANCE APPRAISAL THAT INCORPORATES “STANDARDS OF EXCELLENCE” Theresa A. Wajda, Slippery Rock University Anindya Chatterjee, Slippery Rock University Abbas Noorbakhsh, Slippery Rock University . . . . . Page 259 A NOTE ON ADVERTISING COMPETITION IN A DUOPOLISTIC MARKET Hongkai Zhang, East Central University Hani I. Mesak, Louisiana Tech University . . . . . Page 261 THE EVOLVING MARKETPLACE: A BRIEF REVIEW OF TECHNOLOGY AND MARKET SYSTEMS George M. Zinkhan, University of Georgia Sam S. Zinkhan, University of Texas Ji Hee Song, University of Georgia . . . . . Page 267 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) PRESCRIPTION DRUGS FROM CANADA: WHY ARE THEY CHEAPER? Madhu Agrawal, St. John’s University ________________________________________________________________________ ABSTRACT The issue of legalizing the importation of prescription drugs from Canada was under the national spotlight during the recent US presidential elections, with presidential candidate John Kerry supporting the importation versus current President George Bush opposed to it. Although it is well known that prescription drugs in Canada are far cheaper than the same drugs in the US, the reasons for the drugs being cheaper are less well understood or known. This study examines the factors in Canada’s prescription drug pricing system and compares it to the system in the US leading to high drug prices. Pros and cons for consumers trying to get prescription drugs from Canada are also examined. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 1 ADULT ROLE MODEL PORTRAYAL IN ADVERTISEMENTS DIRECTED TOWARD CHILDREN: THE GRIM, THE BAD AND THE UGLY Nancy D. Albers-Miller, Berry College Caitlyn A. Miller, Rome, Georgia ABSTRACT While adults rarely appear in children’s advertisements, when present, there is reason to believe they are making an impression. Role models, both positive and negative, are an important influence on development. This study attempts to broaden the understanding of the use of adult figures in children’s advertising, defined as advertising associated with TV-Y, TV-Y7 and TVY7-FV programming. This study explores the characteristics of adults, including human actors, cartoons and fantasy figures considered to be “adult” or “grown up” as perceived by children content analysis coders. T-test comparisons of means were used to examine the differences between ads clearly directed at children and “off-target” ads. Finally, models of “grim,” “bad,” and “ugly” behaviors are estimated. INTRODUCTION Advertising directed toward children has been a concern for marketers, researchers and policy-makers for decades. The attention and concern is not without justification (Preston 2004). Children see a great deal of advertising. Moore and Lutz (2000) reported that children in the age range of six to fourteen see an estimated 20,000 advertisements each year. Advertising practitioners recognize this and are more than willing to target children (Basilio 2000). Despite concern acknowledged by caregivers (Eagle, deBruin and Bulmer 2002, Grier 2001), studies suggest that children have increasing amounts of control over how much television they watch and over which programs they select (Basilio 2000). Advertisements are known to have an impact on children, both consumption-related and unrelated to the product advertised. Increasing attention has been focused on the impact of advertising on children which is not directly related to the product. Advertisements have been linked to children’s self image, self concept, motivation and performance (Johnson 1972, Keck and Mueller 1994, Kirkpatrick 1986, Marx 1990, Morrin 1992, Peterson 1998). Of increasing concern is the impact of role models in advertising on children. Adult Role Models A great deal of research has been conducted looking at the influence of role models on children, including non-parent role models. Researchers have discovered that non-parent adults often serve as important role models in children’s development (Greenberger, Chen and Bean 1998). Family members, teachers, television stars and professionals may all be role models to Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 2 which children and teens shape their behavior (Rawwan and Singhapakdi 1998). Kids want to be like their adult role models (Bush, Martin and Bush 2004). Role models have an influence on consumption behavior. Anyone who influences a consumption decision is a role model (Martin and Bush 2000, Bandura 1977). Adults should teach children control and appropriate choices (Wilson 1993). Ward (1974) reported that "young people acquire skills, knowledge, and attitudes relevant to their functioning as consumers in the marketplace" through consumer socialization. Children learn appropriate norms, behaviors, and motivations about consumption (Moschis and Churchill 1978). Bush, Martin and Bush (2004) report that social agents of consumption may come from direct involvement, such as parent and peers, but may also come from mass media and television viewing. Television has been found to be an important social influence on children (Abelman 1989). Indirect consumer socialization can and does come from advertising. Browne’s (1998) research found children are willing to accept stereotyped portrayals in advertising as real and use them as models for their behavior. Advertising has been linked to perceptions of children’s selfimage (Fiske and Taylor 1991, Kirkpatrick 1986, Peterson 1998). Nairn and Berthon (2003) warned that advertisers need to portray role models as desirable self-images. Peterson (2002) called for television commercial sponsors and their advertising agencies to “contemplate possible implications for society in general, employers, educational institutions, and young people, when they select the “role type” of models.” Unfortunately, for the most part, adults are conspicuous only by their absence in children’s advertising (Albers-Miller and Miller 2003). While adult role models are not as common as peer role models in children’s advertising, they still play an important role in socialization and development. Albers-Miller and Miller (2003) suggested that adults appearing in advertising directed toward children may not be appropriate models of behavior. Characteristics of Adults in Advertising Adults in children’s advertising may not model socially desirable attributes. Greenberger, Chen and Bean (1998) indicated that adults sometimes model deviant behavior and children are influenced by such modeling. Children’s advertising tends to use amusement and drama to capture children’s attention (Moore 2004). Advertisers directing messages at children are increasingly concerned with image creation (Moore 2004), rather than character building. Several traits and characteristics of adults in children’s advertising are of potential concern. Many researchers have examined the influence of celebrities, stars and athletes on children. Hirschfeld (2004) indicated that celebrities do serve as role models and people attempt to emulate them. Rawwan and Singhapakdi (1998) reported the influence that stars have as role models. Bush, Martin and Bush (2004) researched the influence of celebrity athletes on adolescent brand choices and brand loyalty. Clearly, famous personalities can have an impact on children in advertising. Researchers have long been concerned with ability of children to ascertain the degree to which an advertising message is truthful. Researchers have found that children tend to believe Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 3 advertising claims (Moore 2004, Schwartz 1992). Unfortunately, evidence suggests that children do not have the same capacity as adults to identify false claims (Wong 1996). A common criticism of children’s advertising is deception and lack of truthfulness (Armstrong 1984, Mittal 1994, Weisskoff 1985). The general behavior of role models in advertising is of a concern. While researches recommend the depiction of socially acceptable behavior (Browne 1998), advertisers may well rely upon humor and shock-value to promote products. Because advertisers are more concerned with capturing children’s attention with amusement, there is some concern regarding the modeled behavior of adults in children’s advertising. Children’s advertisements are often perceived to be funny (Moore 2004) or silly (Mittal 1994). While Mathios, Avery and Bisogni (1988) called for positive traits to be modeled by adults, depictions of powerful, admirable and smart adults; there is reason to explore the extent to which adults might depict negative traits, such as weakness, stupidity and deplorable characteristics. Research has shown that children are tolerant of, yet influenced by, inappropriate behavior of adults (Rawwan and Singhapakdi 1998). Advertisers have drifted from previous concepts of “tasteful and decent” (Cook 2000). Concerns have been raised over violence in advertising (Eagle, deBruin and Bulmer 2002, Grier 2001 Shanahan, Hermans and Hyman 2003), the tendency for advertisers to promote “unwholesome” values (Mittal 1994) and frightening images in children’s advertising (Albers-Miller and Miller 2003). Elements of the role models physical appearance are also of concern. Cross (2002) recommended a closer look at how advertisers might portray “cute,” and “cool.” Peck and Loken (2004) described concerns regarding unrealistic portrayal of role model attractiveness. The use of attractiveness in advertising messages is of rising academic concern (Bower 2001, Häfner 2004, Saad 2004, Peck and Loken 2004, and others) Additionally, there is reason to examine the demographic characteristics of the role models. For decades, researchers and public policy makers have examined the tendency to use stereotyping in advertising. The use of, the lack of use of, the depiction of, and the influence of minority actors and characters in advertising has long been a concern (Donohue, Meyer and Henke 1978, Hae-Kyong and Reece 2003, Meyer, Donohue and Henke 1978, and others.) Likewise, issues regarding the tendency of advertisers to treat men and women role models differently have also beenraised (Browne 1988, Davis 2003, Putrevu 2001, Scheibe 1979). In children’s advertising, the adult role models are not always actors and they are not always human. Cartoons and fantasy figures play an important role in children’s advertising. Cartoons, animated drawings of characters in an ad, have been very effective in children’s advertising (Bush, Hair and Bush 1983). Non-cartoon, fantasy characters are also commonplace in children’s advertising. Fantasy characters in children’s advertising are depicted both as benevolent and malicious. Lonial and Van Auken (1986) found that children can easily identify with fictional characters. Benevolent fantasy characters included fairies, gnomes, friendly aliens, and other agreeable fantasy characters, such as Rapunzal. Malicious fantasy characters included monsters, unfriendly aliens and other disagreeable fantasy characters, such as Darth Vader. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 4 One special type of fantasy character is known as a spokes character. Spokes-characters have been defined as “nonhuman characters used to promote a product or a brand … created for the sole purpose of promoting a product or brand” (Garretson and Niedrich 2004). Spokes characters, such as Tony the Tiger, are not uncommon for children’s products (Callcott and Lee 1994; Mizerski 1995). Spokes characters are an important influence on children and concern has been expressed over the impact of spokes characters in ads to children (Harrington 1995). Children’s Programming In this study, television advertisements directed to children were examined to determine how adult characters and role models were portrayed. For the purposes of this study, advertising directed toward children was operationalized as advertising aired before, during or after a children’s program rated as TV-Y, TV-Y7 or TV-Y7-FV. The Motion Picture Association of America created TV Parental Guidelines in 1996 (TV Parental Guidelines Monitoring Board 2003). The guidelines subdivided programming directed toward children into three categories, TV-Y, TV-Y7 and TV-Y7-FV. Unlike programming, advertising messages are not rated (TV Parental Guidelines Monitoring Board 2003). The three children’s program ratings are defined as follows: TV-Y This program is designed to be appropriate for all children. Whether animated or liveaction, the themes and elements in this program are specifically designed for a very young audience, including children from ages 2 - 6. This program is not expected to frighten younger children. (TV Parental Guidelines Monitoring Board 2003) TV-Y7 This program is designed for children age 7 and above. It may be more appropriate for children who have acquired the developmental skills needed to distinguish between make-believe and reality. Themes and elements in this program may include mild fantasy violence or comedic violence, or may frighten children under the age of 7. Therefore, parents may wish to consider the suitability of this program for their very young children. (TV Parental Guidelines Monitoring Board 2003) TV-Y7-FV For those programs where fantasy violence may be more intense or more combative than other programs in this category, such programs will be designated TV-Y7-FV. (TV Parental Guidelines Monitoring Board 2003) DATA COLLECTION The data for this study were collected using a content analysis of television advertisements directed toward children. The first step was to identify advertisements directed toward children. Appropriate advertisements were then subjected to a careful evaluation of the traits, attributes and behaviors of the adults portrayed in those ads. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 5 Program and Advertisement Selection . Children’s programming was identified using a television program guide and rating system explained above. Programs recorded for this study covered all three types of children’s programs (TV-Y, TV-Y7 and TV-VY-FV). Programs were recorded over two time slots during which many programs are targeted toward school aged children, weekday afternoons and Saturday mornings. Approximately 15 hours of children’s programs were recorded over an eight day time period. Approximately half of the airtime was recorded from national cable television (Cartoon Network and Nickelodeon) and the remainder was recorded from major network channels (ABC and CBS). Of the ads included in the study, most (63.44 percent) were recorded from cable television. This measure is provided only as an observation and it should be noted that it is most likely misleading in that once any particular ad had been coded it was skipped over with subsequent appearances. In other words, if the ad was first observed on cable, it would have been skipped over on network. Therefore, this measure is not included in any data analysis. Recordings of the programs included the advertisements aired before, during and after the program. Almost no advertisements were aired between programs. The children’s program format has largely moved to a schedule where the start of the new program begins immediately upon the conclusion of the credits for the previous program. Only 5 percent of the advertisements coded in the study appeared between programs. The remaining 95 percent appeared fully within a single program. All unduplicated advertisements recorded were considered for inclusion in this study. The coders watched each advertisement and determined if they believed an adult appeared in the advertisement or not. Ads which the coders agreed contained one or more adults were included. Each adult appearing in an advertisement was considered to be a separate case. For this study, 41 unduplicated ads were coded providing 142 cases Content Analysis and Coding As is the common practice with content analysis, coding was conducted using a standardized coding form. The content included on the coding form was developed from the previous research outlined in the literature review. Coders were given 12 semantic-differential pairs (e.g. good/bad, smart/stupid). The twelve behavioral variables included on the coding form were famous/not famous; bad/good; telling the truth/telling a lie; strong/weak; smart/stupid; funny/serious; nice/mean; scary/silly; same as other adults/weird; hurtful/helpful; pretty or handsome/ugly; and happy/not happy. Coders were allowed to select either end of the scale or mark a neutral point between the two. In addition to the scaled variables, the coders indicated if the actor/character was a man, woman or “I cannot tell.” The coders were trained prior to completing the assignment. Each end point of the semantic-differential scale was reviewed with the coders to make sure that the coders were familiar with the words/concepts. When necessary, descriptions of the terms were developed from the Scholastic Children’s Dictionary (2002), one of the leading children’s dictionaries, to assure that the terms could be described in an age appropriate manner. Prior to the start of the task, all coders exhibited a comfort level with the terms used on the form and the task of coding. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 6 The coding was completed by three independent coders consisting of one seven-year-old girl, one nine-year-old girl and one ten-year-old girl. Using coders in the target audience of the advertisement is strongly endorsed (Albers-Miller and Gelb 1996). Each coder completed their forms independently. Discrepancies between the coders were resolved by majority opinion. When an ad was located that contained one or more adults, the ad was replayed for the coders as many times as they desired to complete the coding task. Each adult appearing within an ad was coded separately and on a new form. On average, there were 2.64 adults per children’s ads that included adults. Naturally, this average is artificially high because it is computed only for ads including adults, and a majority of children’s advertisements contain no adults at all (Albers-Miller and Miller 2003). Inter-coder agreement was extremely high. Simple measures of inter-coder agreement were computed for each pair of coders. Agreement between coder 1 and coder 2 was 94.0 percent. Agreement between coder 1 and coder 3 was 92.8 percent and agreement between coder 2 and coder 3 was 91.8 percent. While the coders were comfortable with the task and agreement between coders was very high, it became apparent that one of the semantic-differential pairs was problematic. While all three coders could explain the difference between “famous” and “not famous,” the children appeared to consider it incomprehensible that someone could appear on TV and still be “not famous.” Therefore, the coders regarded virtually all cases as “famous” or “neutral.” For example, after viewing an advertisement containing an unknown actress portraying the character “Rapunzal,” one coder commented “She is really famous. She has books written about her. She has been in at least two movies and one of those was a Barbie movie.” Because of this apparent dilemma, this variable was removed from the data analysis. The senior researcher recorded demographic information about the advertisements and identifying characteristics about the adults being coded. The researcher recorded time of day the advertisement aired, the title and rating of the television program, position of the ad relative to the program (e.g. before, during or after), and demographic characteristics of the adult (e.g. human, cartoon, fantasy character, minority). DATA ANALYSIS The data analysis for this study was conducted in two stages. First, a factor analysis was used to explore the data for latent dimensions. Then, the resulting dimensions were used in data modeling to describe the use of adult actors/characters in children’s advertising. Prior to the data analysis, the data set was examined for anomalous data. Of the 41 advertisements identified as advertisements containing adults and aired before, during or after children’s programs, six of the ads were clearly for products not aimed at children. They included an ad for automobile insurance, a used car search engine, fitness equipment, broadband services, furniture and an upholstery service. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 7 T-test comparisons were computed on the data between the portrayal of adults in these ads and the ads for more typical children’s products (cereal, toys, etc.). T-tests indicated that adults in these six ads were portrayed significantly differently than adults in the other ads in the data set. These six incorrectly targeted ads (“off-target” ads), which accounted for 48 of the 142 cases in the data set, were excluded from the factor analysis and models, leaving 94 cases. Factor Analysis The first step in data analysis was to explore the data for underlying structures or dimensions of character attributes. A factor analysis with a varimax orthogonal transformation rotation was used. Using a minimum eigenvalue of 1.0, the analysis of 11 of the coded attributes yielded 3 factors. (The attribute “famous” was excluded because of the problems associated with the children’s inability to assess the degree to which the actor/character was famous. See previous discussion for a more detailed explanation.) The characteristics loaded neatly on the 3 factors with factor loadings of .52 or better. The first factor consisted of five attributes and accounted for 3.64 variance explained. This factor, labeled “grim,” captures the variables of funny/serious (reversed scaled); happy/not happy (reversed scaled), telling the truth/telling a lie; smart/stupid; and like other grownups/weird. The factor represents a dimension of behaviors ranging from “grim” to “frivolous.” A grim character (a strong positive correlation with “grim”) would appear as a serious, truthful, joyless, smart adult. A frivolous character (a strong negative correlation with “grim”) would appear as a happy, weird, funny, stupid liar. The second factor consisted of four attributes and accounted for 3.46 variance explained. This factor, labeled “bad,” captures the variables of bad/good; nice/mean (reversed scaled); silly/scary (reversed scaled) and helpful/hurtful (reversed scaled). The factor captures a dimension of behaviors ranging from “bad” to “good.” A bad character (a strong positive correlation with “bad”) would appear as a mean, scary, hurtful, bad person. A good character (a strong negative correlation with “bad”) would appear as a nice, helpful, good person who is more silly than scary. The last factor consisted of two variables, accounting for 1.42 variance explained. This factor was labeled as “ugly” and captures the attractive (pretty or handsome)/ugly (reversed scaled) and strong/weak attributes. The factor represents a dimension ranging from “ugly” to “attractive.” A character exhibiting an “ugly” trait (a strong positive correlation with “ugly”) would more likely be considered strong and ugly rather than weak and attractive. Conversely, a character portrayed as “attractive” would be weak and pretty or handsome. Mean Comparisons and Regression Models Three models were estimated using the dimensions of adult role model portrayal to effectively describe the use of adults in children’s advertising. T-test comparisons of means were used to examine the differences between ads clearly directed at children and off-target ads. As described in more detail in the data analysis introduction, off-target ads aired during Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 8 children’s programs and yet were those clearly advertising products for which children were not the target market (e.g. auto insurance). Three t-test comparisons of means were conducted for the “grim,” “bad,” and “ugly” variables. The tests compared traditional children’s ads with those identified as off-target. Then, three regression models were developed to examine which role model characteristics were most closely associated with each dimension. All three models were estimated with only the advertisements clearly directed toward children. The estimated models were: Grim = α + β1 Cartoon + β2 Monster + β3 Fairy+ β4 Spokes Character + β5 Sex + β6 Minority Bad = α + β1 Cartoon + β2 Monster + β3 Fairy+ β4 Spokes Character + β5 Sex + β6 Minority Ugly = α + β1 Cartoon + β2 Monster + β3 Fairy+ β4 Spokes Character + β5 Sex + β6 Minority In these models, “grim,” “bad,” and “ugly” were standardized average scores of those attributes identified with the dimension from the factor analysis (e.g. bad = (bad + (4-nice) + scary + hurtful)/4). RESULTS The goal of this research was to shed light on the use of adult role models and characters in advertisements directed toward children. This study used an exploratory factor analysis to develop three dimensions of attributes, “grim,” “bad” and “ugly.” These dimensions were used as points of comparison between adult and children’s ads. The dimensions were also used to estimate three descriptive regression models. Six demographic characteristics about the adult role models have been identified as of interest to this study. Cartoons, a drawn portrayal of an adult character, appeared in 16.13 percent of the advertisements. Fantasy characters appeared in 24.73 percent of the ads. Because of a potential issue with majority fallacy (Moore 1980), the fantasy characters, actors in costume depicting monsters, aliens, pixies, etc., were subdivided into “monsters” (9.68 percent of all ads) and “fairies” (15.01 percent of all ads). Monsters were fantasy characters portrayed as malicious and fairies were fantasy characters portrayed as benevolent. Spokes characters, previously defined as “nonhuman characters used to promote a product or a brand” (Garretson and Niedrich 2004), appeared in 8.6 percent of the ads. A majority of the adults in the ads were identified as male (77.42 percent). Only 2.15 percent of the characters were perceived as having an unidentifiable sex. The coders appeared to assign gender to monsters, aliens and other nonhuman characters based on voice characteristics and other in-ad descriptors (e.g. the character being called “dad”). Only 6.45 percent of the adults were clearly minority (e.g. Black, Hispanic, Asian). Only those adults who could be clearly identified as representing a minority group were coded as “minority.” Most of the adults appearing in children’s advertisements were not central to the advertisements. Adults were only a central focus of the ad, based on the amount of relative Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 9 airtime, in 20.43 percent of the ads. In 48.39 percent of the ads, adults were relegated to a background role, often flashed across the screen, in a background position, for a few frames. In 31.18 percent of the cases, the adult was on the screen long enough to be clearly noticeable as part of the ad, but not central to the advertising message. Adults had speaking roles slightly more than one third of the time (39.78 percent), but often stating only a word or two, such as “Hi Billy!” The results of the t-tests showed significant differences in the adult characters in ads directed at children and those ads off-target during children’s programs. All three dimensions were statistically significantly different at the 0.01 level. The “bad” dimension and the “ugly” dimension were more common in a traditional children’s ad, while the “grim” dimension was more common to the off-target ad. In other words, children’s advertisements typically depicted adults as “bad,” “ugly” and “frivolous,” the low end of the “grim” dimension. The first regression model examined the “grim” dimension. The overall regression model obtained an F value of 11.87 (r2 = .45) and was significant at the 0.01 level. Five of the six demographic categories were significant predictors of the grim dimension. Only minority (0.05 level) and female (0.05 level) adults were significantly likely to be depicted as “grim,” and be shown in the ads as serious, truthful, smart, but not necessarily happy. Cartoon characters (0.01 level), monsters (0.01 level), fairies (0.01 level), Caucasians (0.05 level) and men (0.05 level) were most likely to be depicted as “frivolous,” shown in the ads as lying, happy, weird, funny, and/or stupid. Spokes characters were not significant in this model and were just as likely to be portrayed as grim as they were to be portrayed as frivolous. The second regression model examined the “bad” dimension. The overall regression model obtained an F value of 13.26 (r2 = .48) and was significant at the 0.01 level. Four of the six demographic categories were significant predictors of the bad dimension. Fairies (0.01 level), spokes characters (0.01 level), and minorities (0.05 level) were significantly likely to be portrayed as “good,” shown in ads as nice, helpful, good and/or more silly than scary. Monsters (0.01 level) and Caucasians (0.05 level) were significantly likely to be portrayed as “bad,” shown in ads as bad, mean, scary, and/or hurtful. Cartoons were just as likely to be portrayed as bad as they were to be portrayed as good; men were as likely as women to appear as bad. The two categories of cartoon and sex were not significant in this model. The third regression model examined the “ugly” dimension. The overall regression model obtained an F value of 14.94 (r2 = .51) and was significant at the 0.01 level. Five of the six demographic categories were significant predictors of the ugly dimension. Cartoons (0.01 level), monsters (0.01 level) and men (0.01 level) were significantly likely to be portrayed as “ugly”, shown in ads as strong and/or unattractive. Spokes characters (0.05 level) and women (0.01) were significantly likely to be portrayed as “attractive,” and depicted in ads as weak and/or pretty. There was a weak association (0.10 level) of fairies with this dimension, with fairies more likely to be shown as “attractive.” Minorities were not significant in this model. CONCLUSIONS Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 10 The results of the study have strongly indicated that adults appearing in a children’s ad are more likely to be portrayed as “bad,” “ugly” and “frivolous.” The frivolous character traits include being happy, weird, funny, stupid and lying. The bad character traits include being mean, scary, hurtful, and in general a bad person. Finally, adults in children’s ads are more likely to appear to be strong and ugly as perceived by children. Adult characters in children’s advertising are frequently cartoon animation or costumed fantasy characters (40.86 percent of the time). While not at all surprising that monsters were the most negatively portrayed in the advertisements (frivolous, bad and ugly), it is disturbing how often adults are portrayed as monsters in advertising (9.68 percent of the time adults appear in ads). Benevolent fantasy characters (15.01 percent of the adults in children’s advertising) were less negatively portrayed, being frivolous, but good, and most likely attractive. In another 16.13 percent of the cases, the adults in the ads were animated cartoons. Cartoon adults were perceived as frivolous and ugly, but were just as likely to be good as they were to be bad. Spokes characters were probably the most favorably treated of the delusive adult portrayals. Spokes characters were depicted as good and attractive, but were just as likely to be frivolous as grim. The remaining 59.14 percent of the adults in children’s advertisements were depicted as human adults. Minority male actors accounted for only 5.38 percent of all adult characters. These were the most favorably treated role models, depicted as good (nice, helpful, good and/or more silly than scary) and grim (serious, truthful, smart, but not necessarily happy). There were no minority female actors in any advertising in this study. Caucasians were significantly likely to be shown as bad (bad, mean, scary, and/or hurtful) -- both men and women. Caucasian women were treated better than Caucasian men. Caucasian women were grim and attractive. Caucasian men were the least favorable treated of all adult humans. Not only were they more likely than a minority role model to be depicted as bad, they were also significantly likely to be depicted as frivolous (lying, happy, weird, funny, and/or stupid) and ugly. Caucasian human male role models in children’s advertising are similar in treatment to portrayals of fantasy monster characters. The implications are both positive and negative. As role models, minority males are depicted in a generally favorable light in children’s advertising. Unfortunately, fantasy characters and animate cartoons are often the manner in which adults are included in advertising. When adult characters do appear in advertisements, they are often used in fleeting background roles with limited importance to the overall message. Most often, Caucasian human males are not utilized as positive role models in children’s advertising. LIMITATIONS AND FUTURE RESEARCH One of the most serious limitations of this study results from the homogeneity of the coders. All three coders were female, from the same ethic group and roughly the same socioeconomic group. The three coders have all previously attended Christian-based, private school. Although only one of the coders has been identified as a “talented and gifted student,” the other two coders would mostly likely be considered average to above average students. Future research might examine children’s perceptions across a more heterogeneous group of coders. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 11 Additionally, future researchers may wish to more closely examine children’s propensity to view all who appear on television as famous. Clearly, previous research has shown a tendency for children to be strongly influenced by famous athletes, celebrities and stars. This study has highlighted a serious concern that young children may be just as strongly impacted by all characters displayed on television. 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(1993), “In Loco Parentis,” The Brookings Review, 11 (4), 12-16. Wong, Kenman L. (1996), “Tobacco Advertising and Children: The Limits of First Amendment Protection,” Journal of Business Ethics, 15 (October), 1051-1064. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 16 USING FEDERAL INTERNATIONAL INFORMATION ENHANCED MARKETING COURSES IN THE REAL WORLD Karin Cuda Baker – Zachry Construction Company Ruth Lesher Taylor - Texas State University ABSTRACT This paper will provide a testimonial type overview from a student perspective as well as from an on-the-job graduate perspective. This testimonial will illustrate how one college graduate found that a marketing course enhanced with Federal information resources and computer investigation functionalities, such as those published on or utilized by STATUSA/Internet and USA Trade Online Web sites, gave the graduate not only a competitive edge in a very tight job market but also served the student well in terms of job-readiness and career movement possibilities. INTRODUCTION Marketing educators who integrate experiential learning techniques and Federal government information sources and computer research technologies (such as international information published on and computer functionalities utilized in STAT-USA/Internet and USA Trade Online) in the marketing courses they teach benefit students in innumerable ways. Such integration 1) gives students exposure to real-time international market and trade information; 2) acquaints them with some of the latest computer information investigative functionalities; 3) provides them with resume-enhancing qualifications giving them a competitive advantage in the job market; and 4) provides students value-addedness and job-readiness such that they are ‘immediate’ contributors to their employers. Providing a job-ready graduate benefits a hiring organization because it shortens the company’s need for extensive ‘job training’ efforts for the newly-hired college graduate. Overview of Marketing Course Enhanced with Federal International Resources During the Summer Semester of 2002, I first became aware of the vast amount of information available through STAT-USA/Internet and USA Trade Online. Training on the use of both of these Federal Web sites was an integral part of the International Marketing course in which I was enrolled. After successfully completing a series of exercises based on these Federal information resources students became eligible to receive a USDOC Certificate of Training from the U.S. Department of Commerce. BENEFITS AS ENROLLED STUDENT Federal International Resources Enhanced Marketing Course Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 17 The series of exercises students had to complete to receive a certificate was extremely important in making me a proficient user of these Federal information Web sites. The hands-on experience helped make lessons more memorable and assisted students in gaining a better understanding of the Web sites’ information access potential. Cross-Course Application Federal International Resources Information I wish I would have taken this Federal information integrated course earlier in my academic career as it would have been a valuable research tool for other courses as well. I was able to use the Federal information I gained access to through STAT-USA/Internet and USA Trade Online Web sites for an assigned paper in another course. BENEFITS AS AN “ON–THE-JOB” GRADUATE Benefits of Federal International Web site Resources Training in Job Search I graduated at a time when employment opportunities for recent college graduates were below average. Even though I had prior management experience and graduated Summa Cum Laude I job searched for several months unsuccessfully. Eventually though, I was invited to interview for a position. The mentioning of my international market research experience and my earned USDOC Certificate of Training on my resume had caught the attention of a recruiter. Because of my USDOC certificate training I was invited to also interview for an unadvertised position opening within the same company. The USDOC certificate training gave me an advantage over other applicants in a very competitive job market. Benefits of Federal International Web site Resources Training in On-The-Job Responsibilities My current job is limited to domestic commerce. However, through having completed the Federal information enhanced marketing course I had become aware of the wealth of both international and domestic knowledge available through Federal Web sites. More so than my coworkers, I use Federal Web sites to gain information needed to carry out my present job responsibilities. Most people, both professionals in the field and recent college graduates, do not know how much data is published by and is available free from the U.S. government. How Federal Web Resources Training Might Enhance Career-Movement Possibilities Our company has an International Department. The skills I am gaining in my current career, and the training I received in my Federal resources enhanced International Marketing course prepares me for career-movement possibilities. I feel very confident that I will be a qualified candidate for a position within the International Department of my present employer in the future. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 18 SUMMARY AND RECOMMENDATIONS The Federal Web resources enhanced International Marketing course has benefited me in many ways. Not only was I introduced to the vast amount of information available through government Web sites, such as STAT-USA/Internet and USA Trade Online, but the hands-on experience made me a proficient user of these Federal resources. A Federal Web resources enhanced marketing course of the nature described above was hard work, however students were well rewarded with a tangible proof of our achievement – the earning of the USDOC Certificate of Training we received at the end of the course. The organization of the course was refreshingly different from other courses. The overall experiential nature of the course made it interesting, engaging, and memorable; and very useful in on-the-job applications. I would encourage other business professors to engage students in the hands-on use of Federal Web resources. I also encourage educators to offer Federal resources enhanced courses early in the academic program so students could apply their newly-found Federal Web resources knowledge throughout their academic career. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 19 ENVIRONMENTAL MARKETING: A MODEL OF CONSUMER BEHAVIOR My H. Bui, Loyola University New Orleans ABSTRACT This article is a literature review on environmental marketing. Additionally, the author proposes a model and hypotheses of how input (i.e. values, beliefs/knowledge, needs & motivations, attitudes, and demographics) and intervening variables (i.e. eco-labels and consumer backlash) influence consumers’ purchase intentions and purchase decisions for eco-products. INTRODUCTION Beginning in the 1970s, a significant amount of research has been conducted on consumer behavior for environmentally friendly products. Many variables were shown to drive consumer choice in regards to purchasing environmentally friendly products. These variables can be grouped into values, beliefs/knowledge, needs & motivations, attitudes, and demographics. Moreover, a number of intervening variables affect consumers’ intention to pay more for an environmentally friendly product, grouped into eco-labels and consumer backlash. This paper summarizes the results of past research and presents a model showing the relationship between these variables and consumer purchases of environmentally friendly products. VARIABLES THAT DRIVE CHOICE Values Values influence behavior (McCarty and Shrum 1994). Consumers must value protecting the environment before they can have the intention of buying environmentally friendly products. Peattie (2001) argued that consumers must feel that, when they purchase an environmentally friendly product, they will make some sort of material difference. So far, studies have found consumers’ perceived level of self-involvement toward protection of the environment to be relatively low; hence the reason why consumers are less likely to engage in ecologically favorable behaviors (Wiener and Sukhdial 1990). As part of the solution, Bei and Simpson’s (1995) study suggested that emphasizing the importance of environmental issues can motivate consumers’ environmental behavior. Therefore, marketers should communicate to the target audience that buying green products could have a significant impact on the welfare of the environment (Laroche, Bergeron, and Barbaro-Forleo 2001). Beliefs/Knowledge In regards to how knowledge affects consumers’ ecological behaviors, findings have been contradictory. In most cases, knowledge was found to be significantly related to how consumers gather, organize, and evaluate products (Alba and Hutchinson 1987), as well as being a Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 20 significant predictor of environmentally friendly behavior (Vining and Ebreo 1990; Chan 1999). Because knowledge influences all phases of the decision-making process, the wrong information can cause consumers to make a less perfect choice. For example, most consumers assume that soapsuds clean their clothes better; when in actuality, soapsuds are only there to give the “impression” that your clothes will be cleaner - when in fact, soapsuds only harm the environment (Crane 2000). In addition, it has been widely argued that consumers perceive most recycled materials as being inferior to non-recycled materials; the consumers generally assume the performance of most recycled products to not be on par with that of non-recycled products. And as Rao (1974) found, consumers are either uncertain or would not buy if non-polluting products were of poorer quality. Needs & Motivations In self-reported behavior surveys, consumers report that they are willing to spend extra money for a socially desirable concept like environmentalism, but purchasing data suggests that “green” matters very little when compared to price, quality and convenience; therefore, businesses have become skeptical about consumers’ responses to such surveys (Mainieri, Barnett, Valdero, Unipan, and Oskamp 1997). The explanation that many researchers have put forth for this setback is that of “social over-reporting” of environmental concern among consumers (Peattie 2001). In addition, Hume (1991) concluded that consumers do not always act in accordance with their social reporting about the environment. When green purchases involve some sort of tradeoff that may include paying a green premium, accepting a lower level of technical performance, and/or traveling to non-standard distribution outlets, researchers and marketing experts have some explanation for these findings (Peattie 2001). McCarty and Shrum (1994) also found that the perception of inconvenience has a great influence on consumers’ action. As a result, even when using social-environmental benefits as a major selling point, any product that requires a significant amount of compromise is not likely to succeed. This shows us that consumers in general are not willing to forgo comfort and quality lifestyles for the betterment of the environment and society. Attitudes In regards to the effects of environmental attitudes on behavior, findings suggest that attitudes are the most consistent predictor of pro-environmental purchasing behaviors (Schlegelmilch, Greg, and Diamantopoulos 1996). What is key is whether attitudes predict actual behavior. Generally, studies have found positive correlations between environmental concern (i.e. attitude) and environmental friendly behavior (Van Liere and Dunlap 1981; Roberts and Bacon 1997). Simmons and Widmar (1990) found a significant relationship between environmental concern and ecologically responsible behavior in the case of recycling. Berger and Corbin (1992) found that green consumers’ behavior could be influenced by their consumer perceived effectiveness (i.e., attitude) towards the protection of the environment. Others have found weak or insignificant relationships between attitudes and behavior or substantial differences between intention and actual behavior (Wicker 1969). Targeting a category of eco- Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 21 concerned consumers is thus much harder than marketers expected; findings are still relatively inconclusive in regards to the impacts of attitudes on behavior. As a way to enhance the validity and reliability of research outcomes, researchers have suggested that, instead of using single behavioral measures of attitude, researchers should use multiple measures. Ajzen and Fishbein (1977) recommended that, to strengthen the relationship between attitude and behavior, researchers should include other probable intervening variables, such as different attitude representations towards different objects, and matching the specificity of attitude and behavior measurement. In addition, Weigel (1983) suggested that attitudebehavior studies might benefit from the examination of multiple factors, incorporating situational characteristics to verify if these factors affect behavior. Moreover, Straughan and Roberts (1999) suggested that a mixed model incorporating a range of both demographics and psychographics should be preferred to the traditional demographic profiling methods in examining environmental concern as a correlate of environmental behavior because psychographic variables provide stronger profiles of green consumption. Finally, Roozen and De Pelsmacker (1998) recommended that conjoint analysis should be used to test attitudes and behavior because this method can provide information on where consumers stand on the perceived “environmentally friendliness” of specific behaviors. Demographics Although much research has been done on the demographic profiles of green consumers, findings are still relatively mixed with some demographic characteristics showing more consistent results than others. Based on past demographic profiling, green consumers generally fall in the following category: educated, pre-middle aged females earning mid to high-incomes. Education. In regards to education, demographic profiles done in the past show that education is linked to green consumers’ attitudes and behaviors. Most demographic profile studies done on the relationship between education and the behaviors of green consumers have been positively correlated (Arbuthnot 1977; Schwartz and Miller 1991; Newell and Green 1997). Because most studies have found positive correlations between green consumers’ education and attitude and/or behavior, we can expect that future findings will be consistent. Age. In general, the socially responsible consumers’ demographic profile is young and/or pre-middle age (Anderson and Cunningham 1972; Weigel 1977; Roberts and Bacon 1997). But results have been far from conclusive. Roberts (1996b) found the relationship to be significant and positively correlated. Van Liere and Dunlap (1981) found that the relationship between age and green sensitivity and behavior is significant and negatively correlated – green consumers being older than the average. In contrast, McEvoy (1972) found no significant relationship between age and green attitudes and behavior. In summary, the demographic profile of green consumers in regards to age is still uncertain. Gender. Gender-related studies between males and females in regards to the environment are also inconclusive. In general, researchers argue that females are more likely than males to be ecologically conscious (Banerjee and McKeage 1994). In regards to the relationship between gender and environmental concern, MacDonald and Hara (1994) found the relationship to be Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 22 significant. Moreover, results from Laroche, Bergeron and Barbaro-Forleo’s (2001) studies showed that gender influences consumers’ willingness to pay more for green products in a statistically significant way. On the other hand, Samdahl and Robertson (1989) found the relationship between gender and environmental concern to be insignificant. Thus, the demographic profile of green consumers in regards to gender is still questionable. Income. The same case holds true for the demographic profile on the income of green consumers and the environment; the results of studies of the relationship between income and environmental concerns have been conflicting. While Zimmer (1994) found significant relationships between income and environmental attitudes and behavior, Roberts (1996b) found no significant relationship between income and environmental concerns. Once again, in regards to the demographic profile of green consumers in relation to income, the results are far from being conclusive. In conclusion, researchers have found that using demographics alone to profile and segment green consumers is not as effective as expected (Straughan and Roberts 1999). Roberts (1996a) claimed that the demographic profile lacks the ability to predict socially responsible consumer behavior and suggests that marketers identify and incorporate relevant attitudes and behaviors, personality characteristics, and purchase intentions into their research. In addition, past attempts to extend environmental marketing initiatives from one ecologically conscious behavior to another have been relatively ineffective. Ecologically conscious consumers try to protect the environment in different ways (Suchard and Polonski 1991); therefore, there are different categories of eco-concerned consumers. A consumer who recycles aluminum may not be the same consumer who cares about recycling plastic or about air pollution. Due to these findings, marketers and policy-makers are more cautious when attempting to target ecologically conscious consumers. Intentions Intention is defined as a course of action that one intends to follow. Generally, before actually purchasing an environmentally friendly product, the consumer must have the intention to buy environmentally friendly products. So far, many studies have shown a considerable difference between intention and actual behavior (Laroche, Toffoli, and Muller 1996). Moreover, market researchers and experts have found that people’s stated intentions of paying a price premium for environmentally friendly products do not necessarily translate into action, in the case of sustainable energy source, for instance (Nakarado 1996). In addition to the disparity between stated intentions and actual environmentally friendly purchasing behaviors, intervening variables – eco-labels and consumer backlash - also affect consumers’ intent to pay more for an environmentally friendly product. INTERVENING VARIABLES AFFECT CONSUMERS’ INTENTIONS Eco-labeling In regards to eco-labeling, many experts have suggested that consumers are confused due to inappropriate labeling. Research has shown that consumers do not always understand Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 23 environmentally friendly labels attached to products (Kangun and Polonsky 1995). Eco-labels such as ‘biodegradable,’ ‘sustainable,’ ‘fair wage/fair trade,’ ‘environmentally friendly,’ and ‘recyclable’ are usually unfamiliar and/or unknown to consumers. Additionally, merely recognizing a label does not mean that one understands the meaning of that label (Morris, Hastak, and Mazis 1995). Consumers must know and trust a label before they can use it to make purchasing decisions. Menon (1999) suggested using The Body Shop’s marketing tactic: environmental information promotions used throughout the store. An integrated marketing communications approach and/or a holistic approach, using eco-labels, may better educate consumers on the social and environmental impacts of their consumer purchasing decisions. What companies must remember, however, is that environmental labeling schemes are only a supplement to – not a substitute for – general environmental awareness and educational efforts (Thogersen 2000). In addition, studies have shown that, in making purchasing decisions, consumers use labels only when he/she trusts the message conveyed; therefore, labels should be promoted in a way that conveys trust. Consumer Backlash The increase in unsubstantiated and/or inappropriate product claims in the 90’s helped create the gap that exists between potential purchasing decisions based on the welfare of the environment. Not surprisingly, these unprincipled actions deeply impacted consumers’ cynicism towards green product claims and the way businesses advertise their green products. According to Fierman (1991), the Environmental Research Association found that 47 percent of consumers dismiss environmental claims as “mere gimmickry”. Moreover, 63 percent of consumers are suspicious of manufacturers’ green product claims (Ottman 1995) and 5 percent described manufacturers as “believable” compared to 89 percent for leading environmental groups (Einsmann 1992). Studies have also found that consumers have difficulty in adopting products that manufacturers claim to be environmentally safe and useful (Brown and Wahlers 1998). Due to unsubstantiated product claims, regulatory guidance on the use of green claims in marketing, such as ICC and ISO, has come into existence (Kuhre 1997). In addition, the media, environmental groups, and governmental agencies are now exposing those companies that make misleading or irrelevant environmental claims (Brown and Wahlers 1998). Businesses have become more cautious about their products’ green claims because they know that they must ensure that their information is based on solid foundations - to minimize potential consumer backlash. Some businesses are more skeptical than others about using product claims as a way to market their products. Some companies are under the perception that green branding is sure to backfire in their markets due to the problems of backlash. One reason is that the media is more inclined to attack companies on the basis of any shortcomings, rather than to highlight the relatively poor eco-performance of their rivals (Peattie 2001). Thus, rather than attempting to use the environment for presenting an overtly positive corporate image, and thereby motivating favorable purchase behavior, firms prefer not using the environment as a major selling point to avoid development of any ‘negative’ corporate associations or dissatisfaction (Crane 2000). Today, many managers still believe that it will take at least an entire generation before firms restore consumers’ trust in environmental product claims. In the mean time, firms are Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 24 shifting from green promotions alone to forming green alliances and ensuring that their green marketing activities are integrated holistically (Polonsky and Rosenberger 2001). The reason for the green alliance approach is that studies have found that environmental information provided by public sources is trusted by consumers more than environmental information provided by producers (Eden 1994/95). In addition, firms have learned that they cannot tactically use the environment to promote their corporate image. If a company wants to promote itself as being an environmentally friendly company, it must approach these efforts holistically, because if consumers become skeptical of a firm’s motives (i.e. tactical approaches), its efforts may actually backfire (Polonsky and Rosenberger 2001). PROPOSED MODEL Input and intervening variables influence consumers’ purchasing decisions of ecoproducts. Below is a proposed model of how these variables affect purchase intentions and purchase decisions for environmentally friendly products. Model: Variables that Drive Consumer Choice Inputs Values Beliefs/Knowledge Needs & Motivations Attitudes Intervening Variables Output Ecolabels Intention to Pay More Purchase of Environmentally Friendly Products Consumer Backlash Demographics HYPOTHESES H1: People who value the environment will have a greater intention to pay more for and will be more likely to purchase environmentally products. H2: People who have more knowledge about the environment will have a greater intention to pay more for and will be more likely to purchase environmentally products. H3: People who are willing to forgo comfort and quality life style for the betterment of society and the environment will have a greater intention to pay more for and will be more likely to purchase environmentally products. H4: People who trust the information conveyed on eco-labels will have a greater intention to pay more for and will be more likely to purchase environmentally products. 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(1994), “Gender differences in environmental concern among college students” Sex Roles, Vol. 33, No. 5/6, pp. 369 – 74. Mainieri, Tina; Barnett, Elaine G. (1997), “Green buying: The influence of environmental concern on consumer behavior”, Journal of Social Psychology, Vol. 137, Iss.2, pp. 189 – 205. McCarty, J.A. and Shrum, L.J. (1994), The recycling of solid wastes: personal values, value orientations, and attitudes about recycling as antecedents of recycling behavior”, Journal of Business Research, Vol. 30, No. 1, pp. 53 – 62. McEvoy, J. III (1972), “The American concern with the environment”, Social Behavior, Natural Resources and the Environment. Menon, A., Menon, A. Chowdhury, J. and Jankovich, J. (1999), “Evolving paradigm for environmental sensitivity in marketing programs: a synthesis of theory and practice”, Journal of Marketing Theory and Practice, Vol. 7, No. 2, pp. 1 – 15. Morris, L. A., Hastak, M., and Mazis, M.B. (1995). “Consumer Comprehension of environmental advertising and labeling claims”, Journal of Consumer Affairs, 29, 328 – 350. Nakarado, G.L. (1996), “A marketing orientation is the key to a sustainable energy future”, Entergy Policy, Vol. 24, No. 2, pp. 187 – 93. Newell, S. J. and Green, C.L. (1997), “Racial differences in consumer environmental concern”, The Journal of Consumer Affairs, Vol. 31, No. 1, pp. 53 – 69. Ottman, Jacquelyn. (1995), “Today’s consumers turning lean and green”, Marketing News, Vol. 29, Iss. 23, pp. 12 – 14. Peattie, Ken. (2001), “Towards Sustainability: The Third Age of Green Marketing”, The Marketing Review, Vol. 2 Iss. 2, pp.129 –146. Polonsky, Michael and Rosenberger III, Philip. (2001), “Reevaluating green marketing: a strategic approach”, Business Horizons, Vol. 44, Iss. 5, pp. 21 – 31. Rao, C.P. (1974), “Consumer ecological concern and adaptive behavior”, Journal of the Academy of Marketing Science, Vol. 2, Iss. 1, pgs. 262 – 278. Roberts, James. 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(Eds), AMA Summer Educators’ Conference Proceedings, American Marketing Association, Chicago, IL, Vol. 2, pp. 187 – 201. Thogersen, John. (2000), “Psychological Determinations of Paying Attention to Eco-labels in purchase decisions”, Journal of Consumer Policy, Vol. 23, Iss. 3, pp. 285 – 315. Van Liere, K. and Dunlap, R. (1981), “The social bases of environmental concern: a review of hypotheses, explanations, and empirical evidence”, Public Opinion Quarterly, Vol. 44, No. 2, pp. 181 – 97. Vining, J. and Ebreo, A. (1990), “What makes a recycler? A comparison of recyclers and nonrecyclers”, Environmental Behavior, Vol. 22, pp. 55 – 73. Weigel, R. H. (1983). Environmental psychology: Directions and perspectives (pp. 257 - 287). New York: Praeger. Weigel, R. H. (1977), “Ideological and demographic correlates of proecological behavior”, The Journal of Social Psychology, 103, 39 – 47. Wicker, A. W. (1969). “Attitudes versus action: The relationship of verbal and overt behavioral responses to attitude objects”, Journal of Social Issue, 25(4), 41 –78. Wiener, J.L. and Sukhdial, A. (1990), “Recycling of solid waste: directions for future research”, in Parasuraman, A. et al. (Eds), AMA Summer Educators’ Conference Proceedings, American Marketing Associations, Chicago, IL, Vol. 1, pp. 389 – 92. Zimmer, M.R., Stafford, T.F. and Stafford, M.R. (1994), “Green issues: dimensions of environmental concern”, Journal of Business Research, Vol. 30, No. 1, pp. 63 – 74. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 28 EVALUATING CONSUMER’S CONCERNS REGARDING THE WAY THEIR PATIENT RECORDS ARE MAINTAINED Brenda Reagan Bundy, Marshall University Ashish Chandra, Marshall University ABSTRACT Patient records are perhaps one of the things that consumer’s want to protect the most. However, there are hardly any studies to address the concerns of consumers regarding the way their patient records are maintained. This study was conducted to address the issue regarding the consumer’s level of awareness and concern in how their medical records are maintained. These individuals were also asked about their familiarity with their rights to their medical records as well as their familiarity about who has access to these medical records. A totaled 188 usable surveys were obtained for this exploratory study. Findings from this research are provided in this paper. INTRODUCTION The Internet has proposed many advantages to the health care field; however the industry has been reluctant to adopt these new innovations. Many aspects of the issue are being researched and certain technologies are being considered for future implementation. The new HIPAA privacy regulations, Information Technology and the impact that it has on individually identifiable health information, patient’s rights to their medical records, and what individuals would be accessing this information for what reasons are some of the issues to be discussed. The possibility of being able to provide such efficient care requires a mastery of all types of data as well as a coordinated effort of health care professionals to have a willingness to commit to the usage of information technology. There are billions of dollars spent each year just on paper claims and the qualities of these claims are nothing short of erroneous. This report highlights the issues of automating certain functions within the healthcare industry that could save the industry billions of dollars that could be used elsewhere, such as improving the quality of care that is given to each patient every year. Some of the automated functions that are said to improve the overall quality of healthcare that are discussed in this study include smart cards, smart monitors, forcing functions, barcoded patient identification bracelets, CPOE’s and a very small CD that can fit into the palm of your hand which contains a patient’s medical records. Predicted outcomes for future technological advancement are many, but the healthcare industry has many barriers to overcome. Neither the government nor the healthcare industry is ready to accept full responsibility for technology that results in unwanted adverse events nor are they prepared to assume the costs that can be incurred due to these negative outcomes. However, technological advancement within the healthcare industry is imminent; it is merely a matter of time when the government and the industry can work out all of the “kinks.” There have been dramatic changes in the healthcare industry with the implementation of computers. Computers have significantly contributed many advances to the health care industry. More than 70 countries have already taken steps in the direction of moving towards electronic medical records (Lawrence, 2004). For instance, CT scans, MRI’s and instant literature searches have traditionally enabled doctors to better provide care and treatment to patients without the intervention of the government. This new innovation has allowed for many advances within the industry which has resulted in an overall increase in the quality of care given to consumers as well as increased life expectancy. However, with the implementation of such highly evolved technology, there have been concerns as to whether or not this information is secure. This study was designed to evaluate consumer’s level of awareness and level of concern regarding how their medical records are maintained. These individuals were also asked about their familiarity with their rights to their medical records as well as their familiarity about who has access to these medical records. THE PROBLEM Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 29 Consumers may be unaware, uneasy, or simply may not be concerned with how their patient/health records are maintained. The issue of filing their medical records electronically would affect them to a great deal concerning confidentiality, accessibility, privacy and security of their personal information. To assist in patient concerns about privacy issues, the American Medical Association has adopted principles in which define the essentials of honorable behavior in physicians in order to increase the probability of trust and full disclosure. These principles include: 1. 2. 3. 4. 5. 6. 7. 8. 9. “A physician shall be dedicated to providing competent medical care, with compassion and respect for human dignity. A physician shall uphold the standards of professionalism, be honest in all professional interactions, and strive to report physicians deficient in character or competence, or engaging in fraud or deception, to appropriate entities. A physician shall respect the law and also recognize a responsibility to seek changes in those requirements which are contrary to the best interests of the patient. A physician shall respect the rights of patients, colleagues, and other health professionals, and shall safeguard patient confidences and privacy within the constraints of the law. A physician shall continue to study, apply, and advance scientific knowledge, maintain a commitment to medical education, make relevant information available to patients, colleagues, and the public, obtain consultation, and use the talents of other health professionals when indicated. A physician shall, in the provision of appropriate patient care, except in emergencies, be free to choose whom to serve, with whom to associate, and the environment in which to provide medical care. A physician shall recognize the responsibility to participate in activities contributing to the improvement of the community and the betterment of public health. A physician shall, while caring for a patient, regard responsibility to the patient as paramount. A physician shall support access to medical care for all people” (Principles of, 2001.) This study is devised to address the knowledge of consumers regarding patient record maintenance as well as some of potential concerns that they may have related to their medical records. The primary objectives of this study were: To assess consumer’s awareness of how their patient/health records are maintained. To determine if consumers are concerned about the way their patient/health records are maintained? To evaluate how aware consumers are regarding their rights to their medical records. To evaluate if consumers are concerned about the confidentiality, privacy, and security of their personal information and who has access to these files. For the purpose of this study, a survey instrument was developed. Of the 400 that were distributed (using convenience sampling technique), 188 usable responses were obtained giving a response rate of 47%. RESULTS AND DISCUSSION The majority of the respondents were between the ages of 25 and 44, mainly as the result of having surveys distributed to those individuals affiliated with Marshall University. Regarding gender distribution of respondents, the majority of the respondents were female (109 58%), while the males totaled (79 42%), totaling in 188 respondents. Since the surveys were distributed in a college setting, it was not surprising to get a majority of the respondents who had obtained a college degree. As for the last time respondents had visited the doctor, the majority responded that they had been between 1 and 4 months (reasons for visits unknown), totaling 78. Upon reviewing the results, 94 respondents (50%) indicated that they were unaware of how their medical records are maintained as shown below in Table 1 and 102 respondents (54.3%) indicated that they were concerned with how their medical records are maintained as shown below in Table 2. Clearly an issue to be addressed exists with this information. Perhaps individuals are given this information and do not fully understand the content, or individuals are not given the information nor are they informed about how their medical records are maintained. Individuals that go to see a doctor or physician are usually given information concerning their rights as a patient and how their information may be used, however research has shown that the information given to them does not include how their medical records are maintained within the facility. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 30 Table 1: Respondent awareness of how medical records are maintained Respondent's age 18-24 25-34 35-44 45-54 55-65 65-74 75 & above Total Are you aware of how your medical records are maintained? Yes 10 18 18 14 14 3 1 78 Total No 22 21 19 17 11 3 1 94 I don't know 1 8 3 2 2 16 33 47 40 33 27 6 2 188 Table 2: Respondent concern regarding how the records are maintained Respondent's age Total 18-24 25-34 35-44 45-54 55-65 65-74 75 & above Are you concerned with how your medical records are maintained? Yes 17 25 18 19 18 5 102 Total No I don't know 14 2 13 9 16 6 11 3 8 1 1 2 64 22 33 47 40 33 27 6 2 188 The majority of individuals who responded to the survey also indicated on a scale from Not at all Concerned to Very Concerned that they were Somewhat Concerned about the way their medical records are maintained (51.1%). Other findings included: 43.6% of respondents said that they were somewhat concerned about who is viewing their medical records within the doctors office, 39.9% said they were somewhat concerned about who had access to their medical records within the doctor’s office, 42.6% said they were somewhat concerned about the reasons their medical records were being viewed, 43.1% said they were somewhat concerned about having their medical records stored on a computer, 52.7% said they were very concerned about the possibility of having their medical records transferred over the Internet, and 37.8% said they were somewhat concerned about the possibility of doctors viewing their medical records outside of the doctors office. Upon reviewing respondent’s level of concern, this study also indicates respondent’s level of awareness regarding their medical records as well. Individuals responded on a scale ranging from Not at all Aware to Very Aware. Results indicate: 50.5% of respondents said they were Somewhat Aware of how their medical records are maintained, 57.4% said they were Somewhat Aware of who is able to view their medical records, 58.5% said they were Not at all Aware of the possibility that their information could be bought and sold on the Internet, 45.7% said they were Somewhat Aware of their rights to their medical records, 43.6% said they were Not at all Aware that employers may have the ability to view medical records before they hire, and 47.9 % said they were Somewhat Aware of security measures to protect their private, personal information. Next, individuals were asked how strongly they agree or disagree regarding the trust in their physician, how informed they are about how their information is stored, their rights as a patient and how well they understand these rights, and whether or not they trust the way their personal information is stored. Results indicated: 45.2% of respondents said they Agree to feeling a lot of trust in their physician, 30.3% said they Agree to feeling informed about the way their medical records are maintained, 38.3% said they Agree to being informed about their rights as a patient, 27.1% said they are Neutral to fully understanding their rights as a patient, and 34.6% said they are Neutral in fully trusting the way their medical records are maintained within the doctors office. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 31 Lastly, the majority of respondents indicated that they had received information both verbal and in writing (16.5%) concerning their rights as a patient signifying that information had been made available to them, 9.6% said that they had not received any information concerning their rights as a patient, 1.6% did not reply, .5% said they were confused, .5% said they did not remember and .5% indicated they were in the military and had received the information verbally and written. Next, cross tabulations were conducted on each of the above questions with each remaining question on the survey, including the remainder of demographic questions as well. To be considered statistically significant, the Pearson Chi-Square results must be equal to or less than .05. The cross tabulations that this study found to be statistically significant were as follows: 1. 2. 3. 4. 5. 6. 7. “Respondent’s age” cross tabulated with “Respondent’s highest level of education.” Pearson Chi-Square equaled .000. “Respondent’s age” cross tabulated with “I am informed about the way my medical records are maintained.” Pearson Chi-Square equaled .031. “Respondent’s age” cross tabulated with “I feel a lot of trust in my physician.” Pearson Chi-Square equaled .032. “Respondent’s age” cross tabulated with “The way your medical records are maintained.” Pearson ChiSquare equaled .048. “When was the last time they visited their doctor” cross tabulated with “Who is able to view your medical records.” Pearson Chi-Square equaled .005. “Respondent’s sex” cross tabulated with “Who is viewing your medical records within your doctor’s office.” Pearson Chi-Square equaled .027. “Respondents sex” cross tabulated with “Your rights to your medical records.” Pearson Chi-Square equaled .034. In cross tabulating “Respondent’s Age” with “Highest level of education,” the responses that were received indicated that 39.4% of individuals in the 18-24 age categories had some college level of education but no college degree. Among those respondents who belong to the 25-34 age categories, it was interesting to see that 34% of the respondents had some college experience but no college degree. Additionally, 34% of respondents had obtained a bachelors degree. It was even more surprising to observe that 37.4% of individuals between the ages of 45-54 had some college experience, but no college degree. The most likely answer to this lop-sided response seems to be that the individuals in that age bracket may have had other opportunities of making ends meet, or they may have a decent job that does not require a college degree. The next cross tabulation that was performed concerned “Respondent’s Age” with “I am informed about the way my medical records are maintained.” Results indicated that the respondent’s in the age categories of 34 years of age or less tend to disagree regarding the fact that they are informed about the way their medical records are maintained. However, it seems as though the older the individual, the more they agree that they are informed with how their medical records are maintained. Also, similar to the findings from the previous cross tabulation, it seems that the older the individual, the more trust they have in their physician. In almost all age brackets, a significant number of respondents indicated that they were somewhat concerned regarding the way their medical records are maintained. However, it was interesting to find that most of the respondents that were between the ages of 45 and 64 were very concerned with the way their medical records are maintained. Those that had visited their doctor in the past 0-4 months were somewhat aware of who is able to view their medical records. However, the most interesting fact was that over 70% of the patients who visited their doctor over a year ago were not at all aware of who is able to view their medical records. Perhaps the main reason for this maybe closely related to how well HIPAA regulations have been implemented by health care professionals. Our cross tabulation analysis with the respondent’s sex and who is viewing their medical records in their doctor’s office indicated that female patients (36.7%) are very concerned regarding who is viewing their medical records in a doctor’s office as compared to male patients where only 20.3% indicated that they are very concerned. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 32 Regarding the respondent’s level of awareness of their rights to their medical records, only 22% of females were not aware of their rights to their medical records whereas 40.5% of males were not at all aware of their rights. CONCLUSIONS These results are not indicative of any cause and effect relationships. The findings were obtained for general knowledge and a simple awareness of how well individuals are concerned or aware of how their medical records are maintained. The results obtained are qualitative in nature and therefore present an information “base” that could assist in future research studies. In conclusion, this study has reported interesting findings, specifically between age and gender variables. It seems as though the younger the individual, the less informed they are regarding the way their medical records are maintained as opposed to those middle-aged and older who reported being more informed of this information. However, this study reported that mostly everyone in all age categories had some concerns about the way their medical records are maintained, although the majority of respondents who were older (40’s and above) reported being very concerned about this issue. This older crowd also seemed to hold more trust in their physician as well, which could be a major contributor to their trust. Also, those who had visited their doctor or physician within the last 0-4 months reported being more informed and aware of the use and disclosure requirements of their medical records as well as who is able to view them. This could perhaps be the result of new HIPAA regulations forcing healthcare professionals to provide this information to their patients, however those who had not recently visited their doctor or physician (a year or longer) seemed to be less aware of how their personal information is used and who is able to view this information. Overall, females seemed to be more attuned to information regarding the maintenance of their medical records, as well as their rights to these records, whereas males tended to be less aware and concerned of how their medical records are being stored and who is viewing them. Reasons for these findings are unknown; however, they could be affected by external factors such as culture, society, values and beliefs, education level, financial aspects, or a combination of many other variables. The overall goal is to present an awareness of an issue that could pose potential problems in the near future for the healthcare industry. The aspects mentioned above are just but a few that state and local governments will have to take into consideration while making recommendations and proposals to improve the quality of care given to patients. The simple implementation of technological tools, as previously mentioned, will not solve every problem. It is just a minute part of the many impasses that will have to be considered and addressed within the near future. FUTURE PREDICTIONS As the technology improves there is no doubt that in future we will see more secure patient record maintenance tools. However, this also creates new challenges for health care organizations as it will involve increased training and educational efforts for the personnel who will be directly involved in the utilization of these technically advanced tools. This will involve more expenses on the part of health care organizations which are already financially strapped and may not be able to undertake new training and educational efforts. Unfortunately, this may create a scenario where the available technology may be great but the implementation is poor. REFERENCES Lawrence, Stacy. (April 20, 2004). “Panel Suggests Steps Toward Electronic Medical Records.” Enterprise Apps. Pp. 1-2. (Retrieved May 9, 2004). www.eweek.com/article2/0,1759,1571011,00.asp “Principals of Medical Ethics.” (2003). American Medical Association. Pp. 1-2. (Retrieved June 6, 2004). http://www.ama-assn.org/apps/pf_new/pf_online?f_n=browse&doc=policyfiles/HnE/E-0.01... Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 33 PREPARING FOR PRIVACY: A MODULE FOR MARKETING EDUCATORS IN AN ERA OF ELECTRONIC COMMERCE E. Vincent Carter, Oakland University Rajni Goel, Howard University ________________________________________________________________________ ABSTRACT This paper presents a Privacy Pedagogy Module (PPM) to improve the comprehension, conceptualization, critical thinking, communication, and content awareness of information privacy issues in marketing education. The advent of digital markets has ushered in an era of electronic commerce wherein information currency for conducting transactions. Persistent “information privacy risks” stem from the abstract, unfamiliar, complex, and asymmetrically controlled electronic channels that connect customers to digital markets. Existing online constructs available to marketing educators treat information privacy as an important but peripheral matter. The PPM equips marketing educators with a richer and more rigorous treatment of information privacy dimensions. ________________________________________________________________________ INTRODUCTION Consumer information privacy is changing the marketing world and challenging the integrity of the marketing education. Expanding digital markets have led marketing managers, scholars, and educators to reexamine information privacy issues. Significant numbers of current and potential online service users are wary of how their personal information is used (Gardyn 2001; Libbon 1999; Hoffman, et al. 1999a). For companies, on the other hand, Internet business models are driven by the user’s willingness to supply data (Milberg, et al. 2000). Marketing managers in particular benefit from the ability to customize a wide array of products and programs to digital customer profiles (Berger and Nasr 1998; Dwyer 1989). Those types of targeted market segmentation strategies improve brand equity and build loyal customer relationships (Sheth 1991). Recently, privacy issues have entered business and marketing realm, culminating in specific online guidelines stipulated by the “Consumer Information Privacy Act.” “ Common to all of these (fair information practice codes) are five core principles of privacy protection: 1) Notice/Awareness; 2) Choice/ Consent; (3) Access/Participation; (4) Integrity/Security; and (5) Enforcement/Redress.” (FTC 1998) These policies set new online marketing ethics boundaries and also call for changes in marketing education. Properly understood, “information privacy” is recast from a peripheral digital marketing consideration into a central e-commerce transaction mechanism. There is Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 34 mounting support for a central “privacy construct” in digital markets that controls marketing information systems, online consumer access, and customer relationship management (Franzak, et al. 2001; Wang et al. 1998; Foxman and Kilcoyne 1993) and the “marketing mix” elements (e.g., four “Ps”) formulated to provide economic value. Privacy, therefore, is a complex phenomenon that revises the entire functional spectrum of marketing education pedagogy. The need to integrate information technology into the marketing education curriculum is echoed in both business and academic domains (Miller and Mangold 1996; Atwong and Hugstad 1997). Business managers regard computer technology applications as an opportunity for students to acquire real world skills (Mitchell and Strauss 2001) and prepare for an information technology driven marketplace. Marketing courses that combine academic and business applications of digital technology are strongly championed by marketing practitioners (Van Horn 1995). Marketing faculty are strong proponents of computer-based instruction (Carter 2002; Smart, Kelly, and Conant 1999). Recent studies have demonstrated the widespread viability of interactive technology within the context of the marketing curriculum (Ueltschy 2001; Benbunan-Fich, et al. 2001). Those studies are also buttressed by improvements in the comfort level of marketing faculty with digital technology and their use of Internet applications in the classroom (Vaidyanathan, et al. 1998). Looking to the future, Sautter, Pratt, and Shanahan (2000) see interactive electronic technology educational modules as a “natural progression” of the experiential approach -“electronic tools to promote active learning” (Gillette 1996, p.60). Atwong and Hugstad (1997) specifically point to dramatic “Internet technology” usage growth in the marketing classroom. Despite the impressive adoption of information technology in marketing education (Malhotra 2002) and practice (Wind and Mahajan 2001; Blattberg, et al. 1994), scholars and managers have shown comparative neglect for information privacy issues. The emergence of new insights about the dimensions and functions of information privacy in digital markets, presents a timely opportunity for marketing educators to contribute to this innovative wave with scalable instructional modules. A literature search of marketing journals found that articles addressing information privacy in electronic commerce environments are becoming more prominent in the general marketing literature, although trailing the number of privacy studies published in MIS, Consumer Affairs, and Business Ethics journals. Among the marketing journals, Figure 1 shows that the vast concentration of articles related to information privacy appear in the ethics-oriented Journal of Public Policy and Marketing, and to a lesser degree consumer focused outlets like the Journal of Consumer Marketing, Consumer Research Magazine and the Journal of Consumer Affairs – as well as electronic commerce directed sources like the International Journal of Electronic Commerce and the Journal of Interactive Marketing. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 35 Figure 1 Representation of Information Privacy Related Issues in the Marketing Literature Academic Marketing Journal Categories Ethics, Policy & Consumer Affairs Consumer Behavior/Markets Electronic Commerce Top General Marketing Marketing Education Other Goodwin 1991 Urbany 1986 Foxman & Kilcoyne 1993 Brreitenbach & Van Doren 1998 Thomas & Maurer 1997 Consumers” Research Magazine (1999) Milne & Boza 1999 Cronin 2000 Chang, et al. 1999 Melugin 2000 Rust & Lemmon 2001 Goldman 1999 Miller & Dickson 2001 Reichheld & Schefter 2000 Croson & Jacobides 1997 Jarvenpaa & Todd 1996/97 Bloom, et al. 1994 Peterson, et al. 1997 Petty 2000 Mitchell & Strauss 2001 Ansari, et al. 2000 Blattberg & Deighton 1991 Cespedes & Smith 1993 Hagel & Rayport 1997 Singhapakdi , et al.1999 Caudill & Murphy 2000 Carter 1997 Culnan 2000 Prabhaker 2000 Petty 2000 Franzak, et al. 2001 Phelps, et al. 2000 Urban, et al. 2000 Klein 2001 Milne & Rohm 2000 Plummer 2001 Sheehan & Hoy 2000 Mohr, et al. 2001 Miyazaki & Fernandez 2001 Miyazaki & Krishnamurthy 2002 Frequency = 13 Frequency = 9 Frequency = 6 Frequency = 3 Frequency = 2 Frequency = 7 Percent = 33% Percent = 23% Percent = 15% Percent = 7% Percent = 5% Percent = 17% If information privacy issues in marketing are incipient in the general marketing literature, they are pre-nascent in marketing education journals. A focused search of information technology, ethics, and information privacy “keywords” on websites of two leading marketing education journals – Journal of Marketing Education and Marketing Education Review -- shows the stark imbalance between the inclusion of electronic technology, ethics, and information privacy in pedagogical and curricular considerations (see Figure 2). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 36 Figure 2 Findings from a “Privacy” Literature Search of Marketing Education Journals Marketing Education Journal Themes [JME 1999-2004; MER 1991-2004] Information Technology Ethics and Responsibilities Information Privacy Atwong & Hugstad 1997 Smart, et al. 1999 Kaynama & Keesling 2000 Siegel 2000 Smith 2001 Lincoln 2001 McCorkle, et al. 2001 Benbunan-Fich, et al. 2001 Evans 2001 Castleberry 2001 Clarke, et al. 2001 Eastman & Swift 2001 Mitchell & Strauss 2001 Ueltschy 2001 Young 2001 Elliott & Hall 2002 Celsi & Wolfinbarger 2002 Ferrell & Ferrell 2002 Heinrichs, et al. 2002 Young, et al. 2003 Granitz and Greene 2003 Hensen, et al. 2003 Peltier, et al. 2003 Hunt, et al. 2004 Priluck 2004 Taylor, et al. 2004 McCorkle, et al. 1999 Smart, et al. 1999 Petty 2000 Catterall, et al. 2002 Yoo & Donthu 2002 Wee, et al. 2003 Wood & Suter 2004 Hunt, et al. 2004 Chonko 2004 Elam & Spotts 2004 Petty 2000 Mitchell & Strauss 2001 (JME Subtotal = 26) (JME Subtotal = 10) (JME Subtotal = 2) Miller & Mangold 1996 Suter & Kopp 1998 Moon 1999 Sautter, et al. 2000 Bell, et al. 2001 Berger & Topol 2001 Paul & Mukhopadhyay 2001 Carter 2002 Hannaford, et al. 2002 Malhotra 2002 Malhotra, et al. 2002 Peterson, et al. 2002 Jones & Kelly 2003 McBane 2003 O’Boyle & Dawson 1991 Hoffman & Siguaw 1994 Bhattacharya & Sheth 1996 Suter & Kopp 1998 Munilla, et al. 1999 Rozenscher & Fergenson 1999 Loe & Ferrell 2001 (MER Subtotal = 14) (MER Subtotal = 7) (MER Subtotal = 0) Combined Frequency = 40 Combined Frequency = 17 Combined Frequency = 2 Combined Percent = 68% Combined Percent = 29% Combined Percent = 3% Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 37 The pattern depicts “information age” diffusion (Rogers 1983), as technology and business ethics commingle to introduce information privacy as the medium of exchange in electronic commerce markets. Digital technology raises the value of personal information, because individuals are required to input data in order to conduct electronic transactions. The heightened value of information, in turn, has transformed the concept of “privacy” as originally crafted by the U.S. Supreme Court (Brandeis 1928) from a constitutional right with public sector duty to a personal right with individual responsibility. Wang, et al. (1998) regards this distinction between traditional privacy (the right to be left alone) and information privacy (the right of personal data anonymity) as a paradigm shift in how digital marketing is conducted. “The term privacy is usually described as ‘the right to be let alone,’ and is related to solitude secrecy and autonomy. However, when associated with consumer activities that take place in the arena of the electronic marketplace, privacy usually refers to personal information and the invasion of privacy is usually interpreted as the unauthorized collection, disclosure, or other use of personal information as a direct result of electronic commerce transactions.” (Wang, Lee, and Wang 1998, p.64) As expected, the non-educational marketing journals are leading this rethinking of the role of information privacy in digital marketing (see Figure 1). However, because the phenomenon of online consumer privacy is becoming central to electronic commerce relationships (Kleindl 2001; Franzak, et al. 2001; Wang, et al. 1998), marketing educators have the opportunity to innovate course design and delivery with thoughtful inclusion of the new information privacy paradigm. These privacy literature search findings beg two questions: 1. If information technology is vital to marketing curricula and the significance of digital marketing acknowledged, how can the information privacy construct be evaded? 2. How can future marketing professionals fully grasp and effectively manage information privacy phenomena if marketing pedagogy does not prepare them? The central role of privacy in online marketing is inextricable from preparing students for future digital marketing management. Information privacy literacy and management are skills that should also accompany the use of information technology as marketing education tools. More than the merits of ethical considerations, privacy learning entails digital marketing insights and applications for an era of electronic commerce. Three main factors comprise the e-commerce privacy construct; (a) growing reliance on the Internet as a social and economic infrastructure for information exchange, (b) the use of information privacy assurances to strengthen online customer trust and loyalty, and (c) the logic of trading privacy for customer benefits. Widespread acceptance of the Internet in U.S. markets has transformed the role of information privacy in online processes. In computer mediated environments (Hoffman and Novak 1996), wherein information substitutes monetary currency, physical facilities, and tangible products, customers develop a new set of “information rules” (Shapiro and Varian 1999). Chief among these e-commerce codes for customers is to treat personal information as a commercial asset and to regard information privacy as the mechanism for controlling that asset (Raul 2002; Cate 1997). This results in the need for e-commerce information privacy to be classified into two cyclic consumption dimensions: Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 38 1. pre-transactional, in which commercial interaction is static, cognitive information processing is autonomous, and information privacy concerns are directed towards data security (“data bank”) 2. transactional, in which commercial interaction is dynamic, cognitive information processing is collaborative, and information privacy concerns are directed towards preserving personal anonymity (“data blank”). This “privacy matrix” component of the pedagogical module introduces the emerging concept of “variable privacy” (Goel and Carter 2004) to distinguish between the e-commerce mode when consumers are autonomously processing information and the mode when information is processed collaboratively. During the autonomous mode, the static pause in commercial transaction leads customers to tally gains. This places priority on safe guarding data assets (“data bank”). On the other hand, dynamic collaborative mode interaction makes free information flow a premium. Identities, then substitute data as the prime information asset (“data blank”). Collaborative mode identities are safeguarded with anonymity, so that bytes of personal data can be bartered for online convenience and customization (Gardyn 2001; Phelps, et al. 2000; Goldman 1999). Marketing educators can incorporate the “privacy matrix” along with its complementary framework -- the “privacy planning mix,” as tools for the entire spectrum of marketing courses. The “privacy planning mix” serves as a more application-oriented tool, to translate the “variable privacy” concept into a practical critical thinking framework parallel to the “marketing mix” for non-information intensive interactions. Likewise, the “variable privacy” distinctions are essential for marketing pedagogical objectives across all marketing course offerings. Specifically, the course coverage encompasses: 1. 2. 3. 4. 5. 6. online consumer(Carter 2002; Shehan and Hoy 2000; Sheth and Sisodia 1997) marketing research (Malhotra, et al. 2002; Miller and Dickson 2001), information product management (Meyer and Zack 1996), e-commerce pricing (Nagel and Holden 2002; Monroe and Posner 2000), digital “marketing mix” (Harvey, et al. 1996; Bordon 1964) and relationship marketing (Franzak, et al. 2001; Morgan and Hunt 1994). The information privacy void in marketing education research marks the next stage in the pedagogical diffusion of information technology instruction. The proposed “Privacy Pedagogy Module” (PPM) is consistent with marketing education aims to foster technology integration (Benbunan-Fich, et al. 2001; Atwong and Hugstad 1997), the development of e-commerce marketing skills (Mitchell and Strauss 2001; Miller and Mangold 1996), Internet-based instructional methods (Jones and Kelly 2003), course specific web marketing platforms (Hannford, et al. 2002; Kaynama and Keesling 2000), and “virtual community” connections (Peltier, at al. 2003). Ironically, even the delivery of future of marketing education courses requires an information privacy orientation. The expanded use of “electronic classrooms,” with online Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 39 interaction required for all or part of the course, means that marketing education pedagogy must embrace information privacy policies for course delivery, to comply with the data protections of the Family Educational Rights and Privacy Act (FERPA) http://www.ed.gov/policy/gen/guid/fpco/ferpa/index.html. While preparing students for the impacts of information privacy on e-commerce marketing an upgraded pedagogy will simultaneously practice “fair information access codes” (FTC 1998). This urgent need for heightened pedagogical attention to the information privacy construct in marketing education, affirms the charge of Lincoln, et al. (2001) to; “find the balance between emerging technologies and traditional teaching methods and tools.” (p.1). Therefore, the proposed PMM has continuity with the evolving curriculum integration of ecommerce marketing skills and credibility grounded in the ethical tenets for both marketing education (Munilla, et al. 1999) and practice (AMA 1996). PPM INSTRUCTIONAL PROGRESSION Following the pedagogical guidelines of Krishnan and Porter (1998), the PPM consists of five phases – introduction, background, elaboration, reinforcement, and feedback (see Figure 3). Figure 3 The “Privacy Matrix” of Information Privacy Modes and E-Commerce States Information Privacy Mode E-Commerce State Digital Marketing Strategy Consumer Information Processing A. PreTransactional Static -- Temporarily suspended “Data Mining” [supply-oriented] -- Decipher online consumer patterns Autonomous individual -- Personal data protection [“data bank”] B. Transactional Dynamic -- Continuous exchange “CRM” [demand oriented] -- Formulate “variable privacy” profiles Collaborative interactive -- Personal anonymity preservation [“data blank”] These five phases are summarized briefly here and frame the progression of the paper. 1. Introduction: Comprehension Learning Outcomes a. Evolution of electronic commerce, digital markets, and information privacy compared to physical privacy concerns in traditional markets b. Informational “digital identity” compared to biological physical identity c. “Networked” digital market interaction compared to physical channel exchanges d. “Real-time” interactive digital marketing strategy/management compared to “regulartime” non-interactive traditional marketing strategy/management e. “Digital literacy” as a fundamental nomenclature for comprehending information privacy within an e-commerce digital marketing context Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 40 2. Background: Conceptualization Learning Outcomes a. Information privacy in the social regulatory context of digital marketing b. Information privacy in the business e-commerce context of digital marketing c. The “privacy construct” as a core e-commerce mechanism for determining economic exchange value for online consumers d. The “privacy matrix” as a framework for discerning the two primary states of ecommerce associated with specific types of online consumer information processing – and alternate “variable” privacy modes. 3. Elaboration: Critical Thinking Learning Outcomes a. The “information privacy matrix” as a typology of e-commerce dimensions of information privacy – cognitive modes b. Critical thinking applications of “information privacy matrix” dimensions and themes to digital marketing strategy/management c. The “privacy planning mix” as a schema for charting digital marketing management/strategy functions and activities d. Critical thinking applications of “privacy planning mix” elements and properties to digital marketing strategy/management 4. Reinforcement: Communication and Content Awareness Learning Outcomes a. “Doing & Sharing,” experiential learning through interpersonal group projects using online content and “best practice” sharing in informal classroom settings b. “Proving & Caring,” outcome-oriented self-selected application assignments with personal instructor attention and work monitoring 5. Feedback: Cumulative Learning Outcomes a. Ongoing constructive evaluation provided by verbal and written feedback b. Targeted verbal and numeric grading of key module “learning outcomes” – comprehension, conceptualization, critical thinking, and communication c. Comprehensive final evaluation of module using oral/written methods d. Post-module application effectiveness demonstrated by improved digital marketing performance academically, professionally, or extra-curricular. Comprehending Information Privacy as an E-Commerce Phenomenon This learning out come phase entails pointed discussion of electronic commerce evolution and the parallel information privacy issues confronting marketers (Raul 2002; Wind and Mahajan 2001; Wigand 1997). Historically, market merchants and customers engaged in a shopping ritual that consisted of implicit information access, such as processing familiar sensory cues, noting physical features, and remembering interpersonal bonds. By contrast, e-commerce interaction requires explicit information entry and retrieval of personal information in order to achieve the digital market benefits of convenience and customization. Instead of a familiar faces and facilities, e-commerce participants interface with devices and icons that only have meaning in a digital context. More worrisome, each of these requires personal consumer data to perform their intended function. In fact, the collection and mining of online consumer data is inextricable from the e-commerce value model and value proposition. However, digital consumers are typically unaware of the full spectrum of data collection during Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 41 online transactions, and even less certain about how that information will be analyzed by data mining techniques. Within this more abstract and unfamiliar electronic “marketspace” context, the marketing functions and the salient customer characteristics are compressed into digital form (Rayport and Sviokla 1994). The PPM, therefore acquaints students with the contrast between biological customer identity wherein isolated physical characteristics are targeted, and digital customer identity wherein interactive cognitive patterns are engaged (Carter 2002; Breitenbach and Doren 1998; Negroponte 1995). Alternative methods for grasping these patterns of “customer connection” (Wayland and Cole 1997) are also available to marketing educators, including digital capital business web models (Tapscott 2000), network analysis (Iacobucci 1998, 1996), as well as the formulation of “net gain” and “net worth” (Hagel and Singer 1999; Hagel and Armstrong 1997). Ultimately, the pedagogical benefit of distinctions between traditional and electronic commerce is the infusion of a broad based “digital literacy” (Gilster 1997). The comprehension of e-commerce evolution and the role of information privacy in digital marketing is supported by handout materials and a guided tour of pertinent websites, such as the Federal Trade Commission (FTC) www.ftc.gov, the Electronic Privacy Information Center (EPIC) www.epic.org/privacy/internet/hr_98.html, and a sampling of popular online shopping web sites such as Amazon.com www.amazon.com, eBay www.ebay.com , and Expedia.com www.expedia.com Conceptualizing Information Privacy at the Core of Online Consumer Interaction Electronic commerce is a dominant business and societal force that is transforming marketing and management information systems (MIS) research and practice. Information gathering is both an antecedent and outcome of market commerce. The historical symbiotic cycle of information and commerce is manifested more explicitly in the recent emergence of electronic commerce transactions (Tapscott 2000). Unlike traditional market settings, ecommerce modes are non-physical and therefore more information intensive. Market decisions are informed by intelligence gathering and retail commercial transactions generate higher volumes of data. Consumers are increasingly concerned about the privacy of their personal information as well as their buying behavior information. With so many cases of identities theft and computer fraud today, people want more than ever to protect their identities and private information from those that will use it maliciously (Haegele 2000). The goal of e-commerce is to personalize the product or service without compromising security or user’s anonymity (Westin 1999; Wigand 1997). This raises a dilemma: How does an e-commerce business protect the identity of online consumers when personal data is required to customize digitally marketed products and services? “The current conflict between marketers and consumers also results from the economics of information capture. Consumers have become all too aware that companies’ ability to collect information far outstrips their ability – or inclination – to deliver meaningful value in return. … Consumers increasingly recognize that they are selling their ‘privacy’ cheaply to companies that are using it to forward their own interests.” (Hagel and Singer 1999, p.16) Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 42 Currently, the scale has not been balanced between the economics of information capture for e-commerce strategy and the ethics of preserving information control for individual consumers (Clemmons and Bradley 2001; Hagel and Rayport 1997; Foxman and Kilcoyne 1993). This imbalance stemming from the economic and informational dimensions of ecommerce (Evans and Wurster 2000) heightens the value of information privacy for the entire spectrum of marketing activities. One way of better conceptualizing the marketing implications of “variable” information privacy is to frame instructional content based on the fundamental factors of economics and information (Urbany 1986). When information processing is viewed from the economic perspective, a “privacy matrix” emerges with two types of consumer information processing and two electronic commerce states (see Figure 3). The first e-commerce state is essentially pre-transactional. Online consumers are either contemplating entirely new transactions by conducting data searches and evaluations to achieve a desired market outcome, or they have completed transactions and are assessing the market lessons learned in order to improve the outcome of future market transactions. In the pretransactional state, commercial activity is static, or temporarily suspended, in order for consumers to perform autonomous information processing. Because online consumers are noninteractive during these pre-transactional periods, their information privacy mode is oriented towards data security, or maintaining their “data bank.” It is the data itself that online consumers value most during autonomous information processing, because data integrity, accuracy, and security determine the sufficiency and sustainability of e-commerce market decisions. By contrast, the second state of e-commerce activity is essentially transactional, or interactive. In this second state, commercial activity is dynamic and consumers perform collaborative multitask information processing -- relying on a host of electronic commerce venues, links, and options. As a result of the transactional state’s interactive activity, shared data flow, and multiple user connections, the information privacy mode is oriented towards protecting online personal identity (Turkle 1995), preserving anonymity, and preventing access to private characteristics by opting for a “data blank.” This dynamic transactional state permits powerful data retrieval activities, which increase online consumer uncertainty (Clemmons and Bradley 2001), and heighten information privacy concerns. Critical Thinking Applications of Information Privacy A more pragmatic framework for digital marketing application complements the PPM’s theoretical conceptualization of information privacy modes. The proposed “privacy planning mix” equips marketing educators with an adaptation of the useful “marketing mix” schema to improve critical thinking about the role of information privacy influences in e-commerce marketing management (see Figure 4). The literature search of marketing journals supports the role of information privacy as a catalyst for building customer trust in a digital marketplace (Klein 2001; Reichheld and Schefter 2000; Urban, et al. 2000; Hoffman, et al. 1999). Based upon the significance of these information privacy developments, a fifth privacy element is proposed to augment the traditional marketing mix in the digital marketplace. Ward Hanson (2000) concurs with the fifth “privacy P,” to augment traditional marketing mix elements; Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 43 “A more complicated problem is establishing policies on information access … Customers are concerned about their personal information.” (Hanson 2000, p.418) Figure 4 The “Privacy Planning Mix”: Privacy Element [5th P] & Information Branding Attributes Product benefit INFORMATION “BRANDING” ATTRIBUTES “Privacy” * trust * • security • anonymity accuracy Price cost quantity control CONSUMER RISKS format (application & style) quality (relevance & context) currency Promotion communication Place channels MARKETING MIX “4 + 1 Ps” A “privacy manager” would coordinate plans and actions that influence so-called “fair information practices” with respect to customer data (FTC 2000; Clement 1993). Privacy management is directly related to the strength of trust bonds between customers and companies. Besides building trust, a privacy element creates accountability for a wide range of emerging information value factors. From an information and message viewpoint, brand management Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 44 epitomizes the marketing mix in practice (Keller 1998). Consequently, the “privacy planning mix” parallels brand management techniques and its corollary product packaging. Information branding introduces e-commerce value attributes for customized “information packaging.” These “information brand” attributes profile the consumer risks associated with protecting data and identity to optimize digital market value (Westin 1999; Brooker 1984; Bauer 1960). Because these profiles are comparable to risk/return ratios used in the insurance industry, they constitute a privacy actuary for improving the business merit of personal information trading. Comparable to traditional brand theory (Keller 1998; Aaker 1996), information branding carves a competitive position in the customer’s mind regarding a set of attributes that distinguish one company’s privacy/trust package from another. Brand merchandising and packaging have historically close ties because brands give symbolic meaning to packaging features. Likewise, information branding gives symbolic meaning to privacy packaging. Privacy and trust are amorphous ideas that can be made clearer and easier to distinguish by “branding” specific information measures in customer minds. In this respect, information brand distinctions are market signals for attracting customers, similar to signals for privacy, convenience, customization, quality, price, or newness. As seen in Figure 4, the “privacy planning mix” information brand attributes are: a) Accuracy – valid information b) Quantity – information volume c) Quality – information relevance and content richness d) Currency – timing and speed of information delivery e) Format – information application or use and content presentation style f) Control – authority over information use and sharing. Unlike information characteristics specified outside of the marketing literature (Firestone and Schement 1995, pp.8-16), this study’s proposed attributes parallel information brands with traditional brands. Keller (1998) identified five “brand elements” – memorability, meaningfulness, transferability, adaptability, and protectability (p.70). The information brand attributes advanced in Figure 4 are a parallel set of metrics for embedding privacy/trust in ecommerce offerings. Communicating Information Privacy Implications through Content Awareness Effective communication and content awareness methods are vital for building student confidence, as well as to continuously reinforce the PPM’s information privacy orientation for marketing education. Accordingly, the PPM is designed to implemented in group project settings that permit greater instructor facilitation, and “best practice” sharing (McCorkle, et al. 1999). A second implementation guide is to present PPM constructs and content as “active learning” supplements (Paul and Mukhopadhyay 2001) for both electronic (Gillette 1996) and non-electronic course activity. In this respect, the PPM extends the marketing education benefits demonstrated for “experiential learning” (Wee, et al. 2003; Gremler, et al. 2003). The value of experiential learning for improving both academic and practical skills is well established in the Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 45 marketing education literature, including the integral role of information technology applications (Sautter, et al. 2000). Through experiential learning, PPM communication and content awareness objectives are embedded by autonomous group activity, as opposed to didactic instruction. The third PPM implementation directive is to draw upon the knowledge resources provided by “reality-based learning” (Smith and Van Doren 2004). Because information privacy is a prominent theme in e-commerce business, PPM course activities should link with marketing practitioners. In many instances, the marketing education lessons associated with the “privacy matrix” and “privacy planning mix” are more relevant when demonstrated by “real world” ecommerce marketers. Partnering with marketing practitioners improves the PPM’s ability to achieve communication and content awareness outcomes. This pragmatic approach towards imparting information technology oriented skills is supported by marketing education research (Benbunan-Fich, et al. 2001; Moon 1999). Conclusions: Cumulative Privacy Pedagogy Module Contributions The vital role of information privacy in understanding and managing e-commerce exchanges places it at the hub of digital marketing. Although the growing significance of information privacy is represented in the broader marketing literature, it has not been directly addressed in the marketing education literature. The proposed Privacy Pedagogy Module (PPM) is intended to fill this void and catalyze a more contemporary consideration of information privacy in e-commerce marketing. Specifically, the PPM improves “information privacy” comprehension, conceptualization, critical thinking, communication, and content awareness. By introducing a “variable privacy” construct, the modes of information privacy are distinguished based on e-commerce states and online consumer information processing approaches. The resulting “privacy matrix,” in turn, helps comprehend and conceptualize the relevance of information privacy factors across the entire spectrum of marketing course offerings. Far from being an exclusively ethical concern, information privacy should be taught as a central determinant of value in e-commerce markets, and the source of competitive digital marketing advantages. Therefore, by rendering a broader comprehension and conceptualization of information privacy influences, the PPM addresses e-commerce curriculum challenges outlined by Mitchell and Strauss (2001). In order to complement conceptual marketing education outcomes with practical critical thinking applications, the “privacy planning mix” is introduced as a framework for improving ecommerce marketing skills. 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Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 59 HEALTH CARE MARKETING AFTER SEPTEMBER 11, 2001 Tony Carter, William Paterson University INTRODUCTION At Pfizer, the nation’s largest drug maker, Dr. Henry A. McKinnell, the chief executive was in his office when the jetliners hit the World Trade Center. With offices just one block from the United Nations and across the street from the Israeli consulate, both possible terrorist targets, Dr. McKinnell said he was very concerned about the safety of the company’s employees. Or, as Robert J. Kopp, and associate professor who teaches marketing and advertising at Babson College, said, “People, in their gut, like to be able to personalize a company.” But the straightforward approach failed to persuade Susan Fournier, an associate professor at Harvard business School who specializes in marketing and branding. She had been stuck in Chicago waiting for a United flight and had spent more than an hour in a line to get information. Dr. Fournier said United could take a lesson from James E. Burke, former chief of Johnson & Johnson, who saved the reputation of Tylenol during the drug-tampering scare of 1982. Mr. Burke not only appeared on numerous TV interviews, but also gave public updates on all the company’s actions, from removing products from shelves to introducing tamper-resistant packaging. “There is the acknowledgment, and then there is the reparation and recovery.” Dr. Kopp agreed. “I would recommend the C.E.O.’s view these campaigns with some continuity and come back to us with a follow-up” with some concrete actions, he said. “Otherwise, people will think they are just putting their finger in the dam before it bursts.” Aon Corporation This company was very much hit hard by The World Trade Center attacks. That company is Aon Corporation. Even though insurance carriers had minimal job losses they suffered tremendously with claims and brought about coverage issues that the government is examining and debating on. Aon Corporation is a Fortune 500 company headquartered in Chicago, Illinois. Aon is a holding company that consists of insurance brokerage, consulting, and insurance underwriting subsidiaries. Aon Corporation is a global firm, which dominates many sectors of the industry. Aon is the worlds: • No. 1 Global reinsurance Broker • No. 1 Global manager of captive insurance companies • No. 1 U.S. multiline claims services provider • No. 1 U.S. wholesale broker and underwriting manager • No. 2 Global Insurance broker • No. 6 Employee benefits consultant • Aon has approximately 53,000 employees worldwide with 550 offices in more than 125 countries. Aon’s business structure consists of seven major divisions: • Aon Consulting • Aon Re Worldwide • Aon Risk Services • Aon Services Group Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 60 • Aon Warranty Group • Combined Insurance • Virginia Surety Company/London General Insurance • Within these divisions Aon performs services dealing with employees benefits, compensation, management consulting, risk management, and supplemental accident and health and life insurance. In most of these divisions Aon is clearly a global leader in the industry second to Marsh & McLennan only. Shortly after 1993 Aon moved its offices into Two World Trade Center along side its major competitor Marsh & McLennan. The firm occupied 9 floors 92, 98-105 respectively with approximately 1,100 employees in the New York hub. These floors were the worst places to be relative to the impact zone. Many people were left trapped with no alternative but to jump or be burned alive. Aon was hit very hard by the attacks many people chose their fate immediately after the first plane hit Tower One. Those who chose to leave against building announcements were ultimately saved; those that didn’t lost their lives. Aon lost nearly 200 employees to this senseless act of violence. Many employees like the rest of the nation were left traumatized by the experience of this traumatic event. How did Aon handle this difficult situation in the aftermath of the attacks? It recognized that the company had a full fledge crisis on their hands. A crisis is defined as a major unpredictable event that has potentially negative results. These terrorist attacks on the World Trade Center definitely could be classified as unpredictable and had definite negative results. Even though Aon specializes in risk services and management this event was completely unpredictable and never could be imagined even in anyone’s wildest dreams. A crisis can be a turning point in any firm. It can affect sales, employee morale, increase in operating expenses, and financial condition. Aon had to act fast like most other firms in this tragedy to insure the survival of this corporation and to handle this delicate situation with the utmost care. Even in the wake of disaster public relations is extremely important; you definitely do not want bad press and backlash from surviving employees about how insensitive the company reacted. It was a tremendous help that Aon had a Crisis Management practice that was founded in 1999 to assist them in this difficult process. Crisis Management is not only predicting that things will go wrong but developing a plan of action once the crisis has occurred. The Framework for Crisis Solutions was exhibited by Aon. The first step fact gathering consisted of locating the employee’s whereabouts. The Crisis Management Team quickly established a hotline and command center to account for all employees stating that their employee’s safety was their primary focus. Communicating the message was widely used by The Crisis Management Team. The Team relayed information to its customers, employees, and shareholders. Crisis Centers were established to counsel many employees who lost coworkers and provide psychological help in understanding why this violent attack occurred. Crisis management teams were focused on employee morale giving employees ample time to grieve. Employees were asked to come back to work after three weeks and if more time was needed it was granted. Memorials were held at St. Patrick’s Cathedral and a meeting at the Waldorf-Astoria to promote unity and show that there is a support network within the company. Salaries were continued for all employees until relocation could be achieved. Salaries were also continued for deceased employees for six weeks as well. Office space was finally found in midtown Manhattan three weeks later. Learning from the events of September 11 Aon teamed up with Rudy Giuliani to provide corporate crisis management. Giuliani Group LLC and Aon formed a strategic alliance to provide crisis management services to major corporations around the world. Aon CEO Patrick Ryan states that “Companies today must prepare for the what was previously inconceivable. Merging our expertise with that of Rudy Giuliani, whose leadership skills have set a crisis management standard for the world, made perfect sense.” As discussed previously Aon already had a global crisis management team and we will draw form that experience. Aon also created in 1997 a Special Risks Counter Terrorism Team, which combines military and insurance experience to provide risk transfer and risk management solutions to clients who are exposed to terrorism. It also has developed risk management and insurance solutions in the event that chemical, radiological, and biological warfare are used. These are issues that Americans never conceived worrying about here on U.S. soil, but these are issues that firms need to consider bringing quality service to consumers, protecting employees and the firm’s assets. Business Continuity is something that every firm must plan for across all industries. Many firms post September 11 are scrambling to refine their Business Continuity program. Business Continuity is being prepared in case something happens to your home office usually in the event of a fire or natural disaster. Now firms must prepare for terrorist attacks as well. Many of Aon’s clients are expressing a desire to enhance resumption planning, Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 61 security and evacuation planning provisions. Business Continuity has been thought of in the past as a waste of time by many, it has now become a way of life. After the attack on the World Trade Center Aon’s client servicing was rerouted to its Client Service Business Units in Los Angeles, Houston, and Illinois. Aon was still able to manage quality customer service throughout the whole ordeal until the office relocated. All the data files that were contained in the World Trade Center were backed up at the Chicago headquarters as well as the Houston office. This practice is common and insures that service will not be interrupted to clients. The only addition to Business Continuity would be to practice evacuation practices in the event of a fire, bombing, or biological warfare. So in the event that disaster strikes again people will be evacuated immediately, not taking anything for granted. America like the rest of the world must be ready for anything at anytime. Reengineering is defined as altering existing models and thinking. Internal and external changes in the environment may warrant a need to do things differently. These changes can consist of technological advances, globalization, and catastrophic business crises. In the case of September 11 attacks, Aon’s reengineering process will focus on catastrophic business crises. As the Insurance industry is changing Aon’s services in terms of insurance coverage and risk management will be needed more than ever. Aon started its reengineering process by hiring Rudy Giuliani and his firm to assist their crisis management area with public safety, emergency preparedness, and leadership during crisis. In 2002 and beyond this is what clients will need and Aon must find a better way to give customers what they want. With Aon incorporating these strategies it will give them a competitive advantage and increase revenue. Aon is also using reengineering to boost morale for employees. Aon knows that in the coming years preserving the memory of their coworkers will be paramount on their minds. Aon has founded the Aon Memorial Education Fund to honor the memories of fallen colleagues. The fund was created so that the victim’s children could pursue collegiate endeavors. Many employees ran in the NYC and Chicago marathons to raise funds and also to help raise awareness to the cause. With these charitable programs, it has helped employees heal and has shown that Aon has not abandoned the people that have worked so hard for them over the years. This is the type of reengineering that is needed to bring unity within the firm. Aon was hit hard financially by the attacks on the World Trade Center. Aon’s Combined Insurance Company had to pay $45 million of insurance benefits to employees. They also extended medical benefits of $7 million dollars to the families of deceased employees. Insurance claims are still being processed relating to losses that Aon suffered and how much it really costs them in terms of business interruption is still unknown. Lastly the cost of finding interim office space for the last year after the disaster must also be factored into play. The cost of relocation doesn’t stop there. Aon is moving again. It recently inked a deal to move to 199 Water Street downtown. This time around CEO Patrick Ryan said, “These are not tall buildings standing at 40 stories. I think that people are generally comfortable.” This is just another example of how all firms have changed the way they do business. Unfortunately all this hardship a year ago has not faded. Aon is still struggling to regain itself in the wake of September 11 and a SEC probe into their accounting practices. In the wake of September 11 the insurance industry was hit extremely hard and is still reeling from the attacks. The issue of insuring terrorist’s attacks is causing debate within Congress and the industry as a whole. Insurance companies cross the board are still trying to quantify the exact loss suffered. It is estimated that anywhere between $40 to $70 billion was lost. The big debate with Insurance companies today is whether these terrorist attacks were an act of war. If the attack were classified that way many insurance carriers could deny coverage. Most insurance contracts contain war exclusions such as: • War (declared or undeclared) • Civil War • Military Action • Insurrection • Rebellion • Revolution Another avenue that is being questioned by insurers is the “one or two occurrence” debate. Port Authority wants to classify the attacks as two occurrences so they will be covered for both towers and paid accordingly as if it were two separate instances. The insurers believe that it was one occurrence and should be paid accordingly. The only flip side to denying coverage is the bad public relations that will follow. American patriotism is at an all time high, if insurance companies start denying claims it could lose a substantial amount of revenue. The American public at this Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 62 point in time will not support firms that are not putting the needs of the country and its people first at this critical time. Companies do not want to be the firm known for not paying claims on poor innocent victims of the tragedy. This leaves the industry in a tough spot. The industry has already stated that it cannot take another major terrorist attack. These circumstances have prompted the government to examine the situation a little further. President Bush is urging Congress to adopt legislation to protect the insurance industry from losses due to future terrorists attacks. It is the House and the Senate objective to make terrorism insurance widely available at affordable prices limiting the liability of the insurance industry. Congress is extremely close to finalizing a deal to provide up to $100 billion of support to the insurance industry in the event of a future terrorist attack. The general deal involves the government paying 80% of losses up to $10 billion and 90% above that. The other suggestion proposed by the House gives the secretary discretion to decide whether to actually require the insurers to pay back loans or leaving the costs to be paid by taxpayers. The flip side of bailing out the insurance industry is that it would reduce the industry’s incentive to require clients to take adequate security measures that would deter terrorists. If the government is backing them up to a certain percentage, insurance companies will only be liable to a limit. These issues are still being heavily debated, but it is clear that President Bush is committed to putting this through as legislation. This would give him enormous credit and could define his presidency. President Bush is also thinking about re-election and how he handled the aftermath of September 11 is paramount in the American publics mind. The Insurance industry is also being plagued by a sluggish U.S. stock market. Poor underwriting in 2001 cost the industry $27 billion in capital. The industry lost so much revenue because it no longer could depend on attractive investment yields, which would cover the cost of under priced premiums. With a lagging market, increased claims, terrorism coverage, and poor underwriting, this industry must come up with new and innovative plans to keep up with these challenging times. These attacks should show all Hospital Organizations around the world that crisis management is critical to any firm and it is not wasteful planning. Hopefully 3000 lives lost rang the alarm on September 11 and America will never be able to sleep the same way again. NOTES Aon Corporate Communications. “Aon Reports Third Quarter 2001 Earnings; Updates on Business transformation, Impact of September 11 Attacks and Spin-offs Plans”. November 7, 2001 Jessica Papin. Because we are Americans: What we discovered on Sept. 11, 2001. Warner Books, 2001 Tony Carter. The Aftermath of Reengineering. Haworth Press, 1999 Jack Gibson. “Attack on America: Insurance Coverage Issues” International Risk Management Institute Inc. September 2001 Tony Carter. Contemporary Sales Force Management. Haworth Press, 1998 Stephen Labaton. “Threats And Responses: The Insurance Industry’s Tentative Deal is Reported on $100 billion in Aid to Insurers Facing Terror Claims”. New York Times. October 18, 2002 Aon Corporate Communications. “An Insurance Market Overview”. November 1, 2002 Stephen Labaton. “Threats and Responses: The Insurance Industry; Bush Tells Congress to move quickly on Terrorism Insurance”. New York Times. October 2, 2002 Joseph Treaster. “Threats and Responses: The Insurers: Aon is Moving to new offices, but will avoid tall buildings” New York Times. September 10, 2002 Fiscal Policy Institute. “Economic Impact of September 11 World Trade Center Attack”. September 28, 2001 Lingling Wei. “Giuliani teams up with Aon to provide Crisis Management”. SmartMoney. October 16, 2002 Aon Corporate Communications. “Aon Provides Update on World Trade Center Tragedy” September 12, 2001 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 63 THE VALUES FRAMEWORK: CORE VALUES AND CULTURE John Cherry, Southeast Missouri State University Peter J. Gordon, Southeast Missouri State University ______________________________________________________________________________ ABSTRACT A conceptual framework is presented to integrate previous writings in the areas of corporate social responsibility and strategic planning, and to achieve a blend of economic and moral values at the functional level. The various components of the framework are discussed, as well as their inter-relationships. It is argued that moral management practices, implemented through a set of core values and monitored by an Ethical Dialogue Group will foster a socially responsible corporate culture. The implications for the firm's sustained competitive advantage are discussed. _____________________________________________________________________________ INTRODUCTION The connections between corporate strategy and business ethics have been discussed extensively by ethics researchers in the context of strategic planning. An issue of Business Horizons in the early 1990's was entirely devoted to questions of business ethics and corporate social responsibility (CSR). A number of recommendations have emerged from these discussions, and especially a number of separate conceptual frameworks for dealing with these issues. Many viewpoints have been promoted as well as several criteria for consideration: the needs of various stakeholders, the role of organizational core values in the strategy process, and the general role of corporate culture in the promotion and maintenance of organizational values. Over much of the past 25 years there has been relatively little published research which has discussed a unifying paradigm which explicitly considers more than a few of these variables, and even less attention has been given to the way in which the concept of CSR based upon codified moral management practices may lead to competitive advantage. The purpose of this paper is to review some of the more prominent works in the area of CSR and business ethics and to provide an integrative framework which will be useful to organizational planners in the pursuit of competitive advantage. The paradigm advanced here follows Deshpande and Webster's (1989) contingency management/organizational symbolism perspectives: contingency management views organizational structure as an endogenous variable, consisting of beliefs and values developed by and within the organization, while the organizational symbolism perspective emphasizes culture as a metaphor for shared symbols and meanings (Deal and Kennedy 1982). These variables are Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 64 salient in any discussion of core values and moral management and provide insight into the areas of future research, discussed below. What is Corporate Social Responsibility and Why is it Desirable? Corporate Social Responsibility embraces the idea that managers must meet the product and service needs of society while continuing to protect and enhance the resource base, individuals, and society itself (Baird, Post, and McMahon 1990). As early as 1972, Steiner (1972) argued for a conception of CSR which is grounded in the social contract between businesses and the environment in which they operate. Others (Anderson 1982; Hosmer 1991) suggest that as businesses become larger and more complex, they become more resource dependent to ensure long run survival. Hair et al (2004) suggests that CSR requires consideration of both the long run interests of the company and the company's relationship to the society within which it operates. Carroll (1991) suggested that total corporate social responsibility has four components: economic, legal, ethical and philanthropic. Many authors writing on the subject of CSR emphasize the benefits which accrue to the firm in terms of commitment and productivity. While some see business as having no social responsibility other than the creation of profits (Friedman 1970), examples of business persons espousing the CSR concept are notable. Retailer Kenneth Dayton, chairman of Dayton Hudson Corporation, sees business as not only having a responsibility to be socially responsible but feels the continued existence of his business depends on it. A recent study in the Wall Street Journal (September 23, 1999) ranked (in order) Home Depot, Johnson & Johnson, Daimler-Chrylser, Anheuser-Busch and McDonalds as having the highest level of social responsibility in America. Armstrong and Kotler (2003) cite Ben & Jerry's, Saturn and the Body Shop, and others as practicing "caring capitalism" and distinguishing themselves as being more civic minded and caring, to profit by serving the best long-run interests of their customers and communities. The economic benefits of CSR are felt at a number of levels. The co-alignment between corporate values and employees' value structures has been shown to be positively related to measures of employee commitment (Price and Mueller 1986; Hunt, Wood, and Chonko 1989), performance and satisfaction (Churchill, Ford, and Walker 1990; Herndon 1991) and negatively related to turnover (Herndon 1991). Socially responsive firms may be more successful at obtaining productivity and innovativeness through their people (Peters and Waterman 1982). Hosmer (1991) argues that stakeholders who believe they have been treated "rightly, properly, and justly" tend to develop a sense of community that leads to a total organizational effort needed to achieve the desired goals of economic efficiency and competitive effectiveness. A number of authors (Heinz 1976; Moskowitz 1972) have suggested that CSR information may play a role in investors' evaluations of investment desirability. While the empirical evidence linking CSR to profitability is somewhat inconclusive (Kraft and Hage 1990), many writers believe that poor social performance may contribute to poor profitability through the costs of regulation, litigation (Drucker 1980; Tombari 1984), and a devalued corporate image (Robin and Reidenbach 1987). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 65 Ethics, Responsibility, and Freedom As indicated above, the idea of CSR is fundamentally related to the social contract. Implicit in this discussion is the conflict between society, as embodied by consumers and regulatory bodies, and the organization itself. Regulation and litigation are effectively coercion upon the firm to behave responsibly, and most business people agree that self-regulation is preferable to external regulation. Regulatory actions can be seen to decrease degrees of strategic freedom when the social contract between firms and consumers break down. This situation has caused some to take the position that responsibility, as defined by ethics and enforced by social control, is what makes people and organizations free (Wood 1991). Thus, it is argued here that an ethically-based model of CSR will provide the firm the maximum amount of freedom consistent with the demands of stakeholders. MODELS OF CORPORATE SOCIAL RESPONSIBILITY AND STRATEGIC PLANNING Writing on the need for integrating social responsibility and ethics into the strategic planning process, Robin and Reidenbach (1987) have developed a parallel planning system to align traditional planning functions and the requirements of CSR. The primary features of the model include: 1) development of corporate objectives which guide and are guided by a statement of organizational mission and ethical profile, which leads to 2) estimating corporate objectives which influence and are influenced by an estimate of corporate environmental output, followed by 3) development of actionable strategic plans which influence and are influenced by development of actionable ethical core values, which leads to 4) development of workable tactics and implementation of the strategic plan which influences and is influenced by the integration of core values into organizational culture. The parallel planning approach thus is a useful step toward blending CSR and planning, but it raises as many questions as it answers: how will the alignment of cultural values and strategy be effected, and what organizational mechanism, individual, or group will be responsible for defining core values and stakeholder requirements? In addition, the process does not sufficiently specify the various organizational activities which are inherent in the planning process, e.g., operations, finance, and the marketing function, nor does it guide the firm in ensuring that socially responsible culture is perpetuated across management succession and/or environmental change. Hosmer (1991), by contrast, has defined managerial responsibilities at the micro level, suggesting a hierarchical relationship among operational activities (operations, production), functional activities (marketing and finance), technical activities (human resources, data processing), conceptual activities (strategic planning) and ethical management (distribution of benefits/harms generated by the firm). Hosmer argues that his model shifts the question of CSR from "for whom" to "for what", and thereby provides some indication of specific areas of responsibility where core values may be developed and the criteria by which they may be evaluated. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 66 To Hosmer, the challenge of stakeholder management is to ensure that the firm's primary stakeholders achieve their objectives while other stakeholders are also satisfied. However, sorting out the urgency or importance of various stakeholder claims is acknowledged to be problematic. Carroll (1991) suggests two perspectives: from a CSR standpoint, legitimacy of stakeholders' claims may be most important, while from a management efficiency perspective, stakeholders' power might be of central influence (Carroll 1991). This ambivalence suggests the problem inherent in Robin and Reidenbach's (1987) conception: who will resolve completing claims, and on the basis of what information? The Ethical Dialogue Group Reviewing research on organizational governance, Scott (1988) concludes: "The recognition of multiple stakeholders...and competing interests in organizational politics has not amounted to a serious challenge of managerial sovereignty. The answer to the question of who rules is still perfectly plain - management." The ethical dialogue group (EDG) is intended to contribute to greater ethics consciousness by managers of large corporations serving multiple stakeholder needs or interests (Payne 1991). To provide management a special communications forum by which organizational strategies and outcomes may be evaluated from the perspective of CSR, Payne suggests the functions of the EDG may include: 1. Searching for values, interests, power and assumptions among stakeholders; 2. Looking for varying meanings or perspectives of these stakeholders with regard to the social issues confronting the firm; 3. Examining the culture and history of organizational subunits and stakeholder groups; 4. Identifying constraints to more open stakeholder communication, autonomy, and responsibility; and 5. Studying the technological, economic, and market forces influencing the firm and question assumptions based upon such environmental forces when they result in decisions favoring certain stakeholder interests at the expense of others. Perhaps the most important function of the EDG is to attune management to ethical and social challenges and to serve as an additional early warning in anticipating future corporate threats and opportunities (Payne 1991). In this way, the EDG becomes the critical link between the firm's strategic planning, its culture, and its environment. AN INTEGRATED FRAMEWORK The Values Framework is intended to show the primary components upon which socially responsible corporate culture may be built, the relationships among the components, and avenues for future research. The components include the core values module, an ethical dialogue group, the organizational culture in which core values and the dialogue group reside as endogenous variables, and the set of relevant stakeholders. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 67 Figure 1 THE VALUES FRAMEWORK Towards Sustainable Competitive Advantage External Stakeholders Shareholders Customers Corporate Culture CORE VALUES economic moral operations marketing finance technology/human resources conceptual/strategic Creditors Suppliers Ethical Dialogue Group Government/ Society EMPLOYEES Benefits/ harms Toward Sustainable Competitive Advantage Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 68 The Core Values Module Implicit in much of CSR literature is the trade-off between economic values and moral values. Table 1 provides examples of the typical firm's economic priorities at the functional level. In addition, a set of relevant moral values is suggested to provide guidance to the firm which seeks to identify the means by which moral values may complement economic values. The viability of the statements will differ among firms according to internal and environmental factors, and the set of values is not, therefore, a comprehensive list. The primary contribution of the Core Values Module is to permit explicit analysis of deviations from corporate policy at the functional level, to provide insight into the nature and extent of such deviations, and to facilitate analysis of the effects of "subcultural" influences within each functional area (Deshpande and Webster 1989). If, for example, the marketing area (as is widely suggested) engages in ethically questionable activities, the problem may be traced to individual or group influences, or to whether the problem relates to marketing's coordination of activities with other functional activities. Thus, a tactical choice of producing low cost, low quality products may find its roots at the production, marketing, and/or conceptual level. The Core Values Module may enable management, acting through the ethical dialogue group, to address CSR questions directly and precisely, and to specify appropriate remedial action. Clearly, the list of economic and moral considerations presented above should not be construed to be complete. For example, economic factors may differ among firms owing to the firm's definition of its business, market served, mission, or competitive circumstances. In addition, some may argue that many of the moral prescriptions are already mandated by law. In other cases, it may be argued that the economic and moral implications of policies and strategies are not conceptually distinct. For example, the firm may choose not to engage in negative advertising because it has been suggested that this tactic may "backfire" (James and Hensel 1991). It would be argued here that such ambiguities may be a matter of fact ~ individual perspective, and that the merging (or at least the coalignment) of economic and moral values is an explicit goal of the ethical dialogue group. Figure 1 shows the relationship of the Ethical Dialogue Group to the organization's structure: while it monitors the stakeholder environment, it both receives input from and contributes to the coalignment of values in the core values module. Fombrun (1986) suggests three activities by which the EDG may ensure continuity of socially responsible culture: 1) reproduction, which promotes the stability of executive succession in a firm to perpetuate CSR at the top level of management, 2) institutionalization of behaviors, routines, and policies that reinforce the expressed values of the firm, and 3) legitimization, or justification of the activities of the firm. An important issue in organizational culture and the organizational symbolism perspective is the socialization of new members to enhance identity and commitment. With respect to Fombrun's reproduction concept, the EDG addresses the difficult problem of how culture may be sustained across time and management succession by examining the culture and its history, its functional subunits, and stakeholder groups. From the standpoint of the organization's stakeholders, the legitimization function of the EDG is critical: management faces Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 69 Table 1. A Functional-Level Agenda: The Core Values Module VALUES / PRIORITIES WITH: ECONOMIC DIMENSION MORAL DIMENSION Operations / Production -continuously attempt to maintain -hold down costs reasonable prices -competitive cost structures -quality control and services we -will engage in no unfair pricing -will provide the kind of quality products would use ourselves Marketing -will avoid puffery; unrealistic expectations -will engage in no negative advertising -will ensure channel members are treated fairly that -promotional goals: awareness, interest -enhanced channel relations relations are mutually beneficial -will constantly seek innovation to provide better -product innovation and safer products and services -will be prompt, available, responsive, honest in -optimal levels of customer customer service, order processing -collect market information relations -will respect customers’ right to privacy, -will be scrupulous in collecting information on competitors -breadth of product lines product choices -disclosure of product right to ingredients -will strive to provide real, meaningful -will provide full disclosure and respect customers’ know and choose on an informed basis Finance -will not trade with firms pursuing unethical -select profitable investments practices or nations with demonstrated abuses of human rights -increase market value of the firm through portfolio selection -pursue premium bond ratings -maximize profit, ROI maximize -maintain skilled work force -maximize satisfaction, -will avoid overstretching, excessive debt -will maintain adequate reserves -will strive to finance growth internally -primary obligation is to investors: will strive to their security Technical / Human Resources -commitment to training and personal improvement -compensation must be fair Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 70 commitment; minimize turnover clean and safe -achieve technological innovation and enhance -Planning: product markets entered viable projects allocation of resources -integration of planning affected; will ensure full -will provide a work environment that is -will provide equal opportunity for employment and advancement -pursue innovation to deliver better products customer welfare; acknowledgement of and retribution for mistakes is a top priority Conceptual / Strategic -will compete fairly in all markets -will pursue only financially and ethically -will pursue cooperation of all parties participation and line and staff, across functions -vertical integration treated, -secure cooperation of power important internal coalitions accompany -public service charities and -will treat acquired firms as we would wish to be will not “strip” assets -will walk away from unethical deals -will strive to build comfort levels, acknowledge shifts and psycho-logical distress which change -will strive to be good citizens, will support reinvest in the community; commitment to civic improvement re: health and education Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 71 difficult challenges as to which stakeholders merit and receive consideration in the decision making process (Hosmer 1991). The challenge for the EDG is to ensure that the firm's primary stakeholders achieve their objectives while other stakeholders are also satisfied (Carroll 1991). Only by assessing the perspectives of stakeholders regarding social and economic issues confronting the firm can the EDG assess the legitimacy of competing claims. Towards Sustainable Competitive Advantage An important implication of the foregoing discussion is whether a firm's adoption of an ethical corporate culture can lead to competitive advantage in its product markets. Barney (1986) argues that, in order for a firm to enjoy culturally-based advantages, three requirements must be satisfied: 1) the culture must be valuable; it must enable a firm to do things and behave in ways that lead to high sales, 2) the culture must be rare; it must have characteristics that are not common among competitors, and 3) the culture must be imperfectly imitable; competitors cannot easily emulate its culture. The challenge facing the firm with respect to requirement 1 is to capitalize on enhanced relations with customer segments and channel franchises, by trading on goodwill acquired through a reputation based upon fair dealing, quality products, and generally "good corporate citizenship." Much of the marketing literature centers on formal terms of a transaction in evaluating value, but organizational culture and other less tangible aspects of a vendor firm may also be important to the potential buyer (Deshpande and Webster 1989). Johnson & Johnson's handling of the Tylenol problem, and Toyota's response to defects in its Lexus line (Ferrell and Pride 1991) are examples of positive, value enhancing responses by businesses which may have lasting effects on customers and channel members. A promotional strategy which emphasizes the firm's concerns for safety and quality should differentiate the firm from those which do not take similar actions in a highly visible manner. The examples given reflect the idea that a firm, using its cultural resources, can effectively turn a problem into an opportunity, and do so more effectively than organizations which do not have the same cultural resources. With respect to the second and third requirements for sustainable competitive advantage, the socially responsible firm may capitalize on competitors' difficulties in structuring their own cultures to lure customer and channel franchises away from the competition. Lieberman and Montgomery (1988), writing on first mover advantages, have suggested that organizational innovation is often slow to diffuse, and may convey a more durable advantage than other organizational characteristics. The socially responsible culture could be construed as one such form of innovation, and as such, is imperfectly imitable, at a reasonable level of cost. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 72 Perhaps the primary tool in the pursuit of competitive advantage is strategic planning. The Values Framework presented here explicitly recognizes that codes of ethics, like strategic planning, should be explicit and formal. Consistent with the core values module, the input of all employees is actively sought, and employees' comfort levels will be accommodated as fully as possible. Good planning requires line and staff integration, as well as functional integration to tap the creativity of all employees (Ramanujam and Venkatraman 1987). In addition, clearly defined, formalized, and decentralized planning processes lead to enhanced credibility and utilization of strategic plans (John and Martin 1984). By placing the emphasis upon values at the functional level, the firm can identify who the principal participants are in any decision, as well as the moral and economic implications of their actions. USING THE FRAMEWORK TO DEFINE RESEARCH ISSUES Much strategic planning entails consideration of the fit of the organization's competencies and resources with opportunities and threats in the competitive environment. The structure of the organization may be influenced by these factors, as well as its business definition, 8trategic group, and underlying culture. One significant question raised by the framework is what organizational form may most effectively utilize the moral values framework? Contingency theory explicitly recognizes that no single way of organizing will be most effective under all circumstances. In the high technology environment, for example, Texas Instruments and Hewlett Packard are well known examples of firms with very different cultures. The organizational mission, perceived organizational strengths (e.g., R&D and market position), and degree of resource dependency may all be useful variables for determining the differential effects of the Values Framework on varying organizations. The firm pursuing competitive advantage in a variety of product markets may also find that the Values Framework will enhance the perception of value in some markets, with less effect in others. More research is needed to explore whether, for example, corporate good citizenship is a viable competitive strategy in financial services, industrial goods, or high growth markets. Carpenter and Nakamoto (1989) suggest that first moving firms, in the absence of concrete product attribute information, may influence the formation of consumer preferences. It remains an empirical question as to whether the socially responsible firm can add value so as to set the standards for new products with respect to such attributes as environmental safety and product quality. For the socially responsible firm, another question is how to capitalize on its reputation. How should the firm promote itself, on the basis of its culture, to customers, investors, and other stakeholders? If the firm disavows negative or comparative advertising, by what means can it declare its greater social responsibility? In addition, if businesses pursue the path of social responsibility and publicize their efforts, will their actions be viewed cynically by consumers (Bowie 1991)? From a human resources perspective, more research is needed to assess the effectiveness of socialization processes on new recruits, and the influence of socially responsible culture on the management succession process. A firm operating in international markets may find, for example, that the framework designed for one country may not be suitable for another. The firm needs to address the question of whether it can export culture, and if it cannot, how it can adapt its culture to local markets. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 73 A number of measurement issues have direct bearings on all of the above considerations. The means by which social responsibility can be measured are not currently subject to consensus. A difficult problem is the choice of operationalization for such constructs as values, norms, innovation, benefits, and harms. For the resource dependent firm, differing perspectives may only complicate the issue if various stakeholder groups hold fundamentally different values and aspirations. The choice of research design is also relevant to assessing the impact of the Moral Values Framework. Traditional cross-sectional sampling and ethnographical methods are advocated by Deshpande and Webster (1989). The Humanistic Inquiry technique (Hirschman 1986), based in anthropology may be useful to assess the role of stakeholders' influences, the perceptions of decision makers, the socialization process, and the workings of the ethical dialogue group. CONCLUSIONS Research into the influence of organizational culture and competitive advantage has been characterized by emphasis on innovation and/or the generalized effects of group cohesion on performance. The Moral Values Framework provides a specific set of relationships, based on a clear set of organizational ethical guidelines and promoted at the highest levels of management to develop a socially responsible culture and ultimately, competitive advantage. Based upon a functional level analysis, the framework is intended as a conceptual backdrop to operate heuristically in the development of research examining behavioral factors in the study of strategic management, planning and execution. Smircich (1983) suggests that "culture may be another lever or key by which strategic managers can influence and direct the cause of their organizations." The Values Framework suggests that managers can use culture as a lever to win the support of critical stakeholders and ensure survival. If firms can successfully engender moral and economic values without sacrificing the concerns of relevant stakeholders, they may achieve the kind of value and difficult-to-imitate cultures required for sustainable competitive advantage. REFERENCES Anderson, P. (1982), "Marketing, Strategic Planning, and the Theory of the Firm," Journal of Marketing, V. 46 (Spring), 15-26. Armstrong, G. and Philip Kotler (2003), Marketing: An Introduction 6th ed. 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Deal, T. and A. Kennedy (1982), Corporate Cultures, Reading, Massachusetts: Addison-Wesley. Deshpande, R. and F. Webster (1989), "Organizational Culture and Marketing: Defining the Research Agenda," Journal of Marketing, V. 53 (January), 3-15. Drucker, P. (1980), Managing in Turbulent Times, New York: Harper and Row. Ferrell, O. C., and W. Pride (1991), Marketing: Concepts and Strategies, 7th Edition. Boston: Houghton Mifflin Company. Fombrun, C. (1986), "Of Tribes and Witch Doctors: The Anthropologist's View," in Corporate Culture and Change, M. Berman, (ed.), New York: The Conference Board. Friedman, M. (1970), "The Social Responsibility of Business is to Increase its Profits," New York Times Magazine, (September 13), 33. Heinz, D. (1976), "Financial Correlates of a Social Measure," Akron Business and Economic Review, V. 7, 48-51. Herndon, N. 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Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 75 Lamb, C., J. Hair and C. McDaniel (2004), "Marketing 7th Ed.", Mason, Ohio: ThomsonSouthwestern. Kraft, K. and J. Hage (1990), "Strategy, Social Responsibility and Implementation," Journal of Business Ethics, V. 9, 11-19. Lieberman, M. and D. Montgomery (1988), "First-Mover Advantages," Strategic Management Journal, V. 9, 41-58. Moskowitz, M. (1972), "Choosing Socially Responsible Stocks," Business and Societv Review, V. 1 (Spring), 71-75. Payne, S. (1991), "A Proposal for Corporate Ethical Reform: The Ethical Dialogue Group," Business and Professional Ethics Journal, V. 10, 67-88. Peters, T. and R. Waterman (1982), In Search of Excellence, New York: Harper and Row. Price, J. and C. Mueller (1986), Handbook of Organizational Management, Marshfield, Massachusetts: Pitman Publishing. Ramanujam, V. and N. Venkatraman (1987), "Planning and Performance: A New Look at an Old Question," Business Horizons, 19-26. Robin, D. and E. Reidenbach (1987), "Integrating Social Responsibility and Ethics into the Strategic Planning Process," Business and Professional Ethics Journal, V. 7, 29-45. ------and-------- (1987), "Social Responsibility, Ethics, and Marketing Strategy: Closing the Gap Between Concept and Application," Journal of Marketing, V. 51 (January). 44-58. Scott, W. (1988), "The Management Governance Theories of Justice and Liberty," Journal of Management, V. 14. Smircich, L. (1983), "Concepts of Culture and Organizational Analysis," Administrative Science Quarterly, (September), 339-358. Steiner, G. (1972), "Social Policies for Business," California Management Review, (Winter), 17-24. Tombari, H. (1984), Business and Society, (ch. 11), Chicago, Illinois: The Dryden Press. "The Best Corporate Reputations in America," Wall Street Journal, September 23, 1999, B1, B20. Wood, D. (1991), "Toward Improving Corporate social Performance," Business Horizons, (July-August), 66-73. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 76 CAREER PLATEAUS IN RETAIL MANAGEMENT James W. Clark, Southern Arkansas University ____________________________________________________________________________ ABSTRACT Nearly all employees experience plateaus at some point in their career development. Previous research has identified career plateauism as a source of both positive and negative influence in manager’s attitudes and satisfaction. A perusal of the relevant literature finds no research that investigates the effects of career plateaus in the retail environment. Additionally, most research in this area was performed several years ago. This paper discusses plateauism, identifies its causes and effects, relates existing research to retail store managers, and proposes a research project to investigate the relevance of the concepts to the management of retail managers. INTRODUCTION Employees often begin their careers with hopes, or even expectations, of climbing to the top of their chosen organization. Most care deeply about their career development and visualize themselves attaining increasingly greater responsibility, power, and compensation (Nicolson and West 1988). Since organizational cultures breed a “hierarchical fixation” among employees, successful career development is measured exclusively in terms of upward progression (Nicholson 1993). Unfortunately, nearly all employees reach a career plateau before achieving their goals (Bardwick, 1983). In today’s complex work environment, a career plateau is an almost inevitable occurrence for workers (Duffy, 2000). For any of a variety of reasons, employees find that continued advancement up the corporate ladder becomes unlikely or impossible. Alternatively, some persons achieve a level of responsibility beyond which they do not wish to grow. The latter case may generate a time of satisfaction, but the former circumstances frequently lead to disappointment and disillusion. A plateau can be a positive influence upon an employee in the sense that he or she no longer faces uncertainty in the form of changing and/or increased responsibilities. Such a position may lead to contentment, security and job comfort. The employee often chooses this type of plateau and it is described as personal (Ference, Stoner, and Warren 1977). Personal plateaus may also represent situations wherein an individual has the ability, but has lost the desire for career growth. Alternatively, plateaus may be negative influences when an employee feels he or she has the talent and initiative to advance beyond the current position but the company has no available positions or lacks equal confidence in the employee’s ability. Identified as organizational Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 77 plateauing (Ference, Stoner, and Warren 1977), these plateaus occur when individuals want to advance but cannot. Organizational plateaus may be a source of stress and frustration. In the retail environment, there is a clear opportunity for plateauing at the store manager level. While traditionally high turnover rates and continued corporate growth create many opportunities for advancement to store manager, opportunities for growth beyond managing a single store are more difficult to achieve. Additionally, strong managers, those most likely candidates for promotion, may find that upward mobility carries increased responsibility but does not include increases in monetary compensation or other desirable benefits commensurate with the increased requirements of the new job. Top store managers whose incomes may be nearly equal to, or greater than those of their direct superiors may be difficult to motivate to accept promotions and additional responsibility. Researchers have recognized the need to assess the influences of plateauism in context (Nicholson 1993). To clearly understand the influences and implications of plateauism, research must be done in the appropriate environment. Most previous research has focused on the intuitive difficulties inherent in organizational plateauism. These include the description, measurement, and managerial implications of both types of career plateauing. It seems that middle and upper management would be interested in understanding and dealing with the potential negative effects of organizational plateauing within the retail environment. Additionally, in the retail environment, there is special interest in addressing the requirements for motivating store managers to leave personal plateaus and continue to move up the corporate ladder. This paper outlines the need for study and to identify propositions upon which to found an investigation of the focal construct in the retail environment since no previous, similar research has been found. CAREER PLATEAUS IN THE RETAIL ENVIRONMENT Social, economic, and demographic pressures are causing plateaus to occur for greater numbers of employees much earlier than employees intend (Murray 1972; Slocum, Cron, and Yows 1985). In some retail organizations, it is possible for newly recruited college graduates to reach store management in a matter of months. Frequently, the nature of the retail environment requires that organizations entrust the control of large stores to employees with two to three years of experience (Helliker 1995). Advancement beyond store level comes much more slowly, if at all. If not properly addressed, plateauism may cause an organization may find itself staffed at middle and lower management levels by individuals who have been judged, by their superiors, not the best qualified for their positions. Such individuals are unlikely to make high-level contributions, in terms of innovation, administration, and technical decision-making should they be promoted (Evans and Gilbert 1984). Management concern over plateauism has increased as organizations recognize the need to avoid the negative consequences identified in prior research. Previous investigation has reported that half the personnel directors interviewed found plateauism to be a significant organizational problem (Rosen and Jerdee 1990). Plateaued managers have greater stress and health problems, are absent from work more frequently, and have lower satisfaction than their non-plateaued peers (Near 1980). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 78 Plateauism is problematic when either the employee (store manager) or the organization views it as undesirable. Employees are most likely to view organizationally generated plateaus as sources of unhappiness. These employees demonstrate their negative feelings in lowered satisfaction with the job, the company, and the future. Alternatively, personal plateaus may not create problems for a manager. Lessening the stress that upward mobility can create may be a relief to some employees (Slocum and Cron 1988, Gunz, 1989). The rewards for upward movement often may not outweigh the perceived costs. Even so, personal plateaus may slow career advancement and often lead to personal apathy, negativism, retaliation, stress, and job turnover, all of which may create difficulties for an employer (Peterson, 1993). The consequences of plateauism may not be entirely negative. These leveling off periods may be healthy for individual growth and development. In essence, they may be a time for reflection and regrouping. Additionally, appropriate actions by the organization may lessen the more negative effects. Retailers can help to make career plateaus acceptable realities of organizational life rather than a corporate stigma. Demonstrations of appreciation for employees’ performance, providing tangible performance-based rewards, publicly, and creating mentoring opportunities, all can lessen the impact of a career plateau (Elsass and Ralston, 1989). Retail store managers work in an environment where natural plateaus exist at a very early stage in career development. Managers may achieve significant early growth, only to find that they seem destined to make primarily lateral moves to other similar jobs. Managers may also become enamored with the intrapreneurship that is inherent in the store manager’s job. Such employees are likely to plateau themselves, preferring to remain at their present level rather than progress to a higher level that may bring less freedom. A review of the literature suggests that previous studies have developed mixed findings and that plateauism in the retail environment merits investigation. Further it seems that personal plateauism, which has previously been seen as non-problematic for management, may create significant staffing difficulties for retailers and merits considerable attention. The literature review brought to light no previous research regarding plateauism among retail store managers. DEFINITION AND OPERATIONALIZATION Researchers have defined and operationalized career plateauing in a variety of ways. A plateau has been identified as the time in a career when hierarchal advancement is very unlikely (Ference, Stoner, and Warren 1977; Elsass and Ralston 1989). Evans and Gilbert (1984) operationalized plateauism in terms of the length of time between promotions. Near (1980) represents plateauism as the length of time in a job position. Veiga (1981) states that managers define a plateau as the point at which further career mobility, including both upward and lateral moves, is in reasonable doubt because tenure in the present position has been unduly prolonged. Harvey and Schultz (1987) define plateauing as the career point at which an employee is unlikely to receive a promotion, unless he or she changes organizations. Feldman and Weitz (1988) treat a career plateau as the likelihood of receiving assignments of increased responsibility. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 79 For the retail environment, the proposed study would operationalize the focal construct as tenure in the present position. The study will address tenure in the present position in two ways. First, will consider length of time as manager of this store. Second, will use length of time at store management level in all stores managed. The lateral movement from one store to another may not remedy either the employee’s or management’s perceptions of plateauing. Often, moving to another store could easily be construed as a promotion, but this is not necessarily the perception for the manger that wishes to progress into middle management and higher. The study would address the individual’s attitudes about his or her present position as proposed by Chao (1990). It is likely that an individual’s idea of a career plateau may not agree with any operationalization. Managers’ perceptions of their own present circumstances have been found to be more closely related to their intended behaviors than has their tenure on the job (Tremblay, Roger, and Toulouse 1995). INFLUENCES ON PLATEAUISM The factors that influence plateauism may be grouped into three broad categories. These are personal, organizational, and cultural factors. Many managers believe that one personal characteristic most strongly influences plateauism, the individual’s level of competitiveness. Organizational downsizing and decreased corporate growth are also major reasons for plateauism (Bardwick, 1983). Organizational Affirmative Action programs or increased competition in the work environment may also create career plateaus (Near 1980). Perhaps most frequently, organizationally generated plateaus result from management assessments that subordinates are not skilled enough to justify advancement. However, the culture and growth orientation of the organizations may generate plateaus for managers judged qualified for increased responsibility, though such jobs do not exist. The desire to spend more time with one’s family may influence personal plateauism. Also, aversion to additional duties and responsibilities, and unwillingness to relocate to a different location may increase the incidence of personal plateaus. Additional personal influences include individual skills and abilities, individual needs and values, lack of intrinsic motivation, lack of extrinsic rewards, stress and burnout, and slow organizational climate (Feldman and Weitz 1988). Previous researchers have also considered factors such as desire for advancement, unwillingness to relocate, negative benefits from promotion, and perceptions of value in the current position (Ference, Stoner, and Warren 1977). THE EFFECTS OF PLATEAUISM Organizational plateauism may negatively influence job attitudes, job performance, job satisfaction, motivation toward the job, and job tenure (Burke 1989). Additionally, plateaued managers may exhibit increased stress, heightened intent to quit, hostility to the organization, lowered aspirations, and withdrawal (Nicholson 1993). It seems reasonable to expect to find similar effects in the retail environment. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 80 In addition, the nature of the store manager’s job invites persons who seek autonomy, are entrepreneurial, and dislike supervision. Such persons are likely to find store management an enjoyable position and it seems reasonable to expect to find a high frequency of personal plateaus. Additionally, it is expected that store managers may report high levels of satisfaction with their positions, be less upwardly mobile, and have reduced fear of losing their jobs. RESEARCH IN THE RETAIL ENVIRONMENT Chao (1990) suggests that future research on career plateauing should move away from the present interest in job tenure. Investigation of career plateaus should consider job content, mental outlook toward career advancement, and career mobility opportunities both inside and outside the current organization, as well as a variety of psychographic variables. The research should also clearly differentiate a career plateau from a career pinnacle. A career pinnacle is the reaching of the highest organizational level or job to which an individual aspires (Chao, 1990). The proposed study will address issues of job content through the use of two very different retail environments for data collection. The first consists of managers of small specialty shops; while the second is made up of managers of larger general merchandise stores. Using two differing store environments is motivated by the belief that managers of smaller stores are more likely, for a variety of reasons, to seek upward mobility. Such reasons would include financial remuneration, personal freedom, authority in the work place, number of persons managed, and other general job characteristics. A review of the literature has not found previous work that addresses plateauism in the retail environment. For a number of reasons, outlined in this section, it seems that plateauism in the retail environment requires study. Additionally, certain factors, peculiar to a retail career, dictate that any research be specifically focused. Previous research suggests that several job factors that may influence retail managers’ feelings of organizational plateauism. It is proposed: P1: Among retail managers, perceptions of organizational plateauing are negatively related to job satisfaction, attitude toward the job, attitude toward the company, motivation toward the job, and job performance ratings. P1a: Retail managers’ perceptions of organizational plateauing are positively related to job stress, feelings of stagnation, and task repetitiveness. P1b: Retail managers’ perceptions of organizational plateauing are negatively related to the existence of extrinsic and intrinsic rewards, and to perceptions of future opportunity. Issues surrounding personal plateauism differ from those relevant to organizational plateauism. Additionally, the difficulties created by personal plateauism and the solutions to those problems will not be the same as those for organizational plateauism. There are several potential relationships and factors antecedent to a manager reaching a personally identified career plateau, which might influence his or her perceptions of that plateau. It is proposed: Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 81 P2: Among retail managers, personal plateauism is positively related to job satisfaction, attitude toward the job, attitude toward the company, and motivation toward the job. P2a: Personal plateauism among retail managers is positively related to importance of family and aversion to responsibility. P2b: Personal plateauism among retail managers is negatively related to social mobility, competitiveness, career impatience, and job performance ratings. Another opportunity for research in the retail environment considers the type of positions most likely to result in plateauing. Plateaued employees may differ significantly by the type of position held, as well as, differing in personal characteristics, priorities, and career path preferences (Slocum, Cron, and Yows, 1987). No studies have specifically addressed this line of thinking, though previous researchers have recognized differences between those who choose to be plateaued and those who are forced into plateaus. This seems to be a prime area for research in the retail environment. However, it is the individual’s perceptions of job content that are at issue, rather than the position itself. For example, in the retail environment, larger stores offer greater competition and an expanded reward system than do smaller specialty units. Thus, the causes, results, and treatment of plateauing may differ by store type. Previous research would suggest that lower paying, less demanding jobs in smaller stores will be more likely to generate perceptions that the nature of the particular organization creates plateaus. Alternatively, more demanding and rewarding management positions may be less likely to generate organizational plateaus, but may offer greater opportunity for employees to reach personal plateaus. If suggestions are supported, the implication would be that the causes of plateauism, the problems it creates, and the required solutions might differ among retail formats. It is proposed: P3: Organizational plateauing is more prevalent among managers of smaller, specialty type stores than among managers of larger, general merchandise stores. P4: Personal plateauing is more prevalent among managers of larger, general merchandise stores than among managers of smaller, specialty type stores. There is also reason to suggest that level of direct supervision, the nature of the corporate culture, and the growth orientation of the organization may be influential in store managers’ perceptions of plateauism. P5: Perceptions of organizational plateauing are more prevalent among managers who also perceive high levels of direct supervision, consider their corporate culture to be unrewarding of employee performance, believe their company to be less than direct and honest with employees, and find their companies to lack growth orientation. THE STUDY Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 82 The authors are presently developing a research project to collect data that address the above propositions and certain other issues. The study will include two self-report questionnaires distributed within two national retail firms. The first instrument will collect the demographic, psychographic, and attitudinal data required to investigate the issues raised by the above discussion. The second questionnaire requests the individual store managers’ first level supervisors to evaluate the managers on several performance and attitudinal measures. IMPLICATIONS Previous research has identified a number of management strategies for combating the negative effects of plateauism. There are two shortcomings in previous work as it might relate to the retail manager. First, personal plateauism has been primarily dismissed as non-problematic and therefore not meriting study. As outlined above, in the retail environment, personal plateaus are a significant hindrance to the development of capable middle and higher-level management. The results of an investigation may provide help in motivating store managers to seek continued movement up the organizational ladder. Second, rather than identifying a broad set of management interventions that may lessen the effects of plateaus; the object should be to suggest strategies specifically designed to the individual environment. For instance, the entrepreneurial nature of the store managers’ job suggests that strategies involving increased supervisory involvement may be inappropriate. Additionally, research found no strategies for addressing the potential negative effects of personal plateauism. The results of the proposed study will have direct implications for managerial strategy development. Most, if not every, retailer experiences the problems that have been outlined. It can be seen that in a variety of ways, retailing is a people business. Store managers must be people managers as well as caring for the people who shop their stores. Yet, employee turnover rates are among the highest in the world of business. Increasingly sophisticated systems and customers often dictate corporate hiring policies that require college degrees for prospective trainees. As these better educated, potentially more motivated young persons enter management training programs, the reduced growth rates predicted for the next ten years in the retail environment are likely to make the problems of plateauing even more apparent. It is time to begin to learn how best to offset the impending difficulties. REFERENCES Bardwick, J., SMR Forum: Plateauing and Productivity, Sloan Management Review, (Spring 1983): 67-73 Chao, G. T., Exploration of the Conceptualization and Measurement of Career Plateau: A Comparative Analysis, Journal of Management (March 1990): 181-193 Duffy, Jean Ann, The Application of Chaos Theory to the Career-Plateaued Worker, Journal of Employment Counseling (December 2000): 229-237 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 83 Elsass, P.M., and D.A. Ralston, Individual Responses to the Stress of Career Plateauing, Journal of Management 15, 1 (1989): 35-47 Evans, M.G., and E. Gilbert, Plateaued Managers: Their Need Gratifications and Their Effort Performance Expectations, Journal of Management Studies (1984): 99-108 Ference, T.P., J.A. Stoner, and E.K.G. Warren, Managing the Career Plateau, Academy of Management Review (1977): 602-612 Gunz, H., Career and Corporate Cultures Basil Blackwell (1989) Harvey, E. K. and J. R. Schultz, Responses to the Career Plateau, Bureaucrat (Fall 1987): 31-34 Helliker, K., Retailing Chains Offer a Lot of Opportunity, Young Managers Find, The Wall Street Journal (August 25, 1995): 1 Near, J. P., The Career Plateau: Causes and Effects, Business Horizons 23 (1980) 53-57 Nicholson, N. Purgatory or Place of Safety? The Managerial Plateau and Organizational Agegrading, Human Relations 46, 12 (1993): 1369-1389 Nicholson, N. And M. A. West, Managerial Job Change Cambridge: Cambridge University Press (1988) Peterson, R. T., Beyond the Plateau, Sales and Marketing Management (July 1993): 78-82 Rice, R. W., D. B. McFarlin, and D. E. Benett, Standards of Comparisons and Job Satisfaction, Journal of Applied Psychology 74, 4 (1989): 591-598 Rosen, B. and T. Jerdee, Middle and Late Career Problems: Causes, Consequences, and Research Needs, Human Resource Planning, 13, 1 (1990): 591-598 Slocum, J. W., W.L. Cron, R.W. Hansen, and S. Rawlins, Business Strategy and the Management of Plateaued Employees, Academy of Management Journal, 28 (1985): 133-154. ____________, ____________, and L.D. Yows, Whose Career is Likely to Plateau? Business Horizons, (March-April 1987): 31-38 Veiga, J., Plateaued Versus Nonplateaued Managers: Career Patterns, Attitudes, and Path Potential Academy of Management Journal (1981): 566-578 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 84 RUMORS, URBAN LEGENDS AND INTERNET HOAXES Henry B. Dunn, Stephen F. Austin State University Charlotte A. Allen, Stephen F. Austin State University ABSTRACT This paper will examine those specific areas of rumor theory which serve as a connection between urban legends and Internet hoaxes. Subject areas to be highlighted include: why rumors or hoaxes are created and why they are transmitted, with specific emphasis on computer mediated communication. We will also examine the possible impacts that rumors, urban legends and Internet hoaxes may have on the business community. INTRODUCTION Did you hear that Joe is going to be fired? Delete this file from your computer because it is a virus (and then forward this to everyone in your address book). Put in your social security number on this website and it will search the FBI records and give you any information about you that is in the FBI records. Our company needs to verify your account information, please reply to this email with the account number and password. Gossip, rumors, and hoaxes have been around for ages, but computers and the Internet have elevated the passing of information to a new art form with sometimes disastrous consequences. In researching the literature for this paper it was discovered that a substantial amount of academic research has been done in the area of rumors; with much less having been conducted in the area of urban legends and Internet hoaxes. Throughout the literature on urban legends and Internet hoaxes, a common theme of rumor research and theory can be seen even though many theories have been proposed regarding rumor generation and transmission. Within these theories are two different schools of thought: psychology-based theories focusing on the individual and sociology-based theories focusing on group or societal factors (Rosnow 1988). Regardless of the focus, there are a number of common factors that continue to present themselves across the literature (whether it is from a psychological or sociological basis) as being necessary for the creation and/or transmission of rumors. This paper will examine those specific areas of rumor theory which serve as a connection between rumors, urban legends and Internet hoaxes. We will also examine the possible impacts that rumors, urban legends and Internet hoaxes may have on the business community. EARLY RUMOR RESEARCH Rumor research is not new, with the study of rumors by psychologists dating back over seventy years (Bordia and DiFonzo 2002). There are two particular sets of early theory (Allport and Postman 1947; Prasad 1935) that are frequently referenced across the literature. Part of what makes these theories significant are certain key elements which tend to be reiterated as important in the majority of subsequent research; even in those that present themselves as being in opposition. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 85 One of the early detailed studies of rumor generation and transmission was performed by Jamuna Prasad in 1935. The keystone of Prasad’s theory was the requirement for anxiety to exist for the transmission of rumors (Bordia and DiFonzo 2002; Prasad 1935). According to Prasad, rumor transmission frequency was directly linked to the level of experienced anxiety, with rumors spreading the most at peak anxiety and diminishing as anxiety levels subsided. Three additional key elements Prasad proposed were uncertainty, importance and belief: Prasad felt that rumors provide a sense of meaning and answers when situations do not permit clear understanding and control, particularly concerning issues not easily verifiable. Prasad further theorized that in order for rumors to persist, the subject matter must be important to those individuals within the transmitting group. In addition, as the uncertainty and anxiety levels increase, those group members who find importance in the subject matter are less able to critically analyze the rumor’s credibility and veracity. Prasad’s work was originally ignored by many researchers, but was eventually recognized as having validity (Bordia and DiFonzo 2002). In 1947, Gordon Allport and Leo Postman published The Psychology of Rumor, which would become the definitive study of rumors for the next thirty years. In their analysis, Allport and Postman (1947) outlined what they called “the basic law of rumor”, which concluded that the level of rumor transmission varied proportionally with the subject matter’s importance to the group, multiplied by the uncertainty of the evidence available . As with Prasad (1935), Allport and Postman (1947) theorized that rumor creation and transmission was an attempt at finding meaning and answers in unclear situations, as well as recognizing the impact that importance to the group has (Bordia and DiFonzo 2002; Rosnow 1988). Accordingly, Allport and Postman (1947) felt that rumors were an attempt to lessen anxiety levels and their accompanying tensions (Bordia and Rosnow 1998). One of the primary limiters of Allport and Postman’s research methodology was their use of the serial reproduction paradigm (Cornwell and Hobbs 1992), which is a one-way communication process not allowing for cross-examination by the receiver (Bordia and Rosnow 1998). This served to ignore the dynamics normally witnessed in face-toface communication and its possible influences on rumor transmission. More recent research has recognized the importance of this dynamic and has taken it into consideration. The result is a more comprehensive understanding of the influences on why rumors live or die. RUMORS AS A FORM OF COMMUNICATION It is generally agreed that the formation of rumors are usually attempts at sense-making and filling the void created by the absence of information in unclear situations. For the purposes of this paper, we offer the following definition of rumor: A rumor is a hypothesis offered in the absence of verifiable information regarding uncertain circumstances that are important to those individuals who are subsequently anxious about their lack of control resulting from this uncertainty. As such, there appears to be a general consensus among researchers, with some dissension, as to how rumors are typically born. A review of the literature seems to indicate that the real question of interest to researchers, more-so than how and why rumors are born, is how and why rumors are passed along. It is important to note, however, that rumor generation and rumor transmission cannot be viewed strictly as necessarily having separate and distinct causations. The basic structure of communication consists of a sender (the one speaking or writing) creating a message by encoding their intended meaning, who then transmits/sends that message Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 86 to a receiver (the one listening or reading), who in turn decodes the message by assigning meaning to the words received. Words themselves may have no meaning since meaning is assigned by the receiver. It is the assignment of meaning by the receiver that can be one possible factor in a rumor’s creation and transmission. In other words, a rumor can begin simply by the receiver’s misinterpretation of the intended message, which is then transmitted to others (Kapferer 1992). In addition, the real or perceived absence of complete information can lead to the receiver filling in the blanks, thus altering the original intended message which is subsequently passed on (Kapferer 1992). It could likewise be postulated that the failure to fill in the blanks of a misunderstood message could act as a contributing factor to a rumor’s continued transmission. In such a case, instead of acting as an offered explanation for an uncertain event or circumstance, it actually creates uncertainty through its incompleteness of information, prompting receivers to ask why and possibly leading to their filling in the blanks, further altering the message’s original intent. Sociological researchers recognized the importance of examining and understanding the role of communicative patterns in rumor transmission. University of California at Berkley sociologist Andrew Noymer concluded that “rumor transmission is one of the most natural forms of social communication” (Noymer 2001). In recent research, sociologists have proposed that within groups, opinions, explanations and predictions are exchanged until “an acceptable interpretation emerges” regarding a rumor’s content and believability (Bordia and Rosnow 1998). In fact, studies have shown that the primary goal of such collective communication to be the determination of a rumor’s veracity. Sociologists have termed this interaction as a “group problem-solving activity” (Bordia and Rosnow 1998). THE STUDY OF COLLECTIVE COMMUNICATION ONLINE The study of collective communication in a naturalistic setting has always been problematic for researchers. Among the issues faced in conducting this type of research are the problems of observation, data collection and recording, and remaining unobtrusive (Bordia 1996). The advent and proliferation of the Internet, referred to as computer-mediated communication (CMC) networks by researchers, has significantly reduced these constraints, making it not only easier to collect and record data, but also allowing researchers to effectively eaves-drop in an ethical manner. Researchers are able to find and observe rumor discussions by monitoring the various newsgroups, bulletin boards and chat rooms that are located on the Internet. Participants in these online discussion groups recognize that their communications are of a public nature, thus permitting researchers to avoid the issue of privacy violation more typically associated with attempting to observe face-to-face communication unnoticed (Bordia 1996). CMC based research indicates that individuals participate in these discussion groups for the purpose of discussing the veracity of the rumor in question (Bordia 1996). Among other things, researchers have been able to determine that rumor discussion participants in a CMC environment exhibit the same group development characteristics as outlined in group development literature (Bordia and Rosnow 1998). In addition, discussions within the CMC environment exhibit many of the same fundamental communicative patterns and characteristics found in face-to-face communication (Bordia 1996), further validating the position sociologists have held concerning the importance of communicative patterns in rumor transmission. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 87 THE URBAN LEGEND CONNECTION A not so removed subset of rumor research is the study of urban legends. Many researchers contend that urban legends are not really a distinctly separate form of sociological communication, rather they are actually a form of narrative rumor. In fact, in most instances in the literature, urban legends tend to be referred to as rumor-legends. For the sake of brevity, we will simply refer to them as legends. As a point of connection, while legends tend to be more complex and story-like than rumors, both are transmitted with the intention of being believed, are told as being true, and are difficult to verify (Heath, Bell, and Sternberg 2001). In addition, in the course of studying legends and rumors, many of the stories analyzed share many similarities (Heath, Bell and Sternberg 2001). One key difference that separates legends from rumors is the fact that legends tend to have a significantly longer shelf life (or online life) than rumors (Noymer 2001). Legends employ the use of an ironic twist to convey a message that typically reinforces social mores and norms by warning the receiver that negative results are likely should these norms and mores be violated (Donavan, Mowen and Chakraborty 2001; Kamins, Folkes and Perner 1997). Legends, in much similar fashion to most rumors, typically contribute to an increased transmission within groups by conveying negative information and may at times be centered around a particular product type or brand (Donavan, Mowen and Chakraborty 2001). Many times these legends are transmitted within groups as a way of warning other group members to avoid certain situations or actions, including the avoidance of particular products or brands (Donavan, Mowen and Chakraborty 2001; Kamins, Folkes and Perner 1997). The primary transmission vehicle of legends, as with rumors, is face-to-face communication (Llewllyn 1996). As with rumors, through the course of transmitting legends, information may be changed. One of the biggest differences is that typically with legends, the changes made are peripheral in nature, updating the time and location of the story, while the core message remains unchanged (Llewllyn 1996). This is in fact what helps contribute to the longevity of legends. Of particular importance in the transmission of legends is the use of the Internet, which makes it possible to communicate with thousands almost instantly (Donavan, Mowen and Chakraborty 2001). INTERNET HOAXES A hoax is defined as “an act, document or artifact intended to deceive the public.” (Emery 2004). Internet hoaxes can be viewed as a subset of folklore legends; however, the key factor that separates an urban legend from a hoax is that a hoax is a deliberate deception (Emery 2004, West 1999). Most hoaxes found on the Internet can be classified as either Internet chain letters, computer virus/software hoaxes, medical hoaxes, rumors, jokes, or legends (Hoaxbusters 2004a). Internet chain letters may take on many forms: some require that the receiver pass on information to others in a group (usually by way of warnings or threats if information is not directly passed on to a certain number of people) while some tie into a receiver’s greed or play to a receiver’s sympathy. While the proliferation of the Internet, the computer virus/software hoax has quickly become one of the most prevalent forms of hoaxes. The first documented virus (2400 baud modem virus) occurred in October 1988 and since that time, not only has the frequency of virus hoaxes increased, but many continue to circulate on the Internet for years (Hoaxbusters 2004b). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 88 WORD OF MOUTH COMMUNICATIONS The communication process coupled with the transmission of rumors, hoaxes, and legends can and do have a direct impact on business, particularly when the subject involved is a firm’s product. Marketers term the communication between consumers as word-of-mouth (WOM) (Kamins et al. 1987). The study and understanding of the impact and significance of WOM communications, whether the information that is being transmitted is true or false, is of great concern to marketers. One reason for this is due to consumers being influenced more by WOM than by any other source; including Consumer Reports, which is the best known objective source of consumer product information (Kamins, Folkes and Perner 1997). As with legend research, relatively few studies have been conducted concerning rumors in the marketplace. The research that has been conducted seems to indicate that, as with rumors and legends in general, negative product rumors tend to be transmitted more readily than positive rumors due to negative information being considered more indicative of actual product performance (Kamins, Folkes and Perner 1997). Factoring in the ease of dissemination of rumors and legends via CMC (especially through forwarded email) along with the issue of trust between communicating parties (i.e. “I trust the person that sent this to me, so this could be true”), word of mouth communication can spread as quickly as any computer virus. BUSINESS IMPLICATIONS As rumor research has evolved toward the practice of exploring CMC as a research tool, so has legend and marketing research. One reason for this is the increased use of CMC by consumers searching for information before making a purchasing decision (Kozinets 2002). This need to understand consumer WOM is further enhanced by the knowledge that consumer support acts as a key factor regarding positive brand equity. More and more, consumers are utilizing CMC as a vehicle to discuss and voice their opinions concerning product preference and performance (Kozinets 2002; Mudhar 1999). Negative product rumors also abound on the Internet in the form of hoaxed web sites and e-mails. Among the more prevalent Internet hoaxes are those that center around aspects of everyday life such as food safety and public health (Dayly 2004). These subject areas are especially fertile ground for rumor transmission in that they are considered as important by the receiving group members. With more and more consumers using the Internet as a source of information, hoaxed web sites are particularly problematic in that they more closely resemble legitimate information sources. The result is consumer confusion and a very real potential for firms and their products being harmed as a result of lost customers and damaged reputation. The issue has become such a problem that governmental agencies, such as the Food & Drug Administration, have implemented information programs in an attempt to combat many of these hoaxes and rumors (Dayly 2004). The Department of Energy’s Computer Incident Advisory Capability staff estimated that the costs associated with a single virus hoax (note hoax, not a real virus) to be more than $40 million (Bedell 2002). Furthermore, the rise of popularity of internet websites which deal with the evaluation of the validity of internet rumors and hoaxes (ex., www.snopes.com) hint at the need for rational thought and evaluation of said rumors along with their associated costs. While it may be difficult to place an exact monetary amount on what internet rumors, hoaxes and legends cost each year, more research needs to be done to address Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 89 not only the direct financial costs, but the indirect financial costs that incur when a company’s reputation and/or brands are harmed. Companies need to develop guidelines on how to deal with such negative rumors along with guidelines on deciding whether a rumor is “lethal” enough to warrant resources to disprove or fight its impact. CONCLUSION Rumors are an everyday fact of life; with some being completely implausible, and others seemingly difficult to refute. Another inescapable fact is that rumors, regardless of the shape or form they take, are an issue that cannot be ignored by consumer-based firms. Rumors can and do create significant hardships for those businesses that become targets. It would behoove business to not only pay attention to the rumor-related research that has been conducted, but to assist in the furtherance of research – especially that which is related to rumor transmission via the Internet. There will always be rumors; the trick to combating rumors is to understand how and why they are created and transmitted. REFERENCES Allport, G. and L. Postman (1947) Psychology of Rumor, New York: H. Holt and Company. Bedell, D. (2002) “Internet Hoaxes Start to Cost Companies,” The Dallas Morning News, June 5, 2002 (EBSCO host Document Accession Number 2W62556866616). Bordia, P. (1996) “Studying verbal interaction on the Internet: The case of rumor transmission research,” Behavior Research Methods, Instruments, & Computers 28 (2), 149-151. Bordia, P. and N. DiFonzo (2002) “When social psychology became less social: Prasad and the history of rumor research,” Asian Journal of Social Psychology 5(1), 49-61. Bordia, P. and R. Rosnow (1998) “Rumor Rest Stops on the Information Highway,” Human Communication Research 25(2), 163-179. Cornwell, D. and S. Hobbs (1992) “Rumor and Legends: Irregular Interactions Between Social Psychology and Folkloristics,” Canadian Psychology 33(3), 609-613 . Dayly, Karen (2004) “Internet Hoaxes: Public Regulation and Private Remedies,” LEDA at Harvard Law School. Retrieved March 1, 2004 from http://leda.law.harvard.edu/leda/data/255/Daly,_Karen.html DiFonzo, N. and P. Bordia (1994) “Reining in Rumors,” Organizational Dynamics 23(1), 47-63. Donavan, T.D., Mowen, J.C., and G. Chakraborty (2001) “Urban legends: diffusion processes and the exchange of resources,” Journal of Consumer Marketing 18(6), 521-533. Emery, D. (2004) “What is a Hoax,” Retrieved March 1, 2004 from http://urbanlegends.about.com/cs/urbanlegends/f/hoax.html. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 90 Fernback, J. (2003) “Legends on the net: an examination of computer-mediated communication as a locus of oral culture,” New Media & Society 5(1), 29-45. Goodwin, S.C. (1998) “Bringing Urban Legends Into The Classroom,” Journal of School Health 68(3), 114-115. Heath, C., Bell, C., and E. Sternberg (2001) “Emotional Selection in Memes: The Case of Urban Legends,” Journal of Personality & Social Psychology 81(6), 1028-1041. Hoaxbusters (2004a) “Hoax Categories,” Retrieved February 5, 2004 from http://hoaxbusters.ciac.org/HBHoaxCategories.html. Hoaxbusters (2004b) “Information about Hoaxes,” Retrieved February 5, 2004 from http://hoaxbusters.ciac.org/HBHoaxInfo.html. Kamins, M.A., Folkes, V.S., and L. Perner (1997) “Consumer Responses to Rumors: Good News, Bad News,” Journal of Consumer Psychology 6(2), 165-187. Kapferer, J.N. (1992) “How Rumors Are Born,” Society 29(5), 53-61. Kozinets, R.V. (2002) “The Field Behind the Screen: Using Netnography for Marketing Research in Online Communities,” Journal of Marketing Research 39, 61-72. Llewllyn, J.T. (1996/1997) “Understanding Urban Legends: A Peculiar Public Relations Challenge,” Public Relations Quarterly 41(4), 17-22. Mudhar, R. (1999) “Fwd: Fwd: I checked this out, it’s true!. E-mail and the Web are the speediest rumour mill ever invented,” Marketing Magazine 104(10), 24. Noymer, A. (2001) “The transmission and Persistence of ‘Urban Legends’: Sociological Application of Age-Structured Epidemic Models,” Journal of Mathematical Sociology 25(3), 299-323. Prasad, J. (1935) “Psychology of Rumor: A Study Relating to the Great Indian Earthquake of 1934,” British Journal of Psychology 26, 1-15. Rosnow, R.L. (1988) “Rumor as Communication: A Contextualist Approach,” Journal of Communication 38(1), 12-28. Wallich, P. (1998) “This Is Not a Hoax!,” Scientific American 279(5), 54. West, M. (1999) “Online Opportunities,” American Fitness 17(4), 22. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 91 PROVIDING BETTER PATIENT SERVICES UTILIZING SMART CARD TECHNOLOGY: A CASE EXAMPLE Dennis Emmett, Marshall University Reagan Bundy, Marshall University ABSTRACT This paper examines the utilization of smart cards in the healthcare industry. The nature of smartcards is examined, along with the advantages and disadvantages. In addition, an example of the use of smartcard is provided. The benefits achieved are examined along with the problems encountered. The paper provides some possible recommendations for future implementations. INTRODUCTION The purpose of this paper is to discuss the use of smart cards in healthcare. The first thing that will be done is to explore their purpose in healthcare and where they are used. Second, the advantages and disadvantages of this technology will be examined. Finally, a case example will be explored. Smart cards are a relatively new technology which has been used in healthcare for some time. A smart card is about the size of a credit card with an imbedded computer chip on which a large amount of information is stored. In addition, the information can be modified and updated easily with the appropriate equipment. Smart cards could be used by health insurers and HMOs to store plan eligibility information and health data, but few health plans have implemented them on a large scale (Coile, 2002). The smart card has yet to mass support necessary for wide market acceptance (Chan et al., 2001). Smart cards are being used in other countries, especially in Europe but not without problems. A continent-wide health card is wanted in Europe, but overcoming language barriers and legal barriers is a problem (Resch, 1998). Germany has had medical cards since 1995, and France, Belgium, and Slovenia are to offering them (Resch, 1998). France is hoping for cost savings of $333 million through reduction in paperwork (Resch, 1998). In the United States, it appears that smart cards have been doomed from the beginning, since both politics and technology has surpassed smart cards (Appleby, 1995). There are many issues to deal with in the introduction of smart cards. Some of the issues include quality, safety, accountability, and privacy (Healy, 2004). Another potential problem is a widening communication gap that these may create between patient and doctor (Healy, 2004). Smart cards could be used by health insurers and HMOs to store plan eligibility information and health. Few of these groups have utilized the technology (Coile, 2002). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 92 Smart cards have tremendous potential, but it also has numerous problems. The next section will examine the advantages and disadvantages of the smart card technology. ADVANTAGES AND DISADVANTAGES Smart cards have numerous benefits, but also have numerous problems. This section will examine the advantages and disadvantages of the utilization of this technology. In determining whether to employ this technology, it is important to know the advantages and disadvantages and determine how these factors play out in the situation at hand. The advantages of utilizing smart cards are numerous. Some of the advantages are related to monetary savings, but a good number are related to better serving the patient. The advantages are: 1. Smart card has the ability to store a large amount of information about a patient, yet it pocket size offers easy mobility (Chan et al., 2001). 2. Helps reduce the amount of time waiting in lines (Kelly, 2000). 3. Patients who utilize more than one facility in a system (e.g., veterans’ hospitals) will save time by not having to register at more than one (Dash, 2001). 4. The card allows doctors and patients to bypass paperwork and go directly to receiving medical care (Kelly, 2000). 5. Cards allow the caregivers to emphasize the human component of treating patients (Dash, 2001). 6. Smart cards allow a patient who sees numerous physicians to have their information updated and provide complete information; such as, all prescription drugs that they take (Kelly, 2000). 7. Smart cards can combat illegal use of medical information. Smart cards can integrate the use of fingerprints or other biometrics ( Kelly, 2000; Dash, 2001). 8. Smart cards can interact with designated computers to allow access to insurance plan information, lists of providers, and even a medical reading. This will allow patients to be better informed (Healy, 2004) The disadvantages of using smart cards are mostly concerned with the abusing the technology and using information for illicit purposes. 1. Vendors claim that they have a tamper proof card. People always devise a way of tampering with the card (Krysztoforski and Evers, 1994). 2. Technology can not make the people that look at the material behave responsibly (Krysztoforski and Evers, 1994). 3. Many questions about information security and how hospitals will show HIPAA compliance (Serb, 2003). 4. Interface problems between computers often caused the entire system to crash (Serb, 2003). 5. Smart card technology has not gained popularity because of lack of standards (Dash, 2001). ISO has standardized the protocol communications between a smart card and smart card reader (Chan et. al., 2001). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 93 6. There are still diverse protocol currently available fro various vendors.(Chan et al., 2003). 7. Some people envision smart card hybrids evolving into something like HAL, the famous movie computer with the threatening attitude (Healy, 2004). 8. The problem with smart cards is that the people who designed them for health care were from outside the industry (Appleby, 1005). 9. The cards need to be updated, especially if the cardholder went to a non-user institution. This would be hard to enforce (Appleby, 1995). Basically, the industry was the technology to design efficient and effective smart cards. Humans can still misuse the information. The verdict is still out whether the advantages outweigh the disadvantages. There has been talk on developing a national card to be utilized at all medical facilities. This was an idea that was linked to a national health care plan. A CASE STUDY The Hospital Located in Marion County, Florida, Munroe Regional Medical Center (MRMC) is a 421 bed acute-care hospital offering a wide range of clinical services, including in-patient and outpatient. It is located in downtown Ocala. MRMC has over 2,500 employees, 1,200 volunteers and 370 physicians. It is a high-quality hospital as evidenced by its ranking among the top 1000 hospitals in the nation and community-hospital industry benchmark (Solucient Top Hospitals, 2000). MRMC has admissions on an annual basis in excess of 22,000, treats 80,000 in the three distinct emergency room sites, and cares for 45,000 in its outpatient facilities. It is one of the 20 busiest hospitals in the state of Florida and it is ranked in the top 10 busiest emergency rooms. Over the past few years, Munroe has received numerous accolades and recognition for its patient satisfaction and clinical outcomes concerning quality of care. These awards are considered a stepping stone for providing continuous quality improvements. MRMC is committed to preventive care and keeping patients healthy. The hospital also provides wellness programs for employers with the community. The mission statement states that they are committed to continually meeting the changing health needs of our community through caring, patient-centered services of the highest quality (Service Information Booklet, 2002). The Problem MRMC decided to address issues concerning the quality of care given to their patients within the organization as well as the health care industry as a whole. The prevalence of medical errors has risen to the point that it now ranks as the eight leading cause of death in the country (44,000 to 98,000), exceeding motor vehicle accidents (43, 458), breast cancer (42,297), or AIDS (16,516). These errors cause substantial financial cost. It is reported that medical errors cost the nation approximately S$37.6 billion per year, with $17 billion associated with preventable errors (Agency for HealthCare Research and Quality, 2000). Medication error is the most common Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 94 cause of preventable error in hospitals (Poon et al., 2004). Awareness of this issue continues to grow while the public becomes more concerned. The Solution In order to overcome this problem and serve customers better, MRMC decided to institute a program to better track patients using smart cards. A smart card is a credit-card size plastic card that contains an embedded microprocessor chip and memory, so compressed that encrypted data can be written to and read from the card (Reynolds, 2003). MRMC decided to do a pilot run between April and September, 2000 by distributing smart cards to about 12,000 people, including 11,000 seniors belonging to the “Prestige 55” program. “Prestige 55” is a program that offers free and discounted services, wellness classes, etc. These individuals are frequent users of the system, especially emergency services. In addition, individuals in this age category have a tendency to be loyal to physicians and hospitals. MRMC decided to provide incentives, such as movie passes, for updating cards (Chin, 2000). The smart card would obtain information about a participant’s blood type, disabilities, result of recent blood pressure, cholesterol and PSA screenings, baseline EKGs, and name of primary care provider. Card readers were installed in all 29 of its ambulances as well as an additional 10 card readers throughout the health system, including emergency room, nursing home, and office of volunteer and senior services. The cost of installing this system was approximately $86,000. Members of the “Prestige 55 Club” who choose to participate were charged an additional $8 to register for wellness classes, diagnostic screenings, and other activities. The number of individuals choosing to enroll in these classes brought in $96,000. The profit will allow the system to extend the use of smart cards to other services, including in-patient and out-patient. The Outcome The main objective of MRMC was to improve the overall health of the community, as well as to reduce the time it takes to register patients and process medical information. There are now 16,500 people who carry the smart card. There is no quantitative data to prove that the overall health of the individuals has improved or that this is a reduction in the time required to deal with gathering and processing information. This needs to be done in order to prove the worth. The data that is available is the willingness of the consumer to be part of this program. The larger than expected number of participants provides some proof to the effectiveness of the program. There are numerous things which MRMC should do: 1. Should expand the program to include other individuals within the hospital who regularly utilize their services. 2. Should employ staff to oversee the program along with planning and development activities. 3. Should continue to focus on programs, such as, wellness, diagnostic screenings, etc. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 95 4. 5. Expand to include other services in the hospital. Should market the program to the community, emphasizing the importance of a healthier community and increasing efficiency of care. CONCLUSION Smart card technology is at hand, but the implementation is still lacking. In this paper, the advantages and disadvantages have been detailed. The purported advantages are reduction in costs, reduction in waiting time, and increase in doctor-patient contact. The disadvantages are security of information and transferability of information. The case study suggests that the utilization of smart card technology can be successful in certain situations. The program that was implemented was able to provide superior service. The small fee charged was able to more than cover the cost. This project was successful. The question is how to replicate this project in other locations and perhaps transfer this technology to Medicare or a national health insurance program. REFERENCES Appleby, Chuck (1995) “Retro Tech,” Hospitals & Health Networks, 69 (5), 40-43. Agency for HealthCare Research and Quality (2000) “Medical Errors: The Scope of the Problem. Fact Sheet.” Publication no. AHRQ 00-P037. (2000), 1-4. Chan, Alvin, Jiannong Cao, Henry Chan, and Gilbert Young (2001) “A Web-Enabled Framework for Smart Card Applications in Health Services,” Communications of the ACM, 44, (9), 76-83. Chin, Tyler (2000) “Florida Hospitals deals Out Smart Cards to Expedite Care” American Medical Association News, 1-4. Coile, Jr., Russell (2001) The Paperless Hospital: Healthcare in a Digital Age. Health Administration Press. Dash, Julekha (2001) “VA Hospitals Test Smart Cards for Patient Information,” Computerworld, 35 (20), 51. Healy, Bernadine (2004) “2004: A Medical Odyssey,” U.S. News and World Report, 137 (3). Kelly, Joyce (2000) “A Smart Way to Serve Patients,” Hospital and Health Networks, 74 (7), 44-45. Krysztoforski, Joe and Williamson Evers (1994) “Are Patient Smart Cards the Right Way to Go?”. Hospital & Health Networks, 68 (7), 10. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 96 Poon, Eric; David Blumenthal; Tonushree Jaggi; Melissa Honour; David Bates; and Rainu Kaushal. (2004) “Overcoming Barriers to Adopting and Implementing Computerized Physician Order Entry Systems in U.S. Hospitals”. Health Affairs, (July/August) 1-7. Resch, Inka. (1998) “Can A European Import Fix What Ails America?”. Business Week, 3595, (September 13) 94. Reynolds, Phil “Smart Than You Think”. Nelson Publishing, Inc. (2003), 1-6, http://www.healthmgttech.com/archives/h1203smarter.htm. Serb, Chris 92003) “It’s In the Cards”. Hospital and Health Networks, 77 (11), 32-39. Service Information Booklet: Munroe Regional Medical Center’s Expansion Plan, Munroe Regional Medical Center, Ocala, Florida, (2002). Solucient Top Hospitals (2000) “The Top 100 Hospitals: National Benchmarks for Success”. www.100tophospitals.com/winners/national00/benchmarks.htm. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 97 HOFSTEDE’S CULTURE FRAMEWORK: CAN IT BE USED IN SALES RECRUITING Amitesh Gir, University of Louisiana Rajesh Srivastava, University of Louisiana ABSTRACT This exploratory paper discusses the growing importance of and need for intercultural research from a sales perspective and focuses on a potentially powerful tool to conduct such research: Hofstede’s Cultural Framework. This framework has emerged as the most popular research tool in cross-cultural studies. However, its application to sales has been a largely unexplored research frontier. Following an introduction of the framework, relevant and related studies are reviewed for a better understanding of its possible implications for sales. Weaknesses of the framework are analyzed and similar alternative models are discussed. Overall, this paper is intended to a be a simple and useful resource when considering international sales strategy using Hofstede’s model. Recommendations are made for improving sales management as guided by the framework and directions for future research are identified. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 98 A PRELIMINARY INVESTIGATION INTO THE IMPACT OF ASSERTIVENESS AND AGGRESSIVENESS ON THE COMPLAINT BEHAVIOR OF PURCHASING MANAGERS Lynn R. Godwin, The University of St. Thomas ______________________________________________________________________________ ABSTRACT A national sample of 317 purchasing managers was surveyed with regard to their complaint behavior following a focal event involving dissatisfaction with a vending firm. The respondent’s level of assertiveness was found to be significantly associated with several of the outcomes related to this dissatisfaction with the focal vendor. The respondent’s level of aggressiveness, on the other hand, was not related to any of the outcome variables considered. ______________________________________________________________________________ INTRODUCTION Gaining an understanding of the relationship between assertiveness, aggressiveness, and the consequences of purchasing manager dissatisfaction is of crucial importance to both buying and selling firms in the industrial marketplace. From the standpoint of the buying firm, are these characteristics, if present in their purchasing managers, helping or harming negotiations and complaint handling with vendors. From the perspective of vendors, do such personal characteristics impact how the vending firm should react in a complain situation, or do formalized purchasing policies and procedures obviate such a need to focus on personal characteristics? With these questions in mind, this manuscript targets the personality of the purchasing manager with an eye toward understanding any impact on complaint behavior. Specifically, purchasing manager assertiveness and aggressiveness are the current focus. LITERATURE REVIEW Research on industrial buyer complaint behavior (IBCB) has historically been somewhat limited (Barksdale, Powell, and Hargrove 1984; Trawick and Swan 1979, 1981, 1982; Williams and Gray 1978; Williams and Rao 1980a). This is especially true when the IBCB research is compared to the voluminous research which focuses on final consumers. Personality characteristics of buyers, while well discussed in the consumer literature are often overlooked when discussing IBCB. Assertiveness and Aggressiveness Assertiveness as a construct "enables a person to act in his own best interests, to stand up for himself without undue anxiety, to express his honest feelings comfortably, or to exercise his Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 99 rights without denying the rights of others" (Alberti and Emmons 1974, p. 2). Richins (1983a) noted that assertiveness involves making honest expressions, without infringing on the rights of others. Aggressiveness, on the other hand may be defined as "a response that delivers noxious stimuli to another organism" (Buss 1961, p. 1). Richins (1983a) noted such behaviors as "rudeness, raising one's voice, or abusive language" as aggressiveness (p. 74). In the consumer literature, Day (1980) noted that aggressiveness may help to predict complaint behavior(s). Although similar, assertiveness and aggressiveness are most often viewed as separate constructs. With regard to measurement, the instrument developed by Richins (1983a) for use in the consumer arena was modified for use with IBCB research. Past work in the area of consumer complaint behavior has given little credence to the importance of assertiveness. Bearden (1983), Fornell and Westbrook (1979), and Zaichkowsky and Liefeld (1977) found no significant relationship between assertiveness and complaint behavior in consumer settings. Aggressiveness, by comparison, received little attention with regard to its relationship with consumer complaint behaviors (Richins 1983a). Personal interviews with purchasing managers, however, revealed a propensity of many managers to describe themselves as either assertive or aggressive (or both). For this reason and considering that assertiveness and aggressiveness seem to continue to be constructs of interest (despite the above findings) in the consumer complaint behavior research, the two constructs warrant some further investigation with regard to their place within the framework of IBCB. Confirmation of Complaint Expectations Trawick and Swan (1981) found that 84 percent of industrial buyers were satisfied with the complaint process if the complaint was handled in a manner that resulted in the buyer receiving what was wanted. These findings lend support and credence to the importance of satisfying industrial consumers. In the consumer complaint behavior literature, Oliver (1980) and Bearden and Teel (1983) took an expectancy view of satisfaction in general. Disconfirmation of consumers' expectations led to dissatisfaction. Regardless of the "realities" relating to performance of a product, it is consumers' expectations of performance (however reasonable or unreasonable) against which actual performance is measured. It does not take a great leap of faith to propose that satisfaction with the complaint process (and the outcome of this process) depends, to some extent, upon expectations regarding the process and the outcome of it. The following hypothesis was, therefore, proposed: H1: Confirmation of Expectations (CONFIRM) will vary significantly with the purchasing manager’s level of assertiveness (ASSERT) and/or aggressiveness (AGGRESS). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 100 Satisfaction In models of consumer complaint behavior, satisfaction or dissatisfaction may be seen to be influencing factors (Bearden and Teel 1983). Although this is generally conceptualized as satisfaction with a product or service, individuals may be satisfied or dissatisfied with the outcome or the process of complaining. If this argument is made, then future intentions and behaviors may be based, at least in part, upon the outcomes from past complaints. Such a relationship may be expected not only in consumer markets, but in industrial markets as well. The following hypothesis was, therefore, proposed: H2: Satisfaction with the complaint outcome and process (OVERSAT) will vary significantly with the purchasing manager’s level of assertiveness (ASSERT) and/or aggressiveness (AGGRESS). Retained Hostility Retained sentiments of anger and hostility were incorporated in the model presented by Kaufmann and Stern (1988). In their work, Kaufmann and Stern hypothesized that anger and hostility might remain after a dispute if one party judged the other party's behavior as unfair. This hypothesized direct relationship between unfairness and retained sentiments of anger and hostility was supported empirically. In the current research, a hypothesized relationship between satisfaction with the complaint outcome and process and retained sentiments of anger and hostility seems warranted. H3: Levels of retained anger and hostility (RETDANGR) will vary significantly with the purchasing manager’s level of assertiveness (ASSERT) and/or aggressiveness (AGGRESS). Complaint Intentions Trawick and Swan (1982) noted, in discussing the work of Day, Grabicke, Schaetzle and Staubach (1981), "the magnitude of consumer dissatisfaction will be greatly understated if the marketer relies on voiced complaints...thus, it may pay to encourage complaining and open channels of communication for complaints" (p. 83). This may hold for industrial markets as well as for consumer markets and it may be that the dissatisfied industrial purchaser who is seen and heard is better than the invisible, yet dissatisfied one. Thus, the following hypothesis was proposed: H4: Intentions to complain in a similar manner in the future (COMPINT) will vary significantly with the purchasing manager’s level of assertiveness (ASSERT) and/or aggressiveness (AGGRESS). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 101 Repurchase/Relational Intentions Trawick and Swan (1981, 1982) found industrial buyers' satisfaction to be significantly related to reorders. Satisfaction, in the case of Trawick and Swan's research, was operationalized as the extent to which an actual response corresponded with the desired response (on the part of the vendor). Richins (1983b) noted that with consumers, dissatisfaction was often shown to be related to the lack of repurchase. Although purchasing managers seem, on an intuitive level, to be quite different in their buying behavior than consumers, the possibility of a similar process operating in the industrial marketplace, therefore, warrants the following hypothesis: H5: Intentions to repurchase and to remain in the relationship with the vendor (REINT) will vary significantly with the purchasing manager’s level of assertiveness (ASSERT) and/or aggressiveness (AGGRESS). Relational Satisfaction Finally, relational satisfaction was hypothesized to be affected by satisfaction with the complaint outcome and process. It seems inherently logical that intentions to repurchase or remain in the relationship would be a similar construct to satisfaction with the buyer-seller relationship. The logic behind the inclusion of the previously discussed outcome variables is hypothesized to hold here, as well. H6: Satisfaction with the relationship with the vendor (RELATSAT) will vary significantly with the purchasing manager’s level of assertiveness (ASSERT) and/or aggressiveness (AGGRESS). METHOD The research process began with exploratory research. Depth interviews were conducted with ten purchasing managers. After these initial interviews, a pilot questionnaire was developed. This questionnaire was mailed (in a single wave) to 120 purchasing managers. Twenty of these pilot questionnaires were returned for a 16.7 percent response rate. Subsequent to the exploratory depth interviews and pilot survey, two waves of questionnaires (approximately four weeks apart) were directed to a national sample of 2,000 purchasing managers. A total of 317 usable questionnaires were returned for a 15.9 percent response rate. In methodology similar to that utilized by Anderson and Narus (1990), the subjects were asked to recall a focal supplier (i.e., their third or fourth largest supplier). Subjects were then asked to think of a recent "critical incident" of dissatisfaction with a product or service involving the focal supplier. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 102 The psychometric properties of the scales utilized in this research were established utilizing a two-part methodology. A factor analytic model was utilized in establishing the dimensionality of each scale or group of scales. A principal components (PC) methodology was utilized with an orthogonal (VARIMAX) rotation. After the factor analyses, the reliabilities of the various scales were established by utilizing a measure of internal consistency, Cronbach's alpha (Cronbach 1951). Items with low item-total correlations (less than .35) were eliminated from the various scales. Assertiveness and Aggressiveness Assertiveness and aggressiveness were measured by utilizing a subset of items from an instrument developed by Richins (1983a). Originally developed to measure consumer interaction styles in retail settings, not all the items were applicable in the industrial setting of the current study. The assertiveness scale (ASSERT) consisted of 15 Likert-type items of which two were omitted for content reasons and five more were deleted due to low item-total correlations. The finalized assertiveness scale consisted of eight items. The aggressiveness scale (AGGRESS) was measured by six Likert-type scale items. Of these six, two were omitted from the current study due to content problems. Of the remaining items, one was omitted due to a low item-total correlation. The final scale consisted of three items. In both the assertiveness and aggressiveness scales, the wording was altered for some items in order to make them applicable and appropriate in an industrial setting. In Richins' (1983a) research, the assertiveness measure was divided into three sub-scales: resisting requests for compliance, requesting information or assistance, and seeking redress. This dimensionality was based on a principal components factor analysis conducted in Richins' (1983a) research. Similarly, in the current study, the reformulated items were factor analyzed. In Richins' (1983a) research, four factors accounted for the three dimensions of assertiveness as well as the construct of aggressiveness. Likewise, the initial factor analysis of the assertiveness and aggressiveness items utilizing the current sample yielded four dimensions. Unfortunately, apart from the aggressiveness dimension, the other three factors were uninterpretable. Several other factor analyses were made, with a forced two-factor solution making the most conceptual sense. In this analysis, the first factor was termed "generalized assertiveness" and the second "aggressiveness". Although Richins (1983a) dimensionalized assertiveness into three parts, the changes and omissions from her original scale necessitate a uni-dimensional interpretation of assertiveness. Such a uni-dimensional viewpoint best corresponds with the results from the factor analysis and, the fact that there were substantive changes from Richins' original scale makes a direct comparison of dimensionality somewhat questionable. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 103 Considering the scales' reliabilities, Richins only reports reliabilities for the assertiveness scale in a uni-dimensional fashion (thus supporting a uni-dimensional interpretation of the construct). Richins (1983a) developed the assertiveness and aggressiveness scales utilizing two separate samples. Coefficient alpha remained consistent across the two samples for both assertiveness (alpha = .85, .80) and aggressiveness (alpha = .73, .76). This compares favorably with the reliability estimates for assertiveness (alpha = .76) and aggressiveness (alpha = .74) from the current research. It should be noted, however, that direct comparisons of the reliability coefficients may not be applicable. Confirmation of Expectations Bearden and Teel (1983) utilized a single-item measure of disconfirmation of expectations for automobile repair. In the present study, the extent to which expectations relating to the complaint response were met or not met (CONFIRM) was measured by a single Likert-type item. The exact wording of the question was: "How close was the supplier's actual response to your desired response?" The seven-point Likert-type item was bounded by "Not Very Close" on the low end and "Very Close" on the high end. Satisfaction with Complaint Outcome and Process Satisfaction with the complaint outcome and process was measured with an eight-item Likert-type scale with poles labeled "Very Dissatisfied" and "Very Satisfied" (OVERSAT). Of the eight items, six were original. The remaining two items (numbers 1 and 3) originated with Trawick and Swan (1981) where satisfaction was measured with only these two items. In order to psychometrically evaluate this new scale, factor analysis was conducted. The results from this analysis reveal a one-factor construct of satisfaction with both the process and outcome from the complaint episode. Following the factor analysis, a reliability assessment of the scale was made. From this analysis, the reliability of the scale (alpha = .94) was deemed acceptable. Retained Anger and Hostility Retained sentiments of anger and hostility (RETDANGR) were measured utilizing a scale developed by Kaufmann and Stern (1988). This four-item Likert-type scale, bounded by "Strongly Disagree" and "Strongly Agree," was augmented by two additional items. Factor analysis of the RETDANGR scale resulted in a single factor structure. Subsequent reliability analysis resulted in the deletion of two items with low item-total correlations. The purified four-item scale had reliability (alpha = .86) comparable to that in Kaufmann and Stern's (1988) work (alpha = .81). Future Intentions Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 104 Respondents' future intentions on relationship and repurchase (REINT), as well as complaining behaviors (COMPINT), were measured by eight Likert-type items. These items were bounded by "Very Unlikely" and "Very Likely". Factor analysis yielded two distinct factors: the first factor measuring repurchase and relational intentions, the second factor measuring complaint intentions. Items loaded clearly except for a single item which was deleted from subsequent analyses. Reliability analysis, focusing on the seven remaining items provided an alpha of .7377 for REINT and a correlation of .5867 between the two COMPINT items. Relational Satisfaction Relational satisfaction was measured utilizing a modified version of Ruekert and Churchill's (1984) SATDIR scale. This ten-item Likert-type scale (bounded by "very dissatisfied" and "very satisfied") was modified for the current research (and its sample) and is referred to as RELATSAT. Ruekert and Churchill (1984) noted three separate dimensions for their measure of relational satisfaction. A single, uni-dimensional construct, emerged when factor analysis was performed on the altered items utilized in the present study. Ruekert and Churchill (1984) reported reliabilities for two of the three dimensions in their scale: "social interaction" (alpha = .70) and "other assistances:" (alpha = .75). The final two-item subscale, "product," had no reliability (or correlation coefficient) reported. The unidimensional scale utilized in the current study (RELATSAT) produced an alpha of .8856, which compared favorably with those of Ruekert and Churchill. RESULTS Correlational analyses were performed in order to ascertain whether or not any statistically significant associations existed between assertiveness, aggressiveness and the specified outcome variables. Results from the analyses are presented in the table below. CONFIRM OVERSAT RETDANGR COMPINT REINT RELATSAT ASSERT .1803* .2286* -.1566* .2765* .0927 .2097* AGGRESS -.0018 -.0215 .0351 -.0354 -.0574 -.0315 * Sig. < .01 An inspection of the results evidences no significant associations between any of the outcome variables and aggressiveness (AGGRESS). Assertiveness, however, shows numerous significant associations with the focal outcome variables. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 105 Confirmation of expectations (CONFIRM) evidenced a significant positive correlation with assertiveness (ASSERT). In other words, purchasing managers who were more assertive tended to also have their expectations met with regard to their desired response to the complaint episode. There was also a significant positive association between ASSERT and overall satisfaction with the complaint outcome and process (OVERSAT). More assertive managers tended to also be more satisfied. A significant inverse relationship involved ASSERT and RETDANGR. More assertive managers evidenced less retained anger and hostility than did those purchasing managers who were less assertive. Assertiveness was also positively associated with intentions to complain in a similar manner in the future (COMPINT). Repurchase intentions, alternatively, showed no relationship to ASSERT. There was a higher level of satisfaction with the relationship (RELATSAT) associated with higher levels of assertiveness. Finally, the intention to repurchase from a given vendor (REINT) had no relationship to assertiveness. It could be that this action is not totally under the control of the purchasing manager. Consequently, individual factors (such as various personality characteristics) may have less importance in modeling the process than corporate level factors such as policies, contracts, and so on. CONCLUSIONS From these results, it would seem that further analysis utilizing the concept of purchasing manager aggressiveness might bear little fruit. Assertiveness, on the other hand, shows promise as a personality characteristic of interest. In summary, it may well be that understanding the base level of assertiveness present in a given purchasing manager may help, at least partially, explain the behavior of purchasing managers in complaint situations. Further, more rigorous, analysis is, therefore, warranted with regard to the relationship between purchasing manager assertiveness and IBCB. In addition, it is imperative that future work in IBCB not only focus on corporate-level variables, but on personality characteristics as well. REFERENCES Alberti, Robert E. and Michael L. Emmons. 1974. Your Perfect Right: A Guide to Assertive Behavior. San Luis Obispo, Calif.: Impact. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 106 Anderson, James C. and James A. Narus. 1990. "A model of distributor firm and manufacturer firm working relationships. Journal of Marketing 54 (January): 42-58. Barksdale, Hiram C. Jr., Powell, Terry E., and Hargrove, Earnestine. 1984. Complaint voicing by industrial buyers. Industrial Marketing Management 13: 93-99. Bearden, William O. 1983. Profiling consumers who register complaints against auto repair services. Journal of Consumer Affairs 17 (2): 315-335. Bearden, William O. and Jesse E. Teel. 1983. Selected determinants of consumer satisfaction and Complaint Reports," Journal of Marketing Research 20 (February): 21-28. Buss, Arnold H. 1961. The Psychology of Aggression. New York: John Wiley. Cronbach, Lee J. 1951. Coefficient alpha and the internal structure of tests. Psychometrika 16 (September): 297-334. Day, Ralph L. 1980. Research perspectives on consumer complaining behavior. in Theoretical Developments in Marketing, eds. Charles Lamb and Patrick Dunne, 211-215. Chicago: American Marketing association. Day, Ralph L., Klaus Grabicke, Thomas Schaetzle and Fritz Staubach. 1981. The hidden agenda of consumer complaining. Journal of Retailing 57 (Fall): 86-106. Fornell, Claes and Robert A. Westbrook. 1979. An exploratory study of assertiveness, aggressiveness, and complaining behavior. in Advances in Consumer Research, ed. William L. Wilkie, 6, 105-110. Ann Arbor, Mich.: Association for Consumer Research 105-110. Kaufmann, Patrick J. and Louis W. Stern. 1988. Relational exchange norms, perceptions of unfairness, and retained hostility in commercial litigation. Journal of Conflict Resolution 32 (September): 534-52. Oliver, Richard L. 1980. A cognitive model of the antecedents and consequences of satisfaction decisions. Journal of Marketing Research 17 (November): 460-469. Richins, Marsha L. 1983a. An analysis of consumer Journal of Consumer Research 10 (June): 73-82. interaction styles in the marketplace. . 1983b. Negative word-of-mouth by dissatisfied consumers: A pilot study. Journal of Marketing 47 (Winter): 68-78. Ruekert, Robert W. and Gilbert A. Churchill, Jr. 1984. Reliability and validity of alternative measures of channel member satisfaction. Journal of Marketing Research 21 (May): 226233. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 107 Trawick, I. Fredrick and Swan, John E. 1979. The nature of complaint behavior in the industrial market. Proceedings: Southern Marketing Association, 249-251. Trawick, I. Fredrick and Swan, John E. 1981. A model of industrial satisfaction/complaining behavior. Industrial Marketing Management 10: 23-30. Trawick, I. Fredrick and Swan, John E. 1982. Complaint behavior by industrial buyers: Buyer roles and organizational factors. Proceedings: Southern Marketing Association, 81-83. Williams, Robert and Gray, Victor. 1978. Dissatisfaction and complaint behavior of the industrial buyer. Proceedings: Southern Marketing Association, 343-346. Williams, J. Alvin and C. P. Rao. 1980a. Dissatisfaction and complaining behavior among organizational buyers: A determinant attribute approach. Fifth Annual Conference on Consumer Satisfaction, Dissatisfaction, and Complaining Behavior. Zaichkowsky, Judy and John Liefeld. 1977. Personality profiles of consumer complaint letter writers. in Consumer Satisfaction, Dissatisfaction, and Complaining Behavior. ed. R. L. Day, 124-129. Bloomington, Ind.: Indiana University Press. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 108 AN INTERNATIONAL COMPARISON OF ETHICS: A PILOT STUDY Peter J, Gordon, Southeast Missouri State University Bert J. Kellerman, Southeast Missouri State University ______________________________________________________________________________ ABSTRACT Over the past twenty five years, great efforts have been made in both the business world and academia to improve the level of ethics practiced by U.S. corporations. Increased interest in this subject has emerged with some recent, high-profile corporate failures. Cases such as Arthur Anderson, Enron, Global Crossings and others have highlighted the need to improve ethical standards practiced by American companies. But is the U.S. alone in facing these challenges? This study attempts to compare the ethical standards of tomorrow's business leaders in the U.S. with those in similarly advanced economies. ______________________________________________________________________________ INTRODUCTION In the last few years, newspaper headlines have chronicled major ethical failures by U.S. executives at corporations such as Adelphia Communications, Arthur Anderson, Conseco, Enron, Global Crossings, Health-South, Tyco, WorldCom, ImClone Systems and Martha Stewart Living Omnimedia. But ethical failures are not limited to U.S. corporations. Foreign-based multinational corporations such as Parmalat, the large Italian Food producer, Credit Suisse, Royal Ahold NV (Netherlands) and Skandia (Sweden) have all been rocked by recent ethical scandals (Munson 2004). According to Lamb et al, ethics refers to the "moral principles or values that generally govern the conduct of an individual or a group" (p. 78). They point out what is a generally accepted notion that ethical values are acquired through family, educational and religious institutions. That being the case, then how do ethical values compare across cultures that experience different family, educational and religious upbringing? Several studies have been published that compare the ethical standards of business decision makers in different countries. Some have focused on large corporations, while others have focused on smaller organizations. Some have compared relatively similar countries - those with like economic systems and standards of living, while other studies have highlighted the difference between corporate managers in first world and third world countries. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 109 In this pilot study, the authors took a slightly different approach. In order to better determine the likely level of ethics in the future, it was decided to use samples of university students studying business. These students, afterall, will be the business decision makers of tomorrow. Further it was decided to limit the study to countries in relatively similar levels of economic development. Any differences detected in the study would be more closely attributed to cultural differences rather than some combination of cultural and financial/economic factors. The countries chosen were the U.S., Germany, the Netherlands and the Walloon area of Belgium (French influenced). While all four countries share many economic similarities with relatively comparable standards of living, there is much research to indicate that they are identifiably culturally different. According to Ronan and Shenkar (1986), the United States fits into a cluster of countries defined as "Anglo", Belgium is in a cluster labeled "Latin European" and Germany in a "Germanic" cluster. Although the Netherlands was not included, it would likely fit somewhere between the "Nordic" and "Germanic" clusters. Therefore each country could be expected to have an unique set of cultural values. Perhaps the most referenced cultural study was developed by Geert Hofstede who identified four dimensions of culture. (Hofstede later added a fifth dimension - longtermism - to his model) Based on Hofstede's study, we could further expect differences in cultural values between the countries studied. Using the ranking for France as a proxy for French dominated Belgium, on the dimension of Power Distance, Germany had the lowest, followed closely by the Netherlands and the U.S. then France. For Uncertainty Avoidance, France ranked the highest, followed by Germany, the Netherlands and the U.S. For Masculinity, Germany was slightly higher than the U.S., followed by France and the Netherlands. For Individualism, the U.S. ranked highest, followed closely by the Netherlands, with Germany and France close together but some distance behind. What does all this show? That there are cultural differences between these four countries and each has a unique cultural profile. Although the selection of the countries and the universities involved in this study was based, to some extent on convenience factors, there is a sound academic reason for choosing these institutions. All teach their business classes in English, eliminating the difficulties of ensuring accurate translations into multiple languages. All three European countries are contiguous and the close proximity to the three Universities made administration of the questionnaires relatively simple. METHODOLOGY A questionnaire was developed based on a composite of two previous studies. In part it was based on one by the Gallup Organization and published in a series of articles by the Wall Street Journal (1983) to assess ethical standards in the U.S. The other questionnaires were used to compare the ethical attitudes of managers of medium sized organizations in the U.S. and England (Wiles, Wiles and Gordon 1990) and to compare ethical standards of management at large and small organizations (Gordon, Wiles and Wiles 1986). Students in the capstone business course at four universities were chosen for the study sample. These students are those who will be most imminently entering the work-force and also have Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 110 learned everything they were going to learn about ethics from their university experience. The universities involved were located in the U.S. Midwest, western Germany, the southern part of the Netherlands and the Walloon area of Belgium - the French culture dominated area in the south of Belgium. A total of 210 useable questionnaires were completed, almost equally divided between the four universities. THE QUESTIONNAIRE Respondents were asked to state if they thought a number of situations arising in business were ethically appropriate. Questions included the following: How appropriate is it to: take work supplies home? call in sick when not ill? use the company telephone for personal long-distance calls? choose the most expensive item on the menu at a business meal? use the company car for person trips? use the office copier for personal copies? accept gifts from a vendor? overstate salary history on a job application? Students were asked to give their answers mainly on a 5 point scale from Very Appropriate to Very Inappropriate. Demographic data were also collected. RESULTS At the time of publication, the results were being analyzed. It is expected that complete results will be available for presentation at the conference. Preliminary scanning of the data indicate there appears to be limited differences between the ethical standards of the four university groups. However some differences did exist, mainly between the U.S, sample and the three European samples. The Europeans tended to be more homogeneous in their ethical standards. Even before the full results are available, some of the shortcomings of the study methodology can be identified. One problem is sample size. Increasing the size of each sample group would definitely enhance the results. A review of the demographic data suggest that gender mix may have influenced the results - the U.S. sample was slightly more than 50% female, while the European samples were far more male dominated. Likewise with age - the European samples had a higher average age than the U.S. sample. Controlling for these factors might provide results that are more generalizable. The results from the European universities may have also been compromised by the failure to control for foreign students in the class. The U.S. sample was almost 100% native born Americans, while the Euro samples had a mix of students from several nations. This may have contributed to the converging results for all three European universities. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 111 CONCLUSIONS This study was clearly intended to be a pilot study. With refinements to the questionnaire and a larger sample, some truly useful results may be obtained. Results would be useful to both academic and corporate planners. Greater uniformity in the teaching of ethics classes at universities may help contribute to a more consistent ethical standard across first world countries. This is particularly important to multinational corporations where adherence to a common set of ethical standards wherever they operate in the world would be beneficial. It would make transfers of employees between nations easier and simplify the assent of employees to a uniform corporate-wide code of ethics. REFERENCES Czinkota, M. R. and I. A. Ronkainen (2004), International Marketing, 7th Edition, Mason, OH, Thomson/South-Western Publishing. Daniels, J.D. and L. H. Radebaough (1993), International Business: Environments and Operations, 6th Edition, Reading, MA, Addison-Wesley Publishing Company. Gordon, P. J., C. R. Wiles and J. A. Wiles (1986) "The Study of Ethics of Small Business Managers", SBIDA Conference Proceedings, 454-463. Hofstede, G. (1994) "Management Scientists Are Human", Management Science, 40 (1), 4-13. Lamb, C. W. Jr., J. F. Hair and C. McDaniel (2004) Marketing, 7th Edition, Mason, OH, Thomson/South-Western Publishing. Munson, E. (2004) "Where do We Go From Here?", Beta Gamma Sigma International Exchange, Fall, 3-5. Ronen, S. and O. Shenkar (1985) "Clustering Countries on Attitudinal Dimensions: A Review and Synthesis", Academy of Management Review, 30 (3), 449. Swanson, D. (2004) "Ethics Education", Beta Gamma Sigma International Exchange, Fall, 6,8. Wall Street Journal (1983) "Executives and General Public Say Ethical Behavior Is Declining in U.S." October 31, 33, 42. Wall Street Journal (1983) "On Many Ethical Issues, Executives Apply Stiffer Standard Than Public" November 1, 47. Wall Street Journal (1983) "Public Gives Executives Low Marks For Honesty and Ethical Standards" November 2, 37. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 112 Wall Street Journal (1983) "Executives Apply Stiffer Standards Than Public to Ethical Dilemmas" November 3, 39. Wiles, J. A., C. R. Wiles and P. J. Gordon (1990) "Attitudes Toward Business Ethics: A Comparison Of Small Business Managers and Executives of Large Corporations", Proceedings of the National Conference on Ethics in America, 31-41. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 113 INTERNATIONALIZING THE STUDENT BODY: A POST 9/11 PERSPECTIVE Peter J. Gordon, Southeast Missouri State University Willie J. Redmond, Southeast Missouri State University _____________________________________________________________________________ ABSTRACT During the decade of the 1990's, business schools across the country attempted to internationalize their curriculum in response to pressures from industry and accreditation standards issued by the AACSB. Numerous alternatives were developed in response to these pressures, ranging from an increase in the offering of more traditional "exchange" semesters, development of short term programs, development of overseas internship programs and the creation of innovative offerings such as "semester at sea" and similar programs. All was developing well, then, on September 11 2001, international education was forever changed. This paper will discuss some programmatic adjustments necessitated by this pivotal event. ______________________________________________________________________________ Introduction Since September 11, 2001, there have been numerous changes that have dramatically affected the nature of international business education. These changes can be categorized into two types; the changes in the psyche of the participants and the changes in the administrative procedures imposed by institutions both governmental and educational. Affected are, both U.S. students going abroad and foreign students electing to study in the U.S. The effects on these groups are, in ways, both similar and dissimilar. One "universal" result, however, has been a reduction in the number of students engaging in international educational experiences - going from and coming to the U.S. U.S. students studying abroad Contrasting changes have occurred in the overseas study interest of U.S. students. Although there was, initially, a dramatic decrease in the number of students electing to go abroad, over time the numbers slowly recovered. However, more recent events such as the U.S. invasion of Iraq and terrorist attacks in Madrid have renewed fears of terrorism. Although "official" figures do not yet fully reflect this latest downturn in interest in study abroad, much anecdotal evidence exists that this trend is quite real. Interestingly, often the parents have been the impediment, being reluctant to support their children's overseas ambitions. It is difficult to alleviate the fears of parents and students who are truly afraid that something catastrophic might happen. The less traveled the parents are, the more difficult it is to persuade them that overseas travel is relatively safe. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 114 As well as the general decrease in the pool of interested students, the chosen destinations are likely to be those that are perceived as safer or friendlier. Travel to Muslim countries has declined quite a lot - even to countries where there has been no significant anti-American or antiwest sentiment. Countries such as Malaysia, for example, are far less attractive to American students. There has also been an incorrect assumption by some students that some countries now do not like Americans. Students have expressed a worry about travel to France, for example, simply because they perceive an anti-American sentiment will increase the risk to their physical safety. On the other hand, travel has increased to perceived "U.S. friendly" locations as Ireland (+7%), Italy (+7%) and Australia (+17%) (The Institute of International Education.) Offering more programs in countries such as these may stimulate student interest. Another factor that has impacted U.S. student overseas travel plans is cost. Many foreign governments have imposed increased visa fees, many times in retaliation to the increase in fees that the U.S. has made compulsory for their citizens. For example, a visa to go to Brazil will cost a U.S. applicant $100 more than it will cost an applicant of any other nationality that requires a visa. Another element of the cost barrier is due to the deteriorating value of the U.S. dollar. In September 2001, one Euro was worth approximately 90 cents. A little over 3 years later, a Euro is worth approximately $1.33. That equals an increased in the value of the Euro of almost 50%, meaning that the cost of studying in Europe has increase by that amount. If one adds to that the increase in general airfares due to higher fuel prices, it is easy to see that financial barriers for U.S. students studying overseas have become prohibitive. Several other key destination countries have seen similar rises in their currencies - for example the United Kingdom and Japan. Universities can take some actions to help with these financial barriers. Subsidizing student study programs, shortening the length of time overseas and changing destinations to "dollar zone" countries (particularly those in Latin America) are all ways of reducing student cost. Short term program - those of a few weeks - may become more attractive than semester long programs. Although such programs lack the cultural immersion benefits of longer programs, they do provide an attractive alternative. Through these efforts, we can assist the next generation in their understanding of other countries and societies, and allow them to serve as cultural ambassadors to their foreign counterparts. This will consequently make it possible for young Americans to contribute to the creation of a more peaceful world. Foreign students coming to the U.S. The migration of foreign students to the U.S. has also noticeably declined. There are some parallels in this area with the reasons why U.S. students are less likely to travel abroad. Some foreign nationals perceive that the U.S. is a more dangerous place. For many foreign students (or their parents), concern over crime rates in the U.S. has long been a cause of reluctance of some students to come to the U.S. We now add concern about external terrorism to perceptions of the U.S. Anti American fervor on the nightly news fuels this perception. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 115 Some foreign students also fear that they are not welcome in the U.S. Anecdotally, one French student almost declined a pre-arranged study program in the U.S. because she thought Americans disliked the French, a perception that was cultivated by news stories of Americans pouring French wine down drains and renaming "French fries" to "freedom fries". However, economic trends should encourage greater foreign participation in the U.S. education system. The declining value of the dollar should encourage more Europeans and Japanese to study in the U.S. as the costs have reduced significantly over the past year or so. However, the bureaucracy of getting a visa - in both terms of cost and time - becomes almost prohibitive, especially for potential students living a distance from a U.S. consular office. In the case of one exchange program with a German university, students were required to travel over 400 Km each direction and arrange overnight accommodations just to have the now-mandatory personal interview. Adding to these costs is the escalating cost of taking the TOEFL (Test of English as a Foreign Language), that is required by most universities. Furthermore, if the student is seeking admission to an MBA program, several hundred more dollars must be spent to take the GMAT (Graduate Management Admission Test). In the case of nationals from countries perceived to be "less-friendly" or nationals from any Muslim country, visa procedures are even more difficult; with high proportions of visa requests being denied. Given the relative "friendly" treatment from Canadian, Australian and New Zealand consular offices, is it any wonder that more students elect to study in these countries instead of the United States? U.S. institutions should be vocal in lobbying to their congressional representatives to reduce paperwork and unnecessary barriers to qualified foreign students. One incentive that universities can provide is to reimburse students their visa fees once they arrive on campus. This may amount to several hundred dollars per students, and not all universities have the resources and the willingness to expend such amounts. Elimination of duplication may also help financially - for graduate students, why require both the GMAT and the TOEFL? If one can successfully pass the GMAT, in English, surely this proves that they are able to comprehend English sufficiently to ensure success in an MBA program. As the discussion on foreign students continues, we must appreciate that the U.S. is in many ways rewarded from being their destination of choice. Generations of world leaders (in politics and industry) have been educated in U.S. educational institutions. One must not underestimate the goodwill that this can create. CONCLUSION If internationalization of the business curriculum is going to continue to expand, then universities need to adjust strategies in light of the changing political and economic environment. Continuing to do "business as usual" will likely result in less effective programs and a declining base of American students willing to study overseas and foreign students willing to study in the U.S. Perhaps the guiding philosophy for those involved in international education is best Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 116 expressed by the words of Marlene Johnson, the executive director and CEO of NAFSA: Association of International Educators: “It is important not to close our doors and minds to the world beyond our borders. We believe preserving our open society is part of a strong homeland security strategy. We cannot be strong global leaders or establish productive alliances with our neighbors if we do not understand and know them and they do not have an opportunity to know us." REFERENCES Marlene Johnson, NAFSA: Association of International Educators, http://www.nafsa.org/splash.cfm. The Institute of International Education. “Students Study Abroad in Growing Numbers: Despite economic and security concerns post-Sept 11, numbers continue to rise”. http://www.eduserveinc.com/LIB7z.htm. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 117 THE ROLE OF INDIVIDUAL GOAL ORIENTATION IN ORGANIZATIONAL LEARNING AND PERFORMANCE: IMPLICATIONS FOR MARKETING STRATEGY Eric G. Harris, University of South Florida ABSTRACT Organizational learning has been established as one of the more important research areas in the strategic marketing literature (Hunt and Morgan 1996; Dickson 1996; Day 1994). Originally conceptualized as “a process by which organizations as collectives learn through interaction with their environment” (Cyert and March, 1963), organizational learning has been given much research attention. Learning organizations are able to respond to environmental changes rapidly and to incorporate market information processing (MIP) activities into strategic decision-making (Sinkula, et al. 1997). Furthermore, as Day (1994) asserts, firm-level learning processes help foster an overall market orientation. Although organizations ultimately learn through their individual members, work that focuses on the impact of employee learning on firm-level learning orientation is scarce. In fact, Hurley (2002) recently suggested that attempts to foster a learning organization should begin with an understanding of individual-level learning processes. The current work follows recent calls of Hurley (2002) by examining the relationship between individual level goal orientations and overall firm-level marketing strategy. Given that organizations are cognitive systems (Sinkula et al., 1997) comprised on individual employees, a close focus on individual learning and learning goals is necessary. The perspective adopted in this work builds on that of Hurley (2002) in that too much focus has been devoted to overall firm-level learning with too little focus given to the learning processes of the individual employee. As Hurley (2002) discusses “..organizations learn only when people learn and in turn affect the theories in use operating inside the firm (p. 271).” Recent developments in the individual-level goal orientation literature have much to offer this area. Two orientations, learning and performance, are especially important. A learning orientation motivates employees to enjoy the process of learning and to apply learning to achievement situations whereas a performance orientation motivates employees to focus on proving themselves on important performance outcomes to peers and supervisors. The difference between improving ability (i.e., a learning orientation) versus demonstrating ability (i.e., a performance orientation) is important. The recent work of Harris et al. (2005) highlights the importance of individual-level learning motivations. In their work, Harris and colleagues find empirical evidence for the hypothesized positive influence of individual-level learning orientation on customer-oriented selling behaviors. Performance orientation, on the other hand, is shown to positively influence selling-oriented customer contact behaviors. Because individual-level learning motivations influence customer contact behaviors, the Harris et al. (2005) work may be viewed as an initial foundation for bridging the gap between individual-level learning and firm-level learning and market Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 118 orientations. The current work expands the perspective taken by Harris and colleagues (2005) into the organizational learning context. It is suggested that individual-level learning plays an important part in fostering both firm-level learning and market orientations. Implications for strategic marketing management are suggested. SELECTED REFERENCES Day, George S. (1994) “The Capabilities of Market-Driven Organizations.” Journal of Marketing 58, 37 – 52. Dickson, Peter R. (1996) “The Static and Dynamic Mechanics of Competition: A Comment on Hunt and Morgan’s Comparative Advantage Theory.” Journal of Marketing 60, 102 – 106. Harris, Eric G., John C. Mowen, and Tom J. Brown (2005), “Re-examining Salesperson Goal Orientations: Personality Influencers, Customer Orientation, and Workplace Satisfaction,” Journal of the Academy of Marketing Science, 33 (1), 19 -35. Hurley, Robert F. (2002), “Putting People Back into Organizational Learning.” Journal of Business & Industrial Marketing 17, 270 – 281. Sinkula, James M. (1994), “Market Information Processing and Organizational Learning,” Journal of Marketing 58, 35 – 45. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 119 ASSESSING SKILLS AND KNOWLEDGE: A QUALITATIVE INVESTIGATION OF ADVERTISED MARKETING RESEARCH POSITIONS Edmund K. Hershberger, Southern Illinois University Edwardsville Madhav N. Segal, Southern Illinois University Edwardsville ABSTRACT Using content analysis as a qualitative research technique for analyzing advertised marketing research positions, this study attempts to assess marketing research skills and knowledge areas as desired by present industry employers. Marketing research positions [online and published advertisements] of both client organizations and research agencies are investigated and examined using a systematic content analysis procedure. Several areas of marketing research skills and knowledge are identified as critical for prospective employees. The paper also discusses implications for prospective marketing research employees, employers, and academic institutions preparing marketing research students for careers in the field. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 120 THE FOG OF OECD AND NON-OECD COUNTRY EFFICIENCY: A DATA ENVELOPMENT ANALYSIS APPROACH Maxwell Hsu, University of Wisconsin at Whitewater Xueming Luo, University of Texas at Arlington Gary Chao, Northwestern University ABSTRACT Applying Data Envelopment Analysis, this paper attempts to make an efficiency comparison between the developed countries (i.e., OECD economies) and the less developed countries (i.e., non-OECD economies). Indonesia and Argentina are found to outperform other studied nations across all efficiency measures. Our findings also indicate a significant difference between the OECD countries and the non-OECD ones in terms of the scale efficiency and overall technical and scale efficiency. Interestingly, many developing countries such as Turkey, Poland, and Mexico appear to operate in a more efficient manner. INTRODUCTION The country was at the center of trade theories advanced by Adam Smith and Ricardo, but only a paucity of international marketing research has focused on country research in the past few decades. Given that trade liberalization and information technology have acted as locomotives for the economic growth in the late 20th century (Bauer, Berger and Humphrey 1998; DeYong 1998), geographical distance is no longer a main barrier of international business. Indeed, for multi-national companies (MNCs) such as Gillette and Proctor & Gamble, their products are launched all over the world simultaneously, manufactured in fewer places, and coordinated by worldwide procurement (Kanter 1999). As such, more attention should be paid to country research again. Conceptually, each international enterprise or investor would try to price inputs and outputs within the target country so as to put its operations in the best possible position. A country/economy can be defined as efficient if we can price the inputs and outputs in such a way that this country gets out all of the value that it puts in. On the other hand, it can be shown that if a country is inefficient, then a combination of the efficient countries can be found that uses the same amount of inputs as the inefficient country yet produces more outputs. It is in this sense that any input utilization greater than the optimal amount is considered unnecessary and such a country may be regarded as an economically inefficient one. Most of the time, investors want to invest their assets in the most efficient market. However, investors’ final decisions might be to invest their assets in less efficient markets when the marginal benefits from investing in the most efficient country fail to compensate the costs of searching and research. Thus, the identification of economically efficient and less efficient countries has significant implications for MNCs in that they may evaluate each of the potential target countries’ macroeconomic efficiency and then fine tune their global expansion strategy. In Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 121 addition, evaluating a country’s relative efficiency is of critical importance for its policy makers because they can benchmark their own country’s macroeconomic performance with other countries with a similar set of socio-economic status. This paper attempts to make an efficiency comparison between the developed countries and the less developed countries. It is believed that our findings would facilitate MNCs and global investors’ global expansion or investment decisions. Moreover, policy makers may benchmark their own nation’s performance with their peers. A unique feature of the present study is that it incorporates the Data Envelopment Analysis (DEA) (Charnes, Cooper, and Rhodes 1978) to measure the degree of relative efficiency of each country. As illustrated by the review of the DEA methodology in the following section, empirical evidence in the economic and international business literatures reveals the benefits of DEA in many occasions. Next, the main findings are presented and discussed. Finally, we conclude this paper with implications for managerial operations as well as future research. LITERATURE REVIEW The inquiry into possible methods of competitive measurement has attracted a lot of attention in modern international business literature. Though a large number of studies have examined the question of country competitiveness, it is somewhat surprising that modern literature lacks studies on comparative efficiencies of the countries. Most literature and country competitive reports focus on the topic of country performance and, as a result, one drawback of the international competitive assessment is that the more competitive countries tend to possess better infrastructures and higher macroeconomic performance scores, not necessarily reflecting a thorough analysis on a country’s productivity (i.e., using the same amount of inputs to produce a relatively great amount of outputs). In other words, these competitive ranking scores oftentimes do not reflect the potential for higher economic returns in the less competitive countries. Therefore, attention to international comparison should gradually be shifted from monitoring a few benchmarks (e.g., GDP per capita, education attainment) on an individual basis toward a multidimensional system that considers the simultaneous use of multiple resources to generate greater outputs. With the help from DEA model, one can calculate the optimal weight for each input factor to prioritize decision makers’ efforts. Cherchye (2001) adopted DEA-based LIMEP, Global Efficiency Measure (GEM) and GEM-flex indicators to evaluate a number of countries’ performance in term of GDP, CPI, employment rate, and value of exports and imports. Interestingly, Cherchye demonstrated that, due to the various underlying assumptions and insufficient information, the weights were not consistent across different models. The rankings for all input factors were similar, though. It is thought that Cherchye’s models could still provide helpful insights on the sensitivity of performance results with the chosen indicator set as well as the estimation of the policy priorities. Lovell, Pastor, and Turner (1995) employed GEM to evaluate the performance of 14 European OECD and 5 non-European OECD countries. Their input factors consisted of several macroeconomic indicators (e.g., GDP per capita, CPI, inflation rate, employment rate, and trade balance). Interestingly, after incorporating the environment factors (i.e., the carbon and nitrogen emissions) as additional input factors, a dramatic change related to the performance rankings was observed. In other words, the DEA rankings are likely to change when different sample Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 122 characteristics and evaluation criteria are involved. Obviously, the choice of inputs and outputs can be critical to the final efficiency ratings. Raab and Lichty (2002) employed the DEA technique to identify the efficient and inefficient counties based on the 1993 IMPLAN input-output database. An efficient frontier that used as little input as possible while purchasing as much output as possible was constructed for the counties within the Minneapolis-St. Paul metropolitan area as well as its immediate environs. Subsequently, the DEA technique was applied to measure input consumption and output production. Finally, an additional linear program was employed to rank the order from the most efficient to the least efficient. As such, the counties around Minneapolis-St. Paul can be properly divided into three different zones: urban, transitional, and peripheral. Furthermore, accompanying with the location quotients for each industry, Raab and Lichty were able to validate the business activities in each zone. In addition to the above reviewed spatial (space-related) DEA research, DEA has been applied in the area of regional development (Dinc et al. 2003), banking industry (Seiford and Zhu 1999; Sathye 2001; Luo 2003), public transportation industry (Cowie 2002), and so forth. Please see Golany and Roll (1989) for a more detail-oriented discussion of the various objectives for carrying out the DEA technique. Data Envelopment Analysis (DEA) is a promising linear programming technique that utilizes all the information contained in the data to evaluate all decision-making units and benchmark each DMU’s efficiency performance (Banker, Charnes, and Cooper 1984; Cooper, Seiford, and Tone 2000). A distinguishing feature of the DEA approach is that, for each DMU (e.g., an individual country), it calculates a single relative ratio by comparing total weighted outputs to total weighted inputs for each unit without requiring the proposition of any specific functional form. Accordingly, the DEA efficiency value has an upper bound of one and a lower bound of zero. Two main types of DEA models, namely the input-oriented and the output-oriented models, have been widely articulated by researchers. Though the input-oriented model focuses on the cost minimization while the output-oriented model focuses on the output maximization, evidence indicates that research results are not sensitive to which of the models is being used (Golany and Roll 1989). It is in this context that, based on the DEA efficiency measurement, MNCs and policy makers can then easily benchmark efficient and “the best practice” countries. Because the goal of this study is to identify the relative country efficiency and to maximize output of the analyzed national economies, two basic DEA output-oriented models (i.e., CCR and BCC models) are chosen to assess the selected countries. The CCR model assumes constant return to scale (CRS) and is initially introduced by Charnes, Cooper, and Rhodes (1978) while the BCC model assumes variable return to scale (VRS) and is advanced by Banker, Charnes, and Cooper (1984). In the application of DEA, a linear programming model needs to be formulated and solved for each DMU. Such a requirement makes the calculation of efficiency scores for all of the studied countries a tedious job, but now softwares such as IDEAS and DEA-Solver can estimate the efficiency scores for all DMUs in one DEA model that illuminates any potential human error. In DEA estimation, any input utilization greater than the optimal amount is considered unnecessary and such a DMU is classified as an inefficient one. For all DMUs, overall technical and scale efficiency (TSE) refers to the extent to which countries achieve the overall productivity attainable in the most efficient manner (Banker, Charnes, and Cooper 1984) and it can be further decomposed into pure technical efficiency (PTE) and scale efficiency (SE). Pure technical Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 123 efficiency refers to how efficiently countries use their inputs. Scale efficiency, on the other hand, represents how productive the scale size is and it is the ratio of TSE from the constant-return-toscale (CRS) to PTE obtained from the variable-return-to-scale (VRS). METHODOLOGY The present study adopts the intermediation approach to assess the relative country efficiency because the authors view a major role of country as a wealth-creation intermediary that bridges global capital (e.g., MNCs and international investors) and the general consumers in a specific country. Such an approach could reflect the relative efficiency of country operations in the increasingly competitive world. To simplify matters, our analysis utilizes three input factors (i.e., business efficiency, government efficiency, and infrastructure index) and one output factor (i.e., economic performance index) to measure a country’s relative efficiency. Notably, the selected output factor provides useful information related to a country’s macroeconomic performance and it corresponds to the magic diamond of the OECD (e.g., Economic Outlook 1987). The impact of globalization and the burgeoning of technologies have resulted in a big step forward in the wealth-creating potential of business activities around the world. One outcome of this phenomenon is that developed countries are experiencing relatively little constraints as contrasted to developing countries. This is further provoked by the limited access to high quality human capital, abundant capital, advanced technology, and a transparent socio-economic system. It is our belief that these inherited disparities among the non-OECD countries should be considered in arriving at relative efficiency evaluations. Therefore, in evaluating the efficiency of a country, we take into account the fact that the level of development in the OECD countries is generally more advanced than the features of their non-OECD counterparts. If this piece of information is ignored, the evaluation would be unfair to the countries in the highly challenging set (i.e., non-OECD countries) and would be too benign to the economies in the more competitive set (i.e., OECD countries). Accordingly, a hierarchical category is employed in the present study to handle such situation. In this setting, we evaluate non-OECD countries only within that group while evaluating the OECD countries with reference to both OECD and nonOECD countries. DATA The development of objective and practically informative measures are eagerly conducted by many researchers (Krugman 1991, 1994; Lall 2001; Oral and Chabchoub 1996, 1997; Reinert 1995; Thompson 2003). So far there is not a consistent definition about the national competitiveness. The competitiveness index of a nation can be found through a number of international comparison reports. To name a few, the World Competitiveness Yearbook (WCY) by the Institute for Management Development (IMD), the Global Competitiveness Report by the World Economic Forum (WEF), and the Global Country Forecast by the Economist Intelligence Unit (EIU). The present study employs data from the 2004 World Competitiveness Yearbook (WCY). The WCY assesses 60 economies’ ability to maintain their competitiveness in the global business environment by incorporating 323 criteria, which can be categorized into four major factors: economic performance, government efficiency, business efficiency, and infrastructure Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 124 advancement. Indices of the four national environmental factors are reported in the 2004 WCY (see Table 1). Oral and Chabchoub (1996) and Rosselet-McCauley (2004) illustrated the methodology and the principles of the WCY analysis. Table 1. National Environmental Factors* I Economic Performance 1. 2. 3. 4. 5. 6. 7. Prosperity of a country reflects its past economic performance. Competition governed by market forces improves the economic performance of a country. The more competition there is in the domestic economy, the more competitive the domestic firms are likely to be abroad. A country's success in international trade reflects competitiveness of its domestic economy (provided there are no trade barriers). Openness for international economic activities increases a country's economic performance. International investment allocates economic resources more efficiently worldwide. Export-led competitiveness often is associated with growth-orientation in the domestic economy. II Government Efficiency 1. 2. 3. 4. State intervention in business activities should be minimized, apart from creating competitive conditions for enterprises. Government should, however, provide macroeconomic and social conditions that are predictable and thus minimize the external risks for economic enterprise. Government should be flexible in adapting its economic policies to a changing international environment. Government should provide adequate and accessible educational resources of quality and develop a knowledgedriven economy. III Business Efficiency 1. 2. 3. 4. 5. 6. 7. 8. Efficiency, together with ability to adapt to changes in the competitive environment, are managerial attributes crucial for enterprise competitiveness. Finance facilitates value-adding activity. A well-developed, internationally integrated financial sector in a country supports its international competitiveness. Maintaining a high standard of living requires integration with the international economy. Entrepreneurship is crucial for economic activity in its start-up phase. A skilled labor force increases a country's competitiveness. Productivity reflects value-added. The attitude of the workforce affects the competitiveness of a country. IV Infrastructure 1. 2. 3. 4. 5. 6. A well-developed infrastructure including efficient business systems supports economic activity. A well-developed infrastructure also includes performing information technology and efficient protection of the environment. Competitive advantage can be built on efficient and innovative application of existing technologies. Investment in basic research and innovative activity creating new knowledge is crucial for a country in a more mature stage of economic development. Long-term investment in R&D is likely to increase the competitiveness of enterprises. The quality of life is part of the attractiveness of a country. * Adapted from Table 2 at http://www01.imd.ch/wcy/fundamentals/ (accessed on August 6th, 2004) Compared with other available indices, the WCY has a number of advantages: (1) it covers a wide variety of variables that have been used to evaluate the health of a nation, (2) it has been Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 125 issued reliably on a regular basis since 1989, and (3) it features 60 national and regional economies, with a relatively balanced coverage of both OECD countries and non-OECD countries. To fit the purpose of the present study, ten sub-national economies (e.g., Scotland) that are available in the WCY annual report but not listed on the CIA factbook, are excluded from our analysis. The resulting data set used in the present paper contains four factors across forty-nine nations plus Hong Kong with no missing data. EMPIRICAL RESULTS The descriptive statistics of the inputs and outputs are reported in Table 2. For the studied 50 economies, the average government performance index is 54.4; the average business performance index is 53.2; the average infrastructure soundness index is 53.3; and the average economic performance index is 53.5. The Pearson correlation among these variables is reported in Table 3, which shows that all DEA input factors are correlated with the output factor at the .01 significance level. Such findings further supported our selection of DEA inputs and outputs because it is assumed that a DMU consuming more resources (inputs) should generate more outputs (Charnes, Cooper and Seiford 1994; Golany and Roll 1989). Table 2. Descriptive Statistics Cat N Minimum Maximum Mean DEA Input Factors Government All 50 10.362 84.333 54.396 1 21 10.362 84.333 52.655 2 29 21.645 81.669 55.655 Business All 50 5.776 86.693 53.222 1 21 5.776 86.177 49.893 2 29 20.594 86.693 55.633 Infrastructure All 50 13.530 100 53.259 1 21 13.530 73.830 41.790 2 29 21.814 100 61.566 DEA Output Factor Economic Performance All 50 19.643 90.502 53.508 1 21 31.714 79.242 51.374 2 29 19.643 90.502 55.053 * 1 represents non-OECD economies while 2 represents OECD economies. Table 3. Correlation of Variables Government Government Business Infrastructure Economic Performance 1.000 0.850** 0.603** 0.596** Business Infrastructure 1.000 0.675** 0.603** 1.000 0.619** Std. Deviation 17.871 19.241 17.045 19.964 21.011 19.179 19.576 15.921 17.874 12.278 11.596 12.723 Economic Performance 1.000 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 126 ** p < .01 Three efficiency indices -- namely overall technical and scale efficiency (TSE), pure technical efficiency (PTE), and scale efficiency (SE) -- were calculated for each economy (see Table 4 and 5). The mean TSE score was .65 for the non-OECD countries and .53 for the OECD countries. According to the t-test and the Mann-Whitney test, non-OECD countries experienced a higher level of TSE than their OECD counterparts at the .06 significance level. It is worthy to note that, based on the TSE measurement, only 2 countries (i.e., Indonesia and Argentina) were categorized efficient and they both belong to the non-OECD country set. As for PTE and SE, results indicated an average score of .79 and .81 in the non-OECD country segment. On the other hand, results showed an average score of .75 and .72 for PTE and SE, respectively, in the OECD country segment. The t-test and the Mann-Whitney test showed that non-OECD countries experienced a higher level of SE than their OECD counterparts at the .01 significance level, but there was no statistical difference between the two segments in terms of PTE (see Table 5). Overall, non-OECD countries appear to use their inputs in a relatively more efficient manner than the OECD countries. Table 4. Overall Technical and Scale Efficiency (TSE), Pure Technical Efficiency (PTE), Scale Efficiency (SE), and Efficiency Ranking ID WCY 2004 Ranking INDONESIA ARGENTINA BRAZIL ROMANIA PHILIPPINES INDIA COLOMBIA RUSSIA CHINA SOUTH AFRICA THAILAND SLOVENIA JORDAN CHILE ESTONIA MALAYSIA NEW ZEALAND TAIWAN ISRAEL HONG KONG SINGAPORE TURKEY POLAND MEXICO GREECE Cat.* 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 VRS (PTE) CRS (TSE) 1.000 1.000 1.000 1.000 0.922 0.906 0.838 0.773 1.000 0.918 1.000 0.916 0.674 0.596 0.623 0.536 1.000 0.859 0.518 0.444 0.886 0.727 0.800 0.647 0.584 0.460 0.642 0.500 0.678 0.514 0.751 0.546 0.737 0.521 0.708 0.473 0.667 0.444 0.791 0.490 0.833 0.461 0.398 0.382 0.717 0.681 0.944 0.878 0.730 0.620 SE 1.000 1.000 0.983 0.922 0.918 0.916 0.884 0.861 0.859 0.857 0.821 0.809 0.787 0.778 0.757 0.728 0.707 0.668 0.665 0.619 0.553 0.960 0.951 0.930 0.849 Ranking 58 59 53 54 52 34 41 50 24 49 29 45 48 26 28 16 18 12 33 6 2 55 57 56 44 (based on SE) 1 2 3 7 8 9 10 11 12 13 15 18 20 21 26 27 30 35 36 42 50 4 5 6 14 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 127 ITALY SLOVAK Republic CZECH Republic HUNGARY PORTUGAL KOREA SPAIN UK IRELAND LUXEMBOURG BELGIUM AUSTRIA NETHERLANDS FRANCE SWEDEN GERMANY NORWAY ICELAND FINLAND CANADA AUSTRALIA DENMARK SWITZERLAND JAPAN USA 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 0.874 0.654 0.848 0.670 0.681 0.612 0.733 0.824 0.797 0.874 0.831 0.679 0.806 0.904 0.665 0.948 0.675 0.720 0.614 0.740 0.682 0.607 0.662 0.830 1.000 0.717 0.531 0.680 0.519 0.521 0.468 0.555 0.595 0.570 0.601 0.565 0.461 0.546 0.589 0.428 0.606 0.430 0.455 0.380 0.457 0.420 0.371 0.394 0.493 0.577 0.820 0.813 0.802 0.775 0.766 0.764 0.757 0.723 0.716 0.687 0.681 0.679 0.678 0.651 0.643 0.639 0.637 0.632 0.618 0.618 0.616 0.611 0.596 0.594 0.577 51 40 43 42 39 35 31 22 10 9 25 13 15 30 11 21 17 5 8 3 4 7 14 23 1 16 17 19 22 23 24 25 28 29 31 32 33 34 37 38 39 40 41 43 44 45 46 47 48 49 * 1 represents non-OECD economies while 2 represents OECD economies. Table 5. Tests Results of Difference on DEA Efficiency T-test Cat. 1 vs. 2 T Sig. Cat* N Mean SD TSE 1 21 0.654 0.202 2.651 0.011 2 29 0.534 0.116 PTE 1 21 0.793 0.153 1.107 0.274 2 29 0.749 0.129 SE 1 21 0.814 0.126 0.540 0.005 2 29 0.717 0.110 * 1 represents non-OECD economies while 2 represents OECD economies. Mann-Whitney Cat. 1 vs. 2 Z Sig. -1.858 0.063 -0.925 0.355 -2.742 0.006 DISCUSSION In today’s world, non-OECD countries receive proportionally less attention than their OECD counterparts in the global media. In general, the non-OECD countries have to deal with Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 128 more challenges. For instance, their IT infrastructure is not equally advanced as the OECD countries and their national economy tend to be more sensitive to a regional financial crisis and/or worldwide recession. Despite such constraints, our findings showed that many developing countries like China, Israel, and Singapore operate in a more efficient manner. These countries survived the hard times and successfully brought competitive pressures to the world economic system. This study finds significant difference between the OECD economies and the non-OECD countries in terms of the scale efficiency (SE) and overall technical and scale efficiency (TSE). Such a finding challenges the conventional wisdom that OECD economies generally operate in a more scale-efficient manner. This finding perhaps can be explained by reviewing the descriptive statistics of the inputs and outputs. Specifically, Table 2 shows that the OECD countries slightly outperform the non-OECD countries on all aspects but the average input/output ratio among the non-OECD countries is .94, in contrast to the average input/output ratio of 1.05 for the OECD countries. Given that the same amount of inputs can generate larger amount of output in the nonOECD countries, the findings reported in Table 5 should not be considered unearthly. In our research, Indonesia and Argentina were ranked number one across all three efficiency measures. It is worthy to note that, even though these two countries possess some disadvantages such as unattractive exchange rate and poor Internet access, they were found to be relatively more efficient than most other studied economies. In conjunction with other available information (e.g., country risk ranking), investors and MNCs are likely to secure a relatively higher rate of returns from Indonesia and Argentina than from other countries. On the contrary, the United States was ranked near the bottom of the efficiency measurement. This is perhaps because that intensive competition and government regulations (e.g., environment protection regulation) have made business operations more expensive in the United States. It is noteworthy that, in terms of the scale efficiency (SE), Indonesia, Argentina, Brazil, Romania and Philippines were the top 5 non-OECD countries while Turkey, Poland, Mexico, Greece and Italy were the top 5 OECD countries. It seems to be consistent with the commonly shared viewpoint that higher returns are associated with higher risks. We encourage international businessmen to consider not only the international competitiveness but also the efficiency feature of the marketplace and their acceptable level of tolerance toward business risks before making market entry decisions. CONCLUDING REMARKS As indicated earlier, the existing competitiveness report (including WCY) does not provide any efficiency measure to facilitate global investors and MNCs’ decision making. That is, those competitiveness reports might not be a panacea for the global market entry or resource allocation decisions. Since a country with a high competitive rating does not necessarily correspond to a country’s efficiency performance, we propose to further categorize the available country competitiveness data into two subsets: inputs and outputs. Subsequently, the DEA technique is employed to generate an easy-to-understand efficiency index. Our proposed method enables MNCs and global investors to identify the efficient countries among a number of countries when they are in the crossroad of global expansion or resource allocation. In addition, it would allow policy makers to benchmark their own nation’s performance with the peering nations. It is our belief that, though return on investment does not simply depend on government efficiency, Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 129 business efficiency and infrastructure soundness, an investment in the relatively more efficient marketplace is likely to produce higher returns than elsewhere. There are more than 145 countries and/or political entities in the world, and there is a huge variation among countries in terms of political system, infrastructure, socio-economic development, etc. In the present study, we arbitrarily categorized the studied 50 economies into two groups (i.e., OECD and non-OECD countries). Though this type of category arrangement resulted in a relatively balanced number of economies in each segment and thus may be viewed acceptable in this study, it perhaps would not be appropriate in a setting where the number of nations in one group is more than twice or three times in the other group. Future studies may need to incorporate a more meaningful category structure when employing the DEA technique in a broader global setting. Also, it may prove to be worthwhile to consider each country’s political freedom as an additional input factor and the “risk ratings” of each country as an additional output factor. We recommend further studies to find ways and means to facilitate this process. REFERENCES Banker, R.D., A. Charnes, and W.W. Cooper (1984), “Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis,” Management Science, 30, 10781092. Bauer, P., A. Berger, G. Ferrier, and D. Humphrey (1998), “Consistency Conditions for Regulatory Analysis of Financial Institutions: A Comparison of Frontier Efficiency Methods,” Journal of Economics and Business, 50, 85-114. Charnes, A., W.W. Cooper, and E. Rhodes (1978), “Measuring the Efficiency of Decision Making Units,” European Journal of Operational Research, 2, 429-444. 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Kanter, Rosabeth Moss (1999), “Global Competitiveness Revisited,” The Washington Quarterly, 22(2), 39-58. Krugman, Paul A. (1991), “Myths and Reality of U.S. Competitiveness”, Science, 254, 11-815. Krugman, Paul (1994), “Competitiveness: a dangerous obsession”, Foreign Affairs, 73(2), 28-44. Lall, Sanjaya (2001), “Competitiveness Indices and the Developing Countries: An Economic Evaluation of the Global Competitiveness Report,” World Development, 29(9), 1501-1525. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 130 Lovell, C.A. Knox, Jesus T. Pastor, and Judi A. Turner (1995), “Measuring Macroeconomic Performance in the OECD: A Comparison of European and Non-European Countries”, European Journal of Operational Research, 87, 507-518 Luo, Xueming (2003), “Evaluating the Profitability and Marketability Efficiency of Large Banks: An Application of Data Envelopment Analysis,” Journal of Business Research, 56, 627-635. OECD (1987), Economic Outlook, 41, OECD, Paris. Oral, Muhittin and Chabchoub, Habib (1996), “Theory and Methodology on the Methodology of the World Competitiveness Report,” European Journal of Operational Research, 90, 514535. Raab, Raymond and Richard W. Lichty (2002), “Identifying Subareas that Comprise A Greater Metropolitan Area: the Criterion of County Relative Efficiency,” Journal of Regional Science, 42(3), 579-594. Reinert, Erik S. (1995), “Competitiveness and its predecessors - A 500-year Cross-national Perspective,” Structural Change and Economic Dynamics, 6, 23-42. Rodriguez Cano, Cynthia, Carrillat, Francois A., and Jaramillo, Fernando (2004), “A Metaanalysis of the Relationship between Market Orientation and Business Performance: Evidence from Five Continents,” Journal of Research in Marketing, 21, 179-200. Rosselet-McCauley, Suzanne (2004), “Methodology and Principles of Analysis,” IMD World Competitiveness Yearbook 2004, 742-751. Sathye, Milind (2001), “X-efficiency in Australian Banking: An Empirical Investigation,” Journal of Banking & Finance, 25(3), 613-630. Seiford, Lawrence M. and Joe Zhu (1999), “Profitability and Marketability of the Top 55 U.S. Commercial Banks,” Management Science, 45(9), 1270-1288. Thompson, Edmund R. (2003), “A Grounded Approach to Identifying National Competitive Advantage: A Preliminary Exploration,” Environment and Planning, 35, 631-657. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 131 FEDERAL INTERNATIONAL RESOURCES: PREPARING GRADUATES FOR SURVIVAL IN TOMORROW’S GLOBAL WORLD Erin M. Hurley, Texas State University ______________________________________________________________________________ ABSTRACT The objective of this paper is to inform both students and professors alike of the benefits behind governmental resources taught in a college setting. These databases, such as STATUSA/Internet and GLOBUS/NTDB, provide profound tools as well as accommodating information that is valuable both in and outside the classroom. Through these, students receive a well-needed international perspective and become globally aware in today’s economy. Through teaching these resources experientially, a student will have the upper hand research wise, intercultural wise, and technology wise once they enter the business world. Hands-on tactics and experiential utilization in courses help students attain this significant knowledge. ______________________________________________________________________________ INTRODUCTION Businesses, today, operate in a global economy. In this field, many students are handed a degree yet still occasionally lag from a global perspective once placed in an office setting. Graduates have completed all required courses, often read their textbooks, and bubbled in letters at test time. Yet something still is left to be desired in their education process when they enter the actual business world. When faced with real world business issues such as dealing with other countries and international industry sectors, nothing in their education quickly comes to mind as reliable, up-to-date sources of information that can be used to help answer international business concerns. These international information sources that entry-level graduates search for are truly just a few clicks away and are provided free by our very own government; however few graduates know about them. In college we were told in our lecture classes how to do business, and to conduct research; however one important issue was always left out. What information searches need to be behind business start-ups to increase chances of success and where do you really start these information searches that produce the most quality, up-to-date sources of information? Research shows that the identification of such sources are relinquished to the marketing research courses or provided in other courses in the terms of a few relative websites (Taylor & Williams 2004). Seldom ever is the subject of federal international research resources mentioned in business or general education courses or in college textbooks. Acquaintance with Federal international resources cannot be solely the privilege of students enrolling in marketing research courses. International-oriented students, business students and others need to know how to access quality international information if they are to survive as business people and citizens in the global world of today and tomorrow. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 132 REVIEW OF LITERATURE A study of science and humanities, and possessing a reasonable command of English is not enough for today’s college graduates. Davis, Misra and Van Aukhen (2002) found that working marketing alumni tend to feel that they are unprepared for the workforce relative to technology (spreadsheets, statistical packages, and database software) and oral and written communication. Business schools are slowly beginning to incorporate more technology into students’ educational process. However, even technology skills, in addition to the science, humanities, and training in English still are not sufficient. Liberal arts students as well as business students need more; they need to be truly prepared for intra- and extra-industry career movement as recessions and politics within organizations puncture careers and displace employees. Business colleges emphasize required general education courses and core business subject matter content to meet accreditation standards. Historically, little concern is given to varying learning styles of individuals or a focus on students preparing for employment in relation to particular economic cycles in the world around them. Learning from experience, otherwise known as experiential learning, is a fundamental and natural way of learning (Education & Training 2003). Kolb, probably the best known authority on experiential learning and development (Lucas 2002), advocated experiential learning as the true source of learning and development (Kolb 1984). The experiential teaching mode allows the learner to use the elements of action, reflection and transfer (Education & Training 2003) and involves the ‘whole’ person through thought, feelings and physical activity (Cattell 2003). EXPERENTIAL LEARNING Schools of business and schools of other disciplines consider the mode of presentation a subservient concern, not realizing that student involvement in the learning process promotes further in depth understanding (Kelmar 1992). Fortunately, this myopic concern for developing graduates with employee-readiness is slowly changing domestically. Young, Klemz, and Murphy (2003) found that marketing education seems to be rapidly shifting from the pedagogy of lecture/textbook/exam to that of a modified pedagogy rich in experiential learning; and, they found that schools are strongly supporting this movement with the required educational technology. Anseimi and Frankel (2004) found that experiential learning improves the effectiveness of higher education. Other authors have found that experiential modes of teaching represent a shift from the ‘instruction’ paradigm, where students are passive in the learning process, to the ‘learning’ paradigm, where students are active in the learning process (Barr and Tagg 1995; Saunders 2004; Speece 2002; and others). Similarly, Speece (2002) found that other universities as well as international universities are adopting experiential modes of information delivery. However, cultural elements can in fact inhibit the effective use of experiential learning modes dependent on where that mode of teaching is being enacted; in collectivist or individualistic society (Speece 2002). This author found that such collective/individualistic factors affect the students working together in groups. Although initially not a preferred method Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 133 of learning in the Asian culture, experiential group work as a learning mode did improve in acceptability and effectiveness after the first few weeks of introduction. THE BUSINESS WORLD TODAY Today, unemployment levels are high and rising and career paths are becoming less defined as the budget displaced business professional seeks employment shelter in adjacent or even non-related industries; seeking employment refuge where ever the unemployed might find employment. Like Kelmar advised in 1992, teaching in uncertain economic environments needs to take on a more practical approach fostering strong business acumen. Experiential learning can be used by professors in such a way that this mode of teaching can truly make a difference in students’ transferability of knowledge, skills and attitudes from the confines of the four walls of the classroom to the students’ interaction in the broader world (Smith and Van Doren 2004). In using business plan development and other experiential learning approaches such modes allow students to practice transferable skills that, upon graduation, students can readily transfer to today’s technological workplace (Garvin and Ramsier 2003). However, today’s business environment is not just technology-related; it is also intercultural-related and has global interconnectedness - herein lays the problem from an educational standpoint. Two key issues are neglected: international information research and international communication. Research wise, students are not being educated in how to sort quality web information from that of not so quality. Likewise, they are not learning to go to the most direct source of quality, reliable and most up-to-date information; that which is published by the U.S. Federal Government and provided ‘free’ to every citizen and business in the United States at the nearly 1,300 Federal Depository Libraries (FDLs) located nationwide. Many FDLs, otherwise known as Government Document Libraries, are located at university sites. Today, many students graduate knowing that there is a government documents library somewhere in the main library on their own campus but never once entered the government documents door; nor have they been encouraged by their professors to do so. A body of literature demonstrating use of Federal documents, such as the Exporters’ Guide for Small Businesses and federal documents Web sites, Stat-USA/Internet and USA Trade Online, which would serve as new tools for teaching and learning, has not penetrated general or academic business journals or other academic literature. A recent literature search showed that there has been some coverage of Federal Resources in the literature. However, this coverage has been limited to book reviews from 1989 (15 years ago) and was published in library-oriented journals (Library Journal 1989a and 1989b). Lack of presence in published research makes government documents appear to be one of the best-kept secrets (Taylor 2003). It is not just experiential learning relative to technology that is needed today to prepare graduates to survive in tomorrow’s global world. Intercultural communication skills are essential and are prerequisite because almost all of business, whether domestic or international, involves communication, written, oral, or both, with people from different cultural backgrounds. Business schools have a responsibility to prepare students in intercultural communication (Cheney 2001). Many schools have begun to incorporate intercultural communication in their Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 134 business curricula though individual lectures, term projects, study abroad programs, and other methods. Some intercultural/experiential modes of teaching require more university and personal resources than others. However, experiential learning need not be expensive and require large amounts of technology to support the learning process (Education and Training 2003). One resource for teaching toward experiential and intercultural communication skills building that is often overlooked on campuses is that of the designing experiential learning exercises involving and capitalizing on the international student population on campus (Cheney 2001). Another resource for teaching intercultural/technological/global skills-building, also largely overlooked on campuses, is that of Federal international information Internet resources that are applicable to teaching/learning in both business schools and liberal arts programs. Federal international information resources are applicable to all, and free to all students and local businesses and citizens at local Federal Depository Libraries (FDL). These resources are accessible by students whether the local university has a campus-wide site license, or a library-use-only FDL ‘free’ license. Integrating Federal international information Web-resources into the business or liberal arts classroom is an essentially free way of incorporating intercultural knowledge and communication, as well as technological experiential learning into existing courses. Short-term and long-term benefits of doing so will accrue to student, professor and university alike. WHY GOVERNMENT RESOURCES SHOULD BE PART OF COLLEGIATE EDUCATION Lack of Information Breeds Business Failure Businesses fail for many reasons, with failure happening repeatedly due to the same prominent reason. The Score® Company out of the U.S. provides counseling to America’s small businesses. They point out that one of the main reasons companies do not do well, about 78% of them, is because they have insufficient research. They also explain that 55% of businesses fail because they do not understand their competition (Score Association 2004). Similarly, the Marketplace of Ideas (2004) cites that ignoring financial, economical, and political information leads to failures in marketing products abroad. Federal International Resources Businesses often fail for the lack of research information when actually these facts easily come from online governmental resources. Students and businesses alike would benefit from the experiential learning of such resources as STAT-USA/Internet (which includes the STATE-OFTHE-NATION database and the GLOBUS&NTDB database); USA Online; and other government provided international information sources (CIA World Factbook; UN Statistical Abstracts; and others). These and myriad other international information resources can be conveniently accessed through various links on STAT-USA/Internet’s GLOBUS & NTDB database such as Country Background Notes, Country Commercial Guides, International Marketing Insight Report links and many more. Domestic information can also be accessed on Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 135 STAT-USA/Internet’s State of the Nation database that provides up-to-date, reliable information on domestic economic and financial data. USA TRADE ONLINE, another Federal Web site, accessible through the STAT-USA/Internet site, provides timely, reliable data relative to the sale (exports) of U.S. products worldwide and the U.S. purchases (imports) of foreign products. Through both STAT-USA/Internet and USA Trade Online, information necessary to answer many questions that may be encountered in conducting international business can be readily acquired. Additionally, customized and personal help may be sought from the STAT-USA customer service program. STAT-USA/Internet is truly a one-stop information shop offering information and training to both students and businesses to help those overcome common failures and to readily begin understanding the business of our global economy. Tables 1 and 2 (used with permission of Taylor and Williams 2004) provide an overview of some of the important links to international information that can be located on the STATUSA/Internet Web site under the GLOBUS & NTDB database. There is a wealth of international information on this database grouped by trade leads/global business opportunities (Table 1) and by NTDB Country and Market Reports and Contact Directories (Table 2). TABLE 1: TODAY’S GLOBAL BUSINESS OPPORTUNITY LEADS (update daily): FedBizOpps (FBO) Government procurement opportunities over $25,000. Commercial vendors seeking Federal markets for their products and services can search, monitor, and retrieve opportunities solicited by the entire Federal contracting community (formerly Commerce Business Daily, CBD). Defense Logistics Agency Leads (DLA) Lists contracting opportunities to provide supplies and services to America’s military forces worldwide through the DLA. Commercial vendors may perform comprehensive and detailed searches against Request for Quotation (RFQ) and Award documents. Trade Opportunity Program Leads (TOP) Gathered by US embassies around the world, these leads include requests for manufactured goods, services, representation, investment, joint-ventures, and licensing from both private companies and foreign governments. International Marketing Insight Reports (IMI) Contains short profiles of specific foreign market conditions or opportunities prepared by the Department of Commerce’s U.S. and Foreign Commercial Service, the Department of State, and multilateral development banks in overseas markets. These reports provide information on a dynamic aspect of a particular market. They may focus on specific projects, industry profiles, finance and marketing trends, regulation and import changes, trade show opportunities, or government policy updates. Agricultural Trade Leads (AgLead) Contains information on foreign buyers who are seeking U.S. food, agricultural, and forest products. AgLeads include detailed contact information, product specifics, and quantities needed, packaging and labeling requirements, the type of quotation required, and a bank reference. United Nations Trade Leads (ETO–Electronic Trading Opportunities) Contains leads for small and medium-sized enterprises that originate from over 150 trade points around the world. Current and Historical Trade Leads Trade Opportunity Program Leads; Agricultural Trade Leads; FedBizOpps (formerly Commerce Business Daily Leads); Defense Logistics Agency Leads. United Nations Trade Leads – UN’s Electronic Trade Opportunities Bulletin Board Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 136 Service. Contacts Registry - This registry can be used to search for international partners, research the competition, and locate trade-related officials working in their state. These directories can be used to search for international partners, research the competition, and locate trade-related officials working in their state: NTDB Global Trade Directory - This is STAT-USA’s new searchable database of manufacturers, resellers, and buyer contacts around the world. It can be used to register a company in the directory. National Export Directory - This link provides contact information useful to businesses desiring to export. This information is provided by state for each of the fifty states in the U.S. The National Export Directory provides contact and location information related to Economic Development Centers, Commerce Departments, International Trade Administration, Export Assistance Centers, Export Legal Assistance Networks, Free Trade Zones (FTZ), Minority Business Development Centers, MBDC), Minority/Women Business Development Centers, State Trade Offices, Trade Finance Offices, Regional Offices of Ex-Im Bank and other export contacts. Used with permission of Taylor and Williams (2004), “Cross-Border Harvesting of Foreign Marketing Intelligence: Federal Websites with Enhanced Investigation Functionalities, Journal of Contemporary Business Issues, 12 (Spring), 1, p. 42.59. TABLE 2: NTDB MARKET AND COUNTRY REPORTS International Marketing Insight Reports These reports offer information on current conditions in specific country markets and identify upcoming opportunities for generating sales. Sector snapshots, reports, opportunities, and obstacles; Infrastructure projects and opportunities; Investment Laws and Opportunities; Travel warnings and conditions; Overview of procurement opportunities; Rehabilitation projects; Economic overviews; Mandatory safety requirements; Tourism reports; Inflation reports; Marketing and management services and consultancy; Foreign exchange restrictions; Business opportunities; Investment climate; Consular information sheet’ and other such reports. These reports can be accessed by date, by industry and by country. Industry Sector Analysis Reports (ISAs) Industry Sector Analysis Reports offer succinct international market information on specific industries that can help determine market potential, market size, and competitors for a company’s products and services. These reports provide a market summary and overview of all kinds of industry sectors. For example: by date, industry or country the summary would include specific information about the particular industry and the market from various past, present and future perspectives. Overviews are given concerning the competitive environment and any reorganization, deregulation or privatization; and, also address any economic recessions and the effects on the industry and the present cycle of rapid or restrained growth. Country Commercial Guides (CCGs) One of the major NTDB publication features are the Country Commercial Guides (CCGS). These guides are part of the Trade Promotion Coordinating Committee (TPCC) to consolidate various reporting documents prepared by U.S. government agencies for the U.S. business community. Country Commercial Guides provide overviews for doing business in more than 120 countries with information about market conditions, best export prospects, financing, finding distributors, and legal and cultural issues. Multilateral Development Bank (MDBs) Alerts U.S. firms to new and potential national consulting services opportunities under the Asian Development Bank’s (ABD) technical assistance (TA) grants program. Included in these reports are statistics about how many grant dollars are won by many small U.S. consulting firms for technical Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 137 assistance contracts awarded. Other reports might concern European Bank for Reconstruction and Development (EBRD) invitation for U.S. firms to express their interest to provide services to assist with certain Multilateral Development Bank (MDB) projects like poverty reduction programs, social services, education and youth development, environmental projects, urbanization projects, and others. Global Agriculture Information Network (GAIN) AgWorld Attache’ reports. These are the Attache’ Reports of the US Department of Agriculture's Foreign Agricultural Service. These are compiled for the purpose of informing US export marketing opportunities, but provide a view of worldwide agricultural policy changes and important social and environmental factors which influence imports and exports. The database of reports can be searched by date, commodity, country, and subject keyword or document number. The reports are available in either PDF (requiring Adobe Acrobat Reader) or WordPerfect format. Country Background Notes Background Notes are factual publications that contain information on all of the countries of the world with which the United States has relations. They include facts on the country’s land, people, history, government, political conditions, economy, and it relations with other countries and the United States. The Notes are updated/revised by the Office of Electronic Information and Publication of the Bureau of Public Affaires as they are received from regional bureaus and are added to the database of the Department of State Web site. They are likewise available through the one-stop STAT-USA Web site. In addition to the Background Not for each country listed, each country has a “country page; containing additional information about the country. This can be accessed by clicking on the country name link under “OFFICIAL NAME” at the beginning of each Background Note. For a list of the countries in a region of the world (with links to respective country page) a user can got to the Country Information section in each of the following areas: Africa, East Asia and Pacific, Europe and Eurasia (including the New Independent States of the former U.S.S.R.), Near East, South Asia, and the Western Hemisphere. Using these State Department Background Notes international managers can research in minutes a country’s culture, politics, employment, banking, and investment situation. Country Background notes updated annually. National Trade Estimate Report on Foreign Trade Barriers (NTEs) The National Trade Estimate (NTE) Report on Foreign Trade Barriers is an annual report by the office of the US Trade Representative as required by Section 1304 of the Omnibus Competitiveness Act of 1988. The NTE Report of Foreign Trade Barriers consists of several country-specific chapters (provided as separate .pdf files) that identify significant foreign tariffs and barriers to or distortions of trade. It provides and inventory of trade barriers affecting goods, services, investment property and intellectual rights of major U.S. trading partners. Best Market Reports (BMRs) The US Foreign and Commercial Service no longer produces Best Market Reports. Those presently on the Web site are the most current available. Best Market Reports (BMRs) are snapshot reports of a given market segment (or in some cases, closely related market segments) as they are described by U.S. Commercial Service and U.S. Department of State officials stationed overseas. These brief reports come from much longer reports submitted by all of the larger and most of the smaller embassies as part of their annual reporting duties, called the Country Commercial Guides (CCGs) that are also available on the National Trade Data Bank (NTDB). Posts are requested to describe the best market segments for U.S. exporters; those sections are separated out by market and presented here. If you would like further information on the commercial market in a given country, consult the CCG and other U.S. Government reports on www.usatrade.gov, or contact your nearest U.S. Department of Commerce Export Assistance Center. Used with permission of Taylor and Williams (2004), “Cross-Border Harvesting of Foreign Marketing Intelligence: Federal Websites with Enhanced Investigation Functionalities, Journal of Contemporary Business Issues, 12 (Spring), 1, p. 42.59. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 138 Benefits of Federal Resources in Collegiate Education The benefits of learning how to navigate these governmental websites are endless to any student looking to enter the workplace. Almost any profession requires an international and cultural understanding as every sector is being opened up worldwide. Whether having a degree in computer information systems, communications, or business, each graduate needs to be culturally aware. In such classes as international relations and advertising, government background knowledge on varying countries is often needed. This can easily be obtained through these Federal resources, which are reliable and accurate. Experiential learning leads to an awareness and provides skills that are necessary for navigating Federal international information web sites. This provides a research tool that would benefit all majors and college students alike; while still conducting research for other courses in colleges as well as later when they enter their desired careers. Experiential Learning: A Prerequisite These vital Federal information sources cannot be taught in a lecture, nor should be read from a textbook. In a college setting it should be taught through experiential learning. David Kolb (1984), who brought about the theory of experiential learning, coined the phrase "Tell me, and I will forget. Show me, and I may remember. Involve me, and I will understand." Kolb’s theory clarifies experiential learning and explores the cyclical pattern of all learning in distinct stages: Experience through Reflection and Conceptualizing to Action and on to further Experience (Garvin and Ramsier 2003). Another ideal of experiential learning is purported by Rogers, who explained that experiential learning can also be described as the significant type. Just seeing and listening to a subject matter does not have much impact on whether it will stay with a student, making the matter relevant to them is then what makes it real to them (Rogers 2004). Therefore in order for students to fully grasp the benefits of teaching, they must understand that it will not only assist them in a collegiate setting, but will help them to excel once in the business setting. Being able to take this knowledge with them and use it out of the classroom will give them the personal drive to learn, which is needed to truly comprehend (Rogers 2004). A student must not watch a power-point presentation or read the significance of the reports that can be found on these Federal Web sites, but instead learning needs to take a hands-on or experiential approach navigating the Federal Web sites to learn the benefits of this untapped wealth of knowledge and how it is literally at their fingertips. Through instructor guidance and question prompts, they will be able to discover how these resources can specifically be helpful to their academic and workplace needs. Assessment and Utilization in the Classroom The teaching of these resources can easily accompany the lesson plan of an international marketing course, or taught more in depth in a course specialized to this topic. The differing aspects and concepts that make up these Federal Resources can be divided into sections, moving from basic navigation and conceptualization of these web pages to eventually using the provided resources to develop in depth analysis. Specific reports can be created on such aspects as the Commerce department, import and export regulations, and individual country business topics. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 139 These would allow the student to recognize the benefits of the information that they are provided. Through prompts given by professors that ask specific questions, students would then have to turn to navigation and understanding the websites and links in order to achieve answers. Throughout the process, students will become more comfortable with these usefulness and quality of the information that is handed to them. Meeting Tomorrow’s Global World Through such experiential learning and students’ ultimate grasp of the vast international information available though Federal Web sites educators will be able to send today’s graduates out prepared to meet the challenges of today’s and tomorrow’s global business world. Such training will armed graduates with the necessary knowledge, resources, and abilities -- if educators give take time today to prepare students with the needed timely and reliable international research tools of tomorrow. REFLECTIONS ON RECENT EXPERIENTIAL LEARNING EXPERIENCE Having taken classes in a variety of subjects both here in the U.S. and the year that I spent abroad in Spain, I would grasp on and hold for dear life when I would find information that I thought would help me succeed once I would graduate. We live in a very competitive world, and I wanted to always be at the head of that race. Therefore anything I found whether in my studies, travels, or personal life that I thought would transfer into viable, useful information, I would store safely in a part of my memory where I knew that I could later come back to it. This is how I felt when I learned how to navigate the websites of STAT-USA/Internet and Globus/NTDB, and USA Trade Online. All at once I was faced with a vast resource that contained knowledge that I never knew was so readily accessible. I had read through many of my textbooks, and each told of the Internet almost as if it were not to be trusted; explaining to be wary of the information found there. Textbook readings never advised that instead of being fearful of this technology that I should embrace it. Thankfully I was given the chance through the experiential learning method to discover all that these resources had to offer. Instead of watching a download of a home page that was transferred to a power point presentation, I was given the prompts and felt the excitement my professor exerted and then was told to come back with not only answers but how and what I had learned. This was something that was made real to me as my fingers typed on the keyboard and my mouse clicked away; I was able to navigate these Federal databases soon very easily and confidently. I was not just explained to, but rather I became part of the lesson plan. Professors as well as students alike should take an active part in education because they are the ones who will truly benefit. Simply teaching at students will not get them to learn the material beyond the day of the test. Interactive and experiential teaching would consist of students taking part in their own educational future. This is the type of learning that stays with them for life. A true lesson is not learned, it is lived and felt. It is something that has a certain emotional attachment to it, a moment of “Aha,” and pride. Through experiential learning, this all can be accomplished. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 140 REFERENCES Anseimi, Kenneth and Robert Frankel (2004), “Modular Experiential Leaning for Business-toBusiness Marketing Courses,” Journal of Education for Business, 79 (January/February) 3, p. 169 – 175. Barr, R.B., & Tagg, J. (1995), “From Teaching to Learning: A New Paradigm for Undergraduate Education,” Change, November-December, p. 13-25. Cattell, Alan (2003), “The Power of Experiential Learning – A Handbook for Trainers and Educators,” Book Review, Industrial and Commercial Training, 35, 2/3, p. 78. Cheney, Rebecca S. (2001), “Intercultural Business Communication, International Students, and Experiential Learning,” Business Communication Quarterly, New York, 64 (December) 4, p. 90 – 105. Davis, Richard, Shekhar Misra and Stuart Van Auken (2002), “A Gap Analysis Approach to Marketing Curriculum Assessment: A study of Skills and Knowledge,” Journal of Marketing Education, 24 (December) p. 218, 224. Education and Training (2003), “The Power of Experiential Learning: A Handbook for Trainers and Educators,” Book Review – anonymous, 45, 4/5, p. 292-294. Garvin, M.R. and R.D. Ramsier (2003), “Experiential Learing at the University Level: A US Case Study,” Education and Training, 45, 4/5, p. 280 – 285. Kelmar, John H. (1992), “ Business Plans for Teaching Entrepreneurial Behavior,” Education and Training, 34, 1, p. 30-32. Kolb, David (1984), “Experiential Learning….on the Web,” a critique by Tim Pickles, downloaded 10/14/04, http://www.reviewing.com.uk/research/experiential.learning.htm. Library Journal (1989a), “Federal Documents – Exporter’s Guide to Federal Resources for Small Business,” Book Review, Anonymous, Library Journal, 114 (May 15), 9, p. 44. _____________(1989b), “Federal Documents – Power On: New Tools for Teaching and Learning,” Book Review, Anonymous, Library Journal, 114 (May 15), 0, p. 44. Lucas, Jo (2002), “It Ain’t What You Do….,” Training Journal, (August), p. 20-23. Marketplace of Ideas (2004), “Common Reasons Why Businesses Fail,” Marketplace of Ideas Web site, downloaded 10/14/04, http//www.marketplaceofideas.com/directory/businessdev/fail.htm. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 141 Rogers, C. (2004), “Experiential Learning,” downloaded 10/14/04, http://www.tip.psychology.org/rogers.html. Saunders, Peter (2004), “Teaching and Learning in the 21st Century,” downloaded 10/14/04, http://www.wmich.edu/teachlearn/feature/story.htm Score Association (2004), “Top Reasons Businesses Fail,” Jessie Hagen, U.S. Bank, Score Association Web site, downloaded 10/14/04, http://www.foxcitiesbusiness.com/score/whybusinessesfail.htm. Smith, Louise W. and Doris C. Van Doren (2004), “The Reality-Based Learning Method: A Simple Method for Keeping Teaching Activities Relevant and Effective,” Journal of Marketing Education, 26 (April) 1, p. 66 – 74. Speece, Mark (2002), “Experiential Learning Methods in Asian Cultures: A Singapore Case Study,” Business Communication Quarterly, 65 (September) 3, 106 – 121. Taylor, Ruth Lesher (2003), “Best-Kept Secrets: The Use of Federal Resources in Marketing Courses,” Proceedings 2003 Association of Collegiate Marketing Educators (March). Taylor, Ruth Lesher and Forrest B. Williams (2004), “Cross-Border Harvesting of Foreign Marketing Intelligence: Federal Websites with Enhanced Investigation Functionalities,” Journal of Contemporary Business Issues, 12 (Spring) 1, p. 42 – 59. Young, Mark R., Bruce R. Klemz, and J. William Murphy (2003), “Enhancing Learning Outcomes: The Effects of Instructional Technology, Learning Styles, Instructional Methods, and Student Behavior,” Journal of Marketing Education, 25 (August) 2, p. 130 – 142. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 142 AN EMPIRICAL INVESTIGATION OF A MODEL OF ENVIRONMENTALLY CONCERNED CONSUMER BEHAVIOR AND ITS DETERMINANTS: THE MODERATING ROLE OF MARKET MAVENSHIP AND PRODUCT INVOLVEMENT Kishwar Joonas, Prairie View A&M University Shahid Bhuian, Louisiana Tech University ABSTRACT Literature presents an incomplete picture of environmentally concerned consumer behavior (ECCB). An integrated model of ECCB was theorized, with empirical results (n=212) explaining between 51 and 81 per cent of variance in four behavioral dimensions. Interactional effects were found on the direct linkages, of product involvement and market mavenship, a construct hitherto ignored by the literature. EXTENDED ABSTRACT Extant literature offers incomplete explanations of environmentally concerned consumer behavior (ECCB), based on subsets of determinants. In this study, I have presented an integrated model of ECCB, and examined the main effects of three key psychological determinants (environmentally concerned beliefs and attitudes, personal norm, and perceived consumer effectiveness) and two key socio-cultural determinants (injunctive norm and collectivist orientation), on four dimensions of ECCB, namely purchase behavior, search for information, conserving behavior, and supporting intent. The study also examined the interactional effects of market mavenship and involvement on these direct linkages. I conducted a national online survey among members of environmental organizations (n= 212). The model explained 58.8 per cent of the variance in purchase behavior, 62.2 percent of the variance in search for information, 51.7 per cent of the variation in conserving behavior, and 81.3 per cent of the variance in supporting intent. The study has served to strengthen, support and extend previous research in the area of ECCB. Support was found for the main effects of environmentally concerned beliefs and attitudes on purchase behavior, and supporting intent. Furthermore, support was found for the main effects of personal norm on purchase behavior, search for information, and conserving behavior. Additionally, results supported the main effects of injunctive norm on purchase behavior, search for information, conserving behavior and supporting intent. Also, results supported the main effects of perceived consumer effectiveness on purchase behavior, search for information, and conserving behavior. However, collectivist orientation was not supported as a positive determinant of any dimension of environmentally concerned consumer behavior. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 143 Market mavenship was examined in the environmental context for the first time in this study, and was evidenced to be a determinant of search for information. Additionally, interactional effects of market mavenship were evidenced on two direct linkages in the model. Further, product involvement was evidenced to be a determinant of search for information, and also of supporting intent. Additionally, interactional effects of product involvement were evidenced on three direct linkages in the model. The contributions of this study have wide research implications, and also societal and managerial implications for the various environmental stakeholders. SELECTED REFERENCES Dunlap, R.E., and K.D. Van Liere (1978) “The New Environment Paradigm: A proposed measuring instrument and preliminary results,” Journal of Environmental Education, 9, 10-19. Feick, L. F. and L.L. Price (1987) “The market maven: A diffuser of marketplace information,” Journal of Marketing, 51(January), 83-97. Fishbein, M., and I. Ajzen (1975) Belief, attitude, intention, and behavior: An introduction to theory and research, Reading, MA: Addison Wesley. Joonas, K.A. (2004) An empirical investigation of a model of environmentally concerned consumer behavior and its determinants: The role of market mavenship and product involvement, Unpublished dissertation, Louisiana Tech University. Ling-yee, L. (1997) “Effect of collectivist orientation and ecological attitude on actual environmental commitment: The moderating role of consumer demographics and product involvement,” Journal of International Consumer Marketing, 9(4) 31-53. Roberts, J.A. and D.R. Bacon (1997) “Exploring the subtle relationships between environmental concern and ecologically conscious consumer behavior,” Journal of Business Research, 40, 79-89. Stern, P.C., T.S. Dietz, and G.A. Guagnano (1995) “The new ecological paradigm in sociopsychological context’,” Environment and Behavior, 27(6), 723-743. Zaichkowsky, J.L. (1985) “Measuring the involvement construct,” Journal of Consumer Behavior, December: 341-352. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 144 FORMALIZATION OF SALES FORCE MARKET INFORMATION GENERATION Thomas W. Lanis, East Central University Patrick D. Fountain, East Central University Karla Peterson, East Central University ABSTRACT This paper proposes and tests a measure of the formalization of sales force market information generation. The measure, called the formalization of sales force market information generation scale, is an adaptation of an organization formalization scale used by Ayers, Dahlstrom & Skinner (1997). The resulting 5-item scale showed a coefficient alpha of .885. This paper also briefly reviews literature related to market information, market information generation, formalization and formalization of sales force market information generation. INTRODUCTION Sales force personnel are boundary spanners for organizations. This boundary spanner position creates an opportunity for organizations to gather information through their sales force. Research to date indicates a lack of formalized support for sales personnel to collect and disseminate information. What little research has been done in the area concerned with formalization of the information gathering done by the sales force is of a very general nature. It is hoped that this paper will provide a platform for further, more specific, research in this area. The paper begins by reviewing literature related to market information and market information generation and then reviews literature related to formalization and formalization of sales force market information generation. The next section highlights the need for further research and the development of a specific measure for formalization of sales force market information generation. It is followed by a section on the methodology used to test the proposed measure. The results of the test are then presented followed by a section with a discussion of the results along with conclusions and recommendations for further research. MARKET INFORMATION AND MARKET INFORMATION GENERATION Market Information Market information refers to information about customers, competitors, and other relevant market environmental factors that might affect a firm’s marketing activities within the market or might affect the outcome of a firm’s marketing activities within a market. Market information generation is the acquisition and collection of market information. Because sales people are in regular direct contact with customers and their markets, they have a unique opportunity to collect market information (Webster 1965) and are able to provide accurate information about customers (Lambert, Marmorstein and Sharma 1990). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 145 As boundary spanners of the organization, sales people’s activities bring them in direct contact with parties in the organizations’ external environment. In the business-to-business markets sales people may have contact with many different individuals in the customer organization. These contacts might range from the CEO to the members of the buying center and even down to the part-time employee selling coffee in the company cafeteria. In addition to direct contact with customers, sales people have direct contact with competitors, channel members, and often even customers of their customers. Sales people also have frequent contact with members of non-competitors who sell to the same customers. Market Information Generation In research specifically addressing sales force market information generation, Beltramini (1988) found that sales people have a desire to have more involvement in product development and want to be able to share their knowledge of customers and the market with relevant people at the home office. Troy, Szymanski, and Varadarajan’s (2001) study supports the idea that firms benefit by generating greater amounts of market information. However, Gordon, Schoenbachler, Kaminski, and Brouchous (1997) found nearly 60% of sales organizations assigned their sales people limited or no responsibility for generating market information regarding customers’ new product needs. Their findings indicated that the sales forces tend to generate more short-term focused information regarding customer product needs and that a vast majority tended to collect and disseminate the information informally. This leads to minor product improvements rather than new-to-the-world products. These studies suggest that while sales force generated market information is valuable to a firm, many sales organizations do not have formal procedures or policies in place to guide the sales people in their market information generation activities. Simply because a wealth of market information is available from a variety of sources does not mean that the sales person will collect information relevant to the organization. Sales people have a primary responsibility of selling the organization’s products and managing relationships with their customers. Often compensation and reward systems are based on an individual’s sales levels and, therefore, there is little motivation for sales people to engage in activities that do not have a direct impact on their sales levels. Members of the sales force may ignore information that is not relevant to their primary responsibilities or, when sales people do gather market information, they may not see any need to share the information with others in the organization. Walker, Churchill, and Ford (1972) suggested that sales people may perceive that time spent gathering market information is unproductive and in conflict with selling responsibilities. Of course, as noted by Marshall, Moncrief and Lassk (1999), selling and sales person responsibilities have seen tremendous change since then. FORMALIZATION Formalization has been defined in the literature as the degree to which rules define roles, authority relations, communications, norms and sanctions, and procedures in an organization (Deshpande and Zaltman 1982; Hall, Haas and Johnson 1967) and the extent to which these rules and procedures must be followed (Damanpour 1991). It is the degree to which rules or standard operating procedures are used to govern the interaction between individuals, as well as written Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 146 directives designed to guide employee action toward the accomplishment of objectives (Ayers, Dahlstrom, and Skinner 1997; Ruekert and Walker 1987). Troy, Szymanski, and Varadarajan (2001), building on Damanpour (1991) noted that formalization is the degree to which the rules and procedures must be followed in an organization. Formalization can vary significantly across organizations. Organizations with low formalization lack rules and procedures and the employees have greater levels of flexibility in carrying out their roles. Organizations with high levels of formalization have specific rules and procedures (Low and Mohr 2001). In the selling environment, sales people working in an organization with low levels of formalization will have greater flexibility in managing sales territories. At the other extreme, sales people working in an organizational environment of high formalization may have strict guidelines governing all of the various tasks, activities, and responsibilities of the job. Formalization of Sales Force Market Information Generation Organizations, which desire market information from the sales force, may seek to improve information through increased formalization. Formalization of sales force market information generation is defined as the degree to which rules and procedures have been established to direct market information generation by the sales force. It may involve specifying types or categories of market information. This formalization may also involve using call reports or other reporting formats to assist the sales person in organizing and reporting any market information acquired. Formalizing sales force market information generation would lead to greater efficiency in the information generation process (Ruekert, Walker, and Roering 1985). Through formalization, sales people would better know what kinds of information to gather and the categories of information would be consistent across the sales organization. In organizations that have high levels of formalization of sales force market information generation, sales people may be instructed, for example, to gather information about competitors’ products, activities, successes, failures, and problems. Furthermore, there may be specific procedures regarding how the information should be organized and reported back to the sales organization. Formalization of sales force market information processes may be both task and role related. Formalized procedures may regulate the tasks the sales people perform or may alter the role responsibilities of the sales person (Ayers, Dahlstrom, and Skinner 1997). Studies have identified the numerous tasks sales people may perform in carrying out their duties (Marshall, Moncrief, and Lassk 1999). Formalization of sales force market information generation may specify the tasks required for the sales person. From a role perspective, members of an organization’s sales force likely see themselves as having specific roles in the organization, and the acquisition of market information may not be one of the roles perceived by these sales people. Evidence from the literature supports this. Gordon, Schoenbachler, Kaminski and Brouchous (1997) noted that while the sales organization may be an excellent source of market information, organizational barriers impede efforts to utilize this potentially rich information source. In their study, they found that only 20% of sales managers reported their sales force received formal training on market information generation related to new product development. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 147 The limited research in the area of formalizing the generation of market information has mostly been somewhat of a general nature and has not provided researchers with a sound platform for additional research. Evans and Schlacter (1985) reported a wide variance in the formality of sales managers’ approaches to gathering market information. Their study suggests there is not any consistency across sales organizations in formalizing market information generation activities. Additionally, Gordon Schoenbachler, Kaminski, and Brouchous (1997) reported that commission and incentive structures do not provide any incentive for sales people to expend time and effort gathering and reporting market information. The predominately general findings of research in this area indicates a need for additional research investigating the formalization of sales force market information generation. Churchill (1992) called for better measurement practices and measures for sales management research. This study begins that process with a proposal and test of a specific measure of formalization of sales force market information generation. METHODOLOGY We operationalize the formalization of sales force market information generation scale by adapting a formalization scale used by Ayers, Dahlstrom & Skinner (1997). Changes are made to the scale to focus the formalization on sales force market information generation. The adapted scale is presented in Table 1. The methodology of the study to test and validate the new scale is explained below. The results of the study are indicated in the next section. The population for this study is sales organizations of business-to-business firms. The key informants targeted are sales managers who have responsibility for managing the sales organization in their respective company, because they are in a position that provides them the knowledge, ability and authority to complete the survey instrument. To generate the sampling frame for the study, contact information for 1,500 sales managers and sales organizations was acquired from two commercial list sources. Companies were included in the list if the SIC category or other business description of the business indicated the firm was manufacturing related or involved in marketing and selling products in a business to business environment. One thousand names were randomly selected from the sampling frame. The study used two approaches to collect data. The primary method used for collecting data was to mail a questionnaire to potential respondents. A cover letter and questionnaire were mailed to 714 potential respondents, with prepaid return envelopes provided. A follow-up postcard reminding respondents to complete the questionnaire was mailed about three weeks after the initial mailing. Seventeen mailed questionnaires were returned for wrong addresses/contact information, and the researcher received two phone calls from people who politely explained that their firm did not have any type of sales organization. Assuming all of the other questionnaires reached their target, there were a net 695 potential respondents to the mail survey. The second method used involved first telephoning potential respondents and asking them to participate in the study before sending a questionnaire. The primary researcher attempted to contact 115 of the remaining names from the randomly selected list by telephone (time limitations prevented more Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 148 calls). Of the 115, only 48 were actually contacted. Of them, 26 respondents qualified and agreed to complete the survey instrument. The 26 qualified respondents were then mailed or faxed the survey instrument. In four cases the respondent requested the questionnaire be sent as an email attachment. Respondents were able to return completed questionnaires by fax, mail or email. One hundred and eighteen responses were received, twelve of which were returned via fax or email. Of the 106 returned via postal mail, seven envelopes were either empty, contained a blank questionnaire, or were deemed unusable for other reasons. This left the total useable mail responses of at 99 and total usable responses at 111. The net response rate for the mail method was 14.2%. The gross response rate was 23% and the net response (of those qualifying and agreeing to complete the questionnaire) was 42% for the phone method. The overall response rate was 14.9%. In this study, the two sub-samples were examined independently for response bias. Late respondents — those returning the questionnaires after being reminded to do so — were compared to early respondents using t-tests. A second nonresponse bias test was conducted by selecting the respondents from the second sampling group (telephone) and comparing their responses to other respondents using t-tests. These two groups were examined for differing response means. The results of the t-tests indicated no significant differences, indicating that nonresponse error is not a problem in this study. RESULTS Component factor analysis indicates that all five items of the new formalization scale load on one factor. The reliability coefficient alpha measure for the five item scale is α = .885. However, reliability analysis indicated that if item 5 is removed, the overall scale reliability would be .929. Item five also has the lowest factor loading of the items. It likely that the reverse coded nature of the item may be the source of the weakness in this item. However, according to Nunnally (1967), as reported by Churchill (1979, p. 68), “increasing reliabilities beyond .80 is probably wasteful,” therefore the fifth item is not eliminated from the measure. Researchers may want to consider minor revision to the fifth item so that it is not reverse coded. A question that might be raised about the scale is whether the scale is a formative or a reflective measure. Previous research from which this scale was adapted treated the measure as a reflective measure, and hence it is treated as such in this study. The next section contains conclusions and recommendations resulting from this study. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 149 TABLE 1 FORMALIZATION OF SALES FORCE MARKET INFORMATION GENERATION COEFFICIENT ALPHA AND ITEM-TO-TOTAL CORRELATIONS FSFIG: Coefficient alpha = .885 1. The responsibilities of sales people regarding the collection of information about customers are clearly defined. 2. The responsibilities of sales people regarding the collection of information about competitor activities are clearly defined. 3. Our sales people know their role in collecting and reporting information about the market(s) they serve. 4. Management has clearly outlined the sales peoples’ responsibilities for collecting information about customers’ product needs. 5. Sales people are pretty much on their own regarding what information they collect about their customers and markets.(reverse scored) Factor Loadings .890 Item–To–Total .921 .850 .893 .799 .891 .814 .539 .417 .778 CONCLUSIONS AND RECOMMENDATIONS Researchers typically examine formalization from a structural perspective, as an organization-wide factor (Damanpour 1991; Agarwal 1999; Low and Mohr 2001). This study introduces an adaptation of the formalization construct to focus on a specific organizational activity, the formalization of sales force market information generation. Examining task-specific formalization is not new. Troy, Szymanski and Varadarajan (2001), for example, examined the formalization of new product idea generation. The findings indicate that researchers can examine the formalization of a specific activity within the confines of a distinct functional area, as is demonstrated in this paper. More importantly, the research suggests that research which views formalization more broadly (the organization itself is governed formally or informally) may be overlooking the possibility that formalization may actually be activity specific only. Given the importance of market information in organizational strategy and performance, future research might use the measure examined in this study in research studies which examine sales force information generation. For example, does formalization improve information generation quantity and quality? How does information generated by the sales organization improve sales performance or new product performance? Further research should also explore the compensation and control issues that arise when tasks such as information generation are formalized. Additionally, researchers should investigate the extent to which sales force information technology tools and software enable greater levels of information generation formalization. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 150 REFERENCES Agarwal, Sanjeev (1999), “Impact of Job Formalization and Administrative Controls on Attitudes of Industrial Salespersons,” Industrial Marketing Management, 28, 359-368. Ayers, Doug, Robert Dahlstrom, and Steven J. 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(1990), “Industrial Salespeople as a Source of Market Information,” Industrial Marketing Management, 19(2), 141-148. Low, George and Jakki J. Mohr (2001), “Factors Affecting the Use of Information in the Evaluation of Marketing Communications Productivity,” Journal of Academy of Marketing Science, 29(1), 70-88 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 151 Maltz, Elliot and Ajay K. Kohli (1996), “Market Intelligence Dissemination Across Functional Boundaries,” Journal of Marketing Research, 33(February), 47-61. Marshall, Greg W., William C. Moncrief, and Felicia G. Lassk (1999), “The Current State of Sales Force Activities,” Industrial Marketing Management 28, 87-98. Nunnally, Jum C. (1967), Psychometric Theory. New York, McGraw-Hill Book Company. Richardson, Lynne D., John E. Swan and Cecilia McInnis-Bowers (1994), “Sampling and Data Collection Methods in Sales Force Research: Issues and Recommendations for Improvement,” Journal of Personal Selling & Sales Management, 14 (4), 31 - 40. Ruekert, Robert W. and Orville C. Walker, Jr. (1987), “Marketing’s Interaction with Other Functional Units: A Conceptual Framework and Empirical Evidence,” Journal of Marketing; 51 (1), 1-19. Ruekert, Robert W., Orville C. Walker, Jr., and Kenneth J. Roering (1985), “The Organization of Marketing Activities: A Contingency Theory of Structure and Performance,” Journal of Marketing, 43 (Winter), 13-25 Troy, Lisa C., David M. Szymanski and P. Rajan Varadarajan (2001), “Generating New Product Ideas: An Initial Investigation of the Role of Market Information and Organizational Characteristics,” Journal of the Academy of Marketing Science, 29(1), 89-101. Walker, Orville C. Jr., Gilbert A. Churchill, Jr., and Neil M. Ford (1972), “Reactions to Role Conflict: The Case of the Industrial Salesman,” Journal of Business Administration, 3 (Spring), 25-36. Webster, Frederick E., Jr. (1965), “The Industrial Salesman as a source of Market Information,” Business Horizons, 8(1), 77-82. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 152 A LOGIC DEDUCTION OF ATTRIBUTE LEVEL-VALUE LINKAGES Chin-Feng Lin, National Chin-Yi Institute of Technology, Taiwan ABSTRACT This study utilizing the variable matrix and the set theory proposes a logic deduction procedure to interpret the relationships between product attribute level and consumer value. The logic deduction framework not only can analyze the linkages of “consumer value satisfaction” and “product attribute level design” to formulate the useful marketing strategies, but also can be used as a programming basis to establish the marketing information system for enhancing business competitive advantages. Key words: Attribute level, Logic deduction, Means-end chain, Value INTRODUCTION The theoretical thinking of qualitative and quantitative methodologies has been widely used in marketing researches. Generally, the theoretical thinking of quantitative methodology uses various mathematical models to convey its logic for systematic analysts to transforming its conceptual theory into a concrete and logical programming system. Such a programming system leads to the intra-base of establishing information system. Contrarily, the qualitative way of thinking, even though it has been developed and applied in practice for a long time, is facing the difficulties of embodying its logic in programming system. Recently, scholars have been trying to deduct the logic of qualitative analyses through mathematical calculation procedures for systematic analysts to establishing their information systems. This study constructed a logic deduction procedure of means-end chains (MEC) methodology (a qualitative methodology) (Gutman 1982) by using mathematical models such as set theory and matrix analysis. Such a logic deduction procedure could help marketer for their marketing strategy implementations and computer programmers for their information system designs, in order to establish effective information systems. THE LINKAGE THEORY OF CONSUMER-PRODUCT KNOWLEDGE Consumer psychology cognition directly reflects consumer’s viewpoints toward product knowledge; therefore scholars in the 1970s emphasized the concepts of merchandise-customer relevance. Gutman and Reynolds (1979) firstly proposed the means-end chain theory shown on the top of Figure 1 to analyzing consumer-product relationship involving product attributes (A), consequences (C) and values (V). The underlying assumption was that product attributes are means for consumers to obtain desired ends, namely, values through the consequences of those attributes. Thus, product attributes, consequences and values could be linked hierarchically in cognitive structures through a laddering technique (Reynolds and Gutman 1988). Such a technique uncovers the means-end hierarchies defined by the connection of attributes (A), Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 153 consequences (C) and values (V) into a tree diagram, termed a hierarchical value map (HVM). The HVM not only could be used to interpret the relationship between a product design and consumer’s value demand, but also could provide marketers valuable information for formulating their product strategies. However, the traditional MEC methodology only can provide marketers what attributes can satisfy consumers’ value demands rather than decisive information for a product design to meet consumers’ really needs. In fact, a product’ attribute consists of a set of attribute levels (Green and Srinivasan 1978). If marketers can further understand what attribute levels of a product’s attribute are more desirable by consumers, it becomes easier for marketers to design their products with more precise information of consumers’ needs. Color, for example, is a product attribute. In traditional MEC methodology, marketers would be able to understand that “color” is an important attribute to achieve consumers’ value satisfaction, but could not know which color do consumers really prefer. To conquer this, the researcher adopted the expanded MEC theory proposed by Lin (2003) to interpret the product design-value satisfaction relationships. The expanded MEC theory included four key concepts: attribute levels (AL), attributes (A), benefits (B), and values (V). Product attributes here were used as a medium, similar to consequence variables proposed in the traditional MEC. Benefits were employed in this study, because benefits indicated perceived positive consequences associated with product purchase and use (Zeithaml 1988). In this study, the AL-A-B-V linkages were thus used to substitute the traditional A-C-V linkages. On the bottom part of Figure 1 exhibited the expanded MEC theory. Traditional MEC theory Attribute Consequence Value concrete/abstract psychosocial /functional terminal; internal/ instrumental; external The expanded MEC theory Attribute-Level Attribute Consequence/Benefit Value concrete/abstract concrete/abstract psychosocial / functional terminal; internal/ instrumental; external Figure 1. A comparison of the traditional MEC and the expanded MEC theories The procedure of conducting a logic deduction structure for establishing the relational database between product-design and value-demand was demonstrated as follows: (1) Collecting secondary data and deciding attribute (A), and benefit (B) variables through focus-group research and content analysis. A and B variables are decided by the mode of each variable category. The nine V variables are directly adopted from LOV inventory (Kahle 1986). (2) Gathering AL variables of a given product and deciding AL variables of each attribute (A) Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 154 (3) (4) (5) (6) (7) (8) (9) category. Interviewing consumers to understand consumer’s preferences of a particular product’s attributes and comprehending whether his/her preferences of these attributes can obtain benefit consequent feelings, leading to partial value satisfactions. Focusing on consumer’s preference of the particular product’s attributes and inquiring consumers about the attribute levels of the particular product’s attributes of a given product. Summarizing the linkage frequencies between attributes (A) and benefits (B), as well as benefits (B) and values (V), the researcher records each linkage frequency into the summary implication matrix (Reynolds and Gutman 1988). The cutoff value is decided either by percentile (Gengler and Reynolds 1995) or using the distribution of the collected data. Choosing the A-B and B-V linkage frequencies greater than the cutoff value and putting them into the HVM. Selecting the modes of attribute levels of product attributes that consumers prefer and calculating their percentages to record on the HVM. Depending on the results of the HVM to formulate product design strategies and analyze the implications of marketing strategy. Connecting with other related internal databases through marketing intelligence system to become an interference of product design strategies. LOGIC DEDUCTION 1. The definitions of A j B k and B k V m The purpose of product design is to achieve consumer’s positive value and expects to provide consumer’s positive consequent feelings (benefits). Thus, this study adopted “attributespositive consequent feelings (benefits)” and “positive consequent feelings (benefits)- consumer value satisfaction” to interpret the MEC chains. Moreover, the AL variables with higher mode in its belonging attribute’s group were selected, in order to interpret the degrees of importance of the attribute levels. The following are the symbol definitions of variables: (1) AjBk：Each interviewee (i) toward all attributes (Aj) of a particular product owns his/her preference attribute groups, contributing to one or more benefit feelings (Bk). (2) BkVm：Each interviewee toward all benefits (Bk) of a particular product has his/her preference benefit group, leading to one or more value satisfactions (Vm). 2. The descriptions of the relations of variable symbols and variable databases are shown as followings: C={C x 1 , C x 2 , ……, C x i ,…, C x n1 }, i=1, 2, 3,……,n 1 ; x=1 or x=2 C 1i = {A j B k } i ; when X=1 C 2i = {B k V m } I ; when X=2 X=1; C 1i represents a set of A j B k preferences of the ith interviewer. X=2; C 2i represents a set of B k V m preferences of the ith interviewer. n 1 represents the number of interviewers. j=1, 2, 3,…………, n 2 ;..………….... n 2 represents the number of times of Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 155 k=1, 2, 3,…………, n 3 ;…………….. m=1, 2, 3,…………, n 4 ;...………….. w=1, 2, 3,………, n 5j ;....………….. A={a 1 , a 2 , a 3 ,…, a j ,…, a n2 }…………. B={c 1 , c 2 , c 3 ,…, c k ,…, c n3 }…………. V={v 1 , v 2 , v 3 ,…, v m ,…, v n4 }………… AL={a l 11 , a l 21 ,…, a l wj ,…, a l n5n2 }………… attribute variable. n 3 represents the number of times of benefit variable n 4 represents the number of times of value variable n 5j represents the number of times of attribute level of the jth attribute. A represents a set of attribute variables. C represents a set of benefit variables. V represents a set of value variables. AL represents a set of attribute level variables. The matrix of attributes and attribute levels is shown as formula (1): a1 al 11 al 21 al 31 − − − al w1 − − − al n51 a 2 al al al − − − al − − − al n 52 32 w2 22 12 a3 al 13 al 23 al 33 − − − al w3 − − − al n53 ------------------------------------------------(1) = | | | | | | | | aj al 1 j al 2 j al 3 j − − − al wj − − − al n 5 j | | | | | | | | a n 2 al 1n 2 al 2 n 2 al 3n 2 − − − al wn 2 − − − al n 5n 2 The A j B k and B k V m matrix showed as formula (2) and (3) can be expressed by n1 n1 i =1 i =1 ∑ C1i and ∑ C 2i which are the sum of AB and BV linkages crossing all interviewers. In other words, C 1i and C 2i of the ith interviewer represent his AB and BV linkage matrix. The contents of AB and BV linkage matrix of each individual not only could be 0 or 1 scale, but also could be a weighted or likert scale. n1 n1 n1 n1 n1 ∑ A1 B1 ∑ A2 B1 ∑ A3 B1 − − − ∑ A j B1 − − − ∑ An 2 B1 i =1 i =1 i =1 i =1 in=11 n1 n1 n1 n1 AB ∑ 1 2 ∑ A2 B2 ∑ A3 B2 − − − ∑ A j B2 − − − ∑ An 2 B2 i =1 i =1 i =1 i =1 i =1 n1 n1 n1 n1 n1 ∑ A1 B3 ∑ A2 B3 ∑ A3 B3 − − − ∑ A j B3 − − − ∑ An 2 B3 n1 i =1 i =1 i =1 i =1 C1i = i =1 ∑ | | | | | i =1 n n 1 n 1 n 1 n 1 1 ∑ A1 Bk ∑ A2 Bk ∑ A3 Bk − − − ∑ A j Bk − − − ∑ An 2 Bk i =1 i =1 i =1 i =1 i =1 | | | | | n n 1 n 1 n 1 n 1 1 ∑ A1 Bn3 ∑ A2 Bk ∑ A3 Bn 3 − − − ∑ A j Bn 3 − − − ∑ An 2 Bn3 i =1 i =1 i =1 i =1 i =1 -----------------------------------------------(2) Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 156 n1 n1 n1 n1 n1 ∑ B1V1 ∑ B2V1 ∑ B3V1 − − − ∑ Bk V1 − − − ∑ Bn 3V1 i =1 i =1 i =1 i =1 in=11 n1 n1 n1 n1 BV ∑ 1 2 ∑ B2V2 ∑ B3V2 − − − ∑ Bk V2 − − − ∑ Bn 3V2 i =1 i =1 i =1 i =1 i =1 n1 n1 n1 n1 n1 B1V3 ∑ B2V3 ∑ B3V3 − − − ∑ Bk V3 − − − ∑ Bn 3V3 n1 ∑ 1 1 1 i i i 1 i = = = = = 1 i C 2i = ∑ | | | | | i =1 n1 n1 n1 n1 n1 B V B V − − − B V − − − B V B V ∑ 1 m ∑ 2 m ∑ 3 m ∑ ∑ k m n3 m i =1 i =1 i =1 i =1 i =1 | | | | | 1 1 1 n n n 1 n 1 n B V B V − − − B V − − − B V B V ∑ 1 n 4 ∑ 2 n 4 ∑ 3 n 4 ∑ ∑ k n4 n3 n 4 i =1 i =1 i =1 i =1 i =1 3. -----------------------------------------------(3) Simulation analysis of linkage numbers n1 The linkage frequencies of A-B and B-V are demonstrated as the matrix ∑C i =1 1i and n1 ∑C i =1 2i , separately. Through simulation analysis, researchers can evaluate the distribution of previous linkage numbers. In this study, researcher used statistical simulation software to test the number of times of linkage of 8 different products. The test results showed that 5 out of 8 fitted the lognormal distribution. The distribution of linkage numbers tested by goodness-of-fit of Chi-square test indicated that p value was 0.0197055 under 5% of significant value. Thus, the null hypothesis was sustained; that is, the distribution of ln (linkage frequencies) would follow normal. Furthermore, the results of K-S test, d equaled to 0.0964729 and p = n.s. represented insignificant , therefore, the null hypothesis was supported while the significant level is under 5%. Thus, the lognormal distribution would be adopted to decide the cutoff value. 4. The logic of constructing HVM n1 After deciding the cutoff value, the accumulated numbers in the ∑ C1i and i =1 n1 ∑C i =1 2i matrix greater than the cutoff value were the referred factors to construct the HVM. In other words, the linkage numbers greater than the cutoff value would be put into the HVM. As part I of Figure 2 illustrated, once the cutoff value was decided, the all linkages of (A1, A2, A3) and (B1, B2, B3) would become 9 AjBk linkages including (A1, B1), (A1, B2), (A1, B3), (A2, B1), (A2, B2), (A2, B3), (A3, B1), (A3, B2), and (A3, B3). In fact, after deciding the cutoff value, only the larger linkages of AjBk and BkVm in the n1 ∑C i =1 1i and n1 ∑C i =1 2i matrix would be selected, therefore the HVM map could only show the bigger numbers of AjBk and BkVm linkages. Considering the AjBk and BkVm linkages had better not yield too many cross lines, researcher should examine the following steps as criteria to construct the HVM. (1). As shown in part I of Figure 2, there are 9 intersections existing among AjBk linkages. The cross lines were listed as formula (4). A1 B2 A1 B2 A1 B3 A1 B3 A1 B3 A1 B3 A2 B2 A2 B1 A3 B1 A2 B1 A3 B1 A2 B2 A3 B2 A3 B1 A2 A3 B3 B1 A2 B3 --------------------------------------------------------------------------------(4) A3 B2 (2). The analyzing results of cross lines indicated that the cross lines would occur in the Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 157 Aq1 Bq 2 matrix while q3>q1 and q2>q4, therefore the concept for programming should A q 3 Bq 4 try to minimize the sum of count (q3>q1;q2>q4). The count () represented the function of counting the number of the variable in the parentheses. q1, q2, q3, and q4 represents the Aq1 Bq 2 matrix sequential number of attribute and benefit variables in the A B q 3 q 4 representatively. (3). Use the concept of switching or changing the order of variables to eliminate the number of intersections. For example, there are two intersections shown on the left hand side (P1) of part II in the Figure 2. As the position of B variables was changed from (B1, B2, B3) into (B1, B3, B2), there becomes no intersection exhibited on the right hand side (P2) of part II in the Figure 2. Further changing the sequent positions of A variables from (A1, A2, A3) into (A2, A3, A1), the researcher found that the original HVM with 4 intersections on the left hand side (P3) of part III of Figure 2 became no intersection at all (see P4 of part III of Figure 2). (4). The concept of switching variables between Arabic numeral orders can be easily applied through loop programming for obtaining the fewest intersections. Thus, to provide a clear and easy to read HVM map, namely fewer intersections, the concept of switching the order of variables and minimizing the count (q3>q1; q2>q4) can be implemented by computer programming. (5). Attribute level and value variables should also adopt the previous 4 steps. While doing computer programming, researcher should consider the connections among AL, A, B, and V variables to construct a product HVM. B1 B2 B3 B1 B2 B3 B1 B3 B2 A1 A2 A3 A1 A2 A3 A1 A3 A2 Part I Part II (P1) (P2) B1 B2 B3 B1 B2 B3 A1 A2 A3 A2 A3 A1 (P3) Part III (P4) Figure 2. An example of constructing HVM CONCLUSION AND FUTURE RESEARCH Qualitative analysis is usually criticized, because of its subjective measurements. Recently, several scholars addressed that it is necessary to understand the logical implications of Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 158 qualitative analysis through the expression of the mathematic functions (Pasquier and Rossier 1982). Hence, this study using the MECs as an example and applying some mathematic concepts to decompose the logic of qualitative analysis, in order to provide systematic logic as a programming basis of establishing marketing information system. Following are the managerial implications of this study and suggestions for future researches: (1) Researchers can use the logic deduction of AL-V linkages proposed in this study to analyze related consumer behavior models such as AIDA (Strong 1925) and the hierarchy of effects model (Lavidge and Steiner 1961). Using mathematic functions to interpret those models, the analysts of information system will be able to analyze consumer behavior information effectively. (2) This study based on the MEC theory proposed the logic deduction procedure for deciding the cutoff value. The information system establishers can use the logic framework of cutoffvalue decision mechanism to develop a flexible system; that is, the system will be able to provide marketers dynamic HVM information associated with different cutoff values. Marketers can use the dynamic HVM information to fully understand consumer preference trend for formulating their marketing strategies. (3) Based on the logic deduction of AL-V linkages and adopted appropriate programming languages, the information system can provide the managerial related market information for enhancing business competitive advantages. ACKNOWLEDGEMENTS The author wishes to acknowledge the financial support of this paper by the National Science Council, Taiwan. No: NSC 92-2416-H-167-001-H. REFERENCES 1. Gengler, Charles E. and Thomas J. Reynolds, (1995) “Consumer Understanding and Advertising Strategy: Analysis and Strategic Translation of Laddering Data,” Journal of Advertising Research 35, 19-33. 2. Green, Paul. E. and V. Srinivasan, (1978) “Conjoint Analysis in Consumer Research: Issues and Outlook,” Journal of Consumer Research 5, 103-123. 3. Gutman, Jonathan and Thomas J. Reynolds, (1979) “An Investigation of the Levels of Cognitive Abstraction Utilized by Consumers in Product Differentiation,” in Attitude Research under the Sun, J. Eighmey, ed. Chicago: American Marketing Association. 4. Gutman, Jonathan, (1982) “A Means-end Chain Model Based on Consumer Categorization Processes,” Journal of Marketing 46, 60-72. 5. Kahle, Lynn R., (1986) “The Nine Nations of North America and the Value Basis of Geographic Segmentation,” Journal of Marketing 50, 37-47. 6. Lavidge, Robert J. and Gary A. Steiner, (1961) “A Model for Predictive Measurements of Advertising Effectiveness,” Journal of Marketing 25, 59-62. 7. Lin, Chin-Feng, (2003) “Quality-Delivery System: A Conceptual Framework of Attribute Level-Value Linkages,” Total Quality Management & Business Excellent 14(10), 10791092. 8. Pasquier, J.-N. Du, and E. Rossier, (1982) “The Scientific Work of Luigi Solari,” in Qualitative and Quantitative Mathematical Economics, ed. Paelinck, Jean. H. P., Martinus Nijhoff Publishers, The Hague, The Netherlands, 19. 9. Reynolds, Thomas J. and Jonathan Gutman, (1988) “Laddering theory, Method, Analysis, Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 159 and Interpretation,” Journal of Advertising Research 28, 11-29. 10. Strong, Edward K., Jr., (1925) The Psychology of Selling and Advertising, McGraw-Hill, New York, 9. 11. Zeithaml, Valarie. A., (1988) “Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence,” Journal of Marketing 52, 2-22. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 160 VARIATIONS IN THE PERCEIVED IMPORTANCE OF SERVQUAL DIMENSIONS: A COMPARISON BETWEEN RETAIL BANKING AND A MUSEUM Jill K. Maher, Robert Morris University John Clark, Robert Morris University ________________________________________________________________________ ABSTRACT As marketers recognize intense competition and are more customer focused then ever before, they continue to develop and employ marketing strategies that differentiate themselves from the competition. One logical area for differentiation in a customer-focused, competitive environment is in the area of service quality. Consumers judge the service quality of their service encounters, leading to varying levels of customer satisfaction. Similarly, in the nonprofit sector, organizations can look to service quality as a way to gain a competitive advantage as well. LITERATURE REVIEW Service quality is defined as the difference between customer perceptions of the current service being provided by a given organization and customer expectations of excellent service within that given industry (Parasuraman, Zeithaml, and Berry 1985, 1988). While there have been many different approaches or methods for measuring service quality, the SERVQUAL instrument (Parasuraman, Zeithaml, and Berry 1985, 1988) seems to have the greatest potential for applicability in different industries and sectors. Parasuraman, Zeithaml, and Berry (1988) refer to the dimensions of service quality as tangibles, reliability, responsiveness, assurance, and empathy. Tangibles refers to the appearance of physical facilities, equipment, personnel, and communication materials. Reliability relates to the organization’s ability to perform the promised service dependably and accurately, while responsiveness is determined as the willingness to help clients and provide prompt service. Assurance is the knowledge and courtesy of employees and their ability to inspire trust and confidence, and finally empathy refers to the caring, individualized attention the organization provides its clients. While research has recently illustrated that the dimensions of service quality are similar between nonprofit organizations and service industry providers (Maher, Clark, and Motley 2004; McFadyen, Harrison, Kelly, and Scott 2001) (for contrasting views, see Orwig, Pearson, and Cochran 1997; and Vaughan and Shiu 2001), very little research has investigated the difference in customers’ rankings of service dimensions between sectors. The current research investigates differences in customers’ rankings of these dimensions in a typical service industry (i.e., banking) compared to rankings in a nonprofit organization, such as a museum. METHODOLOGY Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 161 The research settings were a small museum and a small community bank in a northeastern city (n = 192 participants and 542 respectively). Customers were randomly chosen in each setting. RESULTS Results indicate that customers perceive slight differences in their expectations of service by different service providers; in this case a retail bank and a small museum. Specifically, in a more traditional service setting, customers expect reliable service followed by the assurance that services will be provided as promised. In a nonprofit, arts-based service situation, patrons perceive assurance of service to be most important followed by the tangible aspects of the service. This is not surprising in a museum setting. Thus, service marketers must recognize the differences in expectations of customers by industry/sector. Modifications to marketing strategies must take these differences into consideration. Table Comparison of Expectations of Service Dimensions Retail Bank Customers (RB) vs. Museum Patrons (M) ________________________________________________________________________ Reliability Importance Ranking ______________________________________________________ RB M RB M RB M RB M ______________________________________________________ Tangibles Reliability Responsiveness Assurance Empathy .83 .80 .79 .87 .81 .80 .86 .70 .75 .76 Mean 6.11 6.73 5.82 6.71 5.60 Stnd Dev 6.12 6.12 5.78 6.53 5.18 .91 .51 1.40 .77 1.36 .91 .88 1.15 .75 1.19 3 1 4 2 5 2 3 4 1 5 ________________________________________________________________________ SELECTED REFERENCES Maher, Jill K., John Clark, and Darlene Gambill Motley (2004), “Measuring Service Quality in an Arts Organization: The Dimensionality of SERVQUAL,” in Proceedings of the Social Marketing Advances in Research and Theory Conference, (ed.) Debra Zabreznik, Kananaskis, Alberta, 51-54. Parasuraman, A, Valarie A. Zeithaml, and Leonard L. Berry (1985), “A Conceptual Model of Service Quality and Its Implications for Future Research,” Journal of Marketing, 49 (4), 41-50. __________, Valarie A. Zeithaml, and Leonard L. Berry (1988), “SERVQUAL: A Multiple-Item Scale for Measuring Consumer Perceptions of Service Quality,” Journal of Retailing, 64 (1), 12-40. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 162 A CONCEPTUAL FRAMEWORK FOR RESEARCH INTO FINE ARTS MARKETING Kimball P. Marshall, Alcorn State University William S. Piper, Alcorn State University ABSTRACT Although the fine arts are a multi-billion dollar business (The New England Council 2000), business academicians have largely ignored the fine arts (Clarke and Flaherty 2002). This is unfortunate because of the financial size of the industry and because the expressive nature of fine art provides opportunities to extend marketing theory and research further into the realm of symbolic and social values (Petkus 2004, Hirshman 1984, Levy 1959). Whereas symbolic and social values may stand alone in exchange situations, in the case of fine arts marketing, symbolic and social values become an intrinsic aspect of a product that is purchased in monetary terms. This paper draws on anecdotal evidence (de Zayas 1996, Alpers 1988) to develop a marketing perspective from which to view marketing exchanges involving fine art. Consideration is given to the nature of fine art as a product, the artist as producer, the art consumer as a customer, and the art gallery as a marketing intermediary that adds value to the product by reducing the consumer's perception of risk. In this paper, decisions to purchase fine art are seen as intrinsically risky in that market valuations are fraught with uncertainty. Art galleries are considered marketing intermediaries (Fillis 2002) that add value by facilitating trust through the provision of social definitions of quality artworks (Burnham 1975). The fine art product is conceived as having at least three dimensions, the tangible (physical) work of art, and two intangible dimensions. These include the artist's experience in producing the work that the artist intends to share with the consumer, and the consumer's experience of the work of art (Dewey 1934). The consumer's experience might or might not be able to be shared with others and might or might not correspond to the experience intended by the artist. The intangible dimensions of a work of art might most heavily influence monetary value except when the artist has reached high levels of notoriety. Because uncertainty increases risk and risk reduces monetary value, the art gallery can add monetary value by providing "social definitions of reality" through which the work of art is "framed" in the consumer's symbolic universe. By facilitating social definitions of art, the gallery operator can enhance the potential buyers' confidence in the monetary value of a work of art. The degree to which the gallery effectively serves this function will depend upon the gallery's ability to define its image as authoritative in regard to the monetary and symbolic valuations of art in the consumer's social context. Galleries use several techniques to reduce uncertainty such as classifying an artist's works into popularly recognizable categories, providing educational information to make consumers aware of specific features, publicity to give the artist "celebrity" status, and efforts to associate the consumer's decision with similar decisions by reputable collectors. While marketing intermediaries perform similar functions in many selling situations, these value enhancing roles may be especially important in fine arts marketing due to the high dependence of the product on personal experiences and social definitions. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 163 REFERENCES Alpers, Svetlana (1988), "Freedom, Art and Money," pp. 88-122 in Svetlana Alpers, Rembrandt's Enterprise, Chicago, IL: The University of Chicago Press Burnham, Bonnie, Editor (1975), "The Reptuable Dealer," The Art Crisis: How Art Became the Victim of Thieves, Smugglers, and Respectable Investors, New York, NY, St. Martin's Press. Clarke, Irvine, III and Theresa Flaherty (2002), "Marketing Fine Art on the Internet," International Journal of Nonprofit and Voluntary Sector Marketing, Vol. 7, No. 2, 146160. de Zayas, Marius (edited by Francis M. Naumann) (1996), How, When, and Why Modern Art Came to New York, Cambridge, MA, MIT Press. Dewey, John (1934), "The Live Creature," pp. 3-19 in John Dewey, Art as Experience, New York, NY, Perigee Books Fillis, Ian (2002) "Creative Marketing and the Art Organization," What can the Artist Offer?" International Journal of Nonprofit and Voluntary Sector Marketing, Vol. 7, No. 2, 131145. Fitzgerald, Michael C. (1995), Introduction," pp. 3-13 in Michael C. Fitzgerald, Making Modernism: Picasso and the Creation of the Market for Twentieth-Century Art, New York, NY, Farrar, Straus and Giroux Hirshman, Elizabeth C. (1984), "Aesthetics, Ideologies and the Limits of the Marketing Concept," Journal of Marketing, Vol. 47, Summer, pp. 45-55. Levy, Sidney J. (1959), "Symbols for Sale," Harvard Business Review, 37 (July-August), 117119. Petkus, Ed, Jr. (2004), Enhancing the Application of Experiential Marketing in the Arts, International Journal of Nonprofit and Voluntary Sector Marketing, Vol. 9, No. 1, 49-56. The New England Council (2000), The Creative Economy Initiative: The Role of the Arts and Culture in New England's Economic Competitiveness, Boston, MA, The New England Council. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 164 INTERACTIVE WEB-BASED MAPPING IN THE TOURISM INDUSTRY: A CASE STUDY OF UK AND MALAYSIA Dr. Sanjay S. Mehta, Sam Houston State University Mark R. Leipnik, Sam Houston State University Subhash C. Mehta, University of Southern Maine ABSTRACT Geographic Information Systems (GIS) are a suite of computer programs designed to store, analyze, manipulate and create output like maps, charts, and reports from geographic data linked to descriptive attribute data. The geographic data typically are features that can be portrayed on maps or in aerial photography and stored in a special topological structure. Within this unique format, coordinates, scales, projections, and geometric interrelationships are explicitly maintained. Descriptive attribute data is stored in a tabular format and linked to the geographic data (Mehta et. al, 1999b). GIS data is structured into a series of layers. These layers are co-registered (i.e., have the same spatial extent) coordinate system and projection. For example, a GIS might have a layer of zip code boundaries, a layer of streets and highways, and a layer of streams, lakes and wetlands (hydrography), a layer of state and national boundaries, a layer of unit (store) locations, a layer of competitor unit locations, a layer of customer locations, etc. For each distinct layer there would be (at least one) database table containing as many records as there were features in the corresponding geographic (map) layer to which they were linked. Each record there would have a primary key with a unique numerical identifier that differentiates that record and links the record to the feature (such as a point representing the residence of a customer). While GIS technologies have been in existence for approximately forty years, its adoption by businesses and diffusion within marketing is a relatively new phenomenon. Historically, the most common applications (and original uses) of this technology have been in the areas of natural resources management, infrastructure and facilities management, and land records management. More recently, public utilities and municipal governments have embraced the technology. Today, GIS is being applied to literally thousands of disparate applications from mapping crime incident locations to tracking nuclear submarines. While the technology itself is complex, businesses can use and apply the technology with relative ease once they understand the general structure, functions, and source of both data and software that are readily available. GIS can be used to analyze the demographic, economic, and infrastructure related to a given “place”. These factors often determine the appropriateness of locating a new retail unit, engaging in a direct marketing campaign, making a real estate investment, etc. (Sui, 2002). For example, the number and socioeconomic information of persons residing within a specified distance or travel time would help to determine the profit potential of a trade area. The presence of employers, hotels, airports, highways, arterial streets, public transportation, inter-modal links, etc. would help determine the potential customer base for drive through or walk up business. Physiographic factors (e.g., proximity to flood zones or earthquake faults) can also have an effect on the long-term value of an investment in a particular area. Given all the advantages and Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 165 utilizations of the technology, it is not surprising that many large and small businesses are embracing GIS into their overall marketing strategies. A particularly fruitful and relatively new area for the utilization of GIS is the application of interactive mapping over the Internet. One of the first industries to embrace the use of GIS technology over the Internet is tourism (Wang et. al., 2004). The precedent for use of the Internet in tourism is well established. With a large volume of airline, hotel, rental car companies, and other travel related reservations being made on-line (Spee, 2003). Since travel, by its very nature, has a geographic component/association (e.g., selection of lodgings in an unfamiliar city), it is obvious that the use of maps in tourism is a valuable (if not essential) tool for businesses. With the advent and evolution of the Internet, there is demand to access these maps on-line. Some examples of web-based GIS in the field of E-tourism include imbedded GIS within websites like Expedia, Travelocity, Goto, Mapquest, Alta Vista, etc. While there are numerous applications and uses of GIS in E-business, we identified and recognized a few leading websites within the E-tourism industry that are using GIS-based interactive mapping on their website. More specifically, we identified two countries (i.e., Britain and Malaysia) and compared and contracted their official E-tourism websites. While the websites of several national tourist offices contain interactive mapping capabilities, Britain and Malaysia were purposely chosen. These two countries are for all practical purposes, very different from one another. That is, they are geographically in different continents, religiously different, ethnically diverse, speak different languages, are in different stages of economic development, etc. In summary, selecting two countries that are very different from one another would help us better understand the general state of GIS-based interactive mapping on the Internet. SELECTED REFERENCES Mehta, S.S., Leipnik, M.R., & Maniam, B. (1999b). Application of GIS in Small and Medium Enterprises. Journal of Business and Entrepreneurship, 11(2), 77-88. Spee, P. (2003). Personal Communication, Director of Marketing for Internet Applications. Environmental System Research Institute Inc., Redlands, CA. Sui, D. (2002). The Importance of Place and the Internet Revolution. Journal of the American Association of Geographers. Wang, J., Sui, D.Z., & Lai, F.Y. (2004). Mapping the Internet Using GIS: The Death of Distance Hypothesis Revisited. Geographical Systems, forthcoming. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 166 MARKETING THE MILITARY: EVALUATING THE MOTIVATIONAL APPEALS OF RECRUITMENT SLOGANS Sylvia A. Miller, Cameron University M. Suzanne Clinton, Cameron University John Camey, University of Central Oklahoma ABSTRACT For approximately a century, the United States military has utilized slogans to attract recruits. O’Guinn, Allen and Semenik (200, p.380) define a slogan as “a short phrase…used to help establish an image, identity, or position for…an organization…to increase memorability.” As is the case with several slogans employed by the United States military, a good slogan can Become an integral part of a brand’s image and personality. Act as a shorthand identification for the brand. Provide information on important brand benefits. Provide continuity across different media and between advertising campaigns. Bring about thematic integrated marketing communications. (O’Guinn et al., p. 380). Each branch of the armed forces relies on slogans to attract recruits. Marine slogans have typically emphasized the image of toughness and the implied eliteness of those who can stay the course. Both “We’re Looking for a Few Good Men” and “The Few, the Proud, the Marines” promises entrance into an elite organization (Garfield, 2001, p.49-50). In the 1970s, the Marines briefly used the slogan, “We never promised you a rose garden,” a campaign that emphasized a boot-camp view of Marine life (Rosenberg, 2001, p. 1). Like the Marines, the Air Force has also used slogans to make its branch of service seem appealing, elite and desirable. “Aim High, Air Force” helped the Air Force to accomplish this goal. The U.S. Navy utilized the theme of joining the Navy as a way to jump-start a stalled career track. Slogans using this approach include, “Let the Journey Begin,” “You and the Navy, Full Speed Ahead” and “Accelerate Your Life” (Garfield, 2001, p. 49-50). During World War II, women soldiers were recruited with the slogan, “Free A Man To Fight!” This slogan helped women recruits feel that their non-combat jobs such as filling spots an assembly lines were important because they allowed male members of society to join the war effort. Probably the most famous recruitment slogan of the twentieth century was the WorldWar-I-era slogan “I Want You.” This slogan appeared on thousands of posters featuring a sternlooking Uncle Sam pointing at the potential recruit. The authority embodied in the stern fatherfigure influenced many young recruits to enlist. The Army has utilized five recruitment slogans since turning to modern advertising campaigns in 1971. These slogans include the following (Peckenpaugh, 2001): “ Today’s Army Wants To Join You;” “Join the People Who’ve Joined the Army;” “This Is the Army;” “Be All You Can Be;” and “An Army of One .” Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 167 Given the mixed reception that various military recruitment slogans have received over the years, an examination of the appeals utilized in the slogans may be instructive. A number of models have been developed to explain motivation. These models include Expectancy Theory, Maslow’s Hierarchy of Needs, Aldefer’s ERG Theory, and McClellands’s Acquired Needs Theory. An examination of these slogans indicates that for the Army, the most successful slogan of the recent past--“Be All You Can Be,” a slogan which practically became synonymous with the Army for 20 years--emphasizes Expectancy Theory, Self-Actualization, Growth, and Achievement. The same traits characterize the Navy’s successful slogans. Belongingness, Relatedness and Affiliation needs are represented by less-successful Army slogans including “Today’s Army Wants to Join You” and “Join the People Who’ve Joined the Army.” The current slogan, “An Army of One,” is somewhat difficult to categorize according to motivational theory. McClelland’s Need for Power probably comes closest to describing the appeal. It is hard to escape the conclusion that the lack of a clear appeal in “An Army of One” is to blame for the mixed (and often hostile) reception the slogan created by Leo Burnett USA has received. The lesson the Army could take from this analysis is that the 18-to-24-year-old target market is most receptive to self-actualization, growth, and achievement appeals. In the future, it may be that advertising agencies and the military will focus on themes and motivational appeals which have proven to be most successful – those with appeals to Self-Actualization, Growth, and Achievement Needs. REFERENCES Alderfer, C. Existence, Relatedness and Growth (New York: Free Press, 1972). Garfield, Bob. (2001). Army’s latest campaign isn’t all it can be and rings false. Advertising Age, 72, 3, 43. Maslow, A. F.. (1943). “A Theory of Human Motivation.” Psychological Review 50:370-396. McClelland, D. C. “The Two Faces of Power, “ in D.A. Colb, I.M. Rubin, and J. M. McIntyre(eds.), Organizational Psychology (Englewood Cliffs, NJ: Prentice-Hall, 1971), pp.73-86. Nadler, D.A. and Lawler, E.E (1977). “Motivation: A diagnostic approach,” in Hackman, J.R.,Lawler, E.E., and Porter, L.W., eds., Perspectives on behavior in organizations. New York: McGraw-Hill. O’Guinn, Thomas C., Chris Allen, and Richard J. Semenik, Advertising (2nd edition), New York: South-Western College Publishing, 2000. Peckenpaugh, Jason. (2001). Bonding with the Army. Government Executive, 33, 3, 14. Rosenberg, Eric. (2001). Army under fire for its new recruiting slogan. Naples Daily News.wysiwyg://16/http://www.naplesnews.com/01/02/neapolitan/d428096a.htm Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 168 COURSE EVALUATIONS AND TECHNOLOGY MEDIATED LEARNING ENVIRONMENTS Alma Mintu-Wimsatt, Texas A & M University – Commerce Kendra Ingram, Texas A & M University – Commerce Mary Anne Milward, Texas A & M University – Commerce Courtney Russ, Texas A & M University - Commerce Theresa Sadler, Texas A & M University – Commerce ABSTRACT This study investigates how MBA students evaluate instructor’s teaching skills, rapport with students, grading policies, knowledge of materials and presentation skills in two-way interactive television and Internet-based Marketing Management classes. Of the five evaluative criteria, significant difference was noted only with respect to grading policies. Online students rated grading policies better (i.e., higher) than their ITV counterparts. INTRODUCTION Distance education has allowed educators to exceed the boundaries of the typical classroom. According to the Department of Education (2002), an astounding 56% of 2-year and 4-year Title IV degree-granting institutions offered distance education courses during the 20002001 academic year. As education has taken on a more real-world approach, it has become increasingly important for educators to expand the learning environment. Indeed, the use of technology mediated learning in business education has grown exponentially (Malhotra 2002). Among business schools, a growing number of MBA programs are focusing on technologymediated distance learning modes as supplements and/or alternatives to the traditional learning pedagogy (Gerencher 1998; Donoho 1998). Marketing has been in the forefront when it comes to technology mediated learning and its applications (Jones and Kelley 2003; Kaynama and Keesling 2000). As a result, there is growing emphasis on distance education in the marketing literature (refer to the Special Issue of the Marketing Education Review 2002). Unfortunately, published results on the impact of distance education on teaching effectiveness [and specifically on student course evaluations] have generated inconsistent findings (Mintu-Wimsatt 2001). To investigate the impact of different delivery modes on student course evaluations, this paper focuses on technology-mediated learning: two-way interactive television (ITV) and Internet or online delivery. The two pedagogies were used in the delivery of the core course in Marketing Management at the graduate level during two different semesters. This study investigates how students’ evaluation of the instructor’s teaching skills, rapport with students, grading policies, knowledge of materials and presentation skills are affected when technology plays a major role in the teaching methodology. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 169 TECHNOLOGY MEDIATED LEARNING ENVIRONMENT Innovations in the delivery of higher education are becoming more evident. In particular, much emphasis has been placed on distance education and instructional technology (Malhotra 2002). Jones and Kelley (2003) attribute these trends to the changing profile of university students while Mintu-Wimsatt (2001) suggests that universities consider distance education as a means to overcome budgetary constraints. Delivery Methods Distance education includes the use of video, voice, data and/or print technology as a means to bridge the gap between the content provider and learners who are separated by physical distance (Smith 1998). For the purposes of this study, two popular distance education methods will be investigated. Interactive television (ITV) is a two-way, electronic communication process by which students and instructors from various locations are brought together to form a classroom setting in a nontraditional method. Pictures and sounds can be transmitted as digital signals over high-speed lines allowing people separated by thousands of miles to see and hear each other (Omatseye 1999). The development of fiber optics has allowed instructors to monitor students as they work across campus or across the country (Anderson, Banks and Leary 2002). Internet-based or online courses use the Internet to interact with other classmates and the instructor (Farrior and Gallagher 2000; Kaynama and Keesling 2000). Course Evaluations Almost all universities utilize some form of student course evaluation as a tool in gauging teacher effectiveness (Anderson, Banks and Leary 2002). Teaching elements such as the professor’s preparation, communication skills, overall rating, enthusiasm and knowledge are often included in most teaching evaluation instruments (Anderson and Shao 2002). This paper investigates teaching effectiveness using MBA students’ responses to end-of-the-term course evaluations on questions pertaining to the instructor’s: (1) teaching style; (2) rapport with students; (3) grading policies; (4) knowledge of material; and (5) presentation skills. No Significant Differences Syndrome Some studies have suggested that no significant differences exist between traditional learning and distance education. Russell’s (1992) review of research conducted between 1954 through 1992 found little significant differences in teaching effectiveness. Unfortunately, Russell’s (1992) work was done prior to the rapid growth of technology mediated learning of the past decade. Similarly, Smith (1998) suggests that mode of instruction does not matter if (1) technologies used are appropriate; (2) student-to-student interaction is encouraged; and (3) teacher-learner interaction is timely. To further investigate the “no significant differences” syndrome, this study compares MBA students’ assessment of courses taught via ITV and Internet-based methods. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 170 BACKGROUND INFORMATION The current study involves MBA students enrolled in an AACSB accredited regional state university. The university campus is located approximately 60 miles from a major US metropolitan city, but its MBA classes are primarily taught at the university’s educational complex in the city’s suburban area. ITV remote sites for distance education delivery are typically located in community colleges outside the city. Marketing Management Course The graduate Marketing Management course is one of the core courses in the MBA curriculum. The course is offered using two-way ITV and Internet-based formats as well as the traditional face-to-face classroom. The same professor taught the ITV and Internet-based Marketing Management course. Therefore, teaching style and/or personality can be ruled out as a potential extraneous factor. Students’ grades were evaluated based on four major components: discussion/participation; case submissions; mid-term and final examinations. This was consistent across the two modes of delivery. Sample MBA students enrolled in the Marketing Management course during their first year of the graduate program served as the sample groups for this study. Most of the students are in the 2530 age range and have worked for at least two years. A large number of foreign students are also enrolled in the MBA program. ITV. The university campus housed the sending site and there were two receiving sites involved. The receiving sites are approximately 60 miles from the sending site. The class had a total enrollment of 60 students, 32 in the sending site, 22 in one receiving site, and 6 in another receiving site. For the purposes of this study, the evaluation results for sending and receiving sites were all combined together. Approximately 70% of the students enrolled in the ITV course were full-time students and 40% were foreign students. Internet-Based. Thirty nine students enrolled in the Internet-based course. Over 60% worked full time and 40% were foreign students. Course Evaluations MBA students are requested to complete a standardized University evaluation form. For the Internet-based students, a second evaluation form was utilized to assess online technologyrelated issues. Course evaluation forms were distributed during the last week of classes. Summary copies of the students’ evaluations were provided only upon the professor’s submission of the final grades. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 171 Measures The variables of “teaching skills,” “rapport with students,” and “grading policies” were five-point Likert-type items with “strongly agree” and “strongly disagree” as the 1 and 5 anchors, respectively. These constructs were comprised of three items with relatively high Cronbach’s alphas. “Knowledge of material” and “presentation skills” were single items. Both constructs used a five-point scale with “excellent” and “poor” as the 1 and 5 anchors, respectively. Table 1 provides a summary of the descriptive statistics of the five constructs under investigation. Variables Table 1 Descriptive Statistics and Cronbach’s Alpha Site N Mean Standard Number Deviation Of items α Teaching skills I1 O2 51 39 1.82 1.79 .77 .71 3 .77 .91 Rapport with students I O 51 39 1.75 1.82 .80 .76 3 .80 .94 Grading policies I O 51 39 1.89 1.60 .75 .62 3 .80 .88 Knowledge of material I O 51 39 1.73 1.72 .80 .65 1 NA Presentation skills. I O 51 39 1.84 1.94 .90 .72 1 NA Note: 1 “ 2 I” is for the ITV method “O” is for online or Internet-based method RESULTS To determine if significant differences exist between ITV and Internet-based evaluations, ANOVAs were performed on each of the variables of interest. As shown in Table 2, students’ assessment of teaching, rapport, knowledge and presentation were not significant differently between the ITV and Internet-based course. Only the grading criterion showed significant difference at the p<.05 level. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 172 Table 2 ANOVA Comparing MBA Students’ Evaluation of ITV and Internet-Based Marketing Management Course Variables ITV class (b) Internet-based class (c) F-value (probability) Teaching skills 1.82a 1.79a .038 (n.s.) Rapport with students 1.75 1.82 .433 (n.s.) Grading policies 1.89 1.60 4.329 (p<.05) Knowledge of material 1.73 1.72 .007 (n.s.) Presentation skills 1.84 1.94 .222 (n.s.) A post hoc test was conducted to compare final grade differences between the ITV and Internet-based students. No statistical difference was found in the distribution of final grades of students at p<.05 level. DISCUSSION The findings presented in this study provide some empirical evidence supporting the “no significant differences syndrome” particularly in the areas relating to the instructor’s teaching, rapport, knowledge of materials and presentation skills. This finding is promising given today’s student needs and university budgetary constraints where the use of distance education is a foregone conclusion. It is also noteworthy to mention that the instructor for the ITV and online course is a seasoned professor who took the time to master the use of instructional technology and participated in several training sessions. Perhaps, this supports Smith’s (1998) contention on the importance of preparation when an instructor is involved with distance education. Fortunately, there are ample research materials and resources available that can help teaching effectiveness in distance education. The significant difference found with respect of grading policies warrants further investigation. It appears that online students perceived the grading policies to be better (i.e., higher) compared to their ITV counterparts. This leads one to wonder whether online students actually perceive that web-based classes are easier than traditional face-to-face or ITV classes. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 173 CONCLUSION The results in this study are noteworthy as many universities grapple with various issues relating to distance education while instructors speculate on the impact of instructional technology on their student course evaluations. As marketing educators, we strive to be in the forefront in providing for quality education. This study suggests that given ample preparation and utilization of external resources, we can manage to provide quality instruction to our students. REFERENCES Anderson, L., S. Banks and P. Leary (2002), “The Effect of Interactive Television on Student Satisfaction,” Journal of Education for Business, January/February, 164-168. Anderson, L. and L. Shao (2002), “Grading the Teachers,” Biz Ed, November/December, 36-39. Donoho, R.(1998), “The New MBA,” Training, 35, D4-D9. Farrior, E. and M. Gallagher (2000), “An Evaluation of Distance Education,” Topics in Clinical Nutrition, 15, 10-18. Ferrell, O and L. Ferrell (2002), “Assessing Instructional Technology in the Classroom, Marketing Education Review, 12, 19-28. Gerencher, K. (1998), “MBA Programs go Online,” Infoworld, 20, 71-72. Jones, K. and C. Kelley (2003), “Teaching Marketing Via the Internet: Lessons Learned and Challenges to be Met,” Marketing Education Review, 13, 80-89. Kaynama, S. and G. Keesling (2000), “Development of a Web-Based Internet Marketing Course,” Journal of Marketing Education, 22, 84-89. Malhotra, N. (2002), “Integrating Technology in Marketing Education: Perspective for the New Millennium,” Marketing Education Review, 12, 1-5. Mintu-Wimsatt, A. (2001), “Traditional vs. Technology-Mediated Learning: A Comparison of Students’ Course Evaluations,” Marketing Education Review, 11, 65-75. Omatseye, J. (1999), “Teaching Through Tele-Conferencing: Some Curriculum Challenges,” College Student Journal. Russell, T. (1992), “Television’s Indelible Impact on Distance Education: What we Should Have Learned from Comparative Research,” Research in Distance Education, 2-4. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 174 Smith, G. (1998), “Education Poised to go the Distance,” National Underwriter Life & HealthFinancial Services Edition, November 9, 19. U.S. Department of Education (2002), “Survey on Distance Education at Higher Education Institutions, 2000-2001,” National Center for Education Statistics, Post Secondary Quick Information System. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 175 GROUP PROJECTS IN MARKETING CLASSES: A FACTOR-ANALYTIC STUDY OF STUDENT REACTIONS Gordon G. Mosley, Troy University David K. Amponsah, Troy University ABSTRACT Students are often organized into groups to perform projects for their marketing classes. Student reactions to group projects for their classes were assessed through a twenty-three item questionnaire. A factor analysis organized these items into five factors named self-improvement, group process, group scheduling, individual performance, and communication difficulty. These factors were then analyzed and suggestions for improving group projects in marketing classes are offered. INTRODUCTION Many marketing classes use small groups to accomplish various class projects. Student groups are used to prepare marketing plans, advertising campaigns, and marketing research projects. These groups, however, vary in size, length of time for the project, instructor supervision and interaction, grading, the amount of class time devoted to group meetings, and the total amount of work required. Student reactions to groups vary as well, running the full range from enjoying to loathing their group work assignments. In spite of the significant number of students who dislike group assignments (Pfaff and Huddleston 2003), there are several good reasons for using this teaching pedagogy. Students benefit from small group work in the following ways: 1. Students tend to learn more of the subject matter in small groups than they would if they had worked on individual projects (Freeman 1996; Johnson and Johnson 1984-85; Pfaff and Huddleston 2003). 2. Students are exposed to the differing learning, working, and writing styles of other members of their groups (Boyer, Weiner, and Diamond 1985; Pfaff and Huddleston 2003). 3. Students may learn to work with people who are unlike them in gender, age, nationality, or race, if their groups are diverse in these areas (Feichtner and Davis 1984; Pfaff and Huddleston 2003). 4. When students graduate and enter the business world, group work is increasingly important to on-the-job success. Thus, the added experience of working in groups may be important per se. (Chapman and Van Auken 2001). In addition, instructors may see other benefits from requiring their students to participate in group work. These benefits might include: Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 176 1. The average project created by students in groups tends to be of higher quality than those created by individual students (Pfaff and Huddleston 2003), making them quicker and easier to evaluate. 2. Having fewer projects to evaluate conserves the instructor’s time commitment to evaluation (Pfaff and Huddleston 2003). 3. If some class time is used for group meetings, the added pedagogical variety can lead to greater student interest, satisfaction, and involvement with the course. This may increase the students’ satisfaction and, consequently, their evaluations of the course and its instructor. Although class-related small group work has benefits for both the students and the instructor, several variables can become problematic. Each individual student may learn only that subset of project skills for which s/he is responsible within the group instead of the whole set of skills that could be learned through individual projects (Pfaff and Huddleston 2003). Further, a problem may exist with “free riders”—students who shirk their group assignments and let other group members carry a disproportionate share of the workload (Chapman and Van Auken 2001; Huff, Cooper, and Jones 2002). The students may view the group work assignments and weight for grading as either too demanding or too inconsequential (Pfaff and Huddleston 2003). In addition, students may view the grading system as unfair if all group members receive the same grade regardless of their contribution to the work effort (Chapman and Van Auken 2001; Feichtner and Davis 1984), and the very make-up of group membership may be thought to be unfair if assigned by the instructor (Pfaff and Huddleston 2003). Students may also have trouble scheduling group meetings during non-class hours. The most desirable use of small groups for marketing classes would attempt to maximize the benefits listed above while minimizing the occurrence of problems. This study examined how students think about and react to group assignments in their classes and relates these items to demographic variables. Conclusions and recommendations for improvement in the use of groups are then offered. METHOD Subjects Two hundred twenty-five students in upper-level undergraduate and master’s level classes from a mid-sized public southern university that used small groups completed the instrument at the end of their courses. The mean age of the respondents was 23.28, with 111 males, 113 females, and two respondents who gave no gender identification. 155 respondents were citizens of the United States, sixty-eight were non-citizens of the United States (mostly from China and Turkey), and two respondents didn’t list their citizenship. Further, 146 respondents were upper level undergraduate students, seventy-six were MBA students, and three were not classified. Data were collected from seven sections of five different classes (Advanced Marketing, Advertising, International Marketing, Marketing Management, and Marketing Research), over a two-year period. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 177 Instrumentation Based on anecdotal student and instructor comments, a twenty-three-item survey instrument was developed (See Appendix A). It is recommended that factor analysis include 10 respondents for each item on the instrument. An analysis with fewer respondents runs the risk of providing a factor structure that is sample specific (Hair, Anderson, Tatham and Black 1998). The current study included 225 respondents for the 23-item scale—a ratio of 9.78 to 1, approaching the desirable 10:1 ratio. RESULTS An exploratory Varimax factor analysis was performed on the twenty-three items to determine the structure of student responses. The scree plot showed its major change in slope after three factors, but seven factors had eigenvalues over 1.00. Seven different factor analyses were run, with 3 – 7 factors. A five-factor solution was most interpretable as shown in Table 1. The .400 loading level was chosen for an item to be considered as a part of a particular factor. Items M and V were discarded because of double loadings. The factors were named self-improvement, group process, group scheduling, individual performance, and communication difficulty. Self-improvement reflected the degree to which students recognized that the group experience improved their relationships, skills, and motivation. This factor appears to be a summative evaluation of the students’ group experience, including its benefits for relationship formation, problem solving, and motivation. The other four factors indicate the dynamics within the group itself. Group process measured how well the group functioned as a team and shared responsibilities and tasks. Group scheduling reflected the degree of difficulty in arranging group meetings. [In a four-factor solution to this data set, both of the group scheduling items loaded on the group process factor.] Individual performance measured the students’ opinion of the quality of their own contribution to the group. Communication difficulty reflected the students’ perceptions regarding the ease of communication within the group. The coefficients alpha for both self-improvement and group process are well above Nunnally’s (1967) recommended .600 for exploratory research, while a coefficient alpha of 0.50 – 0.60 might suffice in the early stages of research (Harmon, Brown, Widing, and Hammond 2002; Nunnally 1967). Thus, the group scheduling, individual performance, and communication difficulty factors are weaker on this measure of reliability. Demographic differences among student scores on the five factors discussed above were then determined using t-tests. In addition, t-tests were performed to see which of the factors measuring potential problem areas (group process, group scheduling, individual performance, and communication difficulty) were associated with the summary factor, self-improvement. No statistically significant differences on factor scores were found related to gender or the duration of the group’s existence (range: one week to one semester). Further, no statistically significant differences on group process and group scheduling scores were found based on age, gender, citizenship, or class status (undergraduate v MBA level). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 178 Table 1: Factor Loadings of the Twenty-Three Items. Factor SelfGroup Improvement Process Group Scheduling Individual Performance Communication Difficulty Factor’s coefficient ά .884 .831 .533 .508 .411 Item B -.092 -.052 -.269 -.027 .639 Item D -.166 -.082 .090 -.130 .586 Item G -.082 -.117 .027 -.025 .833 Item H -.053 -.282 -.196 -.041 .740 Item K -.157 .157 -.056 -.023 .680 Item N -.218 .070 .265 .234 .467 Item O -.184 -.034 .282 .098 .703 Item Q -.197 -.027 -.086 .237 .734 Item F -.138 .209 .028 -.033 .836 Item J -.231 -.164 .201 -.196 .664 Item U -.187 .289 .157 .266 .615 Item W .108 .155 .287 .248 .410 Item A (R) -.193 .273 -.096 .138 .677 Item P (R) -.290 -.166 -.208 -.080 .625 Item R .147 .311 .130 .091 .683 Item C (R) -.258 .059 .036 -.094 .803 Item I -.140 .192 .130 .177 .698 Item L (R) .025 -.033 .011 -.070 .800 Item E .043 -.151 -.116 .300 .704 Item S -.240 .292 .156 .001 .645 Item T .322 .030 -.041 -.280 .498 Item M .258 .166 .061 -.453 .418 Item V -.226 -.034 .029 .595 .478 Eigenvalue 4.48 3.50 1.88 1.82 1.56 % of variance 19.46% 15.23 8.16 7.92 6.76 explained Items indicated as (R) were reversed. Items M and V were not included with any factor because of double loading. Item T was dropped from Communication Difficulties to improve its coefficient alpha. Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. Rotation converged in 9 iterations. One difference was found based on the size of the students’ group. Students in groups of seven (range for group size was 3 – 7) believed their performance to be inferior to those in groups of three to six (p = .045). Thirty-one students had been in seven-member groups while 193 were in the smaller groups. Factor differences based on student demographics are reported in Table 2. Since no significant differences occurred related to gender, it was omitted. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 179 Table 2: Factor Differences Based on Demographic Information. Age SelfImprovement n.s. Citizenship n.s. Group Process n.s. n.s. Group Scheduling n.s. n.s. BA/MBA MBA agree n.s. n.s. more (p=.050) n.s. = no statistically significant difference at the p=.05 level. Individual Performance n.s. Non-USA agree more (p=.000) MBA agree more (p=.045) Communication Difficulty 24 years and older agree more (p=.001) Non-USA agree more (p=.003) n.s. In addition, group process, group scheduling, individual performance, and communication difficulty were split at the scale’s midpoint—3.0. Students scoring high or low on these factors were split into two groups and compared on their self-improvement scores. There were no significant differences on the self-improvement scores for students scoring either high or low on individual performance or communication difficulties. However, t-tests showed a difference on self-improvement scores between students scoring high and low on group process (p=.000) and between students scoring high and low on group scheduling (p=.004). Further, these same differences (with the same p-values) occurred when the two groups were established at the median splits instead of the mid-point of the scale. Pearson correlations among the five factors and their significances are reported in Table 3. This study found that students who had worked in groups with seven members had significantly lower perceptions of the amount of their self-improvement than students in smaller groups. This is consistent with the hypotheses and findings of many previous studies (Bacon, Table 3: Correlations Among the Five Group Factors. Improve Perform Improve 1.000 Perform -.030 1.000 Comm -.035 .219** Process -.443** .125 Schedule -.282** .157* Sig. (2-tailed) Improve Perform .653 Comm .608 .001 Process .000 .065 Schedule .000 .019 ** Correlation is significant at the 0.01 level (2-tailed). * Correlation is significant at the 0.05 level (2-tailed). Comm Process Schedule 1.000 .238** .165* 1.000 .399** 1.000 .000 .014 .000 Pearson Correlation Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 180 Stewart, and Stewart-Belle 1998; Deeter-Schmelz, Kennedy, and Ramsey 2002; Pfaff and Huddleston 2003). Although no significant differences were found among the smaller groups the direction of the observed differences was that smaller groups were associated with higher selfimprovement scores. Hence, smaller groups could be considered to lead to greater student perceptions of their own self-improvement through the group learning process. This study also found differences in the students’ perceptions of the group’s communication difficulties based on age, with older students recognizing more difficulties. This difference was found even when citizenship and undergraduate or graduate status was controlled for. Non-citizens of the United States were more likely to perceive their own performance as weak and to recognize communication difficulties than were students who were citizens of the United States. Presumably, this result was obtained because English was the second language of the majority of the non-citizen respondents. Additionally, certain of the non-citizen respondents overcame considerable challenges just to become students in the United States, indicating that they may have higher motivational levels than citizen-students. MBA students were more likely than undergraduate students to recognize the benefits of group work for their own improvement. This could be due to their higher level of experience with both academic groups and work teams, although this variable was not measured. Further, MBA students were more likely than undergraduate students to perceive their own performance in the group as lower. The correlations among the factors provide some interesting insights into how students come to view group work as helpful to their learning. The students’ perceptions of their own selfimprovement because of their group activity were negatively correlated with group process and scheduling difficulties, but not with their own performance or communication difficulties. Hence, student reactions to the group work in their marketing classes appear to be directly related to the smooth functioning of their group, but not to their own perceived performance or communication difficulties. This is consistent with Chapman and Van Auken’s (2001) finding that the instructor’s involvement in making sure the group functions smoothly is strongly related to the student’s perceptions that group work has benefits for them. Predictably, the factor correlations also show that students’ higher perceptions of their own performance are correlated with ease of communication and group scheduling. Further, difficulties in group communication were also correlated with difficulties in group process and scheduling. Understandably, group process and group scheduling were also correlated as these two factors became one if the five factor solution to this data set was truncated to four factors. CONCLUSIONS AND RECOMMENDATIONS The major conclusion of this study is that the major determinant of benefits for students from group projects in marketing classes is the smooth functioning of their groups. Hence, professors should take steps to assure that groups function without the common problems of difficult meeting schedules, perceived unfair grading or group assignments, or free riders. Although these problems may never be entirely eliminated, the instructor can take steps to minimize them. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 181 First, instructors should emphasize that part of the goal for the groups will be to improve their skills in building and functioning in teams (Pfaff and Huddleston 2003), since this is an important skill to acquire for their future in the world of work (Antonioni 1996; Chapman and Van Auken 2001). Second, allow an appropriate amount of class time for group organization and preliminary decision-making, since this would tend to alleviate meeting schedule problems (Chapman and Van Auken 2001; Pfaff and Huddleston 2003). Third, allow at least a portion of the individual student’s grade for group work to be dependent on his/her contribution to the group’s performance to increase perceptions of grading fairness (Chapman and Van Auken 2001; Pfaff and Huddleston 2003). Fourth, allow students to engage in peer evaluation to create a vehicle for penalizing free riders and those with lower workloads or lower commitment within the group (Chapman and Van Auken 2001; Pfaff and Huddleston 2003). This opportunity for voice and feedback may also increase the students’ perceptions of fairness (Konovsky 2000) and control of their group’s activities. Further, the instructor should be an active monitor of group activities and supervision. Because of the crucial importance of group functioning to student learning, instructors should be knowledgeable about group activities and should intervene when necessary to assure adequate group performance. LIMITATIONS AND FUTURE RESEARCH This is a report of a study in its preliminary stages, and must be considered with its limitations in mind. First the twenty-three items used in this survey are certainly not exhaustive of student reactions to their group experiences. A more comprehensive list of items should be developed and refined, to eliminate the double-loading items and to improve the coefficients alpha of group scheduling, individual performance, and communication difficulties factors. Future studies could refine these factors and, perhaps, establish others (e.g., affective reaction to group work). In addition, future studies could work toward the establishment of criteria for determining what the appropriate methods for group organization, grading weights and standards, and instructor monitoring and supervising methods might be. REFERENCES Antonioni, David (1996), “How to Lead and Facilitate Teams,” Industrial Management 38 (6), 22 – 25. Boyer, E.G., J.L. Weiner, and M.P. Diamond (1985), “Why Groups?” The Organizational Behavior Teaching Review 9 (4), 3 – 7. Chapman, Kenneth J., and Stuart Van Auken (2001), “Creating Positive Group Project Experiences: An Examination of the Role of the Instructor on Students’ Perceptions of Group Projects,” Journal of Marketing Education 23 (2), 117 – 127. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 182 Deeter-Schmelz, Dawn R., Karen Norman Kennedy, and Rosemary P. Ramsey (2002), “Enriching Our Understanding of Student Team Effectiveness,” Journal of Marketing Education 24 (2), 114 – 124. Feichtner, S.B., and E.A. Davis (1984), “Why Some Groups Fail: A Survey of Students’ Experiences with Learning Groups, The Organizational Behavior Teaching Review 9 (4), 58 – 73. Freeman, K.A. (1996), “Attitudes Toward Work in Project Groups as Predictors of Academic Performance,” Small Group Research 27 (May), 265 – 282. Hair, Joseph F., Jr., Rolph E. Anderson, Ronald L. Tatham, and William C. Black (1998), Multivariate Data Analysis, 5th Edition. Upper Saddle River, NJ: Prentice Hall. Harmon, Harry A., Gene Brown, Robert E. Widing II, and Kevin L. Hammond (2002), “Exploring the Sales Manager’s Feedback to a Failed Sales Effort,” Journal of Business & Industrial Marketing, 17 (1), 43 – 55. Huff, Lenard C., Joanne Cooper, and Wayne Jones (2002), “The Development and Consequences of Trust in Student Project Groups,” Journal of Marketing Education 24 (1), 24 – 34. Johnson, D.W., and R.T. Johnson (1984-85), “Structuring Groups for Cooperative Learning,” The Organizational Behavior Teaching Review 9 (4), 8 – 17. Konovsky, Mary A. (2000), “Understanding Procedural Justice and Its Impact on Business Organizations,” Journal of Management 26 (3), 489 – 513. Nunnally, Jum C. (1967), Psychometric Theory, New York: McGraw-Hill Book Company. Pfaff, Elizabeth, and Patricia Huddleston (2003), “Does it Matter if I Hate Teamwork? What Impacts Student Attitudes toward Teamwork,” Journal of Marketing Education 25 (1), 37 – 45. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 183 APPENDIX A a. b. c. d. e. f. g. h. i. j. k. l. m. n. o. p. q. r. s. t. u. v. w. Most group members did their share of work fairly The group project format helped me to develop better relationship with my classmates It was easy to schedule group meetings I developed greater appreciation for persons of other ethnic backgrounds My English language skills limited my communication ability Only a few people did the Group’s work The group interactions improved my problem solving skills The group problem-solving format motivated me to perform at a high level I had problem meeting my assignment schedules A two-person group format would be better than three or more-person format The group interaction improved my human relations skills The quality of my contribution to the project was high Given the way the group performed, I would prefer to have worked alone Group project activities in a business course is helpful to my learning experience The group project problem solving format increased my willingness to try new and difficult tasks Fairness would demand that each group member earn the same grade on the project The group activity improved my teamwork skills Some group members’ private work assignments interfered with group activity scheduling There were communication difficulties among group members I helped some group members improve their problem solving skills There was a lack of cohesiveness among group members Some group members had low commitment to the group task “Clique” (sub-group) disturbances occurred in the group Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 184 PATTERNS OF COPING OF HEALTH-CARE PERSONNEL: THEIR RELATIONSHIPS WITH PERSONAL CHARACTERISTICS, ROLE STRESS, AND WORK OUTCOMES Sarath A. Nonis, Arkansas State University Len Frey, Arkansas State University ______________________________________________________________________________ ABSTRACT A study was undertaken to investigate a coping patterns that integrates problem-focused coping (PFC), emotion-focused coping (EFC), and time management perceptions and behaviors jointly in a healthcare context. Cluster analysis identified four distinct coping strategy profiles. Results seems to indicate health-care personnel who are able to better handle stress use time management behaviors more often in addition to using high levels of PFC and low levels of EFC. Findings have implications in selecting and training of health-care employees. ______________________________________________________________________________ INTRODUCTION Most coping research to date has focused on coping styles as measured by problemfocused coping (PFC) and emotion-focused coping (EFC), but it has excluded time management perceptions and behaviors as ways of coping with stress (Nonis and Sager 2003). This study attempted to investigate a coping model that integrates PFC, EFC, and time management perceptions and behaviors jointly in a health-care environment. METHODOLOGY Data was collected from 169 healthcare workers whose job involved significant interaction with customers. The literature on organizational behavior refers to such service employees as boundary spanners whose job inherits high levels of role stress which if not managed can result in negative consequences such as burnout and low levels of satisfaction and performance (Singh, Goolsby, and Rhoads 1994). In the sample, 55% were employed as nurses and the remaining 45% were employed in positions such as laboratory, radiology, and food service. All study constructs were measured using psychometrically sound scales that have been used in other major studies and results revealed acceptable alpha coefficients as per Nunnally (1978). RESULTS AND IMPLICATIONS Hierarchical Cluster analysis of coping styles as measured by PFC, EFC, and time management perceptions and behaviors provided a four (4) group taxonomy of coping strategy Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 185 profiles that were comparable to what have been identified by Nonis and Sager (2003) among salespeople. Coping profile 1 (Professionals) consisting of 36% of the sample reflected greatest use of PFC strategy as well as high levels of time management behaviors. In terms of personal characteristics, they possessed high levels of trait optimism, motivation, and self-efficacy. They also demonstrated the highest levels of job performance and lowest levels of burnout. Coping profile 2 (Plodders) consisting of 36% of the sample in contrast used EFC more frequently. Their use of PFC and dimensions of time management behaviors were also low. Individuals in this group demonstrated low levels of trait optimism, motivation, and self-efficacy. In addition, their level of performance was the lowest and their level of burnout was the highest. Coping profile 3 (Productive Worriers) constituted the smallest portion of the sample (9%). Their use of PFC, EFC, and time management behaviors were high but their perception of control over their time was the lowest among the four profile groups. Individuals in this group were highly motivated but they demonstrated low levels of trait optimism and self-efficacy. This group demonstrated high levels of job performance but their levels of burnout were also high. Coping profile 4 (Bystanders) constituted the remaining 18% of the sample who demonstrated low use of EFC, PFC, as well as time management behaviors. However, their perception of control over their time was high. In terms of personal characteristics, they demonstrated low levels of motivation and self-efficacy. They also demonstrated low levels of performance as well as burnout. Results seem to confirm the hypothesis that individuals posses a steady pattern of coping that stays the same–unless deliberate change occurs. This is different from the coping behavior approach that incorporates actions of an individual in response to a stressful event (Edwards 1988; Lazarus and Folkman; Newton 1989) where coping behavior can and will vary across situations. Study results have implications in selecting and training of health-care employees. In terms of selection, instruments can be developed to identify the preferred coping style profile used by prospective employees. In training, results clearly show improvements in time management and coping practices that have to be made for bystanders and plodders. REFERENCES Edwards, J. (1988). “Determinants and Consequences of Coping with Stress,” in Causes, Coping, and Consequences of Stress at Work, C.L. Cooper and R. Payne, eds., New York: John Wiley & Sons, 233-263. Lazarus, R. and Folkman, S. (1984). Stress, Appraisal and Coping. New York: Behavioral Science Book. Newton, T.(1989). “Occupational Stress and Coping with Stress: A Critique,” Human Relations, 42 (May): 441-461. Nonis, S.A., and Sager, J. K. (2003). “Coping Strategy Profiles Used by Salespeople: Their Relationships with Personal Characteristics and Work Outcomes,” Journal of Personal Selling and Sales Management, 23 (Spring): 139-150. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 186 Singh, J. Goolsby, J.R., and Rhoads, G. K. (1994). “Behavioral and Psychological Consequences of Boundary Spanning Burnout for Customer Service Representatives,” Journal of Marketing Research, 31 (November): 558-569. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 187 PROFILING COLLEGE STUDENTS BASED ON TIME-USE: RELATIONSHIP WITH PERSONAL , SITUATIONAL AND ACADEMIC OUTCOME VARIABLES Sarath Nonis, Arkansas State University Melodie Philhours, Arkansas State University Gail Hudson, Arkansas State University ABSTRACT Students today lead very busy lives and spend too little time studying, less than is recommended for learning. Surprisingly, when the research is reviewed as to the impact of decreased study time on academic performance, the results are mixed. This study examines a wider variety of activities to which students devote their time and clusters students into two distinct profiles. Personal, situational variables and academic performance are different for each group. Results provide some explanation as to why previous study results have been mixed. Implications are also discussed. INTRODUCTION The “rule of thumb” is that students should spend between two and three hours per week outside of class studying for each credit hour they take (Cerrito and Levi 1999; Young 2002). However, research has consistently shown that students spend much less time studying. One reason that students are spending less time studying each year may be the growing number of students who are involved in paid work as well as the growing number of hours that students work each week. Many believe that this trend will continue into the foreseeable future. There are four objectives of this study. They include investigating how much time college students spend on various activities and working during a given week; to identify profiles of college students, based on their activities; to determine the extent to which the different student profiles, have different outcomes such as academic performance; and to determine to what extent the different student profiles, vary relative to personal variables (i.e., gender, race, age, number of credit hours completed, ability, level of motivation, self-efficacy) and situational variables (i.e., academic load and whether a student works). METHODOLOGY Sample The sample consisted of undergraduate business students attending a medium size (10,000+), AACSB accredited, public university in the mid-south. The survey consisted of two parts. The first part required students to maintain a journal during a 1-week period, documenting Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 188 how much time was spent on various activities each day of the week (there were 28 activities that were measured). The second part of the survey contained demographic information such as gender, age, race etc., as well as measures of several other constructs including motivation, academic self-efficacy, and academic stress. Four hundred and forty (440) surveys were administered with 288 returned. Two hundred and sixty four (264) of the returned surveys were usable yielding an effective response rate of 62.0%. Results Students on average spent less than 1 hour studying (12.94 hours per week) for every credit hour they took (academic load was 14.06 credit hours). The amount of time students spent watching TV and on other forms of entertainment (i.e., shopping, sports etc.), is very close to the time students spend outside of class studying. In addition, students on average spend significantly more time working than taking classes or studying. Profile 1 students work less, are more motivated, have higher levels of academic self-efficacy, take more credit hours and have higher performance than Profile 2 students. The four variables achievement-striving, selfefficacy, academic-load, and employment status correctly classify students in the two profiles 72.3% of the time and show that personal and situational variables but not ability variables explain differences in time-use by college students. In addition to the situational differences, this suggests that time-use by students is partly explained by personal differences and shows the importance of personal traits such as motivation and self-efficacy on important behaviors for college students to succeed. Simply put, personal traits may have more influence on time-use than even situational demands. Discussion/Implications Results from this study should be shared with students so that they can better understand themselves and how to best spend their time and effectively to influence outcomes. In addition, how much time a student spends at work may need to be added to other variables (i.e., CGPA, course-load) that are considered during student advising. If it is clear that a student is not using their time well, he or she should be advised to take study skills courses or attend orientation sessions that emphasize time management. Faculty need to understand all of the variables that influence student learning and to use this information when designing coursework, the timing of important assignments and guiding students as they strive to achieve important learning objectives. SELECTED REFERENCES Cerrito, P.B. and I. Levi (1999) “An Investigation of Student Habits in Mathematics Courses,” College Student Journal 33(4), 584-588. Young, J.R. (2002) “Homework? What Homework?” The Chronicle of Higher Education December 6, 36-37. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 189 MARKETING EDUCATION AND VIRTUAL REALITY: THE VIRTUAL REALITY GROCERY PROJECT Charles H. Patti, Queensland University of Technology ABSTRACT Marketing educators accept that the vast majority of learning and teaching now takes place in the physical and virtual classrooms. This paper discusses a learning and teaching project within the virtual reality (VR) environment. The project described in this paper, Virtual Reality Grocery (VRG), provides a number of learning benefits. VRG, particularly when used with marketing cases, allows learners to improve higher-order learning skills, including problem solving and critical thinking and it provides a stimulating environment to observe the relationship between theory and practice. Note: The presentation of this paper includes an interactive demonstration of the VRG environment. INTRODUCTION Over the past several years, marketing educators have seen the emergence of many new delivery forms of cases, including the traditional written/paper medium, videotape, CD, and online. These new media have increased the case distribution channels, convenience and learning potential for marketing educators and learners, and graphic portrayal of case materials. However, many of the new media present a largely static environment, offering a marginal learning advantage to the traditional written/paper format. This paper and accompanying demonstration present a significant advancement in marketing case pedagogy by providing learners with the opportunity to test hypotheses within a case environment, thus expanding skills in critical thinking. THE CASE FOR CASES One of the most widely-used methods of teaching and studying marketing involves the use of specific examples from the world of business—cases or case studies. Today, there are professional associations dedicated exclusively to case development and case teaching.1 There are journals that publish only cases.2 Other journals publish one or more cases in each edition.3 Even though cases have been widely-used for teaching and learning in business education for many years, interest has peaked again recently, no doubt stimulated by a growing interest in learners’ active involvement in the learning process. Cases provide the opportunity to draw on prior knowledge and experience, to apply what has been learned in other courses, and to develop and articulate solutions or opinions.4 Basically, a marketing business case is a written description of an organization’s situation at a specific point in time. In essence, cases are stories told by the case author. Stories are one of Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 190 the oldest ways of learning. In the history of knowledge and learning, writing is a recent technology. For most of our history, we learned through stories, told to us by parents and grandparents, passed on from generation to generation. We learned from the experience of applying the lessons of the stories to our environment. While we still learn and grow from the stories of parents and others, communication technology provides us with other learning methods. Some learning methods are passive (eg, listening to a lecture, or watching a video). Other methods involve active participation and learning (e.g., internships and major projects such as the development of marketing plans or advertising campaigns). In the continuum of active learning devices, cases are among the best methods of active learning. See Exhibit 1. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 191 ___________________________________________________________________________ Exhibit 1 Learning Interactivity Continuum ___________________________________________________________________________ Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 192 Today, marketing educators use cases for several reasons, including: (1) providing the opportunity for learners to practice the process of identifying problems and then developing solutions; (2) providing the opportunity for learners to become familiar with many different types of businesses and industries; (3) helping learners appreciate the impact of one business discipline on the overall health of the organization; and (4) facilitating the development of communication skills in selling a recommended solution or analysis.5 While the above are top-level reasons for using cases in marketing education, the underlying purpose is to promote learning and intellectual growth by active participation. Cases facilitate this by providing an opportunity to apply a concept or theory to a particular situation. They also can help build skills in critical thinking because most case situations call for an analysis of a wide range of information, including marketplace data, information about one or more organizations, and the personalities of managers. THE VIRTUAL REALITY ENVIRONMENT AND THE CREATION OF VRG Virtual Reality (VR) technology is not particularly new, although its application to marketing teaching and learning is at the early stages of adoption. Yet, the ability of VR to simulate the physical environment holds much promise to facilitate learning, particularly within the case method. For example, no other medium can more effectively simulate the physical environment, thus bringing the learner in intimate contact with the information, problem solving, and critical thinking dimensions of learning. To explore the application of VR to case development and learning to marketing education, the design and construction of a VR Grocery Store (VRG) was commissioned. The VRG was underwritten by a University teaching and learning initiative grant and was designed and constructed over a six-month period in collaboration with a local VR supplier. The development of VRG included the following timeline stages of development (see Exhibit 2): 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. Conception Creation of specifications Identification of alternative suppliers and evaluation of their potential Negotiation of cost and delivery Phase 1 Construction (prototype) Phase 2 Construction (data collection, selection, and evaluation) Phase 3 Construction (review and refinement) Phase 4 Construction (review and acceptance) Phase 5 Construction (conversion to PC platform) Learning Testing Phase 6 Construction (refinement) Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 193 ___________________________________________________________________________ Exhibit 2 Timeline and Phases of Construction and Testing of VRG ___________________________________________________________________________ Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 194 Features of the VRG The VRG environment simulates a retail grocery store and its surrounding environments, including a residential neighbourhood and grocery store parking lot. It also contains the following features: • a store entry and two completely-stocked aisles, including shelf-talkers, ‘special’ signage, and shelf-hangers; • end-of-aisle features, including product displays; • a check-out facility that itemizes purchases, totals amount spent, and records products inspected but not purchased; • 24 selectable product categories with a minimum of 5 brands within each product category; • ability to alter multiple physical aspects of the selectable categories and the brands within the categories, e.g., price, package design, package colour, shelf positioning, product information, point-of-purchase display; and • ability for individual shoppers to shop the store, evaluating alternative product and brand choices, selecting brands for purchase (placing them into their personal shopping cart), and returning brands to the shelf if they decide not to purchase. HOW TO USE THE VRG FOR MULTI-DISCIPLINE AND MARKETING LEARNING: FROM CASE SUPPLEMENT TO BEHAVIORAL LABORATORY The VRG project lends itself primarily to the marketing discipline; however, the VR concept and model could be easily adapted to other environments and disciplines. For example, educators can develop VR environments to address the learning issues within the disciplines of education (classroom environment), health care (hospital), arts (cultural facility), hospitality (hotel or restaurant), etc. As a marketing education tool, the VRG environment works in three different ways (depicted in the three scenarios summarized in Table 1). In Scenario 1, the VRG functions as a behavioural laboratory, allowing the experimenter to expose subjects to a variety of conditioning materials (independent variables), e.g., advertising, product information, media releases, print media editorials and news items. After exposure, shopper-subjects are given a shopping list (products, but not brands) and then enter the VRG environment where they inspect a variety of grocery products, selecting their preferences, and placing the selections into a shopping cart. After completing the checkout procedure, purchases—along with considered purchase data—are compiled and analysed. Learners then use these data to analyse the effects of the independent variables on virtual shopping behavior. Alternatively, the VRG is useful for testing pricing, packaging, and shelf-placement variables. This flexibility and richness allow the learner to: 1. See the behavioral results of various marketing concepts, theories, and practices. For example, what is the behavioral effect of message length in advertising on purchase behavior?; what is the effect of package colour on purchase behaviour?; what is the Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 195 short- and long-term effect on profitability by changing price (price elasticity of demand issues). 2. Make deeper connections between theory and practice in an environment that is very close to the physical environment. 3. Test alternative propositions and theory while controlling other, potentially confounding variables in the physical environment, e.g., competitive activities as well as location and temporal dimensions of location and time). When used as a behavioral laboratory, the VRG environment requires a number of steps, depicted in Exhibit 3. After the experimenter identifies key learning objectives and an experimental design, subjects are selected and guided through the process shown in the Exhibit. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 196 ___________________________________________________________________________ Exhibit 3 VGR Environment as a Behavioral Research Laboratory Subject recruited to participate in the VRG environment. Subjects exposed to advertising and/or other media stimuli, e.g., product information, media releases, newspaper or magazine news and editorial. Shopping list provided to subjects, prescribing purchase of product categories, but not brands. Shoppers enter VRG environment and evaluate offerings, placing selected items into shopping cart. Shoppers enter check-out area where purchases and considered purchases are recorded for analyses. Shoppers are debriefed. ___________________________________________________________________________ The use of the VRG environment in Scenario 1 allows the learner to accomplish the four learning objectives listed in the third column in Table 1 (experimental design, behaviour observations, deep understanding of theory and application, critical thinking and problem solving. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 197 ___________________________________________________________________________ Table 1 Alternative Uses and Learning Benefits of VRG Environment SCENARIO 1: Behavioural Laboratory 2: Case Scenario (relatively unstructured, PBL learning approach) 3: Complement to Traditional Case DESCRIPTION Experimenter exposes subjects to a variety of conditioning materials (independent variables), e.g., advertising and product information. After exposure, shopper-subjects are given a shopping list and then enter the VRG environment where they make purchase decisions. The preand post-purchase data are used to analyse the effects of the independent variables on virtual shopping behaviour. Instructor presents a brief shopping case scenario to learners who use the features of the VRG to explore the scenario. For example, the shopping scenario would encourage learners to explore the variety of product and brand information within the VRG and use this information to inform recommendations about the scenario. Learners consider issues and challenges presented in a traditional case (paper or electronic) and use the VRG environment to test the case problems, thus conceptualising the VRG primarily as a behavioural laboratory resource as one method of problem solving and secondarily as a concept and practice exploratory device. “Hi-Power Beverage” and “Big Daddy’s Pizza” are just two cases that can be used effectively in this Scenario. LEARNING BENEFITS • Learning experimental design • Observation of the effects of marketing stimuli on virtual behaviour. • Deeper understanding of theory and its application. • Critical thinking and problem-solving skills. • Problem-solving skills • Critical thinking skills Emphasis on prior learning • Deep thinking skills, exploring theory and its relationships to practice • Learning experimental design, including hypotheses development and testing. • Observation of the effects of marketing stimuli on virtual behaviour. • Problem-solving skills • Critical thinking skills (challenging and developing alternative propositions) ___________________________________________________________________________ Scenario 2 uses the VRG environment as a case—that is, the learner develops a brief shopping scenario and learners explore the scenario through the VRG environment. This relatively unstructured, problem-based learning approach allows learners to discover and explore Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 198 concepts and practices largely on their own, thus emphasising prior learning and encouraging the development of problem-solving skills. Finally, Scenario 3 uses the VRG environment as a key complement to an existing case that is presented through one of the traditional media (paper or electronic). This approach uses the VRG environment primarily (but not exclusively) as a behavioural laboratory, allowing learners to decide what concepts to test and to see the behavioural outcomes of their choices. For example, the VRG can be used successfully with cases such as “Hi-Power Beverage” 6 or “Big Daddy’s Pizza.”7 In the “Hi-Power Beverage” case, learners are challenged to decide what elements to test of three alternative television commercials for a carbonated juice brand. When this case is used with the VRG, learners are able to see the behavioural results of the three alternative commercials. This allows learners to challenge the advertising and marketing propositions posed in the case, thus creating a learning outcome that cannot be achieved through any other combination of case delivery media. In the “Big Daddy’s” case, learners are challenged to decide between to marketing communication approaches and the marketing strategies underlying the alternative approaches. The VRG allows learners to test the approaches, thus providing insight about the behavioural outcomes of marketing strategies and marketing communication approaches. Scenario 3 delivers all three learning benefits of experimental design—testing the behavioural effects of marketing stimuli; observing deep connections between theory and practice; and testing alternative hypotheses in a controlled environment.8 EVALUATION AND FUTURE DEVELOPMENTS IN VR Like all learning devices, VR has its limitations. Despite its advantages over earlier technology, the widespread use of VR will have to overcome: 1. Recognition of the differences between the physical and virtual environments. VRG is a reasonable and realistic alternative to the physical environment, but in the end, it is virtual. Therefore, virtual behaviour is perhaps closer to the hierarchy-of-effects stage of “intention to buy” rather than purchase behaviour itself.9 2. Concept development obstacles. Once new technologies or processes appear in the marketplace, there is a tendency to overlook and underestimate the creativity underlying their development. Although VR is an education technology extension rather than invention, its application to marketing education requires conceptual thinking, imagination, and an understanding of the relationship between technology and learning. 3. Time. The VRG project took six months to complete, after the three-month process of developing and applying for a grant to fund the project. Therefore a timeline of nine to twelve months to develop a VR project is realistic. 4. Changing technology. Much of the conceptual underpinnings, software, and hardware behind VR educational technology originated from the popular games industry—an industry whose products change at an increasingly rapid pace because of technology improvements. The result is that today’s educational VR product will quickly become the chalk and board version of electronic, color, graphicallysophisticated presentations. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 199 5. Cost. Marketing educators should anticipate VR development costs of $25,000100,000 per project. Given increasingly restricted budgets for higher education, the development of VR projects will be out of the financial reach of many marketing departments. Despite the limitations described above, VR offers a new level of learning pedagogy (described in this paper) and opportunities for collaboration and research—across disciplines and with industry. Business school accrediting bodies such as AACSB and EQUIS are increasingly examining the relationships between a business school and its business community.10 VRG and its potential variants provide such linkage through generating industry partners who share an interest in learning more about behavioral outcomes of alternative marketing stimuli. When these opportunities are combined with the marketing education benefits described in this paper, VR is a worthwhile initiative for marketing educators, learners, and the business community. REFERENCES 1. North American Case Research Association (www.nacra.net) and World Association for Case Research and Application (www.wacra.org). 2. For example, see Case Research Journal (www.nacra.net), Asian Case Research Journal (www.worldscinet.com), and Business Case Journal (www.sfcr.org). 3. For example, see The Journal of Australia-New Zealand Academy of Management (www.anzam.org.au), the Journal of Interactive Marketing (www.interscience.wiley.com), and The International Journal of Management Decision Making (www.interscience.com). 4. Bonoma, T.V., “Questions and Answers About Case Learning,” Note #9-502-059, Harvard Business School, Soldiers Field Road, Boston, MA. 5. “Learning by the Case Method in Marketing,” item 9-590-008, Harvard Business School Publishing, Boston, MA, July 13, 1989. Also see the introduction and case learning material in any of the many marketing case texts. 6. “Hi-Power Beverage Company,” (Full reference details withheld due to possible identification of the author of this paper. Complete details will be provided when appropriate.) 7. “Big Daddy’s Pizza,” (Full reference details withheld due to possible identification of the author of this paper. Complete details will be provided when appropriate.) 8. Introduction to Research Methods, Fourth Edition, by Robert B. Burns, Pearson Education, French Forest, NSW, 2000. 9. E.K. Strong, The Psychology of Selling, McGraw-Hill, New York, New York, 1925; Robert J. Lavidge and Gary A. Steiner, “A Model for the Predictive Measurements of Advertising Effectiveness,” Journal of Marketing, October 1961; Everett M. Rogers, Diffusion of Innovations, The Free Press, New York, New York, 1962. 10. See the accreditation standards of the Association to Advance Collegiate Schools of Business (www.aacsb.edu) and the EQUIS program (European Quality Improvement System) service of the European Foundation for Management Development (www.efmd.be) Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 200 STRATEGIC REPOSITIONING FOR RURAL REGIONAL HOSPITALS Karla Peterson, East Central University Patrick D. Fountain, East Central University Thomas W. Lanis, East Central University ABSTRACT Smaller regional hospitals compete with large hospitals due to the ease with which consumers can shop around for the highest quality of care. In today’s environment often times that treatment requires specialized care and expensive technology. For smaller hospitals, keeping up with specialization and the related technological equipment is difficult. Another approach is to reposition the smaller hospital as a wellness, referral, and follow up facility. This paper presents supporting evidence for repositioning smaller hospitals as wellness providers. INTRODUCTION Hospitals, especially rural hospitals, are struggling to survive. Due to the aging population covered by Medicare and Medicaid, layoffs causing loss of insurance, and hospital missions that require them to give medical care to anyone, even if they can’t pay, are all contributing to hospitals operating under tight profit margins. Two other areas of concern include keeping up with specialized services that larger hospitals are able to offer, and attracting and retaining qualified physicians. Specialized services require the latest equipment, training of personnel to use the equipment, and a high enough volume of people to pay for the specialized services. Often times, rural hospitals cannot afford the equipment, or the trained personnel, or even sustain a sufficient enough volume of patients to support the capital expenditure. Attracting physicians to rural communities is a problem since their families are not always willing to live in smaller communities. Another problem in attracting physicians is that physicians want to work where their skills can be improved or possibly expanded, and where they have the infrastructure in place to support their work efforts. Given these concerns, rural hospitals need to rethink their purpose in order to survive. Once a clear purpose is established, rural hospitals need to build an image that communicates this purpose to their stakeholders. This paper describes the current environment in which smaller regional hospitals are operating, and suggests four ways they can reposition themselves and build an image of being a value added service provider without having to compete against larger hospitals with greater resources. HOSPITAL ENVIRONMENT Current Situation Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 201 Currently, small to mid-sized regional hospitals are struggling to keep up with hospital services offered by large metropolitan hospitals. The cost of technologically advanced equipment requires a significant critical mass to justify the financial expenditures for equipment. Smaller regional hospitals do not have sufficient numbers of users to justify expensive equipment purchases. Another concern is the expertise necessary for complicated medical procedures. To achieve the highest level of expertise, also requires a critical mass. For example, the recommended number of patients to achieve high success levels for open-heart surgery is 200 operations performed per year (http://www.tn.gov). Below 200 surgeries, the error rate increases significantly. Again, smaller regional hospitals do not have the critical mass necessary to achieve high rates of successful operations. From a financial perspective, the conflict between the various value chain members creates conflicting pressures, contributing to tight profit margins. The health insurance industry wants to pay the least amount of money possible for medical services, consequently pressuring the medical profession to cut costs to create profits. The employer who contributes to health insurance premiums wants to pay the least amount of premiums while still offering a reasonable benefit package to employees. This places pressure on health insurance companies to keep premiums down while still creating a profit after paying for qualified medical services. Another financial pressure comes from Medicare and Medicaid, medical insurance for senior citizens and other qualified groups which places caps on the amount of money paid for specific medical services. When Medicare and Medicaid change the amount of money paid for a particular service, other insurance companies generally follow the reimbursement rate set by these two entities. The patient is typically removed from the financial decisions in medical care since the patient is primarily interested in receiving the best care, regardless of the cost. When the patient is covered by health insurance, there is additional lack of concern for the cost of medical services since the payer is the insurance company. Another problem in the financial considerations of hospitals is the pressure to accept all patients who need emergency medical care, regardless of the patient’s financial situation. If a patient is not covered by medical insurance, it becomes extremely difficult for the uninsured patient to pay for the services. This lack of payment has to be covered in some other manner since this situation basically represents hospitals giving free services. These tight profit margins that hospitals operate under requires cutting costs by generating high levels of efficiencies, or increasing the income stream through some other source. To create high levels of efficiencies requires economies of scale. To achieve economies of scale requires a critical mass. In reviewing a number of articles on health care and knowledge assessment (Calhoun, Davidson, Sinioris, Vincent & Griffith, 2002, Tenkasi & Boland Jr., 1996, NCQA. org) the findings indicate that high volumes of the same procedure are necessary to compete in terms of efficiencies and quality. Another concern comes from the physicians. Physicians are interested in achieving recognition for excellence, achieving high incomes, expansion of their knowledge and skills, and a certain level of quality of work life and personal life. Smaller hospitals are only able to provide some of these benefits and only at limited levels as compared to what large hospitals can offer. This situation creates difficulties for hospitals to attract physicians. Current Strategy Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 202 Neuhauser (2003) has tracked health care over the last thirty years and identified four stages that health care delivery has passed through. The first stage was a fee-for-service payment through third-party insurers, which caused rising costs and “led to the growth of large competing delivery systems (managed care organizations) serving defined populations under capitation payment. This competition forced changes in delivery that are transforming the focus of managed care from (1) cost control to (2) disease management to (3) personal empowerment” (p. 171). These four stages (fee-for-service was the first stage and contributed to the next three stages) overlap and can amalgamate into various combinations. The fee-for-service stage encouraged all providers in the health care value chain to increase tests and services, thereby increasing their respective incomes. This system resulted “in medical care inflation and rising costs” (p. 171). Additionally, the standard practice known as Roemer’s law was to fill any bed that was available. The common thought was, “If insurance pays for it, why not do it?” (p. 172). The cost control stage for many hospitals is implemented through cost cutting. This stage encourages health care workers to work harder and faster for less pay. This system also encourages a denial of services as DRGs (payment based on diagnosis and approved diagnostics and treatment plans) restrict what tests and care are allowed. Many small regional hospitals are operating under the focus of cost cutting (stage 1 according to Neuhauser). The focus is not to become the low cost producer but rather to cut costs in order to create a profit. Rust, Moorman & Dickson (2002) used literature review and a study on issues where quality profitability emphasized revenue expansion, cost reduction or a combination of both to determine which focus resulted in the highest profits. The authors’ found “that firms adopting a revenue emphasis to manage quality profitability may reap the greatest rewards” (p. 19). Their study from primary and secondary sources showed a significant, positive impact on financial performance and customer relationship performance when revenue emphasis is the principal accent. The authors also found the revenue emphasis had a one-year ahead positive impact on ROA and stock returns. The alternative to revenue building is cost cutting. Their research showed that a focus on cost cutting creates a spiral of destruction. As costs are cut, quality drops and customer satisfaction deteriorates, leaving the organization at a lower position than the organization was previously. When a combination of cost cutting and revenue building is selected, there is a conflict between decisions. The revenue building alone determines more specific directions, excluding some responses while encouraging the revenue building responses. The disease management stage focuses on no mistakes. This method uses Meta analysis and knowledgeable decision analysis to determine the correct diagnosis and treatment plan. This system has resulted in specialized care, which is separately organized and contracted out. Evaluation and rating of care is publicized with a move towards proactive prevention, and an assessment of the entire population. “At the core of disease management are clear comparative measures of care outcomes, linked to defined and agreed-upon processes of care”(Neuhauser p.177). This view supports a move towards standardizing health care. This standardization attempts to control costs and quality by dictating the recommended tests, treatment, and specialized experience needed for the most efficient and effective outcome. Personal empowerment is the most revolutionary of the four stages. This stage focuses on self-help, self-care, and hospice care. In this system, nurses and other health care workers become the pivotal caregiver. The focus shifts from diagnosis and follow up care to education, prevention, social support, wellness, and repositioning the hospital as a holistic health resource. The drivers for this change are reducing costs, and available information, primarily through the Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 203 Internet. The patient could very well become the “expert” on the particular health condition, contacting the health provider already documenting the symptoms, diagnosis, and cure. This personal empowerment stage presents the opportunity to reposition health care providers as managers of knowledge and information flows, guiding their members towards improved, healthier life choices. It should be noted that in a proactive approach there are considerably fewer patients as consumers become more proactive and empowered. The personal empowerment stage has the additional advantage for smaller regional hospitals of shifting personnel costs from high paid physicians to lower paid medical personnel. Additionally, the reliance on non-physician employees solves the problem of attracting physicians to smaller communities. As part of this movement towards personal empowerment, numerous quality healthrelated organizations are promoting and publicizing statistics on hospitals and physicians. The goal of NCQA (National Committee for Quality Assurance) is to educate the health care system on best in class procedures and innovations as they become highly regarded. Another goal of NCQA is to empower patients through rankings of health care providers and physicians. Specifically, NCQA has stated the goals of ensuring that all organizations meet basic customer service expectations, ensure that all members regardless of status receive appropriate care and support to promote better health, develop standardized care, and enable consumers and employers to make comparisons between different types of health plans and selection of the best care providers. This movement towards consumer-directed health plans strengthens the quality movement in health care. The intent of this change is to create a competitive environment in which consumers are able to compare and select where they want to receive their health care as well as selecting who they want to perform any needed procedures. This shift towards empowered consumers will put pressure on care providers to become excellent. Those that don’t achieve high ratings will not be selected for medical care. For smaller regional hospitals, this shift will require establishing fewer and higher quality services. Smaller hospitals will need to determine what services their area consumers need in high enough numbers to become excellent in those core procedures and services. Smaller regional hospitals will wither and die if they are unable to achieve high ratings in the services they choose to offer. This threat indicates the importance for smaller regional hospitals to carefully select their core services where there are sufficient numbers to justify offering those services, as well as the expert personnel available to service these offerings. Repositioning Hospitals as Revenue Builders In reviewing the above articles, there appears to be strong evidence that hospitals need to focus on revenue building through a proactive position of knowledge and information providers, motivating members to become empowered through knowledge and healthier life choices. Smaller hospitals can compete with large, specialized hospitals by creating a new position in the marketplace as resources for improving the health of the community. Hospitals can redefine their patients as customers who are seeking improved health rather than caring for patients who are already ill. Through this repositioning, hospitals can create value added services for people, creating a niche in the health industry where large hospitals don’t compete. Image Building Based on the above information, the hospital has the opportunity to identify value added benefits, building those benefits into the hospital’s image. To create value added benefits, key procedures that are aligned with the primary care needs of the community need to be identified. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 204 The primary key procedures need to have sufficient volume for the development of highly efficient procedures. Becoming highly efficient contributes towards a decrease in costs, as well as an improved skill level. As part of the identification of the key procedures, non-selected procedures must also be identified. Identifying what procedures the hospital will not do, contributes towards the development of the image. The image needs to portray excellence in the key procedures and in the repositioned proactive focus of health care. As part of the image development, the hospital needs to create a consistent internal environment that rewards and supports a healthy workplace. Abrams (2004) points out the connection between creating brand loyalty and attracting and retaining employees. Organizations with strong, positive brands can pull in better employees. Our view is that a strong, positive image can accomplish the same thing. Abrams’ research supports hospital needs for attracting high quality employees, especially at the physician level. Retention and attraction of high quality employees was identified in both the literature review of hospitals. Value Added Benefits on Which to Build an Image The first suggestion on which to build an image is that hospitals can redefine their patients as customers who are seeking improved health, rather than caring for patients who are already ill. Through this repositioning, hospitals can create value added services for people, creating a niche in the health industry where large hospitals don’t compete. Another value added service the smaller regional hospitals can develop is improved knowledge of the health insurance industry. Hospitals are in a position to act as a liaison between insured people and their health insurance companies. Many insured people are unaware of the technicalities and legal aspects of health insurance. Smaller regional hospitals can offer this service to members even if the member receives medical care at another medical center. This information can be offered prior to receiving medical care, and as a postoperative service. There is also a benefit to the insurance companies since there would be fewer errors and less confusion in the billing process. A third value added service for smaller regional hospitals is to become experts in referral services. The fact that regional hospitals cannot afford to offer all of the specialized services and procedures that large hospitals can offer closes the possibility of expansion into high-cost, lowvolume services. However, smaller hospitals can create alliances and partnerships with hospitals, which have higher than average success rates in specific procedures. This knowledge creates a value added service for members; regional hospitals can offer diagnostic services with referrals to hospitals’ with high successes in the specific health need. A fourth value added service is to offer local follow up care. In today’s medical environment, hospitals are not allowed to keep patients beyond the time established through the stated DRG. In many cases, patients are still in need of a variety of medical services. These services can be delivered through lower cost employees employed at the regional hospital. The follow up care could include anything from physical therapy to home food delivery. Each of these value added services creates another possibility for building brand identification. Based on the literature review and information from the focus groups, the development of a brand through the identification of value added services would create and encourage loyalty, credibility, and a valuable, long-term benefit to non-urban communities. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 205 Once the image is established, additional research needs to be done to verify that the brand is perceived as it is formally stated. Furthermore, research needs to be conducted to determine shifts in stakeholder preferences of wellness care. CONCLUSION Hospitals, especially rural hospitals, are struggling to survive. From a strategic marketing view, one answer is to give added value to the various customers in the health care industry, communicating these benefits through branding. Another possibility is to create new and increased value throughout the value chain and to redefine the purposes of the health care industry. This paper presents support for smaller regional hospitals to become proactive health providers, focusing on encouraging health promoting life-styles, as well as adding value throughout the value chain in referral services and insurance processing. Combining all of these attributes into one brand that is promoted consistently throughout the internal and external environment creates a distinctive, defendable position for moving into the future. REFERENCES Abrams, Michael N. (2004) “Employee retention strategies: Lessons from the best,” Healthcare Executive July/August, 18-21. Calhoun, J.G., Davidson, P.L., Sinioris, M. E., Vincent, E.T., & Griffith, J.R. (2002) “Toward an understanding of competency identification and assessment in health care management,” Quality Management in Health Care 11(1), 14-38. National Committee for Quality Assurance. Retrieved August 7, 2004, from www.ncqa.org Neuhauser, D. (2003) “The coming third health care revolution: Personal empowerment,” Quality Management Health Care 12(3), 171-184. Rust, R.T., Moorman, C., & Dickson, P.R. (2002) “Getting return on quality: Revenue expansion, cost reduction, or both?” Journal of Marketing 66(Oct.), 7-24. Tenkasi, R.V., & Boland, R.J. Jr. (1996) “Exploring knowledge diversity in knowledge intensive firms: A new role for information systems,” Journal of Organizational Change Management 9(1), 79-91. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 206 THE MEDICAL MALPRACTICE CRISIS: AN ECONOMIC ISSUE OR AN ETHICAL ISSUE? Phil Rutsohn, Marshall University Andrew Sikula Sr., Marshall University ABSTRACT This paper explores the primary issues surrounding the malpractice crisis currently facing the health care system. The authors discuss the primary issues presented by both the supporters of tort reform and the opposition to tort reform. As is true for many issues in health care, final analysis suggests that tort reform is needed or not needed depending on the analysts’ role in the System. The authors suggests that regardless of the economic impact of tort reform on the cost of health care there is a more fundamental issue that society must confront—the ethical implications of the current malpractice litigation “lottery”. INTRODUCTION The continuing controversy over tort reform in general and medical malpractice specifically has produced a wealth of data in the literature but little information. Each viewpoint presents its agenda in an “objective” format leading the reader to a predetermined conclusion solidifying the wisdom of the communicator’s position and the error of the opposition’s viewpoint. If one internalized all of the criticisms of the American Tort Reform Association (1) he/she would be convinced that the current system was developed by the evil Darth Vader while the American Bar Association is convinced that medical malpractice litigation enhances the quality of health care delivery. A rational decision maker should probably take both viewpoints add them up divide by two with the end result approximating reality! Malpractice may be generally defined as a gross departure from an accepted standard of practice. In other words the courts should look at the performance of the defendant physician compared to what a reasonably prudent professional would do in a similar circumstance. Gray and others argue that with the evolution of medicine the patient’s definition of malpractice has become “anything a doctor does that is less than perfect!” (2) Its an interesting phenomena, the better we have become in delivering quality medical interventions the more consumer expectations have risen. The more expectations have risen the more willing the consumer is to sue when performance deviates from expectations. Hence, improvement in the quality of medicine has resulted in increased law suits! The U.S. Chamber of Commerce estimates that U.S. product liability costs are 20 times higher than Europe and 15 times higher than Japan. (3) Once again, medical malpractice liability parallels overall tort liability. Perhaps, if Brennan, Sox and Burstin are accurate in their assessment and compensation for medical malpractice case injuries are based on the extent of the injury rather than the degree of negligence the fundamental problem is ethical in nature and requires an educational intervention. MALPRACTICE LITIGATION: PROS AND CONS In a continuing multi-year study Tillingbast, Towers Perrin concluded that current tort costs are the equivalent of approximately a 5% tax on wages for the typical employee with costs growing at an increasing rate. In 2002 tort costs grew at a rate of 13.3% while overall inflation grew at 3.6%. Medical Malpractice, a subset of total tort costs has demonstrated a parallel trend. (4) However, a study by Price Waterhouse Coopers in 2002 demonstrated that malpractice costs accounted for about 1/14th of the increase in health insurance premiums for the period 2000-2002. (5) The obvious conclusion to be drawn from these two studies—while the cost of malpractice is increasing at an increasing rate it represents such a small component of overall spending in health care Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 207 it should not be receiving massive attention from the media, the Industry, or the political system. Perhaps a more insightful conclusion from these two studies would suggest that the direct impact of malpractice on health insurance premiums may lead one to erroneous conclusions. There appears to be little agreement among analysts concerning the rising cost of malpractice insurance. Mencimer found that malpractice insurance premiums increased 30-40% annually between 1999 and 2002.(6) However, the Congressional Budget Office places the increases at approximately 15% annually for the period 20002002.(7) Price Waterhouse Cooper suggests that increases from 20% to 100% in malpractice premiums were commonly seen across the country.(8) They can’t all be correct; or, can they? It appears that for all physician categories premiums increased 15% annually during this period but for some specialties (for example Obstetrics) the increases ranged from 60% to 100%. In addition there have been significant geographic variations in rate changes (during this time frame West Virginia averaged 35% increases). Therefore depending on the specialty focus and geographic areas analyzed estimates could vary significantly. These differences are certainly understandable but also can be quite misleading. Regardless of the figures used the reality is that malpractice premiums having been increasing at three or more times the rate of general inflation. Critics of the health insurance industry contend that malpractice premiums have risen rapidly because of poor investment strategies and not because of litigation. The insurance industry argues it is a response to rising malpractice costs. Whether it’s the result of historically maintaining artificially low rates to compete in the marketplace, low investment earnings, miscalculation of payouts, high malpractice costs or pure price gouging the result is the same—rapidly growing premium rates. Research has demonstrated that 70% of the malpractice suits are either won by physicians are dismissed, or are dropped. When cases do go to trial 80% are won by physicians. (9) However, even in a straightforward tort case the transaction costs may exceed one-third of total expenditures (10) and typically 60% of the award is absorbed by legal fees. (11) The insurance industry claims that the average cost of defending a physician found not guilty of malpractice was $66,767 in 2000. Perhaps the expenses stated above are merely the “tip of the iceberg”. The true cost of malpractice litigation can be found in a practice called defensive medicine. Defensive medicine is when a physician orders tests, interventions or referrals not because they are medically justified but rather to protect themselves in case of future litigation—“a reasonably prudent physician would have ordered X tests but I went the extra mile and ordered X plus tests just to be sure!”. As is the case for all of the data surrounding malpractice litigation the calculations concerning the cost of defensive medicine varies significantly from one study to the next. The most common estimation is that defensive medicine costs society $10 billion annually. (12) However, the CBO found that there was no evidence that limits on tort liability reduces medical spending. (13) Interestingly malpractice premium rates in Florida range from $23,000 to $72,000 per physician while the rates in Florida range from $143,000 to $203,000 per physician. (14) Since California is a model of tort reform there seems to be some evidence that tort reform results in lower malpractice premiums. However these lower premiums are not manifesting in lower costs to society. Either the physicians are pocketing the difference, the cost of malpractice insurance does not influence defensive medicine or the analysis is faulty. Defensive medicine is a difficult issue to address because it is primarily based on anecdotal information. Surveys are conducted asking physicians if the practice defensive medicine and conclusions drawn. Obviously the respondents have a vested interest in the outcomes and may tailor their responses to promote a particular agenda. When comparing physician interventions between geographic locations one might speculate that where additional interventions are common the physicians are practicing defensive medicine. On the other had the additional services provided may be the result of a profit motive and have little to do with defensive medicine. As one can readily see the economic consequence of malpractice litigation is blurred to say the least. THE ETHICAL ISSUE As stated earlier, malpractice awards seem to be based on the extent of injury incurred and not on the degree of negligence. Claims are frequent when no negligent injury appears to have occurred and juries often compensate the plaintiff when the standard of care has been met by the physician. As a society we must ask ourselves if juries are trying to protect the economic well being of a plaintiff at a cost to society as a whole. In other words, regardless of negligence do juries conclude that they have a responsibility to ensure that the injured party has Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 208 sufficient money to live on. When one considers the huge variation in malpractice settlements per physician by state ($250,000 in Illinois versus $55,000 in California) one might question the objectivity of jury awards. (15) The media may be a significant contributor to the misinformation and misinterpretations surrounding malpractice litigation. For example, between 1996 and 1999 various media reported that jury awards had increased more than 76%; and, the number of million dollar settlements doubled from 1999 to 2000! In actuality the number of million dollar settlements went from 27 in 1999 to 54 in 2000 increasing the cost of health care somewhere in the neighborhood of $27 million. When compared to the $2 trillion we spend on health care this is an insignificant amount. But it has wide market appeal, promotes the perception that we are experiencing a “malpractice lottery” and may contribute to frivolous suits. REFERENCES: (1) ________ Bringing Justice to Judicial HellHoles 2003, American Tort Reform Association, position paper. (2) Gray, James “Why did it ever come to this?” Medical Economics, Vol. 75, Iss. 20, pp. 104-116, 1998 (3) Mooney, Sean “Hunter off the mark on cost of product liability, National Underwriter, vol. 909, p25-26, 1995. (4) _______ “U.S. Tort Costs: 2003 Update” Tillingbast-Towers Perrin, position paper 2004. (5)______ “The factors fueling rising healthcare costs” Price Waterhouse Coopers, www.pwcglobal.com, 2002. (6) Mencimer, Stephanie “Malpractice makes perfect” Washington Monthly, Vol. 35, No. 10, pp. 23, Oct. 2003 (7) ______ “Limiting tort liability for medical malpractice”, Congressional Budget Office, www.cbo.gov. 2002 (8) Price Waterhouse Cooper (9) Zobel, Hiller “Why malpractice suits rarely end up costing the doctor” Christian Science Monitor, Vol. 88, Iss. 141, pp. 19, 1996 (10) Carroll, S.J. et.al. “No fault approaches in compensating people injured in auto accidents” Rand Report R4019-ICJ. 1991 (11) ________ “Studying the impact of malpractice laws” DB’s Medical Rants, www.medrantrants.com, 2003 (12) Mooney (13) Congressional Budget Office (14) medrants.com (15) Lankarge, Vicki. “Soaring malpractice premiums bleed doctors, rob consumers” Health Care news, www.heartland.org, Jan. 2002 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 209 THE UTILITY AND EFFECTIVENESS OF TIERED COPAYMENTS FOR HEALTHCARE BENEFITS Michaeline Skiba, Monmouth University ______________________________________________________________________________ ABSTRACT Healthcare organizations utilize a variety of techniques by which the pharmacy benefit is controlled and contained in terms of cost and utilization. Although traditional regulation methods have included prior authorization, formulary exclusions via National Drug Code (NDC) blocks, and cost sharing through dollar and percentage copayments, the steady increase in multitiered copayment designs over the last few years has become a significant development in healthcare administration. This paper will focus on the ramifications of the use of multitiered copayments from a variety of perspectives, including managed care organizations (MCOs), healthcare providers, and patientsconsumers. Of particular importance will be the results of a recent Journal of the American Medical Association (JAMA) study in which researchers from Rand Corporation, Merck, and the California Healthcare Foundation examined whether copayments decrease unnecessary expenditures in healthcare budgets. In addition, the increased use of multitiered copayments will be explored in terms of its effectiveness in both the reduction of drug expenditures and its overall effect on patient compliance. Finally, long-term employer and healthcare administrative concerns will be addressed. ______________________________________________________________________________ BACKGROUND Many U.S. employer-based healthcare administrators have responded to increased healthcare costs and a weakened economy with a tiered copayment system for prescription drug administration as well as hospital and provider services. In essence, the tiered copayment system is predicated on the theory that patients-consumers will be incentivized to choose and utilize more cost effective and efficient healthcare products and services and, in turn, avoid higher copayments for more expensive choices. In a survey conducted by MetLife in the third quarter of 2004, over 1,500 human resources and benefits executives from companies across the country were asked to rank the most important issues facing senior management within their organizations. Not surprisingly, healthcare ranked first, and this number jumped from 54% in 2003 to 87% in 2004 (Anonymous (Anonymous, 2004). In addition, the same survey revealed that only 11% of employers (and 20% of those with Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 210 1,000 or more employees) offer a wellness program and most employers have no plans to introduce a wellness program during the next 18 months (Ibid., 2004). This paper examines how and where tiered copayment systems are utilized, and whether cost efficiencies outweigh such dimensions as quality, access, and compliance. It also examines whether these systems are clinically effective. OVERVIEW Among patients-consumers, the rise in healthcare costs has been most evident and visible in the rising costs of prescription drugs. Tiered or higher copayment levels and coverage limits for high-cost medications are viewed by corporate executives as methods for cost-sharing drug expenditures with employees. Findings from the 2004 and third annual Arxcel Prescription Benefit Research Survey of human resources, compensation, and benefits executives from privately and publicly held companies with 1,000 or more employees revealed that 71% believed increasing employees’ costs through tiered copayments or overall higher copayments would slow down cost increases in prescription drug benefits. However, this rating was lower than the 2003 response of 81.2% (Anonymous, 2004). Chris Robbins, the Chief Executive Officer of Arxcel, remarked that “most employers are already at the 20% cost-sharing level” and “…this potential solution is short-sighted as it only addresses the immediate cost increase and not the fact that prescription benefit cost increases are averaging 15% annually. Shifting the burden to employees is merely a one-time fix and would be even less viable in subsequent years because of the employee backlash that would likely occur should significant cost increases be passed along each year (Ibid., 2004, p. 3). In an effort to understand the factors that affect patient use of and satisfaction with the pharmacy benefits offered by their health plans, researchers chose a stratified random sample of over 700 Houston, Texas-based patients who were surveyed within 72 chain and independent pharmacies. While patients were generally satisfied with their pharmacy benefits, findings relevant to patient out-of-pocket costs showed dissatisfaction – particularly among patients who did not possess adequate knowledge about their plans’ formularies and who were often surprised when their copayments were higher than expected. The researchers commented that “a patient’s motivation to seek information on formularies and drug benefits should not be overlooked by health plan providers…educational interventions developed specifically with respect to the role of formularies to reduce health care costs may increase knowledge and reduce patient skepticism toward such drug management strategies (Sansgiry & Sikri, 2004). Given that in 2002 alone, Americans spent $1.6 trillion on healthcare (an average of $5440 per person, which represents almost 15% of the gross domestic product [GDP]) (Levit et al, 2004), educational interventions may serve to improve both attitudes and certain foreseeable behaviors on the part of patients-consumers. While a notable study indicated that doubling copayments in a typical two-tier drug benefit reduced the use of certain prescription drugs, it also found preliminary evidence of harm to health when patients with some chronic illnesses cut back on medicines (Goldman, et al, 2004). Therefore, patient education alone cannot account for the impact that changes in cost-sharing have on both the response from patients and the Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 211 consequences they incur in the form of emergency room treatments and hospital stays – both of which are more costly than drug therapy. PROVIDERS Less than two years ago, the National Managed Care Forum Advisory Committee of the Healthcare Financial Management Association (HFMA) examined the use of the tiered copayment approach to cost containment among hospitals affiliated with certain large health plans. Among those plans were the following: • Blue Shield of California, which requires extra copayments of $100 or more per admission for its more expensive “affiliated” hospitals versus its “choice” (preferred provider) hospitals, and which is reviewing the tiered concept for its physician groups; • BCBS of Massachusetts has a two-tiered system in which the copayment differential can be $250 more if one chooses a teaching hospital versus a community hospital; • PacifiCare of California, the first plan to market its tiered product in the healthcare market, requires no copayment at certain low-cost hospitals and decides what the copayment will be at other hospitals (from $100 to $400 per day); and • Cigna’s pilot program has two tiers for inpatient and outpatient care based on negotiated discounts with hospitals. Its copayment for tier two is expected to be three times that of the tier one institutions (Anonymous, 2003). As one member of HFMA’s Advisory Committee observed, hospital administrators are concerned that the system may limit access for patients when particular services are available only at certain facilities. In addition, teaching hospitals that offer charity care may feel penalized for fulfilling their mission (Ibid., 2003). A recent special report issued by Managed Healthcare Executive and reported by the Center for Studying Health System Changes (HSC) in May of 2004 illustrates a very different perspective regarding tiered provider networks. It was acknowledged that tiered networks may decrease costs by encouraging patients to use low-cost providers and encouraging providers to become more efficient or accept discounted payment rates in exchange for preferred tier placement. However, HSC “…questions the ability of provider tiers to really cut costs because many of the preferred tiers include most of a network’s providers anyway (Edlin, 2004, p. 1).” According to this same source, physician tiers are not as prevalent because of a lack of reliable cost measures for medical groups and individual physicians who treat few plan patients-consumers; the complexities associated with risk-adjusted criteria; and the confusion arising from low-cost physicians who admit patients-consumers to high-cost hospitals (Ibid., 2004). Another challenge for hospital and physician tiered networks is their measurable demonstration of quality to both health plans and patients-consumers. Prominent healthcare administrators appear to be divided on this issue. PacifiCare Health (PHS) Chief Medical Officer Sam Ho claims that the quality of care under a tiered plan is better, and preventive medicine – from cancer screening to childhood immunizations – is higher by 15% to 20% than in standard plans. In contrast, physicians and hospitals hold a different view. Dr. John C. Nelson, a Salt Lake City Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 212 obstetrician-gynecologist who is also the President of the American Medical Association, believes the methods used to organize and rank doctors within tiers are unreliable, and “…there’s no way to accurately delineate [quality] (Tsao, 2004, p. 3).” In addition to the aforementioned concerns regarding cost savings and the patient-consumer’s responsibilities for the cost and management of their care, Steinbrook questions their effect on health outcomes which are difficult to verify and validate, and which may not reflect the variations among individual patients. He stresses that outcomes require access to complete information and may take years to analyze and complete (Steinbrook, 2004). In spite of the issues mentioned here, the rise in consumer-driven healthcare is slowly emerging as market demand for personal involvement grows in some parts of the country. For example, Blue Cross and Blue Shield of Florida in Jacksonville offers three levels of hospital copayments in its network at the rates of $500, $750, and $1,200. The copayments for teaching, children’s and specialty hospitals will not exceed the second tier because, in some cases, they provide service unavailable elsewhere (Edlin, 2004). This plan appears to be capitalizing on both market demand for quality care and the patient-consumer’s responsibility for keeping their premiums low. PATIENT COMPLIANCE, SATISFACTION, AND COVERAGE As a mechanism for managing and implementing the financing and delivery of healthcare, managed care has evolved from the HMO concept into a complicated mechanism of less intensive and more choice-based systems, particularly in light of consumerism and market demand. Thanks to the evolution of managed care, within the last decade the patient-consumer has wielded increased influence over their healthcare coverage, choice of providers, and overall medical spending. A study conducted by outcomes researchers from Express Scripts, Inc., a pharmacy benefit management company, examined health plan satisfaction among over 14,000 of their company’s commercial health insurance enrollees. Findings indicated that the strongest determinant of satisfaction with the prescription drug benefit was the extent of cost sharing by enrollees, either through copayments or premiums. Interestingly, differences between two-tier and three-tier copayment structures were not perceived negatively. Rather, dramatic changes in benefit designs, such as denial of coverage for a new prescription or a substantial increase in copayments, were cited as factors associated with dissatisfaction (Motheral & Heinle, 2004). Academic studies of the shifting of healthcare costs – particularly, prescription drug costs – continue to be reported in the popular press. Originally published in the New England Journal of Medicine, a study conducted by researchers at Harvard Medical School and Medco Health Solutions Inc. found that patients-consumers will switch to cheaper options when faced with higher copayments (Forelle, 2003). More alarming, however, are the results from a Rand Corporation study that found that as copayments doubled, the use of prescription drugs fell between 17% and 23% among patients with diabetes, asthma and gastric acid disease, and visits Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 213 to emergency rooms rose 17% and hospital stays increase 10% for people with these conditions (Fuhrmans, 2004). Employed patients-consumers are not the only group facing rising healthcare costs and exclusions. The Kaiser Family Foundation and Hewitt Associates study issued in December of 2004 demonstrated the persistent erosion of retiree health benefits among large employers. Among employers with 200 or more workers, 36% offered retiree health benefits in 2004, down from 66% in 1988, and the affected groups will include new hires “…who are less likely to receive any promise of retiree health benefits (Pear, 2004, p. 2).” With the disappearance of retiree health coverage, it appears clear that retirees who have any coverage of any kind will be paying more for it. To reiterate, patients-consumers with chronic conditions will decrease their use of needed medications and incur higher costs to the healthcare system in the form of emergency room treatments and hospitalizations. Regardless of health status, the ramifications of cost shifting will also affect employment prospects for workers who fear the loss of particular health benefits. FUTURE TRENDS While many researchers agree that the implementation of multitiered copayment arrangements are advantageous, this discussion has emphasized the discreet impact such arrangements incur for healthcare organizations (hospitals), providers, and patient-consumers whose available healthcare choices also affect their working and non-working lives. As pointed out by Garber, “Any approach that requires different copayments for different interventions or for different patients may seem too complex to administer and understand today. Not long ago, tiered copayments for medications were criticized on the same grounds, yet they are ubiquitous today. As spending continues to rise, employers, consumers, and health plans will become more willing to explore alternatives to traditional health insurance (Garber, 2004, p. W288).” Although the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 has committed a half a trillion dollars in additional federal funds to Medicare over the next decade, both privately-sponsored and Medicare benefit designs most certainly will face the added challenges of a large aging population and an employed population that feels immobilized by the fear of insurance coverage losses. As mentioned, market demand for more cost-efficient and effective health plan designs will urge healthcare administrators to examine clinical outcomes and quality dimensions with more scrutiny. In fact, this was reiterated by the Community Tracking Study (CTS), which conducts periodic interviews in sixty communities with 60,000 households and 12,000 physicians, and which focuses on twelve representative markets with site visits producing approximately 2,700 interviews with local health system leaders. Recent CTS findings were reported in testimony to the Federal Trade Commission, and part of them included deep skepticism about the ability of market-based reforms to produce needed improvements in the nation’s healthcare system. CTS investigators commented, “as much as these predominantly private-sector leaders dread the prospect of deeper interventions by government, few of them seem to be able to imagine other alternatives (Nichols et al, 2004, p. 8).” The report went on to say that better quality and Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 214 effectiveness data will improve healthcare administration choices but, in any case, the choices will be difficult ones. Inevitably, the rise in healthcare consumerism will give rise to more consumer advocacy. Ron Pollack, director of the advocacy group Families USA, recently commented on the Medicare drug benefit with the following: “We missed a golden opportunity to deal meaningfully with skyrocketing prices when the Medicare legislation was signed into law…For every dollar spent on drugs in the United States, 43 cents is spent on seniors. If you moderate prices for seniors, you moderate drug prices for everyone. But under the Medicare legislation, prices will continue to skyrocket (Zaneski, 2004, p. 1).” Negotiations between the federal government and the pharmaceutical industry may need to be revisited in light of these astute observations. Absent government’s intervention, private industry should examine more creative approaches to healthcare cost shifting on both pharmaceutical and medical benefits. A notably creative example is found in Pitney Bowes Inc.’s unusual strategy. In the third quarter of 2001, the company decreased the amount that its employees pay for diabetes and asthma drugs. Since that time, the median medical cost for a Pitney Bowes employee with diabetes has fallen 12%, and the median cost for a patient with asthma has dropped 15%. In May of 2004, it was projected that the company will save at least $1 million in 2004 alone, with continued savings in future years (Fuhrmans, 2004). By decreasing copayments on necessary medications used to treat these chronic conditions, the company improved compliance and saved expenses associated with fewer emergency room visits, hospital admissions, and doctor’s office visits. Finally, the use of multitiered copayment systems has been and will continue to be designed to rein in soaring healthcare costs. Whether tiering is the most proactive and useful method is questionable and controversial in light of results gleaned from quality and outcomes data. Suzanne Delbanco, the CEO of Leapfrog, a coalition of large healthcare buyers, is optimistic about the use of tiers but cautions insurers and employers to be careful about how quality measures are interpreted with the following: “We could be artificially changing where patients seek care in ways that have nothing to do with what benefits them (Tsao, 2004, p. 1).” REFERENCES Anonymous (2004), “Corporate Executives Weigh Solutions to Rising Drug Costs,” Drug Benefit Trends, 16(7): 351-352. Anonymous (2004), “Health Care Is No. 1 Benefits Concern, Survey Finds,” Workforce Management. Available at www.workforce.com/section/00/article/23/91/63.html. Accessed December 30, 2004. Anonymous (2003), “Tiered Copayment Approach Pushes Cost Decisions to Consumers,” Healthcare Financial Management Association. Available at www.hfma.org/publications/HFMA. Accessed September 13, 2004. Edlin, M. (2004), “Tiers Keep Costs in Tow,” Managed Healthcare Executive, 14(5): 33-35. Fuhrmanns, V. (2004), “A Radical Prescription,” The Wall Street Journal, May 10, 2004, p. R3. Fuhrmans, V. (2004), “Higher Co-Pays May Take Toll on Health,” The Wall Street Journal Online. Available at www.online.wsj.com/article_print/0,,SB108491551729. Accessed January 9, 2004. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 215 Forelle, C. (2003), “’Tiered’ Health Plans May Pose Risk,” The Wall Street Journal, D3. Garber, A.M. (2004), “Cost-Effectiveness and Evidence Evaluation as Criteria For Coverage Policy,” Health Affairs, Jan.-June, W288. Goldman, D.P. et al (2004), “Pharmacy Benefits and the Use of Drugs by the Chronically Ill,” Journal of the American Medical Association, 291: 2344-2350. Levit, K., Smith, C., Cowan, C., et al (2004), “Health Spending Rebound Continues in 2002,” Health Affairs, 23: 147-159. Motheral, B.R. and Heinle, S.M. (2004), “Predictors of Satisfaction of Health Plan Members With Prescription Drug Benefits,” American Journal of Health-Systems Pharmacy, 61(10): 1007-1014. Nichols, L.M. et al (2004), “Are Market Forces Strong Enough to Deliver Efficient Health Care Systems? Confidence Is Waning,” Health Affairs, 23(2): 8-21. Pear, R. (2004), “Retirees Are Paying More for Health Benefits, Study Says,” The New York Times Online. Available at www.nytimes.com/2004/12/15/politics/15health.html. Accessed January 9, 2004. Sansgiry, S.S. and Sikri, S. (2004), “How Patients View Pharmacy Benefit Plans and Management Strategies,” Drug Benefit Trends, 16(7): 380-392. Steinbrook, R. (2004), “The Cost of Admission – Tiered Copayments for Hospital Use,” New England Journal of Medicine. Available at www.nejm.org. Accessed January 9, 2004. Tsao, A. (2004), “A New Level for Tiered Health Care,” BusinessWeek Online. www.businessweekonline.com. Accessed January 7, 2004. Available at Zaneski, C.T. (2004), “Drug Co-Payments Soar as Insurers, Employers Shift Costs to Consumers,” Knight Ridder Tribune Business News, p. 1. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 216 MARKETING METRICS: A PUSH FOR TEACHING THE VALUE OF MARKETING AS AN ASSET Shane D. Smith, University of South Carolina Thomas J. Madden, University of South Carolina ABSTRACT Marketing professionals have always understood the importance of metrics that measure the value of marketing expenditures as an asset (i.e. brand equity). However, while these are often used at operational levels, they rarely reach the level of the boardroom where they compete with those metrics often accepted in accounting and finance. The purpose of this paper is to address the issue of why measures of brand value are not being used in upper level strategic decisions. Once this is addressed, we then explain why marketing educators are the best hope in changing the status of such metrics in the boardroom. INTRODUCTION Marketing professionals have always seen the importance of metrics that will measure the value of marketing expenditures as an asset (i.e. brand equity). However, while these are often used within departments at operational levels, they rarely reach the level of the boardroom where they compete with those metrics often accepted in accounting and finance. The purpose of this paper is to first address the issue of why measures of brand value are not being used in upper level strategic decisions. Once this issue has been solved, the next step is to find a way in disseminating the proper information of the benefits of metrics. As stated above, marketing professionals have for a long time espoused that marketing should be capitalized or treated as an investment on the balance sheet rather than as an expense (Simon and Sullivan 1993, Madden et. al. 2004). However, while accounting practices view the acquisition of new equipment as a cash outlay and a debit to an asset, the expenditure on advertising is looked at as an outlay balanced by a debit to an expense account. Production expenditures are treated as investments while marketing expenditures are treated as expenses. THE PROBLEM IDENTIFIED While marketing professionals may not like these standards, it is difficult for them to respond to such questions such as; what are we investing in (i.e., what is the asset? and how should we measure the return on the capital employed for the investment?). If marketers want the board members to view marketing expenditures in the same light as other expenditures influencing the firm’s value proposition, then marketers must (1) identify the asset to which the investment applies, and (2) identify a set of measures/metrics that will allow board members to assess the returns on the capital allocated to the asset. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 217 The Financial Accounting Statements Board (FASB) statement of concepts No. 6 defines an asset as: "Assets are probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events." Based on this definition an asset that reflects the efficacy of the return to capital employed by marketing is brand equity. The first formal definition of brand equity was provided by David Aaker: "brand equity is a set of brand assets and liabilities linked to a brand, its name and symbol that add to or subtract from the value provided by a product or service to a firm and/or to that of the firm’s customers" (1991 p.16). Board members and corporate officers appreciate the value of strong brands. However, they may be less certain as to a market value of a strong brand or how strong brands are created and maintained. To quote David Bell, Financial Times Chairman "The value of brands as shareholder assets has been widely recognized, but the crucial role of marketing and advertising in building this brand equity and so enhancing these assets now on the balance sheet, is still not fully recognized." (Beenstock 1998, p. 26) To capture brand equity Aaker (1991) recommends, (in addition to quality and other proprietary assets, such as patents, trademarks, etc.), measures such as: brand loyalty, name awareness, perceived quality, and brand associations. These measures of brand equity and their impact upon shareholder value are different from standard accounting valuation of assets. “Accountants still in their nappies are taught about accruals, but that flies out the window where marketing is about. Good marketing may or may not affect sales: it always increases brand equity” (Ambler 1998, p. 24). The Financial and Reporting Standards FRS 10, Goodwill and Intangible Assets, and the International Accounting Standards IAS 38, Intangible Assets, require companies to report the value of acquired brands on the company's annual accounts. FRS 10 allows companies to amortize these acquired brands over a 20 year period (Bartram 2000). FRS 10 allows for acquired brands to be treated separately from goodwill but it does not apply to any brands developed internally. Still, it is a step in the right direction to meaningfully account for the intellectual capital of a business (Batchelor 1999). This advance is not without its cost to marketers. "The standard further stipulates that in such cases annual impairment reviews (in accordance with FRS 11 Impairment of Fixed Assets and Goodwill) must be carried out; the goodwill or intangible asset in question must therefore be capable of measurement (Gowthorpe 2000, p. 74). We return to the ever-present obstacle of measuring the impact of marketing; in this case the market value of the brand. The marketing metrics research project conducted by the London Business School addressed this issue. Tim Ambler, senior fellow at the London Business School, has summarized the 30-month research project studying marketing metrics in his book Marketing and the Bottom Line. He states:" the brief was to report on best practice in marketing performance measurement, to propose improvements and to put forward a shared language." (Ambler 2000 p. 2). Leading examples from this study are awareness, market share and relative price. The results indicate that marketing metrics are collected (% of firms using measure) but at best only 50% of the firms report the measures reaching members of the board. DISSEMINATION OF INFORMATION Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 218 Thus while many can agree that measures of brand equity should be utilized more often in upper level strategic decision making and that we do indeed have the means to measure these values (Aaker 1991 for example), how should this march to the boardroom be accomplished? We suggest that one begins with a grassroots campaign. Similar to a cohort analysis, the techniques and procedures taught to us in graduate programs shape our views. Mention a "Cash Cow," "The CAPM", Porter's "Five Forces Model," and so forth to practicing managers that received an MBA in the last 20 to 30 years they will know exactly what these are, and why they are important or unimportant to the firm. Conjoint analysis is widely used and accepted by marketing managers. Why? These managers have most likely have been exposed to the technique while pursuing their MBA; especially if they took any marketing electives. They are comfortable with the technique and believe in its value. Therefore it may be up to educators to emphasize this knowledge of marketing metrics to students so that it may enter the boardroom as a useful tool. The goal of our research is to assess the value of marketing/brand equity metrics among the academic community; especially for those professors teaching core courses in MBA programs. What are the managers of tomorrow hearing with respect to the value of marketing metrics? The specific question to be addressed by our research is: Do professors teaching MBA students consider marketing measures as being useful for determining the value of a firm? The next question to answer then is ‘Who in academia will lead the charge?’ Can we expect a unified procession of MBA professors to make this emphasis in their teachings? The following study looks at the belief of using such brand equity measures of MBA professors. It is here where we will find who should be responsible in initiating this push. THE STUDY Measurement The metrics surveyed in our study are a combination of the items used by Brand Finance and those identified by the London Business School’s Marketing Metrics Project. These items are provided in Table 1. Subjects were asked: “In your opinion, how useful are the following measures for determining the value of a firm.” The response categories were: Extremely Useful, Very Useful, Somewhat Useful, Not Very Useful, Not At All Useful, Not Useful and In Fact Misleading, and Not Sure. Items such as brand awareness, brand image, customer loyalty, customer satisfaction, perceived quality and price premium are considered as measures of brand equity. Sample and Procedure. A one page questionnaire, along with a prepaid return envelope, was sent to professors, who taught the core course in accounting, finance or marketing at institutions rated as being one of the top 125 MBA programs. Two weeks after the initial mailing, a reminder letter with Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 219 TABLE 1 TOP BOX SCORES BY ACADEMIC AREA Metric* Total Accounting Area Finance Marketing Significance** (p-Value) Brand Relationship Price Premium Customer Loyalty Number New Products Advertising Effectiveness Brand Image Employee Satisfaction Growth Share Customer Satisfaction Dollar Share Quality Volume Share Brand Awareness Advertising Expenditure 57.3 38.7 38.1 33.3 33.3 28.8 27.2 26.6 24.8 24.0 22.2 21.5 18.5 14.4 59.1 51.7 25.0 34.4 43.3 21.9 30.0 37.5 18.8 25.8 9.7 30.0 9.4 12.9 41.7 27.3 15.6 43.8 38.7 12.5 24.2 30.3 18.8 22.6 18.2 21.9 16.1 18.8 64.0 38.7 56.5 27.4 25.8 41.0 27.4 18.6 31.1 23.7 30.6 16.9 24.6 12.9 .053 .302 .000 .545 .255 .029 .434 .303 .331 .991 .080 .045 .292 .446 *The metrics were listed alphabetically on the questionnaire. **The significance (p-value) is based on the 3x3 table, response (very useful, useful, and not useful) by area (accounting, finance, and marketing); however, for simplification only responses for the top-box (very useful) are shown. another questionnaire and return envelope was sent to all the professors. A postal coupon was included for all professors residing outside The United States. Questionnaires were sent to 114 accounting professors, 120 finance professors, and 116 marketing professors: In total, 132 questionnaires were returned for a response rate of 38%. Respondents who returned comments, but did not complete the questionnaire, were culled from further analyses. The sample used for analysis contained 32 responses from accounting (28% response), 33 responses from finance (28% response), and 62 from marketing (54% response). RESULTS Assessing Differences The question of interest is whether there are differences among the three academic areas (accounting, finance, and marketing) regarding the usefulness of the marketing measures. The Brand Finance survey results (See Table 1) reported the percentage of top-box and top-two box scores. In an analogous fashion, we re-coded the data. Responses to each item were categorized into one of three levels: very useful, useful, and not useful. For most items, the top-box (score of 7) identified the very useful category, a score of 6 represented useful and scores between 2 and 5 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 220 represented not useful. A category of “not sure” was included as a response to each of the items. These responses were treated as missing data. The top-box scores (percent of respondent’s rating a metric “very useful”) for the sample of MBA professors are provided in Table 1. Brand Relationships has the largest top box score (57.1%). Price premium and customer loyalty followed brand relationship in importance, with top box scores of 38.7% and 38.1%, respectively. The items receiving the lowest top-box scores were: advertising expenditure (14.4%), and brand awareness (18.5%). The low top-box score for brand awareness was not expected. In Keller’s model of brand equity (1993) the two drivers of brand equity are brand awareness and brand associations. The other measures received a top-box score of at least 20 percent. As a group, the sample of professors did not rate the marketing metrics as being very useful for determining the value of a firm. Only the one measure, brand relationships had a top box score in excess of forty percent. To assess differences among the academic area with respect to the usefulness of the marketing measures, a chi-square statistic was calculated for the crosstabulations between the marketing metrics and the academic areas. Statistically significant differences (p<.05) were found for four measures: customer loyalty (p=.000), brand image (p=.029), volume share (p=.045) and brand relationships (p=.053). Except for volume share, the marketing professors were more likely to rate the items as useful. One might expect the marketing professors to rate the brand equity items as more useful; however, even for this group only two items (brand relationships and customer loyalty) received scores in excess of 50% for very useful. Therefore, while some professors with an academic area may view the measures as useful (or not useful) others do not. We now turn to a categorical clustering procedure, latent structure analysis, to search for groups of people with similar response patterns regardless of academic area. Latent Profiles The analyses thus far have assessed differences based on an, a priori, classification into one of the three academic areas. We now drop the, a priori, assignment and use the responses to the brand equity items as input to the LADI program to identify latent profiles of responses. LADI (Dillon and Mulani 1989) is a latent structure (cf Lazarsfeld and Henry 1968) clustering procedure and falls under the heading of Latent Mixture Models. Unlike many traditional clustering procedures, LADI uses a “fuzzy”-set logic to assign observations to the latent clusters. Each observation is assigned a probability of belonging to a cluster rather than a zero or one assignment. Each person (observation) is assigned a recruitment probability of belonging to a cluster based on the similarity of the person's responses to the average of the cluster's responses. These recruitment probabilities sum to unity and represent the probability that the individual belongs to each latent class. Therefore, the larger the recruitment probability, the greater the likelihood of the individual belonging to the identified latent class. The LADI program creates clusters using maximum likelihood estimates of mixing parameters and structural parameters. Factor loadings and goodness of fit heuristics aide in this Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 221 selection and a four cluster solution was chosen as indicated by using a chi-square difference test. Inspection of the mixing parameters indicates that cluster two is the largest with approximately 44% of the respondents. The sizes of the other clusters are: one = 12.6%, three = 14.96% and four = 28.35 percent. The structural parameters for the four cluster solution are provided in Table 2. These estimates are conditional probabilities; the probability of responding to a specific level of an item given that you are in a latent class. For example, consider the third item brand awareness. For the entire sample the probability of responding very useful was 18.55 percent. The conditional probability of responding very useful given membership in one of the four latent classes ranges from a high of 68.75 percent for cluster one to a low of 0.0 percent for cluster four. Consequently, those respondents in cluster one view brand awareness as a very useful metric, whereas those in cluster four do not. Similar to the use of loadings in factor analytic models, the structural parameters are used to interpret, or provide meaning, to the latent clusters. We label cluster one as the “Brand Currency” cluster. By comparing the conditional probability of responding very useful given membership in cluster one to the sample probability of responding very useful we can see these people place a greater value on the usefulness of the marketing metrics. Alternatively, people recruited into cluster three are more likely to respond very useful to market share measures. We label this cluster as “Product Currencies.” Earlier we quoted Tim Ambler as saying “good marketing may or may not affect sales; it always increases brand equity.” Our label “Product Currencies’ refers to sales type measures; whereas “Brand Currencies” refers to brand equity type measures. Cluster four is labeled “skeptics.” People in this cluster are more likely to rate the brand equity measures as not useful. The responses from people in cluster one and cluster four are basically contrary; those in cluster one view the marketing metrics as useful, those in cluster four do not. Latent class two is the largest cluster, and therefore, as might be expected, responses are the most similar to the entire sample. People in cluster two are more likely to rate the measures as being useful when compared to the people in cluster three and four but not cluster one. The means and standard deviations for the recruitment probabilities for the four latent classes are provided in Table 3. These recruitment probabilities reflect how sure we are that the observation was placed in the correct latent class. If the recruitment probability for, say class one, was 90 percent, then the sum of the probabilities for the other three classes is only a 10 percent. The results show a very good assignment. We now look at the crosstabulation between a person’s academic area and assignment into one of the four latent classes (see Table 4). The chi-square value for the crosstabulation is chi-square =10.26 with 6 degrees of freedom, yielding a p-value of .11. Therefore the null hypothesis of no association is not rejected. The interpretation being that knowledge of academic area does not provide information as to the latent profile of responses to the brand equity items. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 222 TABLE 2 Structural Parameters For the Four Cluster Solution Item Ad Effectiveness Not Useful Useful Very Useful Ad Expenditure Not Useful Useful Very Useful Brand Awareness Not Useful Useful Very Useful Brand Image Not Useful Useful Very Useful Brand Relationships Not Useful Useful Very Useful Customer Loyalty Not Useful Useful Very Useful Customer Satisfaction Not Useful Useful Very Useful Dollar Share Not Useful Useful Very Useful Employee Satisfaction Not Useful Useful 1 Latent Classes 2 3 4 23.58% 18.75% 12.73% 43.09% 56.25% 38.18% 33.33% 25.00% 49.09% 11.11% 50.00% 50.00% 41.18% 38.89% 8.82% 42.40% 56.25% 29.09% 43.20% 18.75% 58.18% 14.40% 25.00% 12.73% 21.05% 68.57% 47.37% 28.57% 31.58% 2.86% 38.71% 25.00% 21.43% 42.74% 6.25% 62.50% 18.55% 68.75% 16.07% 21.05% 84.85% 63.16% 15.15% 15.79% 0.00% 27.20% 6.25% 0.00% 44.00% 12.50% 67.86% 28.80% 81.25% 32.14% 26.32% 82.35% 52.63% 14.71% 21.05% 2.94% 14.58% 0.00% 2.33% 28.13% 14.29% 16.28% 57.29% 85.71% 81.40% 25.00% 39.13% 37.50% 52.17% 37.50% 8.70% 20.63% 6.25% 0.00% 41.27% 25.00% 44.64% 38.10% 68.75% 55.36% 15.79% 62.86% 63.16% 31.43% 21.05% 5.71% 26.40% 0.00% 14.29% 48.80% 25.00% 69.64% 24.80% 75.00% 16.07% 5.26% 70.59% 68.42% 14.71% 26.32% 14.71% 32.23% 6.25% 38.89% 0.00% 50.00% 43.80% 56.25% 51.85% 0.00% 47.06% 23.97% 37.50% 9.26% 100.00% 2.94% 26.40% 31.25% 17.86% 46.40% 0.00% 57.14% 5.56% 48.57% 77.78% 34.29% Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 223 Very Useful Growth Share Not Useful Useful Very Useful New Products Not Useful Useful Very Useful Perceived Quality Not Useful Useful Very Useful Price Premium Not Useful Useful Very Useful Volume Share Not Useful Useful Very Useful 27.20% 68.75% 25.00% 16.67% 17.14% 33.87% 56.25% 34.55% 0.00% 40.00% 39.52% 18.75% 52.73% 0.00% 48.57% 26.61% 25.00% 12.73% 100.00% 11.43% 24.60% 43.75% 19.64% 42.06% 6.25% 57.14% 33.33% 50.00% 23.21% 15.79% 28.57% 26.32% 42.86% 57.89% 28.57% 34.13% 0.00% 21.82% 43.65% 37.50% 58.18% 22.22% 62.50% 20.00% 15.79% 77.78% 47.37% 22.22% 36.84% 0.00% 20.97% 20.00% 16.36% 40.32% 26.67% 49.09% 38.71% 53.33% 34.55% 21.05% 42.86% 21.05% 42.86% 57.89% 28.57% 42.98% 46.67% 44.44% 35.54% 33.33% 46.30% 21.49% 20.00% 9.26% 0.00% 61.76% 16.67% 29.41% 83.33% 8.82% TABLE 3 Descriptive Statistics for Recruitment Probabilities I Mean Standard Deviation Number .90 .14 16 Latent Class II .98 .004 56 III IV .94 .12 19 .99 .002 36 Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 224 TABLE 4 Cross-classification of Latent Class Membership and Academic Area Latent Class Academic Area 1.00 2.00 3.00 4.00 Total Accounting 3 18.8% 11 19.6% 8 42.1% 10 27.8% 32 25.2% Finance 2 12.5% 13 23.2% 6 31.6% 12 33.3% 33 26.0% Marketing 11 68.8% 32 57.1% 5 26.3% 14 38.9% 62 48.8% Total 16 100.0% 56 100.0% 19 100.0% 36 100.0% 127 100.0% In Table 4 the first number in each cell shows the actual count. The second number is the conditional probability of being in a latent class, given an academic area. For example, consider cell (1,1). The actual count is 3; therefore three of the accounting faculty were recruited in cluster 1, the brand currency cluster. The second number (18.75%) indicates that of the 16 people recruited into cluster 1, 18.75% are accounting professors. Although the majority of the “brand currency” class comes from marketing (68.8%), close to one third of the people reporting very useful to the brand equity items are accounting or finance professors. The make up of cluster three, the “product currency cluster” is somewhat different. Here the accounting professors, are the majority, while the marketing professors are the minority. Cluster two, the largest cluster, pretty much matches the distribution of the academic areas. Cluster 4, the negative cluster contains approximately the same number from each academic area. However, one must remember that approximately half of the sample (49%) is marketing professors. DISCUSSION The results of our survey are similar to those of the Brand Finance survey. The brand equity metrics are not seen as being very useful for determining the value of a firm. We presume they have some value, but what is it? The marketing metrics project indicated that the measures are collected but not communicated to the board. Are they simply useful for the day-to-day managing of the brand? Clearly any firm that scores better on any of the measures should be more valuable. Would you, ceteris paribus, ever pay more for a firm with lower customer loyalty or perceived quality? Clearly not! But when asked, people do not report these as being valuable for determining the value of the firm. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 225 This may seem like heresy to a marketing audience, but maybe the first step is to develop an MASB-- the Marketing Accounting Standards Board. If marketers want their beans to count and be counted, they have to develop a standard and universally accepted set of marketing metrics, (MSI has recognized the area of marketing metrics as one of their two gold research areas). "A metric is a performance measure that top management should review … Metrics is not just another word for measure: metrics should be necessary (i.e. the company cannot do without them), precise, consistent and sufficient (i.e. comprehensive) for review (Ambler 2000 p.5). Having a set of metrics that is recognized by the board will get the board to spend more time scrutinizing the marketing effort. The addition of the above suggestion and the advancement of today’s brand value measures are great improvements as tools to implement these metrics into the boardroom. However, the mere existence of these tools is not enough to ensure that management will use them beyond their daily operations. The ingrained use of existing financial tools is too entrenched for an immediate change to occur. What is needed is a place to plant a seed of appreciation for these metrics in tomorrow’s executives in order for the metrics to be more accepted over time. An emphasis from academics is the best means possible for this task. The training of MBA students to utilize measurement tools has a large effect later in their careers. While these students will also face corporate inertia from current boardroom measures, the dissemination of these brand measures will improve the likelihood of use in the future. Unfortunately, as we have seen from our study it appears that the marketing educators will be battling this task alone if only at first as academics from accounting and finance departments do not share similar viewpoints…yet. REFERENCES Aaker, David A. (1991) Managing Brand Equity: Capitalizing on the Value of a Brand Name, New York: The Free Press. Ambler, Tim (1998) “Advertising and Profit Growth,” Admap (384), 20-24. __________ (2000) Marketing and The Bottom Line: The New Metrics of Corporate Wealth, London: Prentice Hall. Bartram, Peter (2000) “Brand power,” Management Accounting: Magazine for Chartered Management Accountants 78(6),16-18. Batchelor, Alex (1999) “Is the balance sheet outdated?” Accountancy 123(1266), 81-84. Beenstock, Sue (1998) “Raising Brands’ Stock in the City,” Marketing 26(November), 26-27. Dillon, William R. and Narendra Mulani (1989) “LADI: A Latent Discriminant Model for Analyzing Marketing Research Data,” Journal of Marketing Research 26(1),15-29. Gowthorpe, Catherine (2000) “Keeping up with the Standards,” Financial Management (CIMA) (May),75-77. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 226 Keller, Kevin Lane (1993) “Conceptualizing, Measuring, Managing Customer-Based Brand Equity,” Journal of Marketing 57(1),1-22. Madden, Thomas J., Frank Fehle and Susan M. Fournier (2004) “Brands Matter: An Empirical Demonstration of the Creation of Shareholder Value through Brands,” Journal of Academy of Marketing Sciences (Under Review). Simon, Carol J. and Mary W. Sullivan (1993) “The Measurement and Determinants of Brand Equity: A Financial Approach,” Marketing Science 12(Winter), 28-52. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 227 TOP MANAGEMENT ATTITUDE AND INTERORGANIZATIONAL LEARNINIG: THE MODERATING EFFECT OF ENVIRONMENTAL UNCERTAINTY Prashant Srivastava, Oklahoma State University Gary L. Frankwick, Oklahoma State University ABSTRACT A framework is developed for organizational learning in alliance based context. Transparency, intent, and receptivity are identified as factors affecting interorganizational learning in alliances. Affect of top management attitude toward learning on intent and receptivity is discussed. Also, how environmental uncertainty affects the relationship between top management attitude toward leaning and intent, and top management attitude toward learning and receptivity is discussed. INTRODUCTION During the last two decades the world economy has come across an extraordinary transformation. Intensified global competition and reorganization of economic boundaries have significantly shortened the product and process lifecycles forcing firms to develop a continuous stream of innovation (Achrol 1991). To be successful, organizations must not only process information but also acquire and create new information and knowledge. Stata (1991) stated that organizational learning may be the only competitive advantage for firms in the future. Organizational learning is a very well researched area in management and marketing. Many researchers have discussed organizational learning in many different contexts. Slater and Narver (1995) examined the effect of market orientation on organizational learning and performance. Hamel (1991), Inkpen (1998, 2000), and Hamel and Prahalad (1993) looked at organizational learning in alliance based context. Crossan et. al. (1999) discuss the process of organizational learning. Argyris (1976), Argyris and Schon (1978), and Senge (1990) examined the single loop (adaptive) and double loop (generative) learning process. Miller (1996) discusses many different modes of organizational learning. However, to our knowledge, no study has looked at the effect of top management attitude on organizational learning under varying environmental conditions. The focus of this paper is on the conditions fostering or hampering interorganizational learning in an alliance based context. This paper presents a framework of interorganizational learning in uncertain environments by integrating it with strategic alliances. First, we define strategic alliances, reasons for forming alliances, and then we define interorganizational learning and how it is affected by top management attitude. We also propose that the relationship between top management attitude and interorganizational learning is moderated by environmental uncertainty. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 228 CONCEPTUAL FRAMEWORK Strategic Alliances. Strategic alliance involves the pooling of specific resources and skills by the cooperating organizations in order to achieve common goals, as well as the goals specific to the individual partners. Given limited resources and capabilities, each partner firm seeks to leverage them through transferring them to and from its connected relationships striving toward the complementarity of its activities across the various connected relationships (Hamel and Prahalad 1993). Parkhe (1993) defines strategic alliances as, “Relatively enduring interfirm cooperative arrangements, involving flows and linkages that utilize resources and/or governance structure from autonomous organizations, for the joint accomplishments of individual goals linked to the corporate mission of each sponsoring firm” (p. 795). Gaining access to new markets, accelerating the pace of entry into new markets, sharing of research and development, manufacturing, and/or marketing costs, broadening the product line/filling product line gaps, protecting competitive position in the home market, reducing potential threat of future competition, raising entry barriers, overcoming entry barriers, enhancing resource use efficiency, extending resources, and learning new skills are among the motives underlying the entry of firms into strategic alliances (Varadarajan & Cunningham 1995). The various theoretical frameworks advanced to explain the evolution of strategic alliances suggest that market uncertainty, drive for increased efficiency, resource dependence, skills and resource heterogeneity, and imperfect factor markets drive firms to form alliances in their quest for competitive advantage. Webster (1992) notes that “there are multiple types of strategic alliances, virtually all are within the theoretical domain of marketing as they involve partnerships with customers or resellers or with real or potential competitors for the development of new technology, new products and new markets” (p. 8). Alliances are an economical and flexible way to cope with increasing market turbulence, uncertainty and scope (Day 1995). There are many benefits of alliances but these benefits are not cost free. Some identified costs by Varadarajan and Cunningham (1995) are (1) the time spent by management to negotiate, implement, and integrate the alliance; (2) the loss of flexibility and freedom of action in the areas of joint interest; (3) leakage of proprietary knowledge to the alliance partner; (4) the atrophying of firm capabilities in areas of alliance activity that have been given up to the partner. Inkpen (1998) notes that the formation of an alliance is an acknowledgement that the alliance partner has useful knowledge. If the knowledge were not useful, there would be no reason to form a learning alliance. Organizational Leaning. In bringing together firms with different skills and knowledge bases, alliances create unique learning opportunities for the partner firms (Inkpen 1998). “Organizational leaning is the acquisition of new knowledge by the actors who are able and willing to apply that knowledge in making decisions or influencing others in the organization” (Miller 1996, pg 486). Organizational learning is both a function of access to new knowledge and the capabilities for using and building on such knowledge. Miller (1996) describes six modes of learning such as analytical, synthetic, experimental, interactive, structural, and institutional. In an alliance based context, interactive learning most commonly occurs. In interactive learning, learning occurs by the exchange of information and evaluation of transactions that reveal the motives, resolve, and resources of rivals and allies within and outside Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 229 the organization. A strength of interactive learning is that it allows managers to exchange a good deal of information with one another which fosters more realistic collaboration (Miller 1996). There are many types and processes of learning discussed in the literature (Argyris 1976, Cohen and Levinthal 1990, Crossan, Lane and White 1999). Single-loop learning (Argyris 1976) is the activity which adds to the knowledge base, or firm-specific competence, or routines of the firm without altering the nature of the activity. This is analogous to adaptive learning as described by Senge (1990). Generative learning (Senge 1990), which is analogous to double-loop learning (Argyris 1976), requires new ways of looking at the world in understanding customers and competitors. This occurs when the organization is willing to question long held assumptions about its missions, customers, capabilities, or strategy (Slater and Narver 1995). Inter-organizational learning can be achieved by transferring existing knowledge from one partner firm to another partner firm, as well as by creating completely new knowledge through interaction among the firms. Perceived Transparency. This also can be termed as openness of the firm to its alliance partner. Asymmetry in transparency pre-ordains asymmetric learning (Hamel 1991). Some firms and some skills may be inherently more transparent than others. Transparency can be influenced through the design of organizational interfaces, the structure of joint tasks and the protectiveness of individual partners. Since knowledge and skills are considered as power, it is not surprising to find firms protecting their transfer to alliance partners particularly when the embodied knowledge or skill is explicit (Hamel 1991). Alliance partners can adopt explicit measures to protect the transparency of their competencies. The nature of partner interactions may range from operational information exchange necessary to run the alliance to the sharing of more strategic information. Openness in the relationship should be a key element in determining the amount of information shared (Inkpen 2000). Inkpen (2000) defines openness as the willingness and ability of the alliance partner to share information and communicate openly. Transparency also depends on the tacitness, specificity, and complexity of knowledge or skill. Tacitness is the implicit and non-codifiable accumulation of skills that results from learning by doing. The degree of tacitness of a particular competency or skill influences transfer outcomes (Simonin 1999). Tacit knowledge is not easily visible and hard to formalize, making it difficult to communicate or share with others. In contrast, explicit knowledge is systematic and easily communicated in the form of hard data or codified procedure (Inkpen 1998). Specificity refers to the transaction specific skills and assets (Simonin 1999). The main issue is the ease with which a skill and asset can be redeployed to alternative uses and by alternative users without loss of productive value. Complexity refers to the number of independent routines, individuals, technologies, and resources linked to a particular knowledge, skill or asset (Simonin 1999). Complexity impairs comprehending the totality of a skill and prevents its transferability. (Figure 1 presents this relationship graphically as the link from perceived transparency of partner to organizational learning). Intent. The objectives of alliance partners, with respect to inter-partner learning and competence acquisition, may be usefully characterized as internalization or substitution (Hamel 1991). An internalization intent will be strongest in firms which conceive of competitiveness as Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 230 competence-based, rather than as product-based, and seek to close skill gaps rather than to compensate for skills failure. Organizational learning will occur when the partner firm has internalization intent. The intent to internalize also depends on the management’s perception about the payoff of learning. Internalization intent is strongest when the skill to be acquired from the partner is seen as critical to the growth of the entire company, and not just the competitiveness of a single product or business (Hamel 1991). A substitution intent pre-ordains asymmetric learning, and for systematic learning to take place, operators must possess an internalization intent. In an alliance based context, very little or no organizational learning will occur if a firm has a substitution intent as the firm will be seeing the alliance partner only as a substitute for its lack of skills. A firm with no ambition beyond investment avoidance and substitution of its partner’s competitiveness for its own lack of competitiveness may be perfectly content not to learn from its partner. The perceived pay-off to learning is influenced by a partner’s calculation of the cost of continued dependence. An internalization intent and substitution intent can be placed on the two ends of a continuum. Receptivity. Receptivity is the ability of a firm to actually absorb skills from its alliance partners (Hamel 1991). This is similar to absorptive capacity as discussed by Cohen and Levinthal (1990) and knowledge acquisition effectiveness discussed by Inkpen (2000). Receptivity is the ability to recognize and assimilate valuable knowledge from a particular alliance partner. Some organizations may lack the capacity to learn and some firms may be inherently more receptive than others. Asymmetry in receptivity pre-ordains asymmetric learning (Hamel 1991). Top Management Attitude toward Learning. The management of knowledge has become an important role of top management (Prahalad and Hamel 1994). To be successful, organizations must not only process information but also acquire and create new information and knowledge. Firms purposefully adopt structures and strategies to encourage learning. They are not totally reactive, and can proactively seek to influence the environment in which they learn (Dodgson 1993). Firms that purposefully construct structures and strategies so as to enhance and maximize organizational learning have been termed as learning organizations. Pedler, Boydell, & Burgoyen (1989) define it as an organization which facilitates the learning of all its members and continually transforms itself. A Learning organization has a climate in which individual members are encouraged to learn and to develop to their full potential. It is an instilled attitude toward learning. Attitudes are leaned states that influence the choice of personal action the individual makes towards persons, objects or events (Dodgson 1993). A long-term orientation of top management will have a significant effect on the intent of learning. Based on the top management’s attitude toward learning, in some alliances, partners aggressively seek to acquire knowledge and skills where as in others, the partners take a more passive approach to knowledge acquisition and learning. Based on the above explanation, an organization may adopt the philosophy of generative learning rather than adaptive learning depending on top management’s attitude. This will ultimately affect the intent of the organization and will result in internalization (learning) of skills rather than substitution of skills (Figure 1 presents this relationship graphically). Hence we propose: Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 231 Proposition 1: A positive top management attitude toward learning will lead to higher internalization intent and lower substitution intent for learning. Also, if the top management has a positive attitude toward learning, it will allocate more resources and will invest to increase receptivity (absorptive capacity), and give support for higher organizational learning. Hence we propose: Proposition 2: A positive top management attitude toward learning will lead to higher receptivity for learning. Market Turbulence P4 P3 Intent (i) Substitution (ii) Internalization P1 Top Management Attitude toward Learning Perceived Transparency of Partner Organizational Learning P2 P5 P6 Receptivity Technological Turbulence Figure 1 Environmental Uncertainty. In the face of major discontinuities in the environment, firms are likely to find themselves lacking in the broader set of skills and resources needed to effectively compete in the changing marketplace and, hence, demonstrate a greater propensity to enter into alliances with firms possessing complementary resources and skills (Varadarajan and Cunningham 1995). Environmental uncertainty as defined by Milliken (1987) is the perceived inability of an organization’s key managers to accurately assess the external environment of the organization or the future changes that might occur in that environment. Uncertainty results from scarcity and environmental fluctuations. According to resource dependence theory (Pfeffer and Salancik, 1978), interorganizational exchange arises from uncertainty regarding the availability of productive inputs and markets for finished goods (demand). The scarcity of Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 232 resources increases uncertainty about the availability of both the supply of inputs and demand for outputs. In other words, uncertainty exists when and organization is unable to assign a subjective probability to the outcome of its actions (Keister 1999). Hence, environmental uncertainty may be defined as external dynamism and unpredictability. It has two prominent dimensions, market turbulence and technological turbulence. The task environment, i.e. conditions external to the firm, affects the organization’s internal behaviors and functioning. The market turbulence dimension specifies the changes in the composition of customers and their preferences (Kohli and Jaworski 1990). Technological turbulence, on the other hand, is the rate of technological change in a given market (Kohli and Jaworski 1990). Technological turbulence specifies the amount and unpredictability of change in production, process, or service technologies. Uncertainty in the form of frequent changes in technology or market preferences requires organizations to adjust to those changes. Technological complexity and volatility have been found to be associated with the formation of alliances (Hagedoorn 1993). When market turbulence is high, i.e. the changes in the composition of customers and their preferences is frequent, though the top management attitude toward learning might be high, firms will have higher substitution intent than internalization intent as it takes time and other resources to internalize a skill and exploit it. In high market turbulence, markets may change by the time a firm internalizes and exploits the skill from its partner. Hence we propose: Proposition 3: The relationship between top management attitude toward learning and intent for learning will be moderated by market turbulence such that when market turbulence is high, it will lead to lower internalization intent and higher substitution intent. Also when the market turbulence is high, though the attitude of top management toward learning might be positive, it may not allocate sufficient resources for receptivity of the skills. Hence we propose: Proposition 4: The relationship between top management attitude toward learning and receptivity will be moderated by market turbulence such that when market turbulence is high, receptivity will be low, though the top management attitude toward learning might be high. Similarly, when the technological turbulence is high, i.e. the change in production, process, or service technologies is frequent, firms will have higher substitution intent than internalization intent as it takes time and other resources to internalize a skill and exploit it. In high technological turbulence, technology may change by the time a firm internalizes and exploits the skill from its partner. Hence we propose: Proposition 5: The relationship between top management attitude toward learning and intent for learning will be moderated by technological turbulence such that when technological turbulence is high, it will lead to lower internalization intent and higher substitution intent. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 233 When technological turbulence is high, though the attitude of top management is positive toward learning, it may not allocate sufficient resources for receptivity of the skills. Hence we propose: Proposition 6: The relationship between top management attitude toward learning and receptivity will be moderated by technological turbulence such that when technological turbulence is high, receptivity will be low, though the top management attitude toward learning might be high. DISCUSSION AND IMPLICATIONS It is evident that alliances present a good learning opportunity for partner firms and to gain competitive advantage. However, interorganizational learning hinges on the ability of the firm to internalize and exploit different types of knowledge. This also depends on the receptivity of the firm and transparency of the partner firm. Strategic alliances are an important means to achieve this objective and alliances can create effective win-win situations for everyone involved. This paper proposes that in high environmental uncertainty condition, the relationship between top management attitude and intent, and top management attitude and receptivity is moderated by market and technological turbulence. This paper contributes to the literature by examining the importance of top management attitude toward learning to interorganizational learning for firms in an alliance. An important contribution of this will be, measuring the effect of environmental uncertainty on the relationship between top management attitude and organizational learning. CONCLUSION This study addresses the question of differing alliance successes based on organizational learning in different external environmental situations. If our propositions are supported, it will provide support to the importance of top management attitude toward learning on the intent and receptivity of organizational learning. It will also show that environmental uncertainty affects the relationship between top management attitude toward learning and intent and receptivity. It may help researchers and managers to make useful distinctions in examining the sources and facilitators of organizational learning. Through the framework and propositions we hope to encourage future research and facilitate greater managerial understanding. There are no measures available for some of the constructs. Developing and testing measures for these constructs would be an important aspect of future research. Future research may also investigate the hierarchical relationship between intent, receptivity, and transparency. Future research may also investigate the effect of trust between organizations on some aspect of transparency for organizational learning. REFERENCES Achrol, Ravi S. (1991), “Evolution of the Marketing Organization: New Forms of Turbulent Environment,” Journal of Marketing, 55 (4), 77-93. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 234 Argyris, Chris (1976), “Single Loop and Double Loop Models in Research on Decision Making,” Administrative Science Quarterly, 21 (September), 363-375. Argyris, C. and D. A. Schon (1978), Organizational Learning: A Theory of Action Perspective, Reading, MA: Addison-Wesley. Cohen, Wesley M. and Daniel A. Levinthal (1990), “Absorptive Capacity: A New Perspective on Learning and Innovation,” Administrative Science Quarterly, 35 (March), 128-152. Crossan, Mary M., Henry W. Lane, and Roderick E. White (1999), “An Organizational Learning Framework: From Intuition to Institution,” Academy of Management Review, 24 (3), 522537. Day, George S. (1995), “Advantageous Alliances,” Journal of Academy of Marketing Science, 23 (4), 297-300. Dickson, Pat H. and K. Mark Weaver (1997), “Environmental Determinants and IndividualLevel Moderators of Alliance Use,” Academy of Management Journal, 40 (2), 404-425. Dodgson, Mark (1993), “Organizational Learning: A Review of Some Literatures,” Organization Studies, 14 (3), 375-194. Doz, Yves L. (1996), “The Evolution of Cooperation in Strategic Alliances: Initial Conditions or Learning Process,” Strategic Management Journal, 17, 55-83. Hagedoorn, J. (1993), “Understanding the Rationale of Strategic Technology Partnering: Interorganizational Modes of Cooperation and Sectoral Differences,” Strategic Management Journal, 14, 371-385. Hamel, Gary (1991), “Competition for Competence and Inter-Partner Learning within International Strategic Alliances,” Strategic Management Journal, 12, 83-103. Hamel, Gary and C. K. Prahalad (1993), “Strategy as Stretch and Leverage,” Harvard Business Review, 71 (March-April), 75-84. Inkpen, Andrew C. (1998), “Learning, Knowledge Acquisition, and Strategic Alliances,” European Management Journal, 16 (2), 223-229. Inkpen, Andrew C. (2000), “Learning Through joint Ventures: A Framework of Knowledge Acquisition,” Journal of Management Studies, 37 (7), 1019-1045. Keister, Lisa A. (1999), “Where Do Strong Ties Come From? A Dyad Analysis of The Strength of Interfirm Exchange Relationships During China’s Economic Transition,” The International Journal of Organizational Analysis, 7 (1), 5-24. Kohli, Ajay and Bernard J. Jaworski (1990), “Market Orientation: The Construct, Research Propositions, and Managerial Implications,” Journal of Marketing, 54 (2), 1-18. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 235 Levinthal, Daniel A. and James G. March (1993), “The Myopia of Learning,” Strategic Management Journal, 14 (Winter), 95-112. Miller, Danny (1996), “A Preliminary Typology of Organizational Learning: Synthesizing the Literature,” Journal of Management, 22 (3), 485-516. Milliken, Frances J. (1987), “Three Types of Perceived Uncertainty About the Environment: State, Effect, and Response Uncertainty,” Academy of Management Review, 12, 133-143. Parkhe, Arvind (1993), “Strategic Alliance Structuring: A Game Theoretic Approach and Transaction Cost Examination of Interfirm Cooperation,” Academy of Management Journal, 36 (4), 794-829. Pedler, M, T. Boydell, and J. Burgoyen (1989), “Toward the Learning Company,” Management Education and Development, 20 (1), 1-8. Pfeffer, Jeffrey and Gerald Salancik (1978), The External Control of Organizations: A Resource Perspective, New York: Harper and Row. Prahalad, C.K. and Gary Hamel (1994), “Strategy as A Field of Study: Why Search for a New Paradigm,” Strategic Management Journal, 15, 5-16. Senge, Peter M. (1990a), “The Leader’s New Work: Building Learning Organizations,” Sloan Management Review, Fall, 7-23. Senge, Peter M. (1990b), The Fifth Discipline: The Art and Practice of Learning Organization, New York: Doubleday. Simonin, Bernard L. (1999), “Transfer of Marketing Know-How in International Strategic Alliances: An Empirical Investigation of the Role and Antecedents of Knowledge Ambiguity,” Journal of International Business Studies, 30 (3), 463-490. Stata, Ray (1989), “Organizational Learning - The Key to Management Innovation,” Sloan Management Review, 30 (Spring), 63-74. Varadarajan, P. Rajan and Margaret H. Cunningham (1995), “Strategic Alliances: A Synthesis of Conceptual Foundations,” Journal of Academy of Marketing Science, 23 (4), 282-296. Webster, Frederick E., Jr. (1992), “The Changing Role of Marketing in the Corporation,” Journal of Marketing, 56 (October), 1-17. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 236 UNDERSTANDING & USING FEDERAL TECHNOLOGY/INFORMATION RESOURCES IN THE MARKETING CLASSROOM (Educators’ Workshop Overview) Ruth Lesher Taylor – Texas State University Crystal M. Aguilar – Texas State University Rebecca C. Alvarez – Texas State University Karin Cuda Baker – H.B. Zachry Company Sandra L. Griffin – Texas State University Erin M. Hurley – Texas State University Sean P. O’Connor – Texas State University ABSTRACT Intended for educators desiring to use experiential learning techniques and federal government information sources in the courses they teach, this workshop is particularly beneficial to those teaching International Marketing or Principles of Marketing. The integration of Federal government electronic international information resources such as STAT-USA/Internet; USA Trade Online; Euro Trade Online; as well as BEA’s statistical releases for sales of U.S. services in international markets is demonstrated. Practical implementation tips and benefits of integration are discussed by various panel speakers including present students, a graduate/working professional hired by a large international company specifically because of such integrated education, and the professor using this integration methodology. INTRODUCTION Background for educators’ workshop proposal As faculty development, continuing education, and teacher training are increasingly a concern in higher education (ACME 2004), and as external agencies for accreditation are encouraging faculty development training (AACSB), more universities are rewarding faculty for increasing their teaching skills and obtaining additional teaching-related education. Gone are the days when lecture was the means for transmitting knowledge from professor to student. Faculty members have been called on for years to teach using experiential learning methodologies (Kolb 1984) and many marketing professors (Castleberry 2001; Smart, Kelley and Conant 1999; Bobbitt, Inks, et. al. 2000; and others) now responding to the call. Students, themselves, are moving toward the expectation of experiential learning (Castleberry 2001; Bridges 1999; and others). Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 237 Who is eligible to attend workshop Some academic conferences are best known as research conferences and some as specialty conferences. The Association of Collegiate Marketing Educators (ACME), over the past couple of years, has become quite well known as a marketing educators’ conference emphasizing experiential learning for both student and professor. This is evidenced through the ACME Educator Workshops and Certificate Programs that have been offered at the annual ACME conferences the past two years. These workshops seek to provide educators with new ideas, refined skills, and continuing education in teaching. They are extremely popular and are always open to anyone from any discipline registered as part of the Federation of Business Disciplines (FBD) conference. Educator Workshops attendance is not solely limited to ACME members. PURPOSE OF ACME EDUCATOR WORKSHOP PROGRAM The aim of FBD/ACME conference educator workshops is for collegiate faculty across the nation to explore such experiential learning topics as creativity, innovation, experiential learning, assessment, teaching with technology, distance education, teaching to large sections, and other such topics and how such experiences can be readily integrated into university classrooms. Important to note ACME is providing conference attendees who participate in these workshop a certificate of attendance to carry home to their administrators and to place in their annual activity files as evidence of continuing faculty development - faculty activity that administrators emphasize when making performance, merit, tenure and promotion decisions, and when evaluating exceptional faculty performance for annual teaching awards. DESCRIPTION OF FEDERAL RESOURCES WORKSHOP In line with the purposes of ACME to encourage experiential learning for both student and professor, as sketched out above, this “Understanding & Using Federal Technology/Information Resources in the Classroom” is offered as experiential learning for educators with “walk-away” value. This educators’ workshop emphasizes the use of the electronic Federal information products provided by the Federal office of STAT-USA, Economics and Statistics Administration, U.S. Department of Commerce: STAT-USA/Internet, USA Trade Online and Euro Trade Online. Bureau of Economic Analysis (BEA) statistical releases for sales of U.S. services in international markets will also be addressed. The use electronic information will be demonstrated as it was integrated into both Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 238 International Marketing and Principles of Marketing courses -- in a very different fashion and intensity, of course. Workshop benefits can be readily applied in classroom settings providing examples for using similar experiential techniques the classroom to enhance student learning, stimulate critical thinking, and promote use of creativity in decision making, as well as take advantage of technological resources at hand. This educators’ workshop will demonstrate the implementation techniques needed to smoothly integrate “Understanding & Using Federal Technology/Information resources in the Classroom” and to perhaps gain USDOC certificate earning possibilities for students successfully completing the work. Special feature of workshop This workshop is designed to have present and former students participating as panel members, as well as the directing professor. Preliminary plans are to include 2-3 students enrolled in STAT-USA/USDOC/BEA Federal Resources integrated courses to interact with workshop participants. Educators will learn first hand from students who have received benefits by going through the experiential Federal Information Resources integrated course(s). Another yet added feature of the workshop calls for an alumna of this integrated course to be a participant in the workshop. This alumna will demonstrate benefits derived from the experiential laced course and discuss how the use of Federal Resource information, particularly STAT-USA/Internet and USA Trade Online, have demonstrated usefulness in the professional workplace relative to work productivity, employee performance; and how such knowledge have been beneficial in gaining on-the-job promotions and other opportunities. Educator certificate opportunities The following two certificates will be earned by educators attending and participating in this educator workshop: 1. STAT-USA/USDOC certificate of attendance 2. ACME certificate of attendance. REFERENCES ACME (2005), “Call for Papers, 2005, Annual Meeting of the Federal Business Disciplines”, March 1-5, 2005, Dallas, Texas, p. 6. AACSB (2005), American Association of Collegiate Schools of Business Bridges, Eileen (1999) “Experiential Learning and Customer Needs in Undergraduate Marketing Research Course,” Journal of Marketing Education 21 (April) 51-59. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 239 Kolb, D. A., (1984) Experiential Learning: Experiences at The Source Of Learning, Englewood-Cliff, NJ: Prentice Hall. Smart, Denise, Craig A. Kelley, and Jeffery S. Conant (1999) “Marketing Education in the Year 2000: Changes Observed and Challenges Anticipated,” Journal of Marketing Education, 21 (December) 206-216. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 240 THE NEW MANDATORY QSS FOR SERVICES PROVIDERS EVOLUTIONARY NEED FOR CHANGE IN MEASURING INTERNATIONAL SALES IN SERVICES (MARKETING EDUCATORS’ GRASS-ROOTS BRIEFING) Ruth Lesher Taylor, Texas State University ABSTRACT ONLY Category, transparency and comparability of international trade of services data concern businesses, trade negotiators, and educators. The new QSS Mandatory Sale of Services Survey requires change in Federal reporting procedures. Although it does not provide details of the new QSS (available from www.census.gov), this briefing will provide insight into the issues and national concerns of nations as they struggle to meet GATS compliance requirements. The objective of this discussion is to awareness and knowledge of services traded measurement techniques (typically hidden) to the field of marketing. Characteristics of measuring international trade of services are little researched areas of marketing education. The new mandatory Quarterly Sale of Services Survey (Cooper 2003, Knickerbocker 2003, and Evans, 2003) announcement by the USDOC and Bureau of Census has caused service providers to become anxious about Federal reporting changes needed to meet this new mandatory reporting requirement. This change, in addition to a second relatively recent major change (2002) in the measurement of the service industry, the transnational effort, Manual on Statistics for International Trade in Services (UN 2002) have caused statistical measurement in the services sector to go through major shifts. Federal statistics compilers of services traded data (Bureau of Economic Analysis - BEA) are concerned about to embracing these changes because major changes in reporting has a major affect on a nation’s Balance of Payments accounts. This paper presents information to provide marketing educators and service providers a background of information to help them understand and cope with these changes. SELECT REFERENCES Bank, Richard K. (2004), "Too Important to Ignore, " Journal of Commerce, (August 16), p.1. Borga, Maria and Michael Mann (2003), "U.S. International Services, Cross-Border Trade in 2002 and Sales Through Affiliates in 2001," Survey of Current Business, (October) 53-118. Borga, Maria and Michael Mann (2003), "Types of Cross Border Services: Coverage and Definitions," information box, p. 72-73, in "U.S. International Services - Cross-Border Trade in 2002 and Sales Through Affiliates in 2001," Survey of Current Business, (October), 83, 10, p. 58-118. Bureau of Economic Analysis (2004), " U.S. International Services: Cross-Border Trade 1986 -2002, and Sales Through Affiliates, 1986-2001," Bureau of Economic Analysis Web site (downloaded 9/15/04, http://www.bea.doc.gov/bea/di/1001serv/intlserv.htm). Bureau of Economic Analysis (1990), "A User’s guide to BEA Information," Survey of Current Business, (February), 70, 2, p. 47. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 241 Cave, William (2004), " Measuring International Trade in Services and New Demands on the Family of Classifications," Conference Paper, IAOS Conference, London 2002, OECD Web Site (downloaded 9/9/04 http//www.statistics.gov.uk/IAOSlondon2002/contributed_papers/CP_Cave) Cooper, Kathleen (2004), Under Secretary for Economic Affairs, "Under Secretary Kathleen Cooper Previews New Service Sector Survey, " Press briefing, (September 8), the Economics and Statistics Administration Web site (downloaded 9/15/04, www.esa.doc.gov/). Evans, Donald L. (2004), Commerce Secretary, "Under Secretary Kathleen Cooper Previews New Service Sector Survey, " Press briefing, (September 8), the Economics and Statistics Administration Web site (downloaded 9/15/04, www.esa.doc.gov/). Gronroos, Christian and Katri Ojasalo (2004), "Service Productivity: Toward a Conceptualization of the Transmission of Inputs into Economic Results in Services," Journal of Business Research, (April) 57, 4, p. 414. Grove, Stephen J. and Raymond P. Fisk (2003), "The Future of Services Marketing: Forecasts From Ten Services Exports, " The Journal of Services Marketing, (17), 2/3, 107-121. International Monetary Fund (1993), Balance of Payments Manual, 5th ed., Washington. Knickerbocker, Frederick (2004), Associate Director for Economic Programs, Census Bureau, "Under Secretary Kathleen Cooper Previews New Service Sector Survey, " Press briefing, (September 8), the Economics and Statistics Administration Web site (downloaded 9/15/04, www.esa.doc.gov/). Mann , Michael and Maria Borga (2001), "U.S. International Services: Cross-Border Trade in 2000 and Sales Through Affiliates in 1999," Survey of Current Business, (November), 81, 12, p. 49-95. Tinawi, Emad and Judson O. Berkey (1999). , "E-Services and the WTO; Inadequacy of the GATS Classification Framework" Middle East Executive Reports, Washington, (August), 22, 8, p. 8. United Nations (2002), Manual on Statistics of International; Trade of Services, Department of Economic and Social Affairs, Statistics Division Series M, 86, United Nations Publication, p.5. Van Ark, Bart and Erik Monnikhof (1999), "Productivity in Services," The Canadian Journal of Economics, (April), 32, 2, p. 471. Whichard, Obie G., and Maria Borga, (2002), "Selected Issues in the Measurement of U.S. International Services," Survey of Current Business, (June) 82, 6, p. 36-56. Whichard, Obie G. and Maria Borga (2002), "Summary of Measurement Issues for Five Types of Services," chart in "Selected Issues in the Measurement of U.S. International Services, " Survey Of Current Business, (June) 82, 6, p. 36-56). Whichard, Obie G. and Anthony J. DiLullo (1990), "U.S. International Sales and Purchases of services, " Survey of Current Business (September) 70, 9, p. 37-42. Williams, Philip (2003), "Measuring Performance," International Trade Forum, 1, p. 28. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 242 A LEADERSHIP APPROACH FOR MARKETING MANAGERS Dillard B. Tinsley, Stephen F. Austin State University ______________________________________________________________________________ ABSTRACT Strategic marketing requires that marketing managers be effective leaders of their human resources. Managerial leadership for sales managers has been intensively studied - but not for other types of marketing managers. In general, leadership effectiveness is affected by the relationships between managers and employees; however, managers do not always apply what they know to be effective leadership tactics because of various distractions, e.g., time pressures. As a reminder of effective leadership practices, marketing managers of all types can follow a pattern that is based on remembering three words - Stop, Look, and Listen. INTRODUCTION There are many articles about leadership for sales managers; and some sales management textbooks devote a chapter to it, e.g., Dalrymple, Cron, and DeCarlo (2004). Most other types of marketing textbooks, e.g., advertising, retailing, channels, and marketing research, give little, if any, attention to leadership for the other types of marketing managers. Textbooks on principles of marketing, strategic marketing, or marketing management usually mention managerial leadership only in the context of sales management, if at all. This lack of attention is unfortunate because the importance of managerial leadership is well recognized. For example, the Harvard Business Review published a special issue on the minds of managerial leaders in January of 2004. This issue’s classic article by Goleman (2004) has an example of a marketing manager using her leadership skills to put a troubled marketing team on a smoothly functioning basis. Such smooth integration of the various capabilities of employees provides the foundation for an organization’s strategic competencies. The importance of strategic competencies that lead to competitive advantages is commonly presented in strategic marketing textbooks. For example, Peter and Donnelly (p. 7, 2004) assert “...Proctor & Gamble’s distinctive competency is its knowledge of the market for low-priced repetitively purchased consumer products.” They do not, however, explain how this competency has been developed and maintained by marketing managers in working with their employees. The capabilities of different employees have to be coordinated and integrated according to strategic marketing plans. This involves leadership by marketing managers. Many managers, of course, are familiar with the basics of managerial leadership. For example, Cravens, Marshall, Lassk, and Low (2004) included certain elements of leadership in their recent Marketing Management article on sales force control - an article that was probably seen by managers of all types of marketing. Yammarion (1997) presents sales managers more than 15 different techniques of leadership, most of which are suitable for any type of marketing manager. Why, then, does managerial leadership need more attention? Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 243 This paper’s practical approach to leadership is needed because managers in business do not always apply all that they know about leadership. Why don’t they? One obvious answer is that it is probably impossible for managers to remember and apply everything that they know during every encounter with employees. In addition, managers are often pressed for time, especially when looming deadlines are exacerbated by unexpected developments. Rapid changes in tactics and strategies are not unusual in marketing in order to deal with changes in customers’ demands and competitors’ attacks. Managers may also be distracted from applying their leadership skills when they are juggling several different projects. Such situations can result in terse managerial communications that do not consider the concerns of employees, as, for example, when a manager orders employees to “drop everything else” without regard to their priorities. This can lead to poor relationships If poor relationships exist between managers and employees, the employees cannot be satisfied with their jobs. Talented employees may seek (and find) jobs with other organizations. Many managers believe that employees will not do their jobs well unless they have some degree of job satisfaction. For example, Homburg & Stock (2004) have found a link between salespeople’s job satisfaction and customer satisfaction. A LEADERSHIP APPROACH This paper presents an approach to leadership that can be useful to almost any marketing manager, including sales managers. This approach can be used to put interpersonal exchanges on a positive path, no matter which leadership techniques are appropriate for an actual situation. This approach draws on extant research that underlies certain conclusions about managerial leadership in general. Certain aspects of research on leadership in all types of organizations are relevant to marketing managers. Therefore, this paper replaces the term “marketing manager” with the term “manager.” Management research generally indicates that managers need to incorporate some degree of the Emotional Intelligence (EI) into interpersonal exchanges. Kets de Vries, director of Insead’s Global Leadership Center, asserts that EI is the first thing that he seeks when evaluating top managers (Coutu 2004). Goleman (2004) asserts that EI is the vital element in successful management and that it is composed of self-awareness, self-regulation, motivation, empathy, and social skill. It provides insight into psychological factors, such as the emotions of themselves and their employees, allowing the managers to use these insights in their leadership responsibilities. These are referred to as personal needs, e.g., needs to be trusted and respected. Day-to-day exchanges between managers and employees build personal relationships; and research indicates 1) that managers develop different relationships with different employees and 2) that these relationships are related to employee work performance. Influences on these relationships include mutual liking, perception of contribution to work, support for goals and personal character, and respect for professional reputation (Liden & Maslyn 1998). Manageremployee relationships can result in financial payoffs when employees perceive that managers respect them - as shown by exchanges where managers share information, consider employee Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 244 opinions, and involve them in decision-making. When manager-employee relationships are positive, leadership effectiveness is more likely. Development of positive relationships requires that personal exchanges between leaders and employees be positive over some period of time. To assure that a continuing stream of positive exchanges takes place between managers and employees, this paper explains how managers can use a standardized approach to face-to-face communications exchanges with employees. This approach moves managers into automatic application of basic principles of behavioral management for dealing with the personal needs of employees, and it also holds promise for helping managers to fulfill their own personal needs. Paying attention to these personal needs is especially important because of the many factors that have emerged in recent years to complicate business management. COMPLICATIONS During the 1990s, management became more complicated, due to a number of new aspects of modern business, such as computerized information systems, extensive air travel, employee empowerment, team building, stretch goals, and outsourcing. Significant complications and even litigation arose from many new issues that deserve managerial attention, such as diversity and sexual harassment. Another set of complications arose from family issues, such as provisions for single parents and work-life balance. For example, a recent survey revealed that professional women who are aged 26 to 37 are seeking balanced lives, rather than sacrificing children for career (Gutner 2002). The respondents rated personal relationships and family life as goals much higher than goals of money and leadership positions. New complications can be expected over the next few years as the “Baby-Boomers” address retirement issues. A particularly relevant source of complications for manager-employee exchanges stems from the declining levels of civility in the workplace - the civility that reflects and expresses mutual respect between the members of an organization. Civility in the workplace goes beyond etiquette’s rules because civility involves demonstrations of concern and regard. In contrast, a growing “incivility” in the workplace involves “...the violation of workplace norms for mutual respect, such that cooperation and motivation can be hindered broadly.” (Pearson, Anderson, & Porath 2000, p. 125) Such incivility includes ignoring others, as well as overt rudeness in comments, acts, glances, and gestures that are perceived as disrespectful. Offended employees may experience reduced job satisfaction and lowered productivity. Sometimes incivility is perceived as aggression by its targets, and their retaliations may cause a spiral of unrest that runs throughout the organization. Even if the perpetrator meant no offense, incivility can be easily perceived as aggression by an offended party - or at least as disrespect. Feelings of disrespect interfere with the trust levels that are vital to organizational flexibility and effectiveness. Employees who feel disrespected will also feel less job satisfaction. They may reduce job commitment, productivity, and flexibility in dealing with changing business conditions. MANAGERIAL ADJUSTMENTS Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 245 Managerial adjustments to these factors and the resulting complications have met varying levels of success. Effective responses are often based on the research findings that valuing employees and treating them with respect form the path to employee commitment and productivity. For example, Carlos Ghosn was asked in 1999 to lead the turnaround of the Nissan automobile company after its alliance with Renault. As President and CEO in the Tokyo headquarters, Ghosn (2002, p. 44) notes, “I took a lot of flak as the foreigner in charge.” He was able, however, to lead a company turnaround from FY 99's loss to a new profitability. As one of the key factors in achieving this success, he includes his efforts to win the trust of Nissan’s employees by showing them and the company a great deal of respect. Ghosn asserts, “For a turnaround process of this kind to work, people have to believe both that they can speak the truth and that they can trust what they hear from others.” Treating employees with respect, however, should not be used to manipulate them. Such manipulation will demolish trust within the organization, and any hope of managerial leadership will be destroyed. Employees see manipulation as a lack managerial integrity; and personal integrity is one of the most important traits for a manager - or for any employee - to exhibit. Managers must seek to develop a sincere interest and concern for their employees. For example, Cooper (2000, p. 15) recommends that “to bring out more of the best in people,” managers should personalize exchanges with employees, giving “sincere” recognition and encouragement. Making some effort to implement EI insights and to personalize exchanges with employees does not need to take a great deal of a manager’s time. For example, Weeks (2001) explains that managers can successfully deal with stressful conversations - even unexpected exchanges - by remembering three simple rules. Be clear and direct in your words. Be neutral with your body language, including voice tone. Use temperate phrasing, avoiding aggressive or provoking comments. Weeks (2001, p. 114) notes that there will never be a “cookie-cutter approach to stressful conversations....” because there are so many variables and each exchange is always unique. Drawing on years of teaching classes and workshops at top corporations, however, she has shown how these simple rules can be effectively used in spite of varying circumstances. Actually, Ghosn’s (2002) success at Nissan with an alliance of French and Japanese companies was achieved in circumstances that are different from those faced by most managers in the United States. The many factors that can affect personal exchanges and relationships differ somewhat in different cultures. Beyond this, company cultures differ from each other. Even within a company, different departments may have different cultures, e.g., accounting and marketing. Differences in people, situations, companies, and other such factors cannot be overlooked. However, this paper’s standardized approach is analogous to that of Weeks (2001) in that it is generally useful for engaging in face-to-face exchanges with employees. A STANDARDIZED APPROACH Many managers have limited time available to plan and conduct their face-to-face exchanges with employees. Some exchanges are unanticipated, taking place “as needed.” In any exchange, especially unanticipated ones, managers may be focused on business circumstances, rather than thinking about all the factors that might be relevant to employees’ personal needs. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 246 Managers, however, can easily remember to start every face-to-face communication with employees in the same way by gaining their receptive attention. To do this, the manager must give full attention to the employees, whether as individuals or in groups. The manager must Stop what he or she is doing; Look at employees with eye contact; and actively Listen to the employees. Employees who perceive that a manager is giving them full attention will tend to respond by giving their full attention. This helps employees to see the manager as a person who respects them. Giving full attention to an employee enables a manager to make a relational personal contact - a touching of the minds and emotions - with the employee. Real understandings of each other begin to develop between the individuals involved. The process of Stop, Look, and Listen gives the manager time to consider facial expressions, tone of voice, and other body language that influence employee perceptions of managerial attitudes, as well as time to observe these aspects of the employee. This not only adds to understanding during an exchange, it also reduces misunderstanding possibilities. Giving full attention is an approach for making every face-to-face exchange into a real and substantial involvement or contact between manager and employee - a managerial contact. STOP, LOOK, AND LISTEN This managerial contact approach is easily remembered because the key words are ingrained in Americans from childhood. Managers are reminded of the words every time that they see a railroad track. Meaningful managerial contact with employees can occur if the manager takes time to Stop, Look, and Listen. When you first start to interact with someone in a face-to-face conversation, Stop what you are doing, e.g., put down your pen or anything else that might occupy your hands. Look at the employee. If possible, turn so that your body faces the employee, e.g., do not remain turned toward your computer. Give your full attention with eye contact and “open” body language, e.g., without your arms folded in front of you. Note the employee’s body language and facial expressions. Listen carefully to what the employee says. Use “active listening” techniques, e.g., give full attention and respond with appropriate comments, nods, and other body language. Active listening is recognized as a vital aspect of communication for business purposes. For example, one of Reichheld’s (2001, p. 80) six principles in “Leading for Loyalty” is “Listen hard, talk straight.” His work indicates that, “Long-term relationships require honest, two-way communication and learning. True communication provides trust, which in turn engenders loyalty.” Anyone in a conversation likes to receive the other person’s full attention. Making managerial contact with the Stop, Look, and Listen approach is simple to remember; and it communicates the respect, valuing, and trust that are so vital to organizations. Managerial contact helps to nurture employee attitudes that facilitate managerial leadership. It not only elicits information from employees, it leads naturally into sharing information with them. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 247 Managerial contact does not have to be established every time that a manager engages an employee. There are times when the press of activities are such that time cannot be taken. There is a need, however, to do it often enough to establish respect and personal relationships of understanding. If a manager never makes personal contact with employees, consistent employee productivity cannot be expected - much less a positive response to leadership. Employee attention and enthusiasm cannot be expected if an employee feels that a manager is not sincerely interested and does not understand him or her as a person. Managers, therefore, should consider making managerial contact whenever possible and reinforce positive relationships. OTHER BENEFITS The understandings of employees that come from managerial contact also help managers to evaluate the capabilities of their employees. This is particularly important for marketing managers because the insight, creativity, and energy necessary for successful marketers may be difficult to identify in an employee. How do marketing managers ascertain the following capabilities in their employees: 1) the insight needed for correct interpretations of marketing research data; 2) the creativity needed to develop advertising that sells, rather than just entertains; and 3) the judgment and initiative necessary to deal with rapidly changing market situations, such as a competitor’s unexpected attack? Managers may have to work with employees for an extended period of time before their marketing capabilities can be accurately assessed. A final benefit of the Stop, Look, and Listen approach is that it helps to fulfill the needs of managers. Managers are pressured by business trends and stresses, as well as by their special responsibilities as managers. The pressures on managers are causing some companies to implement procedures that help managers fulfill their own personal needs as they deal with business challenges. For example, Marriott International has a “Management Flexibility” program that allows its managers to “...strike a better balance between their professional and personal lives, all the while maintaining our customer service and the bottom line of our financial results.” (Munck 2001, p. 125). The managerial contact developed by the Stop, Look, and Listen approach helps to fulfill the personal needs of the managers for positive relationships with other people. Edward M. Hallowell (1999), a Harvard Medical School psychiatrist, sees many successful business leaders who have some deficiency of human contact in their lives, often resulting in needless anxiety and misunderstandings between people. Hallowell recommends that people take time in their business dealings to participate in what he calls the “human moment,” which is “...an authentic psychological encounter...” that requires “...people’s physical presence and their emotional and intellectual attention.” He thinks that participating in human moments is becoming more important because meeting the social and affiliation needs of human beings is growing more difficult in organizations. Human moments are decreasing in many organizations as a result of electronic communication devices that do not require that people be in the physical presence of others. Many such devices do not reveal the body language, facial expressions, voice tone, and other non-verbal communications that are important reinforcers of people’s judgments of each other and their intentions. This makes every face-to-face exchange even more important in the quest to develop good relationships between managers and employees. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 248 Creating a human moment may require only a few minutes. Hallowell asserts that when you focus on another person in such a manner, the other person will usually respond in kind and that “The positive effects...can last long after the people involved have said goodbye and walked away.” The Stop, Look, and Listen approach to managerial contact and leadership lays the foundation for such human moments - moments that contribute to fulfilling personal needs and to developing positive relationships. CONCLUSION Human resources are often cited as an organization’s most valuable assets. This is especially true for marketing, which involves insight, creativity, and personal initiative. Marketing managers of all types - not just sales managers - can benefit from the Stop, Look, and Listen approach to leadership. Managerial contact helps managers to address employees’ needs in a motivating manner. It incorporates EI and facilitates fulfillment of the personal needs of both employees and managers in accordance with current theories about employee productivity. Stop, Look, and Listen provides a path to managerial leadership that can be easily remembered for effectiveness in person-to-person interchanges. REFERENCES Cooper, R.K. (2000) "A New Neuroscience of Leadership: Bringing Out More of the People,” Strategy & Leadership, 28 (6), 10-15. Best in Coutu, D.L. (2004) “Putting Leaders on the Couch,” Harvard Business Review 82, 1 (January) 65-71. Cravens, D.W., G.W. Marshall, F.G. Lassk, and G.S. Low (2004) “The Control Factor,” Marketing Management 13, 1 (January-February), 38-44. Dalrymple, D.J., W.L. Cron, and T.E. DeCarlo (2004) Sales Management, 8th Edition, Hoboken, New Jersey: John Wiley & Sons, Inc. Ghosn, C. (2002) “Saving the Business Without Losing the Company,” Harvard Business Review 80 (1), 37-45. Goleman, D. (2004) “What Makes a Leader?” Harvard Business Review 82, 1 (January) 82-89. Gutner, T. (2002) “A Balancing for Gen X Women,” Business Week (January 21), 82. Hallowell, E.M. (1999) “The Human Moment at Work,” Harvard Business Review 77 66. (1), 58- Homburg, C. and R.M. Stock (2004) “The Link between Salespeople’s Job Satisfaction and Customer Satisfaction in a Business-to-Business Context: a Dyadic Analysis,” Journal of the Academy of Marketing Science 32, 2 (Spring) 144-158. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 249 Liden, R.C. and J.M. Maslyn (1998) “Multidimensionality of Leader-Member Exchange: An Empirical Assessment through Scale Development,” Journal of Management 24 (1), 43-72. Munck, B. (2001) “Changing a Culture of Face Time,” Harvard Business Review 79 125-130. (10), Pearson, C.M., L.M. Andersson, and C.L. Porath (2000) “Assessing and Attacking Workplace Incivility,” Organizational Dynamics, 29 (2), 123-137. Peter, J.P. and J.H. Donnelly, Jr. (2004) Marketing Management, 7th Edition, New York: McGraw-Hill/Irwin. Reihheld, F.F. (2001) “Lead for Loyalty,” Harvard Business Review 79 (7), 76-84. Weeks, H. (2001) “Taking the Stress out of Stressful Conversations,” Harvard Business Review 79 (7), 112-119. Yammarino, F.J. (1997) “Models of Leadership for Sales Management,” Journal of Personal Selling & Sales Management XVII, 2 (Spring) 43-56. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 250 ATTITUDES OF PERSONAL SELLING STUDENTS TOWARD THE USE OF REAL BUSINESS PEOPLE AS “BUYERS” IN ROLE PLAY PRESENTATIONS Jeff W. Totten, Southeastern Louisiana University ABSTRACT Experiences with using outside business people as “buyers” for Personal Selling students’ roleplay sales presentations are described. The attitudes of both the business men and women and the students were measured through Likert-type rating scales and the statistical findings are reported. Recommendations for continued use of this method are discussed. INTRODUCTION The personal selling course tends to be a staple course offered in some form by most collegiate schools of business in the United States. It may be a required course for some marketing majors, or an elective course for others. The focus may be totally on the selling process or it may include some aspects of sales management as well. Typically involved is some type of sales presentation on the part of each student. Two approaches are a series of short role playing presentations or one major sales presentation “project” in the course. Students are often teamed up in buyer-seller pairs, where each student in the pair plays the role of seller and buyer; that is, student A “sells” to student B, who then turns around and “sells” to student A, who is now B’s “buyer.” This role play may take place in front of other students or just with the professor being present, and may or may not be videotaped. Students may be allowed to choose the product to sell, or they may get to choose from product scenarios in the textbook, with scripted “buyer” instructions provided by the textbook author. This author has usually paired students together and used the role play scenarios found in textbooks (c.f., Marks 1997; Futrell 2002; Weitz, Castleberry and Tanner 2004). Students get to rank-order their preferences for scenarios found in the textbook and are assigned and paired by the author. Time is reserved outside of class for videotaping by the author (15-20 students and no media center) or for videotaping by the media center (larger university with such resources), or taping is done in class (> 20 students, summer session). The author then graded the videotapes outside of class and returned them to students with grades (see Castleberry 1989, and Tanner and Chonko 1991, for advice on using videotapes). As the author began preparations for teaching one section of Personal Selling this past spring semester, a colleague suggested that he consider using outside business and university people (with sales experience) as the “buyers” for his students, rather than relying on his usual method. A review of the literature yielded some anecdotal support for this method but nothing of an empirical nature. McQuiston (2004) offered nine suggestions for improving sales presentations, including #7: “Line up professional buyers from the business community to act as Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 251 buyers and have the students give their presentations in front of the entire class to these individuals” and #8: “Allow a few minutes at the end of the class for the buyer to give his/her perspective on what it takes to be a successful sales representative.” The author posted a question on ELMAR, an electronic posting service that professors register for, and received several anecdotal comments from professors, including the point that industrial buyers have been used in the classroom for over 15 years and that the use of outside business people can be rough on students (ELMAR 2004). Given the lack of empirical data on the use of this method, the author undertook this study of his students and the business people who served as the “buyers.” The purposes of the study were to 1) evaluate Personal Selling students’ experiences with having real business and university people with sales experience come into the classroom and serve as “buyers” for role play sales presentations, and 2) evaluate those same business/university people’s experiences with this teaching method. METHODOLOGY The author recruited both business people he knew and those he was referred to by other colleagues. He also recruited university people whom he knew had sales experience. He selected all nine MWF dates in April 2004 for the sales presentations and recruited nine “buyers.” Background information on the nine people is provided in Table 1. Buyer 1 2 3 4 5 6 7 8 9 a Gender Female Male Female Male Male Male Female Male Male Table 1 “Buyer” Background Information Background Account executive for local ad agency University vice president, former marketing professor (taught sales) Regional account manager for major financial investments company Co-owner of local agricultural seed company (with national accounts) Account representative with major textbook company Director of marketing, university athleticsa Sales director, parish convention and tourism bureau President of division, locally headquartered national salon company Regional vice president, major insurance company Sick; replaced by author; grading done by colleague who also taught the course. After consulting with a colleague who teaches the course on a regular basis, the author allowed the students to choose their own products to sell. He developed a set of instructions for them to follow in developing “buyer information sheets” (along the lines of buyer scripts found in instructor manuals for textbook scenarios; see Table 2 on the next page), and set a deadline of mid-to-late March for the students to get the guides to him, so that he could approve and forward them by e-mail to the buyers. Two questionnaires with introductory paragraphs (serving as “cover letters”) were designed and approved by the university’s institutional review board. Business people were asked to indicate how many students were assigned to them (two, three or four), and to indicate Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 252 Table 2 INSTRUCTIONS FOR PREPARING PRODUCT SCENARIOS FOR BUSINESS MEN & WOMEN WHO VOLUNTEERED TO BE “BUYERS” Prepare a one-page handout with the following information provided: 1. Product you will be selling 2. Information on the product, in terms of: a. Manufacturer b. Features, sizes, styles, colors, as appropriate c. Prices d. Uses 3. What role is the “buyer” playing? NOTE: “BUYER” KEEPS HIS OR HER NAME. You define the role scenario: a. Job title b. Company (historical fact sheet; includes what the company sells and has sold in the past; what products have been successful and which ones have not worked) c. Why is s/he considering your product? What decision is s/he faced with? What are his/her needs? d. Company’s competitors 4. What hobbies/interests does the “buyer” have? This is to help you in the approach stage of the selling process, to “break the ice” so to speak. NOTE: “BUYER” KEEPS WHATEVER SOCIAL STYLE S/HE HAS. [(Footnote) For businesspeople: social styles discussed in the book are Driver, Analytical, Amiable, & Expressive.] 5. Suggested objections for the “buyer” to raise. NOTE: “BUYER” DOES NOT HAVE TO RAISE THESE OBJECTIONS AND MAY RAISE OTHERS!!! SO BE PREPARED FOR ANYTHING! This handout will be due to me by Monday, March 22nd. I will forward the forms to the businesspeople. To facilitate that, submit your handouts as Microsoft Word documents, attached to e-mail messages sent to me at [email protected]. Example (incomplete): [Author], you are the manager of an independent grocery store in <city>. I am selling Hershey Foods’ new candy, Swoops, the “irresistible slices of chocolate candy” that come in four flavors: Reese’s (peanut butter cups), Hershey’s (milk chocolate), Almond Joy, and York (peppermint patties). Each stackable package contains three plastic containers of six slices each (for a total of 18 slices per package). Suggested retail price is xxx. Hershey Foods is located in Hershey, PA, and <more info on the company and product here>. You are interested in adding new products to your shelves because xxxx (bring in historical fact sheet info on what’s sold well and what hasn’t). You are a Houston Astros fan and enjoy reading mystery books <other hobbies, etc.>. Objections you might raise include xxx, yyy, zzz, etc. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 253 via a series of Likert-type scales how well each of the students was prepared for the role play and whether each had provided appropriate instructions to the buyer. “Buyers” were then asked to indicate how positive their overall experience was (five-point scale) and whether the teaching method was worthwhile or not (seven-point scale). Suggestions for improvement were then requested through an open-ended question. The two-page survey was mailed to each “buyer,” along with a stamped, addressed return envelope. Each “buyer” was also sent a “thank you” letter. The student questionnaire consisted of 11 questions for the students to rate using a Likerttype five-point rating scale. Question topics included nervousness before and during the presentation, preparing “buyer” instructions (ease, time needed), the “buyer” (professionalism of, preference for different “buyer”), role play preferences (book’s scenarios vs. picking your own, outside “buyer” vs. paired with student), overall experience, and use of method in future classes. “Buyers” were sent the survey within a week of their participation in the class. Students were asked to complete the survey during class, the week after all presentations were over with. The author asked each student to mark his/her gender on the survey and write any comments on the back of the survey. Six out of the eight “buyers” returned the surveys to the author. Note: one of the original nine “buyers” was sick, so the author substituted as the buyer and another professor was asked to come in and grade the presentations while they were being made. All 27 students returned the surveys; however, only 15 indicated their gender on the forms. RESULTS The six buyers agreed that the students were well prepared for the role play and that they had provided appropriate instructions to the buyers. Medians ranged from 4.0 (Agree) to 5.0 (Strongly Agree) on these questions. Modal values were in the same range. Two students were rated (2.0, Disagree) as not being well prepared or not providing appropriate instructions. The buyers indicated that their experiences with the students were either positive or very positive (the median and the mode; 5-point scale), and that the teaching method was either worthwhile or very worthwhile (the median and the mode; 7-point scale). Kruskal-Wallis tests, given the small sample size, yielded no significant differences for experience and teaching method rating by number of students assigned to buyer. Descriptive statistics for the student respondents is provided in Table 3 on the next page. The students tended to agree or strongly agree that they were nervous both before (19/27, 70.4%) and during their sales presentations (17/27, 63%). Twenty-one students (77.8%) were in strong agreement that they were happy to have been able to pick their own products to sell. Twentytwo (81.5%) strongly disagreed or disagreed with the statement that they would have preferred using the textbook’s scenarios and buyer scripts. Fifteen students (55.6%) disagreed or strongly disagreed that preparing the buyer instructions was harder than expected; however, eight (29.6%) were ambivalent about it. Most students (24/27, 88.9%) disagreed or strongly disagreed with the statement that they didn’t have enough time to prepare the instructions. It was interesting to note the students’ reactions to the buyers. Twenty students (74.1%) agreed or strongly agreed that their buyers were professional, and nineteen (70.4%) disagreed or Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 254 strongly disagreed with the statement that they would have preferred a different buyer. The four students who had a negative experience with the last buyer were in strong agreement with this statement. A possible rationale for this result is that the last buyer was about 20 minutes late, due in part to a delayed flight and in part to inadequate directions on the author’s part. Then he played a tough, cold, aloof “buyer” for the students. The previous buyers had been easier on the students than the author had expected. So the last buyer threw the four students (three men and one woman) for a loop, and they retaliated with their survey ratings and negative e-mails to the author afterwards. There was also some ambivalence about the outside buyers, as 12 students (44.4%) weren’t sure about preferring being paired with another student or not. The rest were evenly split between disagreement (strongly or not, 29.6%) and agreement (strongly or not, 25.9%) with this statement. Table 3 Descriptive Statistics for Student Respondentsb Question Median Mode Range n I was nervous whenever I thought about the approaching date 4.0 4.0 1-5 27 for my sales presentation. I was nervous during my sales presentation. 4.0 4.0 1-5 27 I was glad I could pick my own product to sell. 5.0 5.0 3-5 27 Preparing “buyer” instructions was harder than I expected. 2.0 2.0 1-5 27 My “buyer” was very professional. 4.0 5.0 1-5 27 I would have preferred using the textbook’s role play scenarios 1.0 1.0 1-4 27 and buyer scripts. I would have preferred to have a different “buyer.” 2.0 2.0 1-5 27 I did not have sufficient time to prepare “buyer” instructions. 1.0 1.0 1-3 27 I would have preferred being paired with another student for 3.0 3.0 1-5 27 the role playing/presentations. Overall, this was a positive learning experience. 4.0 5.0 2-5 27 I would recommend this role play method be used in [Personal 4.0 4.0 3-5 27 Selling]. Gender n/a Female n/a 15 b Likert-type five-point rating scale used, where 5 = Strongly Agree and 1 = Strongly Disagree. Twelve students (44.4%) strongly agreed that this method had provided them with a positive experience, and ten others (37%) agreed. Only two (7.4%) disagreed with this question. Twelve students (44.4%) would recommend using the method again, while eleven (40.7%) would strongly recommend its use. The author stressed throughout the semester that he was trying something new with this method. It is good to see the method being endorsed, though there is some worry about acquiescence bias (saying yes to appease the professor). The class was evenly split between women (14) and men (13). Only 15 students indicated their gender; as luck would have it, the responses were also evenly split – eight women and seven men. The author should have pre-marked the surveys with each student’s gender, or added gender as a specific question, instead of just asking them to write it down on the survey. Given the relatively small sample size (15), the Mann-Whitney U test was used to determine if there were any significant differences in the 11 questions by gender. Since no Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 255 prediction had been made, the two-tailed test of significance was used. Since this was an experimental study, a (marginal) significance level of p = .10 was used instead of a more restrictive p value. Two marginally significant differences were found. Female students tended to have disagreed more with the statements, “would have preferred the textbook’s role play scenarios” (U=13.5, p = .055) and “would have preferred a different buyer” (U=14, p = .068). No other significant differences by gender were found. It is quite possible that the three male students’ ratings, based on their negative experience with the last buyer, has resulted in these marginally significant findings. One could hypothesize that, had there not been that negative experience (as perceived by the students), no significant differences by gender would have been found at all. Students were asked to add comments on the back of the survey. Comments included the following: “It seemed as though some buyers were happier to be there than others, which made some people more nervous.” “Even though I found this to be very nerve racking I was glad to have the experience of selling to a real professional. It was great to get advice from people who were experienced with dealing with salespeople. It might be a little less nerve racking if we do a practice first with other students and get feedback from that and then sell to the professionals. Overall, I thought it was a great and helpful experience.” “If buyers could somehow be familiar w/ product before hand … it would help get the most out of it.” “I think by bringing in a stranger to present to, it makes it seem more real. It really makes us look at the product + approaches to selling + objections from different perspectives. I think overall the people who played the buyers were a good choice. The only one that looked really intimidating was Mr. [X]. (But in the real world there are all types of buyers.)” Comments received from students through e-mails included the following excerpts: “I felt they were all really good, with the exception of the buyer that went on the last day. All others buyers seemed to have understood the fact that there was either a meeting or phone call prior to the meeting we had in class. . . . . Everyone that went that day really wished they had a previous ‘buyer.’” “I would prefer you not invite my buyer back. I feel like he was not prepared to serve as a buyer for this class. I also feel my presentation was flawed because of his tardiness.” “I thought that using professionals as outside buyers was a great idea. Many of them did a great job and were very helpful to our learning experience as salespeople. However, I did feel that some of the buyers were too laid back and Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 256 didn’t want to bring up objections or difficult questions. I know that they didn’t want to be too difficult on the sellers but I do feel that some buyers were particularly ‘easy’ on some of the students. Especially some of the younger businessmen/women who acted as buyers.” “I was also proud of myself for getting a 90 on the sales presentation. That was really difficult for me and was the thing that I had been dreading the most since I registered for this class.” DISCUSSION To begin with, there are limitations of this study. It was exploratory in nature, so the questions asked of the students may not have been the best ones to ask. They seemed to be appropriate, but there may have been other questions that should have been asked. The author should have had gender and age questions on the survey; that may have improved the number of students responding with their gender and add another demographic question. Two buyers did not return the survey, which was disappointing to the author. No effort was made to get them to return the surveys, in part due to the anonymity of the responses and the lack of any identifying codes on the surveys or envelopes. The author had some idea about who had returned the survey, but not enough to clearly identify the nonrespondents. 1. 2. 3. 4. 5. 6. 7. The following conclusions were shared with ELMAR in an August 4th posting: Overall, the eight buyers did a good job as “buyers” for my students. A ninth “buyer got sick, so I stepped in as “buyer” and another professor did the in-class grading. Most took time after the presentations to talk with the students who presented. Most of the “buyers” took it easy on my students. The last “buyer” was late to class, unfortunately (due in part to a flight delay and in part to faulty directions on my part). He proceeded to act very “cold” and “non-committal” to the four students, who were expecting an “easier” buyer. He was the last buyer for the round of presentations. As a result, the four students unprofessionally “raked” him over the coals, so to speak, in the survey and in e-mails to me afterwards, even though he took extra time after class to offer suggestions on how each of them could have improved their presentations. My students were very good on product knowledge; they were able to choose their own products. They did not do well with probing, handling objections, and asking for the business. I took several buyers to lunch afterwards and they each confirmed these weaknesses in our students. I would do it again. I would line up buyers much earlier, and push the students to choose their products and write their “buyer instructions” guidelines earlier. I would also encourage my buyers to be tougher on my students, and tell my students to expect buyers to be tough on them. The buyers enjoyed the experience; some found it challenging to change roles two or three times in the 50-minute class period. I had a fairly good mix of male and female buyers – three women, I believe. I would try to have a 50-50 split next time. My women students really wanted to have women buyers and it would have been nice to have had one or two more women buyers. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 257 As I mentioned to another professor via e-mail, I’m not sure that I would recommend this method for a part-time professor or one who will be teaching the selling course for the first time. I believe one should make use of the role play scenarios in the textbooks and the buyer scripts in the instructor manuals. Once a professor has taught the course and has developed some community connections, then bringing in outside professionals to be the buyers would be a valuable method to use for the course. Students probably do need to practice sales presentations with each other before presenting to outside buyers. I do have role play exercises that attempt to give them this experience. However, they would probably learn more if they practiced their actual presentations on each other first. This, of course, requires a rearrangement of one’s teaching plans and syllabus in order to achieve the professor’s “holy grail” – more time. While I was anxious over my last “buyer” being late, I was glad that he challenged my students. Even though they complained about his harsh treatment (in their eyes), he told me at lunch afterwards that he purposefully acted cold and aloof to see how they would handle such a buyer. I’m glad he did that. The other buyers were good, yet they let my students “off the hook” too much. Overall, despite feeling like I was “flying by the seat of my pants” with this method, I’m glad I did it. When I get the chance to teach the course again, I will bring in outside businesspeople again. REFERENCES Castleberry, S.B. (1989) “Videotaped Role Playing in the Personal Selling Classroom: A Practical Guide,” Journal of Marketing Education (Spring), 33-39. ELMAR (2004), Four responses to March 10th posting of “TEACHING: Business People Helping in Personal Selling,” received between March 11th and March 16th; information on ELMAR at www.elmar-list.org. Futrell, C.M. (2002) Fundamentals of Selling: Customers for Life, 7th Edition, Boston: McGrawHill/Irwin. Marks, R.B. (1997) Personal Selling: A Relationship Approach, 6th Edition, Upper Saddle River, NJ: Prentice Hall. McQuiston, D.H. (2004) “Bringing the ‘Real World’ into the Personal Selling Class,” in Great Ideas for Teaching Marketing, 3rd Edition, available online: http://www.swlearning.com/marketing/gitm/gitm05-4.html; accessed August 10th. Tanner, J.F., Jr., and L.B. Chonko (1991) “Avoiding the Guillotine Effect After Videotaping Role Plays,” Marketing Education Review (Spring), 37-41. Weitz, B.A., S.B. Castleberry and J.F. Tanner, Jr. (2004) Selling: Building Partnerships, 5th Edition, New York: McGraw-Hill/Irwin. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 258 DEVISING AN INSTRUMENT FOR FACULTY PERFORMANCE APPRAISAL THAT INCORPORATES “STANDARDS OF EXCELLENCE” Theresa A. Wajda, Slippery Rock University Anindya Chatterjee, Slippery Rock University Abbas Noorbakhsh, Slippery Rock University ABSTRACT A host of literature has been dedicated to examining the processes by which faculty of higher education are evaluated. According to Gunn (1985), public scrutiny surrounding the state of educational productivity necessarily mandates that all institutions of higher learning possess a mechanism of faculty appraisal that is both objective and systematically executed. According to Adams (2003), the need for such a system is critical due to the amount of effort that is exerted and the seriousness that surrounds issues related to faculty advancement including merit pay, performance incentives, and tenure and promotion decisions. However, as also stated by Adams (2003), there is probably no other task more daunting and fraught with controversy than that associated with the assessment of faculty performance. If an inadequate system is put into place or an appropriate system is not executed properly, the end result is typically confusion, frustration, and perhaps the incorrect individuals being hired, fired, or promoted (Adams 2003). In worse case scenarios, lawsuits may also ensue. Thus, the authors of this research describe one university’s endeavor to construct a model of faculty appraisal that promises to achieve cultural change in the “School of Business.” These changes have been deemed necessary due to modifications in this department’s institutional mission as well as the desire of the department to pursue successful accreditation. Specifically, a unique aspect of this research is that it posits a model of faculty appraisal that takes into account a variety of constraints. First, the particular university under consideration regards itself as primarily a “teaching” institution. However, in order to abide by the standards of accreditation, this institution has been mandated to incorporate a more “rigorous” research agenda into its current system of faculty appraisal. Furthermore, edicts from the accrediting body have also required the department to devise “Standards of Excellence” that are to be incorporated into the faculty appraisal system. As a result of the above, this research describes the initiative undertaken by three faculty members from the “School of Business” to design a faculty appraisal system in which “Standards of Excellence” in the areas of “Teaching,” “Scholarly Growth,” and “Service Contribution” are clearly defined and quantifiably measured. The unique contributions of this research include the collaborative/participative nature of this endeavor, the construction of a quantitative/qualitative model versus one that was purely qualitative in nature, the fact that the model had to be designed in such a way to account for six different academic disciplines (i.e., marketing, management, finance, economics, accounting and health management) housed under the singular umbrella of Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 259 the “School of Business,” and the idea that model construction had to take into account guidelines stipulated by a collective bargaining unit agreement. Consequently, it is believed that delineation and justification for use of the proposed model might be useful to other institutions pursuing similar initiatives, especially those facing similar constraints. Thus, based on the work of these researchers, “Excellence” is achieved by demonstrating it in the areas of “Teaching,” “Scholarly Growth,” and “Service,” subject to weights, conditions, and combinations that are subsequently outlined. The procedures spelled out in this research will permit the appropriate committees in the “School of Business” to calculate a quantitative overall evaluation score for each faculty member at a point in time by feeding data into formulas established for each category. This score, then, may be compared against an already established numerical scale to make qualitative judgments. Such scales can continuously be revised in different directions depending on policy directives initiated through collective decision-making processes. Highlights of this model include multi-faceted assessments of teaching “excellence” that factor student evaluations as well as peer and chairperson evaluations into numeric formulas. Similarly, faculty assessment of “excellence” in scholarly growth and service are multidimensional to the extent that a “quantity” component and a “quality” component are incorporated into one numeric formula. “SELECTED” REFERENCES Adams, Jonathan (2003), “Assessing Faculty Performance for Merit: An Academic Accomplishment Index,” Journalism and Mass Communication Educator, 58(3), 240-250. Bennett, John (1985), “Periodic Evaluation of Tenured Faculty Performance,” New Directions for Higher Education, 49, 65-73. Gunn, Bruce (1985), “A Participative Management Evaluation System for Appraising Faculty Performance,” College Student Journal, 19(2), 2-39. Hoffman, Roy (1984), “Correlates of Faculty Performance,” College Student Journal, 18(3), 164-168. Kurz, Richard, John Mueller, and Judith Gibbons (1989), “Faculty Performance: Suggestions for the Refinement of the Concept and its Measurement,” Journal of Higher Education, 60, 43-58. Lucal, Betsy, Cheryl Albers, and Jeanne Ballantine (2003), “Faculty Assessment and the Scholarship of Teaching and Learning: Knowledge Available/ Knowledge Needed,” Teaching Sociology, 31(2), 146-161. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 260 A NOTE ON ADVERTISING COMPETITION IN A DUOPOLISTIC MARKET Hongkai Zhang, East Central University Hani I. Mesak, Louisiana Tech University ______________________________________________________________________________ ABSTRACT Based on a discrete version of the Lanchester advertising model for a duopoly, a mathematical model is developed to compare the alternative advertising policies of a firm (i.e., the focal firm) responding to the uniform advertising policy (UAP) of its competitor. It is shown in a numerical example that under a concave advertising effectiveness function, the focal firm’s UAP is superior to its blitz policy (BP). On the other hand, under a linear or convex advertising effectiveness function, the focal firm’s BP is largely superior to its UAP. ______________________________________________________________________________ INTRODUCTION An important concern of advertising managers is allocating an advertising budget effectively over a finite planning horizon. Marketing researchers have analyzed a variety of models to address the issue of whether or not it is best to adopt a pulsing policy, or a policy of even spending (Feinberg 1988; Hahn and Hyun 1991; Mahajan and Muller 1986; Mesak 1985; Mesak and Darrat 1992; Park and Hahn 1991; Sethi 1977; Simon 1982). The findings of these studies suggest that for a concave or linear advertising effectiveness function, a policy of even spending is optimal, whereas for a convex function, the best practical advertising policy is one of pulsing. All these models, however, have ignored competitors’ advertising policy, which may significantly affect a firm’s advertising performance (Little 1979). This study, like that of Park and Hahn (1991), employs a discrete version of the Lanchester model to describe advertising competition in a duopolistic market. We consider a finite multiperiod planning horizon for the allocation of a certain advertising budget. In the marketing literature, one question of particular significance still stands only partially answered. It is concerned with what is the best policy of allocating advertising funds over a finite planning horizon of n equal consecutive time periods so that a certain performance measure is optimized in a competitive scenario. Blitz Policy (BP) and Uniform Advertising Policy (UAP) are two major advertising policies frequently discussed in the literature (e.g., Mahajan and Muller 1986). BP is a one-pulse policy in which the firm concentrates its advertising efforts in a single time period of the planning horizon, whereas according to UAP, the firm advertises at a constant level. Based on the discrete version of the Lanchester advertising model, we attempt to develop a modeling framework for BP and UAP and address the question mentioned above in a duopolistic setting. For the chosen values of the model parameters, a numerical example is provided to compare the performances of UAP and four types of BP and identify the optimal advertising policy for the focal firm. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 261 MATHEMATICAL MODEL In our study, one of the two competitors in a duopolistic market is chosen as the focal firm, which is assumed to observe and then respond to its rival’s advertising policy. The Lanchester model delineates the interacting impact of the advertising levels of the two rivals upon the market share of the focal firm. This model has been extensively used to examine optimal advertising policies in competitive advertising situations and is claimed to be one of the most popular models of advertising competition (e.g., Chintagunta and Vilcassim 1994; Erickson 1985; Little 1979). In particular, Park and Hahn (1991) highlight two interesting features of the Lanchester model: (1) the duopoly assumption may not be a severe restriction because it describes many interesting competitive situations (e.g., Coke vs. Pepsi), and (2) the discrete nature of advertising inputs in a discrete model enables us to compare the effects of different advertising patterns, such as high-low and low-high pulsing. Thus, we use a discrete version of the Lanchester model to capture the impact of competitive advertising on market share in a duopolistic market. From this point on, the focal firm is referred to as firm 1 and its rival as firm 2. In the following discussions, the planning horizon is assumed to comprise n consecutive equal time periods. Beginning from the starting point of the planning horizon, the n periods are successively denoted as period t (t = 1, 2,…, n). Since firm 1 is not going out of business at the end of the nth period, the infinite period immediately following the planning horizon must also be taken into consideration to assess the effect of advertising efforts in previous periods. Several key notations used in our mathematical model are defined below for the purpose of providing a concise exposition: ut = advertising spending of firm 1 in period t; vt = advertising spending of firm 2 in period t; xt = market share of firm 1 in period t; x∞ = cumulative market share of firm 1 for the infinite period immediately following the planning horizon; x0 = market share of firm 1 at the beginning of the planning horizon; I = total advertising budget of firm 1 available at the beginning of the planning horizon. A discrete version of the Lanchester model, proposed by Park and Hahn (1991), is then stated as xt − xt −1 = f (u t )(1 − xt −1 ) − g (vt ) xt −1 , (1) where f(ut) and g(vt) are advertising effectiveness functions. In the discrete model (1), the market share xt ε [0, 1] requires both f(ut) and g(vt) to be bounded between zero and one (Park and Hahn 1991). f() and g() are increasing functions of their own arguments. Model (1) can be rearranged as a two-component expression: xt = [1 − f (u t ) − g (vt )]xt −1 + f (u t ). (2) Model (2) decomposes firm 1’s market share into two parts: (i) the carryover effect from the previous period and (ii) the effect of firm 1’s current advertising. It is noted in (2) that the carryover rate is a function of the current advertising expenditures of both firm 1 and its rival. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 262 Now let us further examine the advertising effectiveness functions, f(ut) and g(vt). Consider the following two functional forms: δ f (u t ) = a1u t 1 , and (3.1) δ2 g (v t ) = a 2 v t , (3.2) where a1 and a2, bounded between zero and one, are constants representing the advertising effectiveness of firms 1 and 2, respectively; δ1 and δ2 are the shaping parameters assumed to take positive values. A shaping parameter smaller than, equal to, or greater than one indicates a concave, linear, or convex advertising effectiveness function, respectively. A firm’s advertising budget for a multiperiod planning horizon can always be treated as one whole numerical unit, and obviously, advertising spending in each period accounts for a fraction of this unit so that ut and vt are bounded between zero and one. As a result, (3.1) and (3.2) are also bounded between zero and one so that the requirements of model (1) are satisfied. The sum of market shares (i.e., the total cumulative market share) over the finite planning horizon plus the ensuing infinite period, n ∑ xt + x∞ , i =1 (4) is chosen as the performance measure of firm 1’s advertising policies examined in this study, namely, BP and UAP. Assume that firm 2 indefinitely employs UAP with a constant advertising spending v0. For simpler exposition, let g0 = g(v0). The cumulative market share of firm 1 for the infinite period takes the following form (Mesak and Zhang 2003): 1 − g0 x∞ = xn . (5) g0 For i = 1, 2, …, n, let BPi denote firm 1’s blitz policy in which the entire advertising budget I is allocated to period i of the n-period planning horizon. Apparently, under BPi, ui = I and ut = 0 for ∀t ≠ i; under UAP, ut = I/n for t = 1, 2, …, n. A NUMERICAL ILLUSTRATION In this section a numerical example is presented to compare the performances of firm 1’s UAP and BP. Assume for firm 1 a planning horizon of one year composed of four equal periods (quarters) and an advertising budget I = one million dollars to be allocated over the planning horizon, while firm 2 indefinitely implements a policy of UAP with g0 = 0.15. Consider the following advertising effectiveness function for firm 1: f (u ) = 0.5u δ1 . (6) Since the advertising budget of firm 1 is spent exhaustively over the four-period planning horizon, its advertising spending in each period is constantly equal to 0.25 million dollars under UAP. If firm 1 implements BPi, the entire advertising budget is allocated to period i. Three values of δ1, 0.5, 1.0, 1.5, are considered to investigate the impact of the shape of firm 1’s advertising effectiveness function on the performances of its advertising policies examined in this study. Also, six alternative values of firm 1’s initial market share x0, 0.0, 0.1, 0.3, 0.5, 0.7, 0.9, are chosen for the numerical example. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 263 The computational results of (4) are presented for firm 1’s BPi (i = 1, 2, 3, 4) and UAP in Table 1. For example, given a shaping parameter δ1 = 0.5 and an initial market share x0 = 0.3, if firm 2 indefinitely implements UAP with g0 = 0.15, then the cumulative market share yielded by firm 1’s advertising policy of BP1 is 4.033333. Although the following discussions are based on the chosen values of the model parameters, they shed interesting lights on the performances of firm 1’s UAP and BP. Table 1 Total Returns of Firm 1’s Advertising Policies Conditioned by Firm 2’s UAP with g0 = 0.15 δ1 = 0.5 x0 0.0 0.1 0.3 0.5 0.7 0.9 BP1 3.333333 3.566667 4.033333 4.500000 4.966667 5.433333 BP2 3.333333 3.616667 4.183333 4.750000 5.316667 5.883333 BP3 3.333333 3.659167 4.310833 4.962500 5.614167 6.265833 BP4 3.333333 3.695292 4.419208 5.143125 5.867042 6.590958 UAP 4.766667 4.970667 5.378667 5.786667 6.194667 6.602667 BP4 3.333333 3.695292 4.419208 5.143125 5.867042 6.590958 UAP 2.815039 3.162397 3.857113 4.551829 5.246546 5.941262 BP4 3.333333 3.695292 4.419208 5.143125 5.867042 6.590958 UAP 1.531376 1.977375 2.869372 3.761370 4.653368 5.545365 δ1 = 1.0 x0 0.0 0.1 0.3 0.5 0.7 0.9 BP1 3.333333 3.566667 4.033333 4.500000 4.966667 5.433333 BP2 3.333333 3.616667 4.183333 4.750000 5.316667 5.883333 BP3 3.333333 3.659167 4.310833 4.962500 5.614167 6.265833 δ1 = 1.5 x0 0.0 0.1 0.3 0.5 0.7 0.9 BP1 3.333333 3.566667 4.033333 4.500000 4.966667 5.433333 BP2 3.333333 3.616667 4.183333 4.750000 5.316667 5.883333 BP3 3.333333 3.659167 4.310833 4.962500 5.614167 6.265833 It is shown in Table 1 that firm 1’s UAP is superior to all its four types of BP in the presence of the concave (δ1 = 0.5) advertising effectiveness function. Given the linear (δ1 = 1.0) advertising effectiveness function, however, firm 1’s UAP is dominated by its BP3 and BP4. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 264 Firm 1’s UAP can only dominate BP1 and BP2 if its initial market share x0 is at least 0.5 and 0.9, respectively. In the presence of the convex (δ1 = 1.5) advertising effectiveness function, firm 1’s BP2, BP3 and BP4 dominate UAP. Firm 1’s UAP can only dominate BP1 when x0 = 0.9. Also, some interesting comparative findings related to firm 1’s four types of BP are observed from Table 1. 1. The shaping parameter, δ1, appears to have no impact on the cumulative market share yielded by any of the four types of BP. 2. Everything else being equal, the smaller the value of δ1, the larger the cumulative market share yielded by firm 1’s UAP will be. 3. BPi dominates BPi-1 for i = 2, 3, 4. CONCLUDING REMARKS In this research note, a discrete version of the Lanchester model is employed to depict the relationship between the focal firm’s market share and competing advertising efforts in a duopolistic market. A mathematical model is developed to determine the cumulative market share of the focal firm yielded by an advertising policy. A numerical example is presented to compare the performances of UAP and four types of BP adopted by the focal firm. Based on the specified form of the advertising effectiveness function and the assumption that the rival indefinitely implements a policy of UAP, the major findings of the numerical investigation are summarized below: 1. Under a concave advertising effectiveness function, the focal firm’s UAP dominates its BP. 2. Under a linear or convex advertising effectiveness function, the focal firm’s BP largely dominates its UAP. 3. If the focal adopts a policy of BP, the entire advertising budget should be allocated to the last period of the planning horizon to generate the highest return. REFERENCES Chintagunta, P. K. and N. J. Vilcassim (1994) “Marketing Investment Decisions in a Dynamic Duopoly: A Model and Empirical Analysis,” International Journal of Research in Marketing 11, 287-306. Erickson, G. M. (1985) “A Model of Advertising Competition,” Journal of Marketing Research 22 (August), 297-304. Feinberg, F.M. (1988) “Pulsing Policies for Aggregate Advertising Models,” Doctoral Dissertation, Massachusetts Institute of Technology. Hahn, M. and J. S. Hyun (1991) “Advertising Cost Interactions and the Optimality of Pulsing,” Management Science 37, 157-169. Little, J. D. C. (1979) “Aggregate Advertising Models: The State of the Art,” Operations Research 27 (July-August), 627-667. Mahajan, V. and E. Muller (1986) “Advertising Pulsing Policies for Generating Awareness for New Products,” Marketing Science 5 (2), 89-106. Mesak, H. I. (1985) “On Modeling Advertising Pulsing Decisions,” Decision Sciences 16 (1), 25-42. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 265 Mesak, H. I. and A. F. Darrat (1992) “On Comparing Alternative Advertising Policies of Pulsation,” Decision Sciences 23 (3), 541-559. Mesak. H. I. and H. Zhang (2003) “Optimal Advertising Pulsation Policy for a Discrete Model of Advertising Competition,” Proceedings of the 34th Decision Sciences Institute Annual Meeting, Washington, D.C. Park, S. and M. Hanh (1991) “Pulsing in a Discrete Model of Advertising Competition,” Journal of Marketing Research 28 (November), 397-405. Sethi, S. P. (1977) “Dynamic Optimal Control Models in Advertising,” SIAM Review 19, 685725. Simon, H. (1982) “ADPULS: An Advertising Model with Wearout and Pulsation,” Journal of Advertising Research 19 (3), 352-363. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 266 THE EVOLVING MARKETPLACE: A BRIEF REVIEW OF TECHNOLOGY AND MARKET SYSTEMS George M. Zinkhan, University of Georgia Sam S. Zinkhan, University of Texas Ji Hee Song, University of Georgia ______________________________________________________________________________ ABSTRACT The marketplace is an ancient human development that simultaneously delivers a standard of living and serves as a forum for the exchange of ideas. Here, we briefly touch upon the highlights associated with the evolution of the marketplace and show its influences on society. We also discuss how the “marketspace” of emerging technology (e.g., the Internet) is transforming this multi-faceted institution. ______________________________________________________________________________ INTRODUCTION The development of the marketplace is often seen as the beginning of human civilization. In traditional societies, the marketplace is a space where goods and services are bought and sold. In the 21st century, we see a marketplace can also be an electronic trading facility, providing a forum for exchanging information and conducting transactions. In the world of the ancient Greeks or ancient Judeans, the marketplace existed in a discrete location. Today’s electronic marketplaces (e.g., Amazon marketplace, eBay auction) make it possible for a seller in the U.S. to locate buyers in China and consummate exchanges in real time. As marketplaces evolve, the institution of marketing becomes a more salient and more important part of daily life. The objectives of our paper are two-fold: 1) to sketch briefly the highlights associated with the evolution of the marketplace starting in 500 B.C. and extending to the 21st century and 2) to outline how the role of marketing and the marketing discipline are likewise evolving. To address these issues, we examine the history of marketplaces in different cultures. In a short paper, it is not possible to cover completely the full history of marketplace evolution. To illustrate our points, we cite salient examples from three primary sources: 1) the U.S. and Europe (West), 2) Korea (East), and 3) ancient Greece and Judah (which are located at the intersection of East and West). THE MARKETPLACE AS AN ENGINE OF ECONOMIC EXCHANGE & FOCUS OF PUBLIC LIFE Ancient Judah Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 267 The Bible contains many references to merchants and the marketplace (King James Version of the Bible 2004). Exhibit 1 presents some examples of these references. As shown in Exhibit 1, the passage from Ezekiel provides an interesting list of material goods that are available in the marketplace. In this way, the marketplace provides value for the populace and represents an image of the good life, among the ancient Israelis. At the same time, it is interesting to note that the writer ascribes spiritual value to this listing of material wealth and reminds the reader that God has provided these things and those who toil in the marketplace do God’s work and worship God. ______________________________________________________________________________ Exhibit 1. The Marketplace as Represented in the Bible ______________________________________________________________________________ Tarshish was thy merchant by reason of the multitude of all kind of riches; with silver, iron, tin, and lead, they traded in thy fairs. Javan, Tubal, and Meshech, they were thy merchants: they traded the persons of men and vessels of brass in thy market. They of the house of Togarmah traded in thy fairs with horses and horsemen and mules . . .Judah, and the land of Israel, they were thy merchants: they traded in thy market wheat of Minnith, and Pannag, and honey, and oil, and balm. Damascus was thy merchant in the multitude of the wares of thy making, for the multitude of all riches; in the wine of Helbon, and white wool. Dan also and Javan going to and fro occupied in thy fairs: bright iron, cassia, and calamus, were in thy market … These were thy merchants in all sorts of things, in blue clothes, and broidered work, and in chests of rich apparel, bound with cords, and made of cedar, among thy merchandise. –Ezekiel, 27: 12-14, 17-19, 24 ______________________________________________________________________________ For the Pharisees, and all the Jews, except they wash their hands oft, eat not, holding the tradition of the elders. And when they come from the market, except they wash, they eat not. And many other things there be, which they have received to hold, as the washing of cups, and pots, brasen vessels, and of tables. – Mark, 7: 3-4 ______________________________________________________________________________ But the Pharisees and lawyers rejected the counsel of God against themselves, being not baptized of him. And the Lord said, Whereunto then shall I liken the men of this generation? and to what are they like? They are like unto children sitting in the marketplace, and calling one to another, and saying, We have piped unto you, and ye have not danced; we have mourned to you, and ye have not wept. – Luke, 7: 30-32 ______________________________________________________________________________ And when her masters saw that the hope of their gains was gone, they caught Paul and Silas, and drew them into the marketplace unto the rulers, and brought them to the magistrates, saying, These men, being Jews, do exceedingly trouble our city, and teach customs, which are not lawful for us to receive, neither to observe, being Romans. – Acts, 16: 19-21 Now while Paul waited for them at Athens, his spirit was stirred in him, when he saw the city wholly given to idolatry. Therefore disputed he in the synagogue with the Jews, and with the devout persons, and in the market daily with them that met with him. – Acts, 17: 16-17 ______________________________________________________________________________ Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 268 In the passage from Mark, we get a description of important rituals that are associated with the marketplace (e.g., rituals related to cleanliness). In the passage from Luke, we see the marketplace as a public gathering area – as a place where idle children may come and play in a safe environment. At the same time, children are not true participants in the marketplace, and the passage derides such children as ignorant and complaining in unreasonable ways. In the two passages from Acts, we see the marketplace as an area of political power -- a place where the rulers congregate. It also provides a forum for public debate. These New Testament books are (approximately) two thousand years old. In contrast, the prophet, Ezekiel, lived in the 6th century B.C., just prior to the time when the Babylonians take Judeans into exile. Ancient Greece In his Republic, Plato (1955 edition) sets out to create the ideal state. In that work from the fourth century B.C., Plato presents a dialog between two speakers, Socrates and Glaucon, who is Plato’s brother-in-law. Socrates argues that “exchange” is one key reason for human beings to gather together and form a community. For example, it is more efficient for a community to practice “specialization of labor” so that one man is a farmer, another man is a cobbler, another is a metal worker, and so forth (Zinkhan 2004). Given this specialization, it is necessary to create both a currency and a marketplace. Socrates also describes various roles for marketers, including the retailer (who deals in the marketplace), the merchant (who trades across the seas), and the specialty retailer (who deals in luxury goods such as furs or jewelry or fashion goods). Under this classification scheme, the retailer serves to make labor more efficient. Since farmers have specialized skills in tending crops and livestock, it does not make sense for them to sit idly in the marketplace and wait for buyers to emerge. The merchant (importer & exporter) is necessary because it is very difficult to locate a city in a place where all natural resources are in sufficient supply to satisfy the demands of the populace. The specialty retailer is necessary to provide the citizens with luxury goods. At first, Socrates does not believe that luxury goods are desirable in his ideal state. Instead, he believes that the people will be better off with a simpler life. [The people of the city] must have a relish – salt and olives, and cheese, and they will boil roots and herbs such as country people prepare; for a dessert we shall give them figs, and peas, and beans, and they will roast myrtle-berries and acorns at the fire, drinking in moderation. And with such a diet they may be expected to live in peace and health to a good old age, and bequeath a similar life to their children, after them (Plato, 1955, pp. 318). However, Socrates is persuaded by Glaucon to experiment with “a state at fever heat.” Yes .. now I understand: the question which you would have me consider is, not only how a State, but how a luxurious State is created … In my opinion the true and healthy constitution of the State is the one which I have described. But if you wish also to see a State at fever heat, I have no objection. For I suspect that many will not be satisfied with Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 269 the simpler way of life. They will be for adding sofas, and tables, and other furniture; also dainties, and perfumes, and incense, and cakes, all these not of one sort only, but in every variety; we must go beyond the necessaries of which I was at first speaking, such as houses, and clothes, and shoes: the arts of the painter and the embroiderer will have to be set in motion, and gold and ivory and all sorts of materials must be procured (Plato, 1955, pp. 318). Notice how Plato foreshadows Maslow’s hierarchy of needs as he distinguishes between different categories of needs and wants. Also notice how the services of both a marketer and designer are necessary to create a luxurious standard of living for the populace. It is interesting to note all the modern elements that appear in Plato’s dialogue, written more than 2300 years ago. He understands key economic principles related to marketplaces, currency, specialization of labor, hierarchy of needs, retailing, standard of living, importing, and exporting. Economic historians estimate that currency money began in Lydia (modern-day Turkey) in the seventh century B.C. By the time of Solon, a century later, money was weakening the power of inherited aristocracy. Replacing the palace, the agora or marketplace became the center of public life and discourse (Weatherford 1997). In fact, ancient Greek society flourished both because of the economic activities associated with trade in the economic marketplace and because of the free exchange of ideas in the intellectual marketplace (Boardman 2001). There is a symbiotic relationship here as the physical marketplace also served as a forum for the promotion of intellectual inquiry. Following this line of reasoning, it is argued that Greek thought in the Golden Age of Socrates achieved great breakthroughs because the Greek philosopher was required to sell his wares in the intellectual marketplace. If he is to outsell his rivals, the Greek philosopher must display a few novelties in his window, and he must talk up his own goods, while simultaneously talking down those of his rivals. Thus, the facts of Greek intellectual life favored systematically exploring the arguments on both sides of fundamental questions (in order to prove potential adversaries wrong). Take note again of the natural give and take that exists in the traditional platonic dialog. In this way, technological and intellectual advancements go hand in hand. The idea for currency is an abstraction. With currency as a medium, marketplaces develop, and these, in turn, encourage interactions between civilizations. At the same time, marketplaces serve as a public forum where citizens can meet and exchange both ideas and goods. Under the Greek system, these exchanges also fostered intellectual inquiry. One extant artifact of such intellectual inquiry is Plato’s Republic, which, even in the 21st century, amazes readers with its astonishing insights (Zinkhan 2004). Early Marketplace in Korea The first marketplace recorded in Korean history, called “the Central Market,” opened in 490 A.D., and was located in the middle of capital city (The History of Korean Market 2004). In the marketplace, ordinary men and women actively exchanged various goods. The medium of exchange was rice, and barter trades were common practice. Elsewhere, there were several different types of marketplaces based on the locations and occasions. For example, a marketplace was formed when there was a special religious ceremony in a town. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 270 In the 10th century, a number of big marketplaces were formed, and larger ones tended to be government-owned. In the capital city, different kinds of shops were located on both sides of the market corridor. On occasions when foreign government missions arrived in the city, special marketplaces were formed to create international trade. Many small marketplaces operated in local cities, especially in those along major transportation routes. In the 11th century, the first Korean currency, made from iron, was introduced and used in transactions. Prior to the Middle Ages, the development of marketplaces and merchants in Greek and Israeli society was faster than in Korea. In western cultures, marketplaces also served as places of family gathering, entertainment, political purpose, and exchange of ideas. In contrast, marketplaces tended to be formed for specific occasions (e.g., religious ceremonies, and arrival of foreign government missions) in Korea. THE GUILD SYSTEM AND TOWN MARKETS In some respects, the ancient civilizations of Greek and Rome represented a “high point” in human development. Many of their institutions (e.g., marketplaces) did not fully revive in much of Europe until later times. To cite one example, the harbor and associated trading facilities in London were largely unused by the Angles, who replaced the Romans in England. Beginning in the 11th and 12th century, trade guilds started to become widespread throughout parts of Europe (Epstein 1991). The two main types of guilds that existed during this time were the craft guilds and the merchant guilds. This association of tradesmen allowed for members to mutually regulate the sales of their own products. The formation of guilds in medieval towns developed a standard price and quality of a good within that town’s marketplace. In this regard, guild members would check each other’s goods to ensure satisfactory levels of quality (Epstein 1991). Merchants and craftsmen were required to join a town’s guild in order to participate in a town’s marketplace. Three common levels within a guild include: a) a master with special skills; b) an apprentice who was trained satisfactorily by the master; and c) a journeyman who is a “graduated” apprentice (Epstein 1991). Local leaders (e.g., aristocracy) were in competition with one another to create strong marketplaces within their towns in order to collect the associated tax revenues. The guilds rose to prominence for several reasons. First, towns and cities developed throughout Europe, and the marketplace served as a key mechanism for attracting residents and visitors (e.g., who wished to trade in the marketplace). Second, the guild system provided a way for tradesmen and craftsmen to control commerce, within their jurisdiction. For instance, the guilds enforced monopolistic power and practices. Third, the guild system provided customers with some assurance of quality (Zinkhan 2004). In Korea of the early 15th century, department-store-type marketplaces, called “Shijeon,” were located in the middle of Seoul city (The History of Korean Market 2004). About 800 shops were organized and located on both sides of the corridor street. The length of the corridor was Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 271 about 1 mile. The market was divided into several sections according to the kind of goods traded. To operate a shop in the Shijeon, the merchant had to obtain government permission. In addition, the merchant was regulated to supply necessary commodities to the palace, and the merchant incurred tax obligations according to the size of profits. In the early 15th century, peddlers began to appear in Korea, and they were involved in very active commercial transactions. Shijeon merchants tried to control the activities of peddlers through their government permissions. However, in the 18th century, this license system was removed. The peddlers continued to contribute to the development of marketplaces and to international trade. However, due to government prohibition, nationwide market networks could not be organized. In the Middle Ages, it was common, in both the west and east, for rulers to control the marketplace through a system of association or permissions. In Korea, under the strong control of central government, merchants enjoyed only limited power and rights. In contrast, the western guild system is seen as the precursor to later institutions such as trade unions, democracy, the middle class, and individual freedoms. Even though guilds and guild members were still under the control of local rulers, it was significant that the guild members organized themselves and took direct actions to further their goals (sometimes acting independently from local rulers). THE MODERN MARKETPLACE In the late 19th century, department stores brought an entire marketplace under one roof. In the beginning, the departments were leased out to individual merchants. In some ways, they were similar to modern malls, where the property owner has no direct interest in the “departments,” other than to collect rent and provide utilities. By 1900, the smaller companies (individual merchants) were purchased or replaced by large companies, and single-ownership enterprises were created. Since the beginning, department stores featured food courts, entertainments, and specialty goods. These were joined together in spectacular buildings with central atriums, with the departments arrayed around this center. The 20th century mall performed the same service. At the same time, the Sears and Roebuck catalog connected buyers to the marketplace via the U.S. postal service. Eventually, telephone lines and internet service connected buyers and sellers in a different way (Zinkhan 2004). As described by natural selection theory, superior retail formats take hold and drive out less productive organizations (Zinkhan et al. 1999). In this respect, store closings and subsequent expansions are part of the natural order of things. Marketplace changes are part of a cycle, as sellers strive for efficiency and profitability (May 1989). In the modern marketplace, consumers demand value, and they find themselves with limited free time. Thus, the marketplace evolves to meet consumer demands (for goods and information) more quickly (Balazs and Zinkhan 2003). Speed and convenience become more and more important. INTERNET MARKETPLACE In the world of the ancient Greeks, the marketplace existed in a discrete location. Plato described three discrete kinds of marketers. The world is not so simple in the Age of the Internet. Now, it is rather difficult to identify times when we are not in a marketplace. Many Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 272 Internet surfers are paying for their Internet access. While surfing, they encounter a veritable army of pop-up ads. Basic human behaviors and rituals (e.g., courtship) are routinely conducted in cyberspace (Zinkhan 2004). Cyberspace has a variety of unique features. First, it provides a way to conquer time constraints. In the 21st century, potential car buyers on the Internet can obtain more information in just a few minutes than their on-ground counterparts can obtain over a series of days. Second, the Internet provides a way to conquer distance constraints. For example, an e-commerce firm in Atlanta, Georgia can make sales to a customer in Beijing, China. If that firm’s business is selling computer programs, then the Internet can also be used as a means of transport and delivery. That is, the Internet is both a communication medium and a transaction facilitator (or consummator). In the near future, networked computers will be everywhere. Low-cost microprocessors and network connections will be embedded in all consumer durable devices, such as the washing machine, the refrigerator, the hot water tank, the oven, and many others. Every one of these devices will be connected to the Internet, through either the electrical wiring system or through a community wireless network (Watson et al. 2002). The result will add intelligence to everyday objects, and these objects will have the ability to communicate with us in sophisticated ways. For instance, a refrigerator could let us know when its supply of milk is running low. Or, the refrigerator could communicate directly with a local store to arrange for timely delivery. In this way, routine purchases could become automatic and take place below the level of our consciousness. Of course, there would have to be ways for the refrigerator owner to intervene and change the default order. In addition, the refrigerator owner may wish to obtain periodic reports about the nature and frequency of these automatic purchases (Zinkhan 2004). AN EXPANDED ROLE FOR MARKETING In his book, The Sources of Social Power, a professor of sociology, Michael Mann (1986) identified four substantive sources of social power: ideological, economic, military, and political. Ideological power derives from the human need to find ultimate meaning in life, to share norms and values, and to participate in aesthetic and ritual practices. Economic power derives from the need to extract, transform, distribute, and consume the resources of nature. It is different from military power (social organization of physical force) and political power (control of the state). Each power source generates distinct organizational forms. The overall structure of societies is not determined by any single power. Societies are structured primarily by these entwined four powers. For example, any economic organization requires some of its members to share ideological values and norms. It also needs military defense and regulation. Thus, ideological, military, and political organizations reinforce economic structure. In contrast, the revenues raised through taxation could be used not only to finance the military but to build infrastructure. That growing infrastructure then reinforced economic growth and increased national identity itself becomes a kind of ideological power. As a result, all of these interests increasingly intersect to create what he calls the “cage” of the nation-state. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 273 Mann (1986) emphasizes that military power is a traditionally most important power source in society. He notes, “Economic exchange usually occurred over short geographical distances. Large areas and diverse peoples became integrated largely through the force of arms (Mclemee 2004).” As marketplaces evolve, we see that marketing plays an ever increasing role in society. For instance, the amount of advertising and marketing North Americans are exposed to daily has exploded over the past decade; studies show that on average we are exposed to 3,000 ads per day. Consider political and ideological organization. Promotions and public relations play key roles for political parties. Churches strive to attract more worshipers through commercial channels of communications (e.g., advertisements, Web sites). Emergence of the Internet marketplace has also great impact on the expansion of marketing power to other sectors. Consider the expanded role of consumers in our society. From the early 1970s, marketers and managers have emphasized the power of consumers and proclaim that the “customer is king.” In the U.S., both primary and secondary education expands considerable time and resources to teach young people how to be good shoppers and how to get a good deal. Children are taught to be skeptical about advertising messages and campaigns. In the 21st century, the Internet gives consumers greater power (Pitt et al. 2002). For instance, in 2004, a single consumer could reach a large audience (e.g., by creating a successful web site). Consumers can also use the Internet to communicate with each other and thus band together to compete with corporations in the marketplace of ideas (Pitt et al. 2002). THE ALL-PERVASIVE MARKETPLACE In the 21st century, it is very difficult to identify specific times when we are not involved in marketplaces. For instance, all of these instances are examples of marketplace participation: a) being exposed to an ad (e.g., billboard, radio ad, pop-up ad); b) talking with friends about marketplace experiences; c) thinking about material things; d) consuming (e.g., wearing clothing, eating, sleeping in a bed); e) buying; f) searching for information; g) disposing; h) working; i) surfing the Internet; j) e-dating; and so forth. In brief, marketplaces are all-pervasive. A 21st century American has to try very hard to escape the grip or influence of the marketplace. To illustrate the “all-pervasive” nature of marketing, we provide a listing (in Table 1) to show some examples of times when we are “not in a marketplace.” For instance, the very young or very old might be out of marketplaces, in the sense that they do not understand them consciously. Nonetheless, such people may move around the physical (or virtual) space of the market. Even those who seek adventures in remote locations (e.g., Mount Everest) carry with them many specialty items from the marketplace. It is more and more rare for 21st century consumers to use something that they have fashioned for themselves (without any involvement in the marketplace). In summary, the marketplace is our life! Thus, it is no surprise that social scientists increasingly turn to the marketplace to study human behavior. In this way, the traditional preserve of the marketing professor is “invaded” by the sociologist, the human geographer, the psychologist, the psychiatrist, and so forth. At the same time, marketing professors gain more status in society as a whole, because they are seen as having special knowledge about this crucial aspect of human existence. Proceedings of the Annual Meeting of the Association of Collegiate Marketing Educators (2005) . . . page 274 ______________________________________________________________________________ Table 1. The All-Pervasive Marketplace (and not) Times When We are Not in a Marketplace Comments Robinson Crusoe metaphor This description gained instant popularity in the 17th century (e.g., a realization of dependency upon civilization and its associated marketplaces) Out in nature (e.g., in an isolated environment such as jungle, mountain-top, or wilderness) Even here, we often carry things with us from a marketplace (e.g., food, clothing, gear) Rural areas / Lesser developed nations Marketplaces have always been a hallmark of town life or city life The self-sufficient family farm Nonetheless, from early times, the self-sufficient farmer often spent considerable time in the marketplace The hunter-gatherer Barter might be important in this society Those who lack resources For instance, the homeless or the vary old may be excluded from many modern marketplaces Those without a token of exchange The barter system can be cumbersome. Nonetheless, vibrant exchanges can exist in a barter economy Sleeping on the ground When the level of consciousness is very low, we are out of the marketplace. Nonetheless: “To sleep, perchance to dream!” We have to learn how to participate in marketplace, but such training is a crucial aspect of socialization and education in the 21st century Infancy CONCLUSION We briefly sketched the evolution of “the marketplace” in both western and eastern cultures. As the marketplace becomes more salient and important in our daily life, we see that marketing plays an increasing role in every sector of our society. In spite of the central importance of the marketplace concept, research related to the evolution and emergence of marketplaces is rarely done in marketing. It is worthwhile to reexamine this vibrant societal institution and its influence on civilization and world history. 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