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Shaosong Ou | |||||||
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Construct: E-Integration | ||||||
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Items: For vertical integration, the following two measures are generally accepted: Vertical Industry Connection (VIC). Value Added to Sales (VC) ratio.
For electronic integration, the following items are found: Zaheer and Venkatraman (1994): Electronic
Integration is operationalized as the percentage of business (commercial
premiums) directed to the interfaced carrier through the proprietary electronic
channel. Specifically, the item used in the paper is "What's the percentage
of business (commercial premiums) directed to the interfaced carrier through
the proprietary electronic channel?", measured by percentage point number
varying from 0 to 100. Other similar operationalizations include: "Forward integration" is operationalized as percentage of direct sales to end users. Backward integration is operationalized as the percentage of company's component needs produced under the governance of the firm. A continuous measure of vertical integration is based on the share of industry output. Not many validity measures have been found for this one-item construct. Zaheer and Venkatraman (1994) test its convergent validity by examining its strength of association with two other indicators - the number of carriers accounting for 80% of each agency's business as well as the number of carriers that each account for at least 2% of each agency's business. The correlation of EI measure with the former is -0.5847, and the correlation of EI measure with the latter is -0.4788, both significant at 0.01 level. |
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