INTERLOCKING DIRECTORATES

Interlocking Directorates

Interlocking Directorates

Interlocking directorates

Board of Directors owned an important role in establishing close relationships with banks and industrial companies, including through interlocking directorates. This is a consequence of processes that reflect the increasing internationalization process, which objectively requires specific approval of goals and directions of development between the individual major companies, especially outside in the same financial group (Fennema, 1982). Agreeing goals calls for the development of guidelines and how to achieve them. As a result of interlocking directorates to establish closer links and contacts of senior management of the company and the bank. These contacts, in some cases carried out every day and are aimed at information exchange, coordination of financial issues and specific policies, the provision of mutual consultation (Knoke, 1994).

Culture and Structure

Hofstede's different dimensions of culture

Culture is transmitted via our social environment and not through heredity. Hofstede defines power distance as follows: This means that people in a culture with a high power distance are more easily accept the fact that power is unequally distributed than in cultures with low power distance. In most societies, the group stated interest above the interests of the individual (Ackerman, 2000). This is called collectivist societies. The group is dominant factor and the individual derives his identity to the group. There are also societies where the importance of good working relationships, both with the chef as with colleagues and subordinates, and that they live in a pleasant environment. Caring for others and the environment is a dominant value. This gives rise to the introduction of the dimension masculinity/femininity (Sklair, 2001). The way of dealing with uncertainty depends not only on the nature of man but also of the culture in which he lives. For example, England has no penal code but in Germany there are even rules in case there is nothing organized (Knoke, 1994). From previous research showed that there fourth dimension can be introduced because the Uncertainty Avoidance.

Structures that help leaders to establish cultures - in light of Granovetter (1985)

The structural embeddedness is that by which M. Granovetter (1985). His belief is that individuals in the market are "atomized". Instead, they have personal relationships, build relationships of friendship, loyalty and recurring enough to make it possible to reconstruct the overall structure of the network of relationships that runs the market (Zweig, 2001). This work helps to break the image of a sphere of personal relationships, as self-regulated are involved in the operation of trade or, to put it differently, since market participation does not destroy social relationships. The structural embeddedness reflects the contextualization of market exchange in the form of interpersonal relationships (Ackerman, 2000).

Calculating a Decision: Deliver to Customer A or B

Economic Optimal Decision in the Short Run

There are two fundamental aspects to consider when selling product in short-run. Highly significant concern in short-run is sales maximization, and reduction of cost. Average sale price will remain same in both conditions, whether product X is sold to Customer K or Customer ...