Sources of Power: Their Impact on Intrachannel Conflict Author(s): Robert F. Lusch Source: Journal of Marketing Research, Vol.

13, No. 4 (Nov., 1976), pp. 382-390 Published by: American Marketing Association Stable URL: http://www.jstor.org/stable/3151021 Accessed: 29/07/2009 17:34
Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available at http://www.jstor.org/page/info/about/policies/terms.jsp. JSTOR's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/action/showPublisher?publisherCode=ama. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is a not-for-profit organization founded in 1995 to build trusted digital archives for scholarship. We work with the scholarly community to preserve their work and the materials they rely upon, and to build a common research platform that promotes the discovery and use of these resources. For more information about JSTOR, please contact support@jstor.org.

American Marketing Association is collaborating with JSTOR to digitize, preserve and extend access to Journal of Marketing Research.

http://www.jstor.org

ROBERTF. LUSCH*

The sources of power that auto manufacturers use to obtain control over their dealer network are shown to have a significant impact on the level of conflict that dealers have with their manufacturers. Coercive sources tend to increase the level of intrachannel conflict whereas noncoercive sources tend to decrease it. Auto manufacturers need to be cognizant of this fact in order to use intelligently their available sources of power.

Sources

of

Power:

Their

Impact
I I

on

Intrachannel

Conflict
?I I

INTRODUCTION The behavioral concepts of power and conflict commonly are encountered in the study of channels of distribution.Theoretical and empirical investigations of these constructs in the marketingliterature typically concern power [5, 6, 9, 10, 18, 42-44] or conflict [2, 17, 22, 32-35, 37-39], but little has been done to relate the two concepts.' Only one such theoretical work [11] and one empirical work [41] have appearedin the marketingliterature. Many disciplinesformally study the phenomenaof power and conflict, including sociology, economics, political science, business administration,and social psychology. Dahl, a politicalscientist, gives a possible explanation for the relationshipbetween power and conflict in the following statement [8, p. 72].
If everyone were perfectly agreedon ends and means, no one would ever need to change the way anyone else behaved. Hence no relationsof influenceor power would arise. Hence no political system would exist. Let one person frustrateanother in the pursuitof his
Some of these worksdiscuss both powerand conflict;however, the major thrust of the work is on either power or conflict and between the two. not the relationship *RobertF. Lusch is AssistantProfessorof Business Administraat tion in the Divisionsof Accountingand Marketing the University of Oklahoma. In addition he is a faculty research associate in the DistributionResearch Programin the Division of Marketing. ThewriteracknowledgesWisconsinAutomotiveTradesAssociation for financial assistance and Shelby D. Hunt and Louis W. Stern for their commentson earlierdrafts of this paper.
382

system. For the one may thentry to changethe behavior of the other. If he does so by creatingthe expectation of sizeable rewards or deprivations,then relations of power come into existence.

goals, and you already have the germ of a political

Thus Dahl is postulatingthat conflict between A and B will be influencedby the rewards(i.e. rewardsources of power) and deprivations (i.e. coercive sources of power) that B perceives A to possess. The purpose of this article is to develop and test research hypotheses with regardto conflict between channel members A and B and the sources of power that A possesses. Stern et al. [39] investigated this laboratorysetting. relationshipin a nonmarketing THEORETICAL DEVELOPMENT To develop and test the hypotheses it is first neceschannelof distribution sary to (1) select an appropriate for investigation, (2) select an appropriateclassificational schema of sources of power, and (3) develop an appropriate conceptualizationof conflict. The Channelof Distribution Conflict between channel members A and B is inevitablewhen A and B are functionally interdependent [37, 38]. In franchise channels of distribution there is a high degree of functional interdependence between the franchisor(A) and franchisee (B). Given this high degree of functional interdependence, the have well-definedpower chise channelsof distribution structures [7, 20, 21], in which the balance of power is weighted heavily in favor of the franchisor(A).
potential for conflict development is high. Also, fran-

Research Journalof Marketing Vol. XIII (November 1976),382-90

ON INTRACHANNEL SOURCES OF POWER:IMPACT CONFLICT

383

The franchise channel for the distributionof automobiles was selected for study. This channel is characterized by frequent and visible conflicts [15, 16, 21, 31, 41]. In addition there is a definite balance of power in favor of the manufacturerwhich is in part due to the franchise contract [16, 21]. However, during the last 20 years, dealers have attempted to equalize this balance of power by lobbying and have obtained both nationaland state legislation [21, 24]. During the time this study was conducted (November-December1974),the automobileindustrywas in an economic depression and therefore the overall level of conflict in the channel probablywas intensified. The increased conflict was due in part to the technological and production characteristics of the industry,which requireshigh outputto attainlow unit costs. Many economists suggest that production economies are not exhausted until a firm attains an output of from 600,000to 1,000,000units [23, chapter of VI]. For the distribution automobilesthe economies of scale are even greater. Pashigian[27, p. 238] finds that per unit distributioncosts are still declining as sales reach 1.8 million units. Given this incentive to produce in large quantities, manufacturers find it necessary to pressure dealers to accept more cars than they desire in slow times. Thus an inherent conflict is built into the system because the manufacturer's means of maintainingprofits results in declining profits for the dealers. Sources of Power Of the many possible sources of power, five have been defined which seem common and important: reward,legitimate,referent,expert, andcoercive [ 12]. The coercive source can be differentiated from the others because it alone involves potential punishment and therefore the individualbegrudgingly yields power to another. The other four sources are noncoercive because the individualwillinglyyieldspowerto another [18, 30]. Because other researchers [4, 18] have pointed out the extreme difficulty of empiricallydifferentiatingthe various noncoercive sources of power and because the various power sources dichotomize into coercive and noncoercive types, the meaningfully research involves the coercive-noncoercive present classificational schema. However, by combining expert, reward, referent, and legitimate sources of power into one general noncoercive source, much useful information is lost. For example, it would be interesting to investigate the main and interaction effects of the various noncoercive sources on intrachannel conflict. The results would give strong managerial insights into the specific proceduresand processes to be used in managingconflict (e.g., the use of expert versus rewardpower). The criterion validity of the coercive-noncoercive sourcesof powerwas demonstrated Huntand Nevin by [18]. They established empirically in a franchise

thatthe power of the franchisor channelof distribution over the franchisee is dependent upon the coercive sources of power (i.e. ability to punish)and noncoercive sources of power (i.e. ability to provide high quality assistances) possessed by the franchisor. Further,they found that franchisees are less satisfied with franchisors who use coercive sources of power and more satisfied with those who use noncoercive sources. Tests of the discriminant validity of the coercive and noncoercive constructs also have been conducted [19]. Conflict Conflict in its most general sense can be thought of as overt behavior "arisingout of a process in which
one unit seeks the advancement of its own interests

in its relationshipwith the others" (manifest conflict)

[36, p. 363]. However, conflict is such an elastic concept that it also has been referred to in the marketing literature on channels as (1) a feeling of stress, tension, or hostility of one channel member toward another (affective conflict) [17, 40], and (2) the antecedent conditions of conflictful behavior (latent conflict) [34]. For the purposes of this research a perceptual measure of manifest conflict is used. In a channel of distribution manifest conflict usually takes the form of verbal or written exchanges of disagreements be-

tween channel members. Manifest conflict has two dimensions: frequency and intensity. The perceived frequency of manifest conflict is used here.

Impact of Sources of Poweron ChannelConflict If A is likely to use coercivesources of powerwhen B does not cooperate with him, then B will have more frequent and intense conflicts with A. Stern and Gorman [37, p. 161] state:
The issuance of threats, usuallyof an economic nature in the case of intra-channelfriction, is generally a pathologicalresponse to conflict, because threatstend to elicit threats, thus increasingthe degree of conflict when one party establishesthe use of coercion, .... the other is likely to respond in kind, intensifying conflict ratherthan resolving it. Therefore threats of coercion as a response to conflict tend to intensify and increase the frequency of conflict. This view is consistent with most models of the conflict process [28, 29, 32, 33]. It is also consistant with the writing of Baldwin, who states [3, p. 32-33], ".. fear, anxiety, and resistance are typical responses to if A uses negative sanctions today, B threats, ... will tend to be less willing to cooperate with A in the future." In addition Raven and Kruglanski state [30, p. 77], ". . . when coercive power is brought into the manifest conflict situation, it is particularly likely to increase the underlying basis of conflict. With a personal rejection of the source of power, the

384

JOURNALOF MARKETING NOVEMBER 1976 RESEARCH,

provided him with rewards. Also, ". . . positive with A in the future ... ." [3, p. 32-33]. Likewise,

influencee also increases his desire to retaliate and to avoid influence whenever possible." To the extent that B perceives A to possess noncoercivesources of power, B will have fewer and less intense conflicts with A. This outcome is due to the noncoercive power of A over B being based upon (1) A having the ability to mediate rewards for B, (2) A having a legitimateright to prescribe behavior for B, (3) B having an identificationwith A, or (4) A having some special knowledge or expertise in a given area. If A can mediate rewards for B, then A has more latitude in taking actions which conflict with B's goals without B engaging in frequent and intense conflicts with him. The norm of reciprocity [13] explains, in part, why B will engage in fewer and less intense conflicts with A. B feels obligated to not disagree (conflict) with A because A has sanctionstend to enhance B's willingnessto cooperate

fewer disagreements(conflicts) that B will have

with A.
H3:

Coercive sources of power will explain more intrachannel conflict than noncoercivesources. THE DATA

The data needed to test the research hypotheses were collected as part of a nationalstudy on manufacturer-dealer relationsin the automobileindustry. Durwas sent to 1200 dealers selected at random from
a list of more than 25,000 domestic and foreign new car dealers in the United States. Of 608 questionnaires returned, 567 were usable. Several analyses were conducted to test for response bias. The first consisted of comparing the respondents ing November-December 1974 a mail questionnaire

to the extent that B perceives A as an expert, B will be less likely to engagein frequentandintense conflicts with A, because B will be more inclined to believe that A's actions are good for the channel (assuming that B has a high degree of trust in A). If this is In a similar fashion if A has a legitimate right to prescribebehaviorfor B, then B will engage in fewer and less intense conflicts with A because A has a legitimaterightto influencehim.The writingsof Raven and Kruglanski [30, p. 75] support the proposition that legitimate influence can be an effective means of reducingconflict. Finally, if B has an identification with A, then he will want to protect his good standing with A and therefore will engage in less frequent and intense conflicts with A. Raven and Kruglanskistate can indeed forestall disagreementand conflict." Hunt and Nevin [18] found that franchisors rely on primarily coercive sources ratherthan noncoercive sources to achieve power over their franchisees. interviewswith automobiledealerstended Exploratory to confirm this finding. If this is the case then one would expect that, of the two sources of power, coercive sources would have the greatest impact on intrachannel conflict.
RESEARCH HYPOTHESES The foregoing theoretical background led to the H,: The strongerthe coercive sources of power that A (manufacturer) over B (dealer), the more has frequent the disagreements(conflicts) that B will have with A. H2: The stronger the noncoercive sources of power that A (manufacturer) has over B (dealer), the [30, p. 74], ". . . mutual feelings of identification the situation, ". .. expert influence can be an effective means of reducing conflict .. . ." [30, p. 76].

attributed more power to their manufacturer, (2) were less satisfied with their manufacturer, and (3) had more conflict with their manufacturer. The second analysis consisted of sampling nonrespondents by telephone and asking them to answer questions which attempted to determine whether they were similar to the respondents on these three behavioral measures. A third analysis was conducted to determine whether the responding dealers were representative of the total population of dealers in terms of the manufacturers they represented. It was concluded that the sample was representative. MEASUREMENT

of the first, second, and third waves of the questionnaire2to determine whether the later respondents(1)

Conflict For the purposesof this study, conflict was defined operationallyas the frequency of disagreement between manufacturer dealer, over numerousissues, and as perceived by the dealer. Initially a large number of potentialconflict issues were obtained by exploratory interviews with dealers and others familiarwith manufacturer-dealer problems. This list was reduced to 20 issues (Table I) by pretestingof the items. For
each of the 20 issues the dealer indicated whether

he disagreed with his manufacturervery frequently, frequently, infrequently, or very infrequently. The amountsby which dealers disagreedwith their manufacturers on these issues varied considerably. Table issues. An index of the overall level of intrachannel
conflict was constructed by summing the responses on each of the 20 issues; high numbers indicated high frequency of disagreement. Therefore, the assumption is made that conflict in a channel of distribution consists of a domain of issues over which there could I shows the frequency of disagreement over the 20

following research hypotheses.

be disagreementsbetween channel members.

20f the dealers responding, 60.5% responded to the first wave, 20.7% to the second wave, and 18.8% to the third wave.

SOURCES OF POWER:IMPACT ON INTRACHANNEL CONFLICT

385

Table 1
AREASOF MANUFACTURER-DEALER CONFLICT of Percentage dealers who frequently or veryfrequently disagreewith manufacturer 72.0 65.6 58.4 53.9 52.1 47.8 34.4 30.6 28.7 26.0 25.0 23.6 22.8 16.9 16.6 14.1 13.2 8.3 4.7 1.4

Area of disagreement Vehicle availability Partsavailability Productquality Factory sales contests work Warranty New vehicle inventory Minimum sales responsibility Parts purchasesfrom factory Sales promotiondisplays Tool and equipmentpurchases allowances Promotional Customerrelations Factory competition Local advertising Partsinventory Numberof salesmen Retail price discountingon new vehicles Remodelingand expansion Numberof mechanics Hoursof operation

It should be pointed out that the measure used attempts to measure the frequency of manifest conflict; however, the scale also may be measuringsome affective conflict. Dealers may have strong disagreements but never voice them to the manufacturer.The ideal measure of conflict would be obtained by monitoring written and verbal communications between manufacturer dealer;however, this was not possiand ble. Even if such monitoringhad been possible, the techniquesavailableto analyze these communications may not have been sophisticated enough to give a valid measure of manifest conflict. Hungerand Stern [17] used Bales' technique for analyzing interaction processes in a laboratorystudy of the role of superordinategoals in reducingintergroup conflict. The failure of the achieved superordinate goals in reducingbehavioral (manifest) conflict was explained in part by the possible inadequacyof Bales' 12categories of interaction process analysis in capturingall types of behavioral conflict. The validity andreliabilityof the conflict scale were assessed in several ways. Content validity can be tionalizationrepresents the concept about which generalizationsare to be made" [46, p. 44]. To determine the observable domain of conflict in a channel of distribution, it was necessary to conduct interviews with automobiledealers and other individualsfamiliar with manufacturer-dealer conflicts. This process allowed for the development of a list of issues over
defined as the degree " . . to which an opera-

which auto manufacturers and their dealers have disagreements. Two measures of conflict were obtained in the research conducted. To the extent that these two alternativemeasuresare correlated,convergentvalidity is demonstrated.The first measure was obtained by constructingthe conflict scale as discussed heretofore. The second was obtainedfrom a question which attemptedto measurethe overall level of conflict that the dealer perceived. Because multi-item scales are by far the best for measuring psychologicalconstructs, one cannot expect the correlation between the two measuresto be high. The correlationbetween the two measures was .50. Criterionvalidity is demonstratedif a measure of a construct behaves as expected in relation to other constructs. The hypotheses to be tested relating sources of power and conflict provide evidence on the criterionvalidity of the conflict measure. The reliability of a measure concerns the extent to which it is repeatable. The internal consistency of an instrument a criticalrequirement reliability is for [25, chapters 6-7]. The internal consistency of the conflict scale was assessed by coefficient alpha, which for the 20-itemscale was .89. In early stages of basic researchreliabilitylevels of .50 to .60 are sufficient. "For basic research, it can be arguedthat increasing reliabilitiesbeyond .80 is often wasteful. At that level correlationsare attenuatedvery little by measurement error" [25, p. 226]. The conflict scale therefore appearsto be adequatefor the purpose intended. Sources of Power The noncoercive power of A over B is based on power that B willingly yields to A. Hunt and Nevin [18] demonstratedempiricallythat a possible surrogate for noncoercive sources of power in a franchise channelof distributionis the assistances that franchisors providetheirfranchisees. To the extent that these assistances are of a high quality, they establish the franchisoras an expert in the eyes of the franchisee; they establish the franchisor as someone with the ability to reward; they legitimize the franchisor's efforts to gain power; they help to get the franchisee to willingly yield power to the franchisor. Measures were taken on 16 assistances that manufacturers provide their dealers. These assistances, obtainedin the same way as the conflict issues, were: nationaladvertising,local advertising,executive training, salesmen training, mechanic training, sales promotionkits, salesmen incentive programs, dealer incentive programs, bookkeeping assistance, manufacturer'sservice representative,manufacturer's sales representatives, tools and equipment, product warranty, inventory rebates, floor plan assistance, and service manuals. The quality of the assistances was measuredon a 5-point scale: excellent quality, above average quality, average quality, below average qua-

386

JOURNALOF MARKETING NOVEMBER 1976 RESEARCH, or values, or which have a positive utility for P. It's based on potential punishments when P perceives that O might actualize resources which are negatively valent for P, or which have a negative utility with respect to P's needs, desires, or goals.

lity, and not provided.Large numberswould indicate high quality. The coercivepower of A over B is based on power that B begrudginglyyields to A because B believes that A has the ability to punish him if he does not cooperate. Automobile manufacturerspossess a set of punishmentsthey can use if dealers do not cooperate. The more likely they are perceived to be to use these punishments,the strongerwill be their coercive sources of power. Measurements were obtained on six coercive sourceswhichwere identifiedin the exploratorystages of the research: slow delivery of vehicles, slow payof menton warranty work, unfairdistribution vehicles, turndownson warrantywork, threat of termination, and bureaucraticred tape. The perceived likelihood of a manufacturer using a coercive source if a dealer does not cooperate was measuredon a 7-point scale with large numbersrepresentinghigh likelihood. Use of perceptual measures in the behavioral sciences is believed by some to be a methodological weakness. However, in studies of power, this is less likely to be the case. For example, Wolfe states that one condition necessary for O to have power over P is that P must perceive0 as having resources [45,
p. 101]: O's power over P is based on potentialrewards when P perceives that O has resources that P needs, desires,

Also the generalarea of attribution theory in psychology lends support to the use of perceptions. For exampleHeiderstates [14, p. 1]: "Generally,a person reacts to whathe thinks the other personis perceiving, feeling, and thinking, in addition to what the other person may be doing. In other words, the presumed events inside the other person's skin usually enter as essential features of the relation." Several methods were used to insure the validity of the items identifiedas sourcesof power.The content validity of the sources of power was insured by adequatelysamplingfrom the domainsof noncoercive and coercive sources of power. Discriminant validityis the extent to whicha concept differs from other concepts. In the study two sources of power were identified, coercive and noncoercive, whichrepresentdifferentconstructs.Coercive sources of power involve potentialpunishmentand therefore the franchisee begrudgingly yields power to the franchisor. In the case of noncoercive sources the franchisee willinglyyields powerto the franchisor. Discriminantvalidity can be assessed by the use of factor analytictechniques. If coercive and noncoer-

Table 2
FACTOR MATRIXa FACTOR ANALYSISOF SOURCESOF POWERVARIMAX ROTATED Product servicing Coercion assistances
.033 -.099 .118 .123

Variable
National advertising Local advertising

Training assistances
.105 .029

Incentive assistances
.109 .130

Financial assistances
.054 .248

Advertisingb assistances Commonalities

(.480) (.532) .271 .387

Executive training Salesmentraining

-.052 -.049
-.103 -.027 -.037 .024 -.054 -.105 -.121 -.178 -.064 -.107 -.083 -.066 (.749) (.696) (.752) (.687) (.653) (.759) 3.20

.110 .115
(.493) .236 (.603) .071 .061 .311 (.471) .349 (.620) (.554) .179 .047 -.016 -.085 -.139 -.093 -.037 -.070

(.728) (.758)
(.479) .302 .165 .245 .114 .354 .142 .186 .099 .038 .068 .008 -.050 -.077 -.096 -.049 -.005 -.025

.171 .122
.058 .287 .093 (.645) (.614) .160 .076 .211 .043 -.031 .236 .131 .016 -.043 -.025 -.014 -.033 -.019

.156 -.006
-.145 .145 .047 .168 .190 -.027 .082 .195 .100 .296 (.582) (.552) -.024 -.054 -.074 -.067 .015 -.106

.092 .084
-.003 .305 .051 .114 .173 .092 .054 .089 .154 .208 .072 .189 -.088 .015 -.090 .027 .022 .008

.607 .612
.507 .344 .406 .523 .463 .268 .272 .279 .434 .451 .443 .364 .572 .503 .608 .488 .430 .593

Mechanic training Sales promotion kits Service manuals Salesmen incentive programs Dealer incentive programs Bookkeeping assistance Manufacturer's service rep. Manufacturer's sales rep. Tools and equipment Product warranty Inventory rebates Floor plan assistance Slow delivery of vehicles Slow payment on warranty work Unfair distribution of vehicles Turndowns on warranty work Threat of termination Bureaucratic red tape

.81 1.94 1.75 1 11 1.00 Eigenvalues Percentage of total 7.4 factor variance 29.0 17.6 15.9 10.1 9.1 aLoadings above .4 are in parentheses. bAlthough the last factor had an eigenvalue of only .81, it was retainedbecause it was easy to interpretand made intuitivesense.

CONFLICT ON INTRACHANNEL SOURCES OF POWER:IMPACT

387

cive sources of power load on separate factors then evidence of discriminantvalidity is obtained. A factor analysis was performed and six common factors were retainedfor interpretation (Table2). Five of these factors were noncoercive and one was coercive. Overall discriminantvalidity was obtained because in no case did coercive and noncoercive sources load on the same factor. RESULTS Multipleregression was used to test the hypothesis that coercive sources of power will increase manufacturer-dealerconflict. The dependent variablewas the conflict index and the independentvariableswere the six coercive sources. The statistical hypothesis was thatthe beta coefficients wouldbe positive. The results are presented in Table 3. This hypothesis generally was supported because all of the significant beta coefficients were positive. This finding indicates that the dealer will engage in more conflict with the manufacturer the manufacas tureris perceived as being more likely to use coercion. Three coercive sources were importantin this regard: bureaucraticred tape, unfairdistributionof vehicles, and slow payment on warranty work. The multiple correlation coefficient was .460 (R2 = .211), which was significantbeyond the .001 level. The second hypothesis, that noncoercive sources of power will tend to reduce manufacturer-dealer conflict, was tested in a similarfashion. The statistical hypothesis was that the beta coefficients would be negative. The results are presented in Table 4. Table 4 shows that this hypothesis generally was supportedbecause all of the beta coefficients significant beyond the .05 level were negative as hypothesized. Ten beta coefficients were negative; however, only four of these were significant beyond the .05 Table 3
SOURCES OF POWER) CONFLICT= f (COERCIVE REGRESSIONEQUATIONa
Regression coefficient Significanceb level

Table 4
CONFLICT= f (NONCOERCIVESOURCESOF POWER) REGRESSIONEQUATION a
Regression coefficient Significanceb level

Variable

t value

Intercept Mechanictraining Dealer incentives Productwarranty

56.21
-1.57

-1.40 -1.33

30.69 -2.82 -2.72

-2.50

.000 .002 .003 .006

-2.18 -1.06 .015 Inventoryrebates Manufacturer's sales -.77 -1.33 .092 rep. Manufacturer's service -.64 -1.17 .122 rep. Sales promotionkits -.49 -.82 .205 Tools and equipment -.44 -.89 .188 -.14 Nationaladvertising -.32 .373 Bookkeeping .05 assistance -.11 .457 Executive training .04 .07 .943 Salesmentraining .05 .07 .940 Local advertising .33 .13 .743 Floor plan assistance .30 .75 .452 Salesmenincentives .34 .58 .561 Service manuals .63 1.10 .270 correlationcoefficient was .394, R2 = .155, which aMultiple was significantbeyond the .001 level. bSignificancelevel is for a one-tail test if the beta coefficient was negativeas hypothesizedand a two-tailtest if it was positive.

level: mechanic training, dealer incentive, product warranty,and inventoryrebates.The multiplecorrelation coefficient was .394 (R2 = .155) which was significantbeyond the .001 level. When a third regression analysis was run with conflict as the dependent variable and both the noncoercive and coercive sources of power as the independentvariables, R2 was only increased to .266. The addition of noncoercive sources to coercive sources provides only a small improvement in the percentage of variance explained. Taken collectively the foregoing results suggest that as hypothesized, of the sources of power tested, coercive sources explain the largest amount of variance in the intrachannel conflict index. DISCUSSION Most studies of power and conflict are conducted in a laboratory setting to avoid contamination by extraneousvariables.Ina field studyone would expect contaminationby extraneous variables to reduce the chances of obtaining significant findings. Although significantfindings were obtained for all hypotheses in this field study, the strengths of the relationships (R 2) were not strong.Some butnot all of the extraneous variableswhich were not controlled and which could be potential causes of conflict are (1) role deviance, (2) perceptualerrors, (3) goal incompatibility,and (4) inefficient communication system. Controlling for

Variable

t value

33.72 39.09 .000 Intercept Threatof termination -.25 -1.07 .285 Slow delivery on ordered vehicles -.23 -.87 .386 Turndownson warran-.07 -.24 .811 ty work red Bureaucratic tape .73 3.03 .001 Unfair distribution of vehicles .94 3.71 .000 Slow payment of war1.13 3.% .000 rantywork correlationcoefficient was .460, R2 = .211, which aMultiple was significantbeyond the .001 level. bSignificancelevel is for a one-tail test if the beta coefficient was positive as hypothesizedand a two-tailtest if it was negative.

388

1976 NOVEMBER OF JOURNAL MARKETING RESEARCH, satisfaction [18, 20]. The decreased level of satisfaction could result in dealers forming coalitions in attempts to increase their power [26]. This could happen at both the state and national levels. At the state level, for example, coalition formation occurred among automobile dealers as early as the 1930s when dealers from Wisconsin lobbyed for and achieved passage of an administrative licensing statute in 1937. This law specifically forbade certain types of coercion by the manufacturers [21]. To date 34 states have passed some form of legislation which attempts to regulate manufacturer-dealer relations [24]. At the national level, during the early 1950's the National Automobile Dealers Association organized its dealers to lobby for national legislation and achieved passage of the Dealer's Day in Court Act (21) in 1956. The essential point is that if manufacturers had not used coercive sources, dealers probably would not have been so dissatisfied and probably would not have lobbyed for the passage of such legislation. Therefore auto manufacturers should be cognizant that their use of coercion can play an important role in determining manufacturer-dealer relations both on a short-term and long-term basis. CONCLUSIONS It can be concluded that noncoercive and coercive sources of power have significant impacts on intrachannel conflict, at least for the distribution of automobiles in the United States. Noncoercive sources tend to reduce intrachannel conflict whereas coercive sources tend to increase it. Because some conflict may be functional for channels of distribution, it was not possible to develop any conclusions as to whether coercive sources of power definitely should be excluded from use by auto manufacturers. The study perhaps left more questions unanswered than it answered. As a result several directions for future research are available. 1. Attempts should be made to control for major extraneous variables in field studies by attempting to measure these extraneous variables directly or through some surrogates and then controlling for them in the regressionequations. 2. Attemptsshouldbe madeto differentiateempirically the noncoercive sources (i.e. reward, expert, referent, legitimate) so that each can be studied in more detail. 3. The interactions between the various sources of power and their impact on intrachannelconflict should be investigated. 4. The impact of sources of power on the intensity conflict should be investigated. of intrachannel Empirical research into these areas should increase understanding of intrachannel relations and aid managerial applications.

these and other likely explanatory variables should increase R2. Other potential reasons for the low R2's center around the measurement of both the dependent and independent variables. The dependent variable, conflict, has conceptually both a frequency and an intensity dimension; however, measures were obtained only for the frequency of conflict. A method for combining the frequency and intensity of conflict should result in a richer dependent variable which should lead to a higher R 2. In addition the measure for the dependent variable was perceptual rather than behavioral. Manifest conflict, by its very nature, should be measured behaviorally, not perceptually. Such a measure should increase the R2. Finally the dichotomization of sources of power into coercive and noncoercive may result in an oversimplification of the independent variables. Although reward, expertise, legitimate, and referent sources may have something in common, they also may have unique aspects which should be measured. Obtaining separate measurements on each of the sources of power should cause the level of R2 to increase. Although the R2's were low, it is possible to make some generalizations from the data. Of the two types of power sources investigated, the noncoercive are effective for reducing the frequency of intrachannel conflict. This finding supports propositions by Baldwin [3] and also Raven and Kruglanski [30]. To the extent that conflict is dysfunctional to the channel, the channel leader should use noncoercive rather than coercive sources. However there is disagreement as to the impact of intrachannel conflict on channel performance [35] and therefore it cannot be stated with certainty that noncoercive sources always should be preferred to coercive sources. Empirical evidence in franchise channels does support the notion that use of noncoercive sources by franchisors tends to increase the franchisee's satisfaction with the franchisor [18, 20]. Auto manufacturers need to be especially cognizant of this situation because dealers who are more satisfied with their manufacturer tend to perceive less need for legislation to regulate manufacturerdealer relations [20]. The data also tend to support the notion that coercive sources increase rather than reduce the frequency of intrachannel conflict, and thus support propositions by Stern and Gorman [37], Baldwin [3], Raven and Kruglanski [30], and others [28, 29, 32, 33]. Use of coercive sources will tend to make it more difficult for auto manufacturers to implement their channel goals, especially in the long run, because an important side effect of coercion is the "spillover effect" on B's relations with A with respect to future issues [3, p. 32]. Auto manufacturers therefore should carefully consider the consequences of their attempts at coercion. Also, coercive sources of power will decrease dealer

SOURCES OF POWER:IMPACT ON INTRACHANNEL CONFLICT

389

REFERENCES
1. Assael, Henry. "The Political Role of Trade Associations in Distributive Conflict Resolution," Journal of Marketing, 32 (April 1968), 21-8. . "Constructive Role in Interorganization Con2. flict," Administrative Science Quarterly, 14 (December 1969), 573-82. 3. Baldwin, David A. "The Power of Positive Sanctions," World Politics, 24 (October 1971), 19-38. 4. Beier, Frederick J. and Louis W. Stern. "Power in the Channel of Distribution," in Louis W. Stern, ed., Distribution Channels: Behavioral Dimensions. Boston: Houghton Mifflin Company, 1969. 5. Bucklin, Louis P. "The Locus of Channel Control," in Robert L. King, ed., Marketing and the New Science of Planning. Chicago: American Marketing Association, 1968. 6. . "A Theory of Channel Control," Journal of Marketing, 37 (January 1973), 39-47. 7. Cohen, Jerry S. "Conflict and Its Resolution in a Franchise System," in Donald N. Thompson, ed., Contractual Marketing Systems. Lexington, Massachusetts: Heath Lexington Books, 1971. 8. Dahl, Robert A. Modern Political Analysis. Englewood Cliffs, New Jersey: Prentice-Hall, Inc., 1963. 9. El-Ansary, Adel I. and Robert A. Robicheaux. "A Theory of Channel Control: Revisited," Journal of Marketing, 38 (January 1974), 2-7. 10. and Louis W. Stern. "Power Measurement in the Distribution Channel," Journal of Marketing Research, 9 (February 1972), 47-52. 11. Firat, Fuat A., Alice M. Tybout, and Lous W. Stern. "A Perspective on Conflict and Power in Distribution," in Ronald C. Curhan, ed., 1974 Combined Proceedings. Chicago: American Marketing Association, 1974. 12. French, John R. P. and Bertram Raven. "The Bases of Social Power," in Dorwin Cartwright and Alvin Zander, eds., Group Dynamics: Research and Theory. New York: Harper and Row, 1968. 13. Gouldner, A. W. "The Norm of Reciprocity: A Preliminary Statement," American Sociological Review, 25 (1960), 161-78. 14. Heider, F. The Psychology of Interpersonal Relations. New York: John Wiley & Sons, Inc., 1958. 15. Helmers, H. O., Charles N. Davisson, and Herbert F. Taggart. Two Studies in Automobile Franchising. Ann Arbor, Michigan: Graduate School of Business Administration, University of Michigan, 1974. 16. Hewitt, Charles M., Jr. Automobile Franchisee Agreements. Homewood, Illinois: Richard D. Irwin, 1956. 17. Hunger, David J. and Louis W. Stern. "An Assessment of the Functionality of the Superordinate Goal in Reducing Conflict," Academy of Management Journal, forthcoming. 18. Hunt, Shelby D. and John R. Nevin. "Power in a Channel of Distribution: Sources and Consequences," Journal of Marketing Research, 11 (May 1974) 186-93. 19. Lusch, Robert F. "A Validity Test of the Hunt and Nevin Sources of Power Pardigm," working paper, 1974. University of Wisconsin-Madison, 20. . "Franchisor Sources of Power: Their Impact on Franchisee Satisfaction," International Journal of Physical Distribution, forthcoming.

21. Macaulay, Stewart. Law and the Balance of Power. New York: Russell Sage Foundation, 196. 22. Mallen, Bruce. "Conflict and Cooperation in Marketing Channels," in Bruce Mallen, ed., The Marketing Channel: A Conceptual Viewpoint. New York: John Wiley & Sons, Inc., 1%7. 23. Maxey, George and Aubrey Silberston. The Motor Industry. London: Allen and Unwin, 1959. 24. National Automobile Dealer Association. A Compendium of State Licensing Laws Regulating Motor Vehicle Manufacturers, Dealers and Salesmen. Washington, 1967, 1974. 25. Nunnally, Jum C. Psychometric Theory. New York:

D.C.: National Automobile Dealer Association, 1964, McGraw-Hill Book Co., 1967.

26. Palamountain, Joseph C. The Politics of Distribution. Cambridge, Massachusetts: Harvard University Press, 1955. 27. Pashigian, Bedros Peter. The Distribution of Automobiles, An Economic Analysis of the Franchise System. Englewood Cliffs, New Jersey: Prentice-Hall, Inc., 1961. 28. Pearson, Michael Melvin. An Empirical Study of the Operational Results Associated with Conflict and Cooperation in Channels of Distribution, unpublished D.B.A. thesis, University of Colorado, Boulder, 1972. 29. Pondy, Louis R. "Organizational Conflict: Concepts and Models," Administrative Science Quarterly, 12 (September 1967), 296-320. 30. Raven, Bertram H. and Arie W. Kruglanski. "Conflict and Power," in Paul Swingle, ed., The Structure of Conflict. New York: Academic Press, 1970. 31. Ridgeway, Valentine. "Administration of Manufacturer-Dealer Systems," Administrative Science Quarterly, 7 (March 1957), 464-83. 32. Rosenberg, Larry J. "A New Approach to Distribution Conflict Management," Business Horizons, (October 1974), 67-74. 33. and Louis W. Stern. "Toward the Analysis of Conflict in Distribution Channels: A Descriptive Model," Journal of Marketing, 34 (October 1970), 40-6. 34. and . "Conflict Measurement in the Distribution Channel," Journal of Marketing Research, 8 (November 1971), 437-42. 35. Rosenbloom, Bert. "Conflict and Channel Efficiency: Some Conceptual Models for the Decision Maker," Journal of Marketing. 37 (July 1973), 26-30. 36. Schmidt, Stuart M. and Thomas A. Kochan. "Conflict: Toward Conceptual Clarity," Administrative Science Quarterly, 17 (September 1972), 359-70. 37. Stern, Louis W. and Ronald H. Gorman. "Conflict in Distribution Channels: An Exploration," in Louis W. Stern, ed., Distribution Channels: Behavioral Dimensions. Boston: Houghton Mifflin Company, 1969. 38. and J. L. Heskett. "Conflict Management in Interorganization Relations: A Conceptual Framework," in Louis W. Stern, ed., Distribution Channels: Behavioral Dimensions. Boston: Houghton Mifflin Company, 1969. 39. , Robert A. Schulz, Jr., and John R. Grabner, Jr. "The Power Base-Conflict Relationship: Preliminary Findings," Social Science Quarterly, 54 (September 1973), 412-9. 40. , Brian Sternthal, and C. Samuel Craig. "Managing Conflict in Distribution Channels: A Laboratory

390 Study," Journal of Marketing Research, 10 (May 1973),

JOURNALOF MARKETING NOVEMBER1976 RESEARCH,

44.

169-79. 41. Walker, Orville C. "An ExperimentalInvestigationof Conflict and Power in MarketingChannels," unpublished Ph.D. thesis, The Universityof Wisconsin, Madison: 1970. 42. Wilemon, David L. "Power Negotiation Strategies in 7 (February1972),71-2. 43. Wilkinson,Ian A. "Power and Influence Structuresin
Distribution Channels," European Journal of Marketing, Marketing Channels," The Southern Journal of Business,

. "Researching the Distribution Channels for Consumer and IndustrialGoods: The Power Dimensions," Journal of Market Research Society, (January

1974), 12-32. 45. Wolfe, DonaldM. "PowerandAuthorityin the Family," Arbor,Michigan:Institutefor Social Research, University of Michigan, 1959. 46. Zaltman,Gerald, ChristianR. A. Pinson, and Reinhard York: Holt, Rinehartand Winston, Inc., 1973.
Angelmar. Metatheory and Consumer Research. New in Dorwin Cartwright, ed., Studies in Social Power. Ann

(Summer1972), 119-29.