The Influence of External Channel Environment on Channel Governance

  •  Guanglu Cao    


External environment has a vital impact on channel operation, but it remains unclear how task and institutional environment influence channel members’ governance behavior. With data collected from distributors of a large-scale petrochemical enterprise, this study builds a structural equation model to analyze the influence of channel institutional and task environment on channel members’ governance behavior. The empirical results suggest that, both task and institutional environments are influential to channel governance: when the environment is dynamic and complex, channel partners tend to use relational governance mechanism. When the regulatory environment is influential, contractual mechanism is widely used, while relational mechanism is preferred when cognitive environment is sufficiently powerful. This paper provides new insights into research of channel environment, and also provides practical guidance for channel members.

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