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Record for a UF thesis. Title & abstract won't display until thesis is accessible after 2010-08-31.

Permanent Link: http://ufdc.ufl.edu/UFE0021940/00001

Material Information

Title: Record for a UF thesis. Title & abstract won't display until thesis is accessible after 2010-08-31.
Physical Description: Book
Language: english
Creator: Xu, Jun
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2008

Subjects

Subjects / Keywords: Marketing -- Dissertations, Academic -- UF
Genre: Business Administration thesis, Ph.D.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Statement of Responsibility: by Jun Xu.
Thesis: Thesis (Ph.D.)--University of Florida, 2008.
Local: Adviser: Weitz, Barton A.
Electronic Access: INACCESSIBLE UNTIL 2010-08-31

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2008
System ID: UFE0021940:00001

Permanent Link: http://ufdc.ufl.edu/UFE0021940/00001

Material Information

Title: Record for a UF thesis. Title & abstract won't display until thesis is accessible after 2010-08-31.
Physical Description: Book
Language: english
Creator: Xu, Jun
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2008

Subjects

Subjects / Keywords: Marketing -- Dissertations, Academic -- UF
Genre: Business Administration thesis, Ph.D.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Statement of Responsibility: by Jun Xu.
Thesis: Thesis (Ph.D.)--University of Florida, 2008.
Local: Adviser: Weitz, Barton A.
Electronic Access: INACCESSIBLE UNTIL 2010-08-31

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2008
System ID: UFE0021940:00001


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399105d73f5cefc5a789759fd84e7d27b8d1c03a







MARKETING-SALES INTEGRATION: THE ROLE OF MINDSET DIFFERENCES


By

JUN XU















A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL
OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY

UNIVERSITY OF FLORIDA

2008





































O 2008 Jun Xu




































To my parents, my wife, and my daughter









ACKNOWLEDGMENTS

I would like to thank my parents for their endless support for my academic pursuit. Also, I

would like to thank my wife, who is now a management professor, for her support in both my

academic and family sides of life. I would also like to thank my daughter, who has provided me

with tremendous happiness and motivation during my Ph.D. study. Finally, I especially thank Dr.

Bart Weitz, my supervisory committee chair. Without Bart, I would not be able to even make

any academic advancement during my Ph.D. study. Our relationship is not just an advisor-

student relationship. It is also a lifetime friendship!











TABLE OF CONTENTS


page

ACKNOWLEDGMENT S .............. ...............4.....

LI ST OF T ABLE S ................. ...............7................

LI ST OF FIGURE S .............. ...............8.....

AB S TRAC T ......_ ................. ............_........9

CHAPTER

1 INTRODUCTION ................. ...............12.......... ......

2 LITERATURE REVIEW ................. ...............18................


Literature Focusing on the Generic Factors Leading to the Marketing-Sales
C oop erati on/C onfli ct ................... ....... ....... .... .. ....... ....................1
Literature Focusing on the Marketing-Sales Interface Specific Factors Leading to the
Marketing-Sales Cooperation/Conflict .............. ... ...............24..
Summary of Extant Marketing-Sales Conflict Research ................. ................. ........ 26

3 CONCEPTUAL FRAMEWORK ................. ...............30.........._ ....


Focal Construct: Marketing-Sales Mindset Differences ................. ........................_.31
Actual and Perceived Mindset Differences .............. ...............32....
Antecedents of Marketing-Sales Mindset Differences............._..._....... ............. ..........._..._...3 3
Cross-Functional Working Experience and Training, and Actual Marketing-Sales
M indset D ifferences.................. .. ........ ............ ..... .............. .............3
Organizational Socialization Tactics and Actual Marketing-Sales Mindset
D differences ................... ..... ......... .. ........... ... ..........3
Processes of the Marketing-Sales Mindset Differences Impact ................. ............. .......37
Dual-Process Model of Marketing-Sales Mindset Differences ................. ................. .3 7
Social Categorization Process: Perceived Mindset Differences and
Relationship Conflict ................... ...... ......... ......... .... .... .........3
Social Categorization Process: Moderating Effect of Organizational
Identification .................. ........... .. ..... ........ ....... ........3
Information Processing Process: Perceived Mindset Differences and Perceived
Inform ation Novelty .............. ........ .... ............... .. .........4
Information Processing Process: Moderating Effect of Cross-Functional
Learning .................. ............ ...... ....... ...... .........42
Consequences of Marketing-Sales Mindset Differences.................... ... ........ ................ .43
Relationship Conflict, Perceived Information Novelty, and Behavioral Cooperation....43
Behavioral Cooperation and Firm Performance ........_................. ............... .....44












4 M ETHODS .............. ...............49....


O verview ............... .. ......... ....... .. ....... ....... .. ...... .. .. .......4

Initial Study: Developing and Pre-testing the Scale of Marketing and Sales Mindsets.........49
Step 1: Describing the Mindsets of Marketing and Sales ............... .............. ..... ..........49
Step 2: Pre-testing the Value Profile Describing the Mindsets of Marketing and
Sales ................... ...... ....... ... .. ... ...............50

Main Study: Testing the Entire Conceptual Framework ................. ................. ........ 52
Sample and Data Collection Overview .............. ...............52....
M measures ................. ...............55.................


5 DATA ANLY SE S AND RE SULT S .............. ...............65....


Measurement Model Estimation............... ...............6
Construct Validity .............. ...............65....
Common Method Variance .............. ...............66....
Structural M odel Estimation................... ............ ..............6
Elaboration of Moderation Effects in the Dual-Process Model .........__.........._._. .........70


6 DISCUSSION AND FUTURE RESEARCH............... ...............81


Theoretical Implications .............. ...............8 1....
M anagerial Implications .............. ...............83....
Lim stations .........._.... ... .. .._ _. ...............84.....
Directions for Further Research. ........._.__........_. ...............88...


APPENDIX MEASUREMENT SCALE ........._._._ ...._. ...............90...


LIST OF REFERENCES ........._.___..... .___ ...............94....


BIOGRAPHICAL SKETCH ........._.___..... .__. ...............100....










LIST OF TABLES


Table page

3-1 Marketing-sales mindset differences dimension discussed in prior literature ........._.......46

4-1 Narrowed value profile of marketing and sales mindsets (60 items)............... ................63

4-2 Final value profile of marketing and sales mindsets (36 items) ................ ................ ...64

5-1 Means, standard deviations, and intercorrelations among variables............... ................7

5-2 Regression analyses for antecedents and consequences of marketing-sales mindset
difference s ................ ...............74......_._ ....

5-3 Regression analyses for dual-process of marketing-sales mindset differences .................75

5-4 Summary of hypothesis testing ................. ...............76........... ...










LIST OF FIGURES


FiMr page

3-1 General conceptual framework of the dual-process model of marketing-sales mindset
difference s ................ ...............47........... ....

3-2 Detail conceptual framework of the dual-process model of marketing-sales mindset
difference s ................ ...............48........... ....

5-1 Interaction graph for the moderating effect of organizational identification
(marketing data) ........._. ...... .___ ...............77....

5-2 Interaction graph for the moderating effect of organizational identification (sales
data) ........._ ...... ...............78....

5-3 Interaction graph for the moderating effect of cross-functional learning (marketing
data) ................. ...............79.................

5-4 Interaction graph for the moderating effect of cross-functional learning (sales data).......80









Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the
Requirements for the Degree of Doctor of Philosophy

MARKETING-SALES INTEGRATION: THE ROLE OF MINDSET DIFFERENCES

By

Jun Xu

August 2008

Chair: Barton Weitz
Major: Business Administration

This dissertation focuses on the mindset differences between marketing and sales

employees (e.g., short-term versus long-term orientation, result versus process orientation, and

relationship versus product orientation) to explore issues related to the integration of activities

performed by these two functional areas. Drawing from the research in social categorization and

organizational diversity, a dual-process model of marketing-sales mindset differences is outlined.

In this model, both the positive and negative aspects of marketing-sales mindset differences are

examined. Specifically, two underlying processes, the social categorization process and the

information processing process, are proposed to involve in the effect of mindset differences on

marketing-sales integration. In the social categorization process, perceived marketing-sales

mindset differences are proposed to be positively related to the relationship conflict between

these two functions, indicating the negative aspect of marketing-sales mindset differences. In the

information processing process, perceived marketing-sales mindset differences are proposed to

be positively related to the perceived novelty of information sent between these two functions,

indicating the positive aspect of marketing-sales mindset differences. This model also suggests

that organizational identification moderates the social categorization process and cross-

functional learning moderates the information processing process.









This dissertation also explores the antecedents and consequence of the marketing-sales

mindset differences. Specifically, three factors are proposed to affect the actual marketing-sales

mindset differences: the selection of marketing and sales employees with cross-functional

working experiences in both marketing and sales areas, the cross-functional training of current

marketing and sales employees in both marketing and sales areas, and the adoption of the

institutionalized organizational socialization tactics. In addition, marketing-sales mindset

differences are also proposed to eventually affect the behavioral cooperation between marketing

and sales and the subsequent firm performance. Methodologically, this dissertation also develops

and validates a new scale of marketing and sales mindset to measure the marketing-sales mindset

differences.

I tested the conceptual framework by using a cross-sectional survey design collecting data

from 88 matched pairs of senior marketing and sales executives from the same businesses. The

empirical results generally support the proposed dual-process model of marketing-sales mindset

differences. Specifically, the results show that perceived mindset differences are positively

related to the relationship conflict between marketing and sales, and this relationship is

moderated by the level of organizational identification in the sale data. Also, in both marketing

and sales data, the results show that perceived mindset differences is positively related to the

perceived novelty of information sent between marketing and sales when the level of cross-

functional learning between marketing and sales is high. The results also show that percentage of

marketing and sales employees with cross-functional working experience in both marketing and

sales areas is negatively related to the actual marketing-sales mindset differences. These results

suggests that firms can manage the marketing-sales mindset differences by developing strong

organizational identification and by promoting high level of cross-functional learning between









marketing and sales. Also, the results suggest that firm can adjust the level of the marketing-sales

mindset differences by adjusting their organizational recruitment policy.









CHAPTER 1
INTTRODUCTION

Marketing's interfaces with other business functions within the company have attracted

considerable attention. Effective coordination between functional areas with diverse

competence enables firms to exploit synergies and develop competitive advantage.

Coordinating marketing's activities with other functional is particularly important because

marketing is responsible for the relationship between the firm and its customers.

Compared to marketing's other interfaces (e.g., marketing's interface with R&D, with

manufacturing, and with finance), the interface between marketing and sales has received little

attention in academic research. Most of marketing scholars tend to treat sales as a function within

the marketing domain, and thus assume that cooperation between marketing and sales is

automatically achieved through hierarchical control. However, in most companies, marketing

and sales are separate functions (Kotler, Rachham, and Gruner 2006; Homburg, Jensen 2007;

Homburg, Jensen, and Krohmer 2008).

Moreover, cooperation between these two separate functions is far from harmonious in

business practice. For example, marketing often complains that salespeople ignore corporate

branding and positioning standards in a rush to close the sales. Sales responds by stating that "the

one-size-fits-all" type of generic corporate message made by marketing impedes their sales

efforts (B to B 2003, p. 17). Similarly, marketing maintains that "we develop good leads at trade

shows, but sales doesn't follow up." On the other side, sales argues that "marketing wouldn't

know a qualified lead if it is tripped on one. Marketing is locked in an ivory tower and doesn't

have a clue as to what customers really want." (Sales & Marketing Management 1999, p. 27). A

recent survey of senior executives from a wide range of industries reports that improving









marketing and sales cooperation would have the greatest impact on firm performance (The

Economist-Accenture 2003).

The friction between marketing and sales is costly. For example, it is estimated that as

much as eighty percent of marketing' s expenditures on lead generation and sales collateral are

wasted-ignored as irrelevant or unhelpful by sales. On the sales side, it is reported that forty to

sixty hours out of a typical salesperson's month are devoted to redoing, often poorly, collateral

materials that marketing should have generated in the first places (Aberdeen Group 2002).

Rouzies and her colleagues (2005) suggested that an important impediment to marketing-

sales cooperation is the mindset differences different perspectives on issues and approaches for

addressing problems between marketing and sales functions. Rather than the differences in the

observed behaviors, mindset differences refer to the differences in cognition between marketing

and sales. Mindset differences are believed to impair marketing-sales cooperation independent of

goal differences, a commonly believed impediment to cross functional cooperation. For example,

in an interview with both marketing and sales managers, Schultz (2003) found that when asked

to implement the same decision of increasing customer awareness, marketing managers

interpreted it as doing more advertising, whereas sales managers view this decision as hiring

more salespeople. Similarly, in a dialogue between marketing and sales, Cespedes (1995)

showed that both marketing and sales reached the consensus on mutual information exchange.

But sales thought that the critical information to be shared is the timely information from

customers, whereas marketing believed that the most important information to be exchanged is

about the customer' s expectation of tomorrow.

Following the anecdotal evidence and prior conceptual speculation, Homburg and Jensen

(2007) conducted the first empirical study related to the marketing-sales mindset differences.









Their study showed the existence and the impact of mindset differences on marketing-sales

relationship and firm performance. Despite of this pioneering study, there are still some

important issues left unaddressed.

First, extant marketing-sales interface research has mostly concentrated on the negative

aspects of mindset differences, that is, the relational tension between marketing and sales created

by their different mindsets in their social exchange. Little research, however, has explicitly

investigated the potential benefits that marketing-sales mindset differences can bring to the firm

by melding different perspectives to develop creative approaches to business problems.

Second, existing marketing-sales interface research has basically focused on providing

evidence on the existence and the impact of marketing-sale mindset differences on the related

outcomes. Few studies have advanced to the next step in managing the marketing-sales mindset

differences in business operation.

Third, despite the prior conceptual articles, the nature of marketing-sales mindset

differences has not been thoroughly examined. Specifically, the content and underlying structure

of marketing-sales mindset differences have not been compressively understood. Note that in

their pioneering empirical study, Homburg and Jensen (2007) developed a scale of marketing-

sales thought-world differences. This scale includes both the cognitive orientation differences

and the competence differences between marketing and sales. However, their cognitive

orientation differences measure only covers a limited number of the components of marketing-

sales mindset differences (i.e., customer versus product orientation, and short-term versus long-

term orientation). As they pointed out in their discussion section, their scale of thought-world

differences doesn't cover all of the dimensions of marketing-sales cognitive orientation










differences. They called for future research to explore more comprehensive aspects of cognitive

orientation that describe the marketing-sales mindset differences.

Last, in research methodology, past empirical research has collected the mindset

differences responses largely from single side of dyads, either from marketing or sales side. Few

studies, however, have collected measures from the matched pairs of both marketing and sales

informants in the same business.

In this dissertation, I attempt to address these gaps. First, I investigate both the negative

and positive aspects of marketing-sales mindset differences. Specifically, I propose a dual-

process model of marketing-sales mindset differences. Drawing from the similarity-attraction

theory (Byrne 1971) and self-categorization theory (Turner et al. 1987), I propose a social

categorization perspective of marketing-sales mindset differences. Under the social

categorization process, marketing-sales mindset differences are proposed to create the relational

tension between marketing and sales in their social exchange, indicating the negative aspect of

marketing-sales mindset differences. Meanwhile, borrowing from the diversity research (Jehn,

Northcraft, and Neale 1999; Pelled, Eisenhart, and Xin 1999), I also suggest an information

processing perspective of marketing-sales mindset differences. Under the information processing

process, marketing-sales differences can actually bring potential benefits to marketing and sales

in their informational exchange. This informational benefit constitutes the positive aspect of

marketing-sales mindset differences. Collectively, my dissertation combines both positive and

negative aspects of marketing-sales mindset differences in a united research framework.

Second, my dissertation provides insight for firms to manage the marketing-sales mindset

differences in their business operations. Specifically, I investigate the moderating effect of

organizational identification in the social categorization process of marketing-sales mindset










differences. I suggest that by developing strong organizational identification, firms can mitigate

the negative impact of marketing-sales mindset differences on their relational exchange. I also

examine moderating effect of cross-functional learning in the information processing process of

marketing-sales mindset differences. I suggest that by promoting active cross-functional learning

between marketing and sales, firm can actually realize the potential informational benefits of

marketing-sales mindset differences in their informational exchange. In addition to these

moderating effects, I also explore the antecedents of marketing-sales mindset differences by

examining the effects of organizational recruitment, training and socialization practices (e.g.,

marketing and sales employees' cross-functional working experiences and training, and the

organizational socialization tactics).

Third, I develop a new measure of marketing-sales mindsets that includes the

comprehensive aspects of cognitive orientations of marketing and sales. Based on this new

measure, the scale of marketing-sales mindset differences is thoroughly assessed. Specifically,

drawing upon value congruence research (e.g., O'Reilly, Chatman and Caldwell 1991), I

examine the contents and structures of marketing and sales' mindsets by assessing the underlying

values held by these two functional areas. Mindsets are defined as the internalized normative

beliefs about specific modes of conduct or end-state of existence that is personally or socially

preferable to an opposite or converse mode of conduct or end-state existence (Rokeach 1973). I

assess marketing-sales mindset differences by comparing marketing's and sales' value profiles.

The resultant value differences indicate the degree to which marketing and sales differ in their

mindsets .

Finally, in research design, I collect data from the matched pair of marketing and sales

managers from the same strategic business units (SBUs). A total of 88 matched pairs of










marketing and sales senior executives in the same SBUs have already been collected. The

analyses and the empirical results are based upon these 88 dyadic data.

The dissertation is organized as follows. In Chapter 2, I review the literature on the

marketing-sales interface, with a focus on the research that has explicitly addressed the

marketing-sales cooperation/conflict. Then, I present my conceptual framework of the dual-

process model of marketing-sales mindset differences and propose each of the individual

hypotheses in Chapter 3. In Chapter 4, I describe the overview of the methodology, the

development of the marketing-sales mindset differences measure, the data collection process,

and the description of the sample data collected. Afterwards, I provide the empirical results

based upon the 88 matched pairs of marketing and sales executives' responses in Chapter 5. In

the last chapter, the Chapter 6, I discuss the theoretical and empirical implications of my

dissertation, and the limitation, and the direction for the future research in marketing-sales

interface research.









CHAPTER 2
LITERATURE REVIEW

The prior literature relevant to my dissertation is the research, primarily in management,

that has examined the factors affecting cross-functional conflict and coordination in general. The

literature review in this section will focus on extant research that has specifically addressed the

interface between marketing and sales.

An overview of the past research in marketing-sales interface arrives at the following two

conclusions. First, since most of the marketing' s cross-functional research often treats marketing

and sales synonymously, only a limited number of studies have explicitly addressed the interface

between marketing and sales. Second, among these limited body of studies, most of them view

the marketing-sales interface as a mere subset of the cross-functional interfaces. Therefore, they

addressed the marketing-sales cooperation/conflict largely by extending the generic Eindings

identified in other cross-functional interfaces to the context of marketing-sales interface

(Dewsnap and Jobber 2000). Specifically, this line of research focus on the generic factors that

result in marketing-sales cooperation/conflict, ranging from goal congruity, bidirectional

communication, trust, to the norms of information sharing.

While these studies have highlighted the commonality between marketing-sales interface

and other cross-functional research, little research, however, has examined the factors that are

unique in marketing-sales interface and considered the inherent characteristics of marketing-sales

interface (i.e., the mindset differences) that lead to marketing-sales cooperation/conflict.

Whereas the generic factors (e.g., goal congruity, bidirectional communication, trust, norms of

information exchange) have their own merits in explaining the marketing-sales interface

cooperation/conflict, the more unique and subtle factor (e.g., mindset differences) that is









inherently associated with marketing-sales interface and leads to the marketing-sales

cooperation/conflict has yet to be extensively explored.

Recently, there are a small but growing number of research that start to emphasize the

uniqueness of marketing-sales interface, focusing on certain specific characteristics that are more

salient but very important in driving marketing-sales cooperation/conflict in specific (e.g., the

thought-world differences in Homburg, Jensen's (2007) paper). As such, this section will first

review the literature that focuses on the generic factor leading to the marketing-sales

cooperation/conflict. Next, it will look at the extant research that concentrates on those factors

that are unique and inherently associated with marketing-sales interface in causing the

marketing-sales cooperation/conflict. This section will support my contention and the

contributions of this research that there is a need to

a. empirically address those factors that are unique and inherently associated with

marketing-sales interface in causing the marketing-sales cooperation/conflict;

b. explore both the positive and negative aspects of the marketing-sales mindset

differences;

c. develop a comprehensive scale measuring marketing-sales mindset differences;

d. collect data from both sides of marketing-sales dyads in the same business.

Literature Focusing on the Generic Factors Leading to the Marketing-Sales
Cooperation/Conflict

Table 2-1 describes the summary of reviewed extant marketing-sales cooperation/conflict

research in detail.

In their study of consumer grocery product firms, Strahle and his colleagues (1996)

examined the degree of alignment between business level marketing strategies and functional

level sales obj ectives and activities. They found discrepancies between marketing executives and









sales managers with regard to specific product strategies. When marketing executives specify

hold, harvest, or divest product strategies, sales managers did not establish corresponding sales

obj ectives that were consistent with those specified strategies. Subsequently, this could result in

sales managers promoting products that marketing executives did not plan to support in the long

run, while also providing inadequate support to the products that marketing executives intended

to promote. Obviously, such misalignment between marketing and sales generates the marketing-

sales conflict.

In the post-survey interviews, Strahle and his colleagues (1996) also investigated the

possible reasons for the misalignment between marketing executives and sales managers. One of

the primary reasons was the lack of goal congruency. They found that sales managers always aim

at generating sales volume, which was incongruent with the goal of marketing executives when

the marketing product strategies moved on to hold, harvest, or divest stages. As such, Strahle and

his colleague's study focused on the inconsistent communications between marketing and sales

and they suggested these inconsistent communications can be traced back to the differences in

goals between marketing and sales. In sum, Strahle and his colleagues' (1996) research focused

on the generic factors, such as goal incongruence and inconsistent communication, to explain the

marketing-sales interface conflict. Their research didn't address those factors that are uniquely

associated with the marketing-sales interface.

Dewsnap and Jobber (2002) employed a similar approach to explain the marketing-sales

conflict in the fast moving consumer good (FMCG) companies. FMCG companies are often

faced with powerful channel members as well as sophisticated end consumers. Drawing from the

realistic group conflict theory, Dewsnap and Jobber pointed out that the goal conflict between

brand-focused marketing personnel and channel-focused sales personnel is one of the major









reasons for the marketing-sales conflict in FMCG companies. Specifically, marketing personnel

focus on product brands with the goal of meeting the needs of the end consumers. Conversely,

sales personnel concentrate on the retail channels with the goal of satisfying the powerful

channel members. Any discrepancy between these two sets of customers and their goals can

create the potential tension between marketing and sales personnel, which in turn, leads to the

marketing-sales conflict.

In another study on the same FMCG industry, Dewsnap and Jobber (2000) went beyond

the single factor of goal conflict and advanced a comprehensive framework to explain the inter-

group integration (the opposite of the conflict) between brand-focused marketing and channel-

focused sales personnel. In this framework Dewsnap and Jobber (2000) considered other factors

contributing to the inter-group integration, including employee participation, physical proximity,

joint reward, and early involvement. Specifically, they proposed that the higher the degree of

employee participation, j oint reward, and involvement in the earlier stage of the j oint proj ect

between marketing and sales, the closer the physical locations of marketing and sales functions,

the greater the perceived level of integration between marketing and sales. Clearly, in both of

Dewsnap and his colleagues' (2000, 2002) studies, they didn't go beyond the generic factors that

could also found in other cross-functional interface research to explain the marketing-sales

interface conflict and didn't consider those factors that are unique and inherently associated with

marketing-sales interface in causing the marketing-sales conflict. In addition, both of their

studies are conceptual in nature.

Rouzies and her colleagues (2005) proposed a comprehensive framework for explaining

the marketing-sales conflict. In their conceptual paper, they suggested several sets of integrating

mechanisms in developing the marketing-sales integration (just the opposite of the marketing-









sales conflict). These integrating mechanisms include various behavioral factors such as

decentralization, communications, and j ob rotation. Specifically, they proposed that

decentralization of marketing and sale functions has a positive effect on the degree of marketing-

sales integration. In addition, they proposed an inverted-U shared relationship between

communication and the degree of marketing-sales integration. Specifically, they pointed out that

both formal and informal communications positively affect marketing-sales integration.

However, information about strategic directions and regularly occurring information exchanges

are best done through formal communications, whereas information about unstructured problems

is best done through informal communications. Similarly, job rotation is also considered to have

an inverted U-shaped relationship with the marketing-sales integration. The modest level of job

rotation is intended to result in the highest level of marketing-sales integration. Rouzies and her

colleagues' (2005) also raised the issue of mindset differences in their conceptual work but they

did not empirically test their framework.

Dawes and Massey (2005) focused on the effect of communication on marketing-sales

conflict and found that bidirectional communication has positive effects on the perceived

relationship effectiveness between marketing and sales managers. In addition, they found that

although the use of threat as a communication influence strategy increases a marketing

manager' s amount of manifest influence, it reduces the perceived relationship effectiveness

between marketing and sales managers. However, they did not explore the underlying factor of

mindset differences that potentially cause the communication failures.

Smith, Gopalakrishna, and Chatterjee (2006) didn't directly study the impact of

organizational behaviors and inter-functional relationship on marketing-sales interface. Instead,

they modeled the sales response to marketing communication efforts. Their study focus on the










timing and budget allocation of marketing communication in effectively generating sales leads,

sales appointments, and sales closures. They found that there is a complicated interplay among

the marketing communication efforts, delays in sales follow-up, and sales' efficiency. Their

study stressed the importance of the internal collaboration between marketing communication

and sales leads follow-up efforts but did not provide much guidance about how to create such

collaboration.

At a more macro-level, Cespedes (1993) advanced several organizational level factors that

can mitigate the conflict between marketing and sales managers. These organizational level

factors involve several structural changes including setting up liaison units at the headquarters

level to link marketing and sales activities, establishing multifunctional account teams, and

altering existing career paths and training programs for both marketing and sales. Cespedes'

(1993) research only extended the generic findings in other cross-functional interfaces to the

marketing-sales interface. He didn't consider the marketing-sales mindset differences, the factor

that is inherently associated with marketing-sales interface and potentially causes the marketing-

sales conflict. .

Dawes and Massey (2001) conducted one of the few empirical studies that address the

marketing-sales conflict. Using a sample of 200 firms from the United Kingdom and Australia,

Dawes and Massey (2001) examined the perceived relationship effectiveness between marketing

and sales managers. Focusing on the relational perspective, they found that trust has strong direct

effects on perceived relationship effectiveness. In addition, they showed that it also has indirect

effects on perceived relationship effectiveness via bidirectional communications between

marketing and sales managers. While this study is one of the pioneering studies that empirically

examined the marketing-sales interface conflict, it only addressed marketing-sales interface









conflict by extending the generic Eindings in other cross-functional interface research. The

factors that lead to the marketing-sales interface conflict and also are inherently associated with

the marketing-sales interface (i.e., mindset differences) was not explored.

Homburg, Jensen, and Krohmer (2008) developed a multidimensional model of marketing-

sales interface. They identified Hyve archetypes describing the marketing-sales interface: Ivory

Tower, Brand-Focused Professionals, Sales Rules, Marketing-Driven Devil's Advocacy, and

Sales-Driven Symbiosis. Their Eindings suggested that the most successful marketing-sales

interface configurations are characterized by a strong structural linkage between marketing and

sales and the high level of marketing knowledge in marketing. Basically, their study emphasized

the importance of identifying the structural configurations in marketing-sales

cooperation/conflict. It did not explicitly examine the actions that can be used to develop an

effective interface.

Literature Focusing on the Marketing-Sales Interface Specific Factors Leading to the
Marketing-Sales Cooperation/Conflict

Only two studies explicitly examined the marketing-sales cooperation/conflict by

investigating the factors that are unique and inherently associated with the marketing-sales

interface. In his interview with six industrial firms, Cespedes (1994) examined the interface

coordination among product management (one major sub-function in industrial marketing

department), sales, and customer services units. He found that the conflict between these units is

partly due to the implicit disagreements about what constitutes "success" in performing

marketing activities. Managers in each unit may agree that success is ultimately defined by "the

customer." But these units that are j ointly responsible for customer satisfaction perceive the

customer differently. Using a cognitive concept of hierarchy of attention, Cespedes further

explained that each unit differs in placing their priorities and allocates their attention along









different lines. Therefore, the resultant patterns of attention are inconsistent among these units.

These inconsistencies lead each unit to perceive the customer differently, which ultimately drives

the marketing-sales conflict. In conclusion, Cespedes (1994) explicitly considered the cognitive

factors that are inherently associated with marketing-sales interface, but he did not develop

measures of different marketing-sales mindsets or empirically test his theory. Also, Cespedes

(1994) research only considered the negative aspect of those cognitive factors that are inherently

associated with marketing-sales interface. He didn't explore the potential positive aspect of those

cognitive factors that influence marketing-sales interface interaction.

Homburg and Jensen's (2007) study on the thought-world differences addressed the

marketing-sales cooperation/conflict by considering the factors that are unique to the marketing-

sales interface. Their scale of marketing-sales thought-world differences includes both the

competence differences and the cognitive orientation differences between marketing and sales.

They found the negative impact of the cognitive orientation differences on marketing-sales

relationship quality. Note that their measure of the cognitive orientation differences between

marketing and sales only includes customer (versus product) orientation and short-term (versus

long-term) orientation. Realizing that their thought-world differences scale does not cover all

dimensions of the cognitive orientation differences between marketing and sales, they called for

future research to explore the comprehensive aspects of the cognitive orientation differences

between marketing and sales and to validate their findings in the comprehensive scale. In sum,

this study explicitly considers and measures the though-world differences measure, a cognitive

factor that uniquely characterize marketing-sales interface. However, a comprehensive set of

mindset differences dimension was not fully developed in this study. Also, this study mostly

focused on the negative aspect of the thought-world differences between marketing and sales,









although the positive side was implied. Additionally, their empirical test was largely on the data

from the single side of marketing-sales dyads.

Two other papers did not explicitly address, but imply, the marketing-sales

cooperation/conflict by considering the uniqueness of marketing-sales interface. In their

conceptual paper, Rouzies and her colleagues (2005) suggested that a maj or impediment to

coordinating the activities between marketing and sales is that marketing and sales personnel

have different mindsets. Although not explicitly stated in their paper, these mindset differences

were assumed to lead to potential conflict between marketing and sales and were not empirically

tested.

Using a different concept of organizational subculture, Kotler, Rachham, and

Krishnaswamy (2006) pointed out that the misalignment between marketing and sales is partially

due to the culture conflict between marketing and sales. Marketing people are more analytical,

data oriented, and proj ected focused, whereas salespeople are more relationship oriented and

willing to talk to the existing and potential customers rather than playing with the number behind

the office desk. This subculture conflict makes it hard for marketing and sales to work well

together. While this study suggested some dimension of marketing-sales mindset differences in

causing the marketing-sales conflict, it didn't develop a comprehensive set of mindset

differences dimensions and only concentrate on the negative aspect of subculture differences

between marketing and sales. Additionally, this study is also conceptual in nature.

Summary of Extant Marketing-Sales Conflict Research

Extant marketing-sales cooperation/conflict research has several characteristics. First, most

of the studies are conceptual, normative and even anecdotal in nature. The only empirical paper

examining the factors that are inherently associated with the marketing-sales interface in causing









the marketing-sales cooperation/conflict is Homburg and Jensen's (2007) study. Further

empirical evidence is needed to understand the marketing-sales cooperation/conflict.

Second, only a limited number of extant marketing-sales interface research considers the

factors that inherently characterize the marketing-sales interface in causing the marketing-sales

cooperation/conflict. Among the existing twelve marketing-sales interface research, only four

papers, two explicitly and two implicitly, addressed the marketing-sales conflict by investigating

those marketing-sales interface specific factors, such as the thought-world differences (Homburg

and Jensen 2007), mindset differences (Rouzies et al. 2006), subculture conflict (Kotler,

Rachham, and Krishnaswamy 2006), and hierarchy of attention (Cespedes 1994). Moreover,

among these four papers, only one (i.e., Homburg and Jensen 2007) has explicitly examined the

content of the mindset differences between marketing and sales. Yet, as Homburg and Jensen

(2007) pointed out, their measure only partially covers the wide range of the marketing-sales

mindset differences. Future research is called for further study on this under-explored concept.

Third, almost all of the existing marketing-sales interface research has focused on the

negative impact of the marketing-sales mindset differences on marketing-sales integration. No

research has explicitly addressed the positive impact of the marketing-sales mindset differences.

Note that Homburg and Jensen's (2007) study result implies that there is some positive impact of

marketing-sales thought-world differences on firm performance. However, they did not explicitly

investigate underlying process of this positive aspect, thus failing to show the mechanism how

both positive and negative aspects of the marketing-sales mindset differences affect the

marketing-sales interface.









Last, all of the past marketing-sales interface studies only collected information from the

single side of the marketing-sales dyads. Future research need to build its solid evidence based

upon the response from the both side of the marketing-sales dyads.

Based upon above review, my dissertation will address these gaps and further the research

in marketing-sales interface by: (1) investigating both positive and negative aspects of

marketing-sales mindset differences; (2) examining the underlying process of both positive and

negative impact of marketing-sales mindset differences, thus providing suggestions in how to

manage the marketing-sales mindset differences; (3) exploring the comprehensive dimensions of

marketing-sales mindset differences to help understand the content and underlying structure of

mindset differences between marketing and sales; and (4) testing the evidence of marketing-sales

mindset difference using data from match pairs of marketing-sales dyads.











Table 2-1. Summary of extant marketing-sales conflict research
Positive/negative Construct
Major account for.
Paper Types cofitimpact focus developed for Dyadic data
mmndset differences


Negative No No


Cespedes (1993)


Conceptual Liaison unit,
multifunctional team,
career oath, and training
program
Conceptual Hierarchy of attention
Conceptual Goal congruence
Conceptual Employee participation,
joint reward, and early
involvement
Conceptual Goal congruence
Empirical Bidirectional
communication and trust
Conceptual Bidirectional
communication
Empirical Thought-world
differences
Empirical Structural configuration
Conceptual Subculture differences
Conceptual Decentralization,
communication, job
rotation, and mindset
differences
Empirical Timing, and budget of
communication


Cespedes (1994)
Strahle, Spiro, and Actio (1996)
Dewsnap and Jobber (2000)


Dewsnap and Jobber (2002)
Dawes and Massey (2001)


Negative
Negative
Negative


Negative
Negative

Negative

Negative and
positive (implied)
Negative
Negative
Negative



Negative


Dawes and Massey (2005)

Homburg and Jensen (2007)

Homburg, Jensen, and Krohmer (2008)
Kotler, Rachham, and Krishnaswamy (2006)
Rouzies et. al (2005)



Smith, Gopalakrishna, and Chatterjee (2006)


Yes (but not
comprehensive)
No
No
No



No









CHAPTER 3
CONCEPTUAL FRAMEWORK

A framework of the dual-process model of marketing-sales mindset differences is

presented in Figure 3-1 and Figure 3-2. Figure 3-1 depicts the general conceptual framework and

Figure 3-2 shows the detail conceptual framework of the dual-process model of marketing-sales

mindset differences.

As depicted by Figure 3-1, two types of marketing-sales mindset differences (actual and

perceived mindset differences) are investigated. Actual marketing-sales mindset differences are

proposed to affect the perceived marketing-sales mindset differences. The left hand-side of the

general conceptual framework presents the antecedents of actual marketing-sales mindset

differences. Actual marketing-sales mindset differences are affected by the cross-functional

working experiences, training, and socialization for the marketing and sales employees.

Perceived marketing-sales mindset differences affect both the relationship conflict between the

marketing and sales functions and the perceived novelty of the information provided by the

employees in the counterpart functions.

Two underlying processes of the impact of marketing-sales mindset differences are

considered. The first process is called the social categorization process (indicated by the dot-line

rectangle). Under the social categorization process, perceived marketing-sales mindset

differences arise when marketing or sales employees categorize themselves in their own

functional area and emphasize the differences between their function and the other function.

This social categorization leads to the increased conflict between marketing and sales. This

social categorization process is moderated by the level of marketing and sales employees'

organizational identification, that is, the organizational identification reduces the social

categorization effect.









The second process is called the information processing process (indicated by the dash-line

rectangle). Under this process, perceived marketing-sales mindset differences lead the marketing

and sales employees to feel that people from the other function have unique perspectives and

novel information that can provide the basis for innovative solutions. This process is moderated

by the level of the cross-functional learning that exploits the differences in perspectives from

people in the other function.

The right hand-side of the general conceptual framework shows the consequence of the

marketing-sales mindset differences, where relationship conflict positively influences and

perceived information novelty positively affects the behavioral cooperation between marketing

and sales, which subsequently affects the firm performance.

Figure 3-2 expands the conceptual framework shown in the Figure 3-1. The maj or

differences between these two figures are that: (1) Figure 3-2 also provides the source of data

(indicated by the letters in the parentheses) collected for each of the variables shown in the

figure; and (2) Figure 3-2 separates sales and marketing' s responses in each of the proposed

processes. The following hypotheses development will base upon the detail conceptual

framework depicted in Figure 3-2.

Focal Construct: Marketing-Sales Mindset Differences

Marketing-sales mindset differences refer to the different perspectives on issues and

approaches for addressing problems between marketing and sales functions (Rouzies et al. 2005;

Ancona and Caldwell 1992). Homburg and Jensen (2007) used a similar concept of thought-

world differences to describe the mindset differences between marketing and sales. Their

concept of thought-world differences is broader in that it includes both orientation and

competence differences between marketing and sales. The marketing-sales mindset differences









concept in this dissertation concentrates only on the orientation differences dimension of the

thought-world differences concept described in Homburg and Jensen (2007) paper.

An extensive review of prior marketing-sales mindset difference literature (i.e., Cespedes

1992, 1994, 1995; Rouzies et al. 2005; Homburg and Jensen 2007) indicates that marketing-sales

mindset differences have several sub-dimensions. Rouzies and her colleagues' (2005) conceptual

paper suggested six dimensions of marketing-sales mindset differences. These six dimensions

include customer versus product orientation, personal relationship versus analysis orientation,

continuous daily activity versus sporadic proj ects orientation, field versus office orientation,

results and process orientation, and short-term versus long-term orientation. In Homburg and

Jensen's (2007) thought-world differences study, they described the marketing-sales mindset

differences using two sub-dimensions, customer versus product orientation and short-term versus

long-term orientation dimension. Recognizing that their concept of thought-world difference

didn't cover the comprehensive aspects of marketing-sales mindset differences, Homburg and

Jensen (2007) further discussed the marketing-sales mindset differences in the limitation section

and recommended more mindset differences dimensions including quantitative versus qualitative

orientation, analytical versus intuitive orientation, ability to deal with structured versus

unstructured problems, high versus low emotional arousal, positive versus negative outlook, and

expressive versus non-expressive attitude. The Table 3-1 summarizes the descriptions of

marketing-sales mindset dimension in the extant literature.

Despite of the conceptual discussion, prior literature did not distinguish two types of

marketing-sales mindset differences, that is, the actual and the perceived mindset differences.

Actual and Perceived Mindset Differences

Actual mindset differences refer to the differences between marketing people's perception

of their own mindsets and salespeople's perception of their own mindsets. Whereas, perceived









mindset differences refer to the differences between marketing/sales people' s perceptions of their

own and their perceptions of their counterpart function' s mindsets.

The distinction between actual and perceived mindset differences is made because prior

literature shows that it is the perception of differences, not necessarily the actual differences

themselves, that leads to the subsequent attitudes and behaviors (Riordan 2000; Turner et al.

1987). For instance, in performance appraisal research, Pulakos and Wexley (1983) indicate that

perceived similarity/dissimilarity is a more effective predictor of subordinate performance

evaluations than actual similarity/dissimilarity. Also, Cable and Judge (1997) found that actual

similarity has relatively weaker effect than perceived similarity on job applicant selection

decisions, because comparing to perceived similarity's direct influence, actual similarity only has

a relative distal influence on the attitudinal and behavioral outcomes. Harrison and his colleagues

further (2002) suggest that if differences are to be meaningful, they must be perceived. Based on

these above arguments, the first hypotheses reiterate this premise.

Hypothesis la: Actual marketing-sales mindset differences are positively related to the

marketing people 's perceived marketing-sales mindset differences.

Hypothesis lb: Actual marketing-sales mindset differences are positively related to the

salespeople 's perceived marketing-sales mindset differences.

Antecedents of Marketing-Sales Mindset Differences

The three factors examined in this research that affect the degree of actual marketing-

sales mindset differences are percentage of marketing and sales employees with cross-functional

working experiences in both marketing and sales, percentage of marketing and sales employees

with cross-functional training in both marketing and sales, and the nature of the organizational

socialization tactics.









Cross-Functional Working Experience and Training, and Actual Marketing-Sales Mindset
Differences

Upper echelons theory (Hambrick and Mason 1984) suggests that employees' functional

background affects how they understand, interpret, and comprehend their surrounding business

environment. Employee's functional training, for instance, serves as a cognitive filter to direct

their perceptions of the outside world in accordance with their functional background. Similarly,

selective perception theory (Dearborn and Simon 1958) suggests that employees' functional

working experiences selectively channel their perceptions of the surrounding working

environment. For example, Beyer and her colleagues (1997) found that even when facing the

same events, managers tended to narrow their attention to the information related to the areas

where they have working experiences.

Thus, it is expected that employees from two different functional areas will understand,

interpret, and comprehend the same business environment differently, if they only have working

experience and training in their own functional area. It is also expected that employees from two

different functional areas will understand, interpret, and comprehend the same business

environment similarly, if they have working experience and training from not only their own but

also their counterpart' s functional areas. In other word, employees with cross-functional working

experience and training from both their own and counterpart's functional areas are more likely to

arrive at the similar environment judgments and reach consensus with colleagues in their

counterpart' s function, because their cross-functional working experience and training

background allows them to understand, interpret, and comprehend the outside information

consistent with not only their own but also their counterpart's functional areas. In the long run,

employees with cross-functional background are more likely to develop similar mindsets with

their colleagues in the counterpart functional area. Operationally, it is expected that when an










organization recruits high percentage of marketing and sales employees with cross-functional

working experience in both marketing and sales areas, and when an organization invests much

resources to train its marketing and sales employees in both marketing and sales areas and

maintain a high percentage of cross-functional training marketing and sales employees,

marketing and sales employees in this organization are more likely to develop similar business

orientations and belief systems, and less likely to have high level of mindset differences between

each other. Thus,

Hypothesis 2a: Percentage of employees in marketing and sales functions who have

working experiences in both marketing and sales areas is negatively related to the actual

nzarketing-sales mindset differences.

Hypothesis 2b: Percentage of employees in marketing and sales functions who have cross-

functional training in both marketing and sales areas is negatively related to the nzarketing-sales

mindset differences.

Organizational Socialization Tactics and Actual Marketing-Sales Mindset Differences

Organizational socialization refers to the process by which new employees make their

transition from organizational outsiders to insiders. Literature in organizational socialization has

developed through several stages. Van Maanen and Schein's (1979) pioneering work

conceptualizes six organizational socialization tactics: collective-individual, formal-informal,

sequential-fixed, variable-random, serial-disjunctive and investiture-divestiture. Jones (1986)

subsequently groups these six socialization tactics into three broader factors: context, content,

and social aspects of organizational socialization tactics. Considering the sizable level of inter-

correlations between the socialization tactics factors found in Jones' (1986) works, some scholars

have recommended that organizational socialization tactics can be further arranged on a single

continuum ranging from institutionalized to individualized (e.g., Bauer et al., 1998).










Institutionalized socialization tactics refer to a systematic, structured, and planned set of program

where organizations group new employees together and put them through a common set of

learning experiences. Individualized socialization tactics reflect a relative absence of a structured

socialization program where organizations place new employees alone in their j obs to "sink or

swim" and let them to develop their own approaches to their roles and situations in the new

organization.

Compared to individualized socialization tactics, institutionalized socialization tactics

encourages new employees to accept the preset organizational values and norms, ensuring that

new employees receive a common message about the organizational values and how they should

perceive, interpret, and respond to different situations (Van Maanen and Schein 1979). As such,

in organizations where the institutionalized socialization tactics are adopted, new employees

from different functions are more likely to interpret and respond to the same business

environment in the similar ways, arrive at the common business environment judgments in the

short run, and in the long run, reach consensuses in their values and internal belief systems about

their business environment. Applying this logic to the current marketing-sales mindset

differences research setting, it is expected that marketing and sales people are less like to have

different mindsets when their organizations adopt the institutionalized socialization tactics, as

compared to those whose organizations adopt the individualized socialization tactics. Therefore,

Hypothesis 2c: Institutionalized socialization tactics is negatively related to the actual

nzarketing-sales mindset differences, such that the high level of institutionalized socialization

tactics the jirns uses, the lower level of actual nzarketing-sales mindset differences the firm will

have.









Processes of the Marketing-Sales Mindset Differences Impact

Dual-Process Model of Marketing-Sales Mindset Differences

Research in work group diversity provides two distinctive perspectives toward the impact

of inter-group differences on subsequent inter-group attitudes and behaviors (van Knippenberg,

De Dreu, and Homan 2004; van Knippenberg and Schippers 2007). The social categorization

perspective suggests that a social categorization process involves in the inter-group integration,

where the differences between groups form the basis for categorizing "self' and "others"

between members from different groups. The result of this social categorization process may be

that people tend to favor ingroup members over outgroup members, to be more attracted by

ingroup members than by outgroup members, and to be more willing to cooperate with ingroup

members than outgroup members (Tajfel and Turner 1986). The social categorization perspective

concentrates on the relational aspect of inter-group integration and emphasizes the negative

effect of inter-group differences.

The information processing perspective, however, focuses on the informational aspect of

inter-group integration and highlights the positive effect of inter-group differences. It suggests

that an information processing process involves in the inter-group integration, where the

differences between groups are rather viewed as a pool of diverse information, knowledge, skills,

and capabilities contributed by different groups. Integrating this pool of diverse resources may

result in more creative problem-solving approaches, more comprehensive decision making, and

superior performance.

Extending these two perspectives, I propose a dual-process model of marketing-sales

mindset differences. In this model, two processes are proposed to simultaneously involve in the

effect of marketing-sales mindset differences on their inter-group integration, where the social

categorization process highlights the impact of marketing-sales mindset differences on their









relational integration, and the information processing process emphasizes the effect of

marketing-sales mindset differences on their informational integration. The detail of this dual-

process model is described as follows.

Social Categorization Process: Perceived Mindset Differences and Relationship Conflict

Self-categorization theory (Turner et al. 1987) provides the theoretical foundation that

elaborates the proposed social categorization process, where the marketing-sales mindset

differences negatively influence the relationship between marketing and sales, resulting in

potential relationship conflict between these two functions. According to self-categorization

theory, marketing-sales mindset differences increase group distinctiveness between marketing

and sales through the cognitive processes of meta-contrast and comparative fit. This increased

group distinctiveness heightens the prominence of group boundaries between marketing and

sales, and also raises the level of group differentiation between these two functions. Because

highly differentiated groups usually have different standards for guiding behaviors (Rokeach

1968), members from one function will find greater difficulty in predicting the behaviors of the

members from the other function. Also, because the highly differentiated groups usually have

different ways to interpret the same situation events (Rokeach 1968), inter-group communication

between these highly differentiated groups becomes more difficult. Therefore, due to the low

predictability and poor communication, cross-functional cooperation between the differentiated

marketing and sales functions is less likely to achieve and the relationship conflict between

marketing and sales is more likely to occur.

Several other theories support the prediction that perceived mindset differences are

positively related to the relationship conflict between marketing and sales. Similarity-attracti ons

theory (e.g., Byrne 1971) suggests that while perceived similarity between group members (i.e.,

marketing and sales people) evokes attraction and liking, perceived dissimilarity produces









divisive tensions and disliking (Tziner 1986). Research in this paradigm finds that disliked

dissimilar group members are evaluated more negatively and elicit less cooperation and more

relational conflict (Krauss 1966), whereas liked similar group members are expected to generate

more cooperation. In a similar vein, belief congruence theory (e.g., Bryne, 1971) provides the

same prediction. Belief congruence theory investigates the effects of similarity (or dissimilarity)

on relations between members from different groups. Research in this framework finds that

perceived dissimilarity between own beliefs and those of an outgroup member is positively

related to inter-group discrimination (Insko, Nacoste, and Moe 1983). This inter-group

discrimination, thus, creates potential inter-group conflict.

In sum, because marketing-sales mindset differences creates both cognitive (i.e.,

heightened group boundaries, low predictability, and poor communication) and affective (i.e.,

disliking, unattractive, and inter-group discrimination) barriers between marketing and sales,

marketing-sales mindset differences is proposed to be positively related to the relationship

conflict between marketing and sales. Thus, two following hypotheses regarding this social

categorization process of marketing-sales mindset differences are described as,

Hypothesis 3a: Marketing people's perceived marketing-sales mindset differences are

positively related to their perceived relationship c IonfliL t n ith sales.

Hypothesis 3b: Salespeople 's perceived marketing-sales mindset differences are positively

related to therir~ perceived relationship c IonfliL t n ithr marketing.

Social Categorization Process: Moderating Effect of Organizational Identification

Van Knippenberg and his colleague (2004) suggest that the extent to which the differences

(e.g., mindset differences) engender the social categorization process is contingent upon several

factors. One important contingent factor is cognitive accessibility. Cognitive accessibility refers

to how easily the social categorization process implied by the differences (e.g., mindset









differences) is cognitively activated. The existence of the cognitive accessibility implies that the

inter-group differences don't necessarily trigger the social categorization process. If certain

environment variables suppress the social categorization process, that is, deactivating the

cognitive accessibility of the inter-group differences, the negative impact of the inter-group

differences on inter-group relationship will not be able to realize. In the current marketing-sales

mindset differences research setting, one such potential suppressing variable is the role of

organizational identification.

Organizational identification refers to the extent to which organization members are

committed to and identified with their organization in terms of the common organizational

values, norms, and cultures. Gaertner and his colleague's (1993) common in-group identify

model suggests that by building up a high level of organization identification, former ingroup

and outgroup members can be readily re-categorized from former functional identity to a new

common superordinate identity (e.g., from marketing or sales functional identity to a common

organizational identity). In that way, the former functional identity becomes less accessible and

the new common organizational identity becomes more accessible. As such, the negative impact

of mindset differences on marketing-sales relationship is less likely to occur, because the

presence of the organizational identity suppresses the formal functional identity created by the

mindset differences between marketing and sales, motivating the marketing and sales people to

work together in accordance with the common organizational values rather than their former

functional values. In other word, under the high level of organizational identification, the

marketing-sales mindset differences is less cognitively accessible and thus, less likely to affect

the relationship conflict between marketing and sales. Thus,










Hypothesis 4a: Organizational identification moderates the effect of perceived marketing-

sales mindset differences on relationship conflict between marketing and sales. Specifically,

under high level of organizational identification, marketing people 's perceived marketing-sales

mindset differences will be less likely to be positively related to their perceived relationship

conflict ~I ithr sales.

Hypothesis 4b: Organizational identification moderates the effect of perceived marketing-

sales mindset differences on relationship conflict between marketing and sales. Specifically,

under high level oforganizational identification, salespeople 's perceived marketing-sales

mindset differences will be less likely to be positively related to their perceived relationship

conflict ~I ithr marketing.

Information Processing Process: Perceived Mindset Differences and Perceived Information
Novelty

In contrast to the social categorization process, the information processing process

emphasizes the positive effect of inter-group differences. Research in work group diversity and

top management team (TMT) provides the theoretical foundation that elaborates this process

(Van Knippenberg, De Dreu, and Homan 2004; Simons, Pelled, and Smith 1999). It starts with

the notion that the differences from other group introduce a new set of information, knowledge,

skills, and capabilities to the original group. In addition, the differences from the other group also

bring new perspectives and opinions to the original group. Members from both groups will be

more likely to perceive the novel information and ideas, when they are exposed to the diverse

resources and perspectives from the other groups. The addition of new resources and

perspectives also allow both groups to generate innovative and creative approaches when the

diverse information and perspectives are effectively integrated. In the current marketing-sales

mindset differences research setting, because the different mindsets from the other function









introduce new information, values and perspectives about how to deal with the same business

environment, it is expected that marketing and sales people are more likely to perceived the

novelty of the information sent from the other functions when they are exposed to the diverse

information, values, and perspectives introduced by the different mindsets from the other

function. Thus,

Hypothesis 5a: Marketing people 's perceived nzarketing-sales mindset differences are

positively related to their perceived novelty of information sent by sales.

Hypothesis 5b: Salespeople 's perceived nzarketing-sales mindset differences are positively

related to their perceived novelty of information sent by marketing.

Information Processing Process: Moderating Effect of Cross-Functional Learning

Van Knippenberg and his colleague (2004) suggest that the extent to which the inter-group

differences (e.g., mindset differences) bring the positive effect to inter-group informational

integration depends on one important contingency, that is, the elaboration of diverse information

and perspectives from the other group. When exposed to the diverse information and

perspectives from other groups, members may not able to perceive the novelty of the added

information and perspectives, thus reaping the expected information benefit, if they do not

actively engage in learning, elaborating, and integrating the new information and perspectives

from the other groups. In the current marketing-sales mindset differences research setting, it is

expected that marketing and sales people with different mindsets will not necessarily perceive

the novelty of information sent from the other function, if the level of the cross-functional

learning from the other function is low.

Hypothesis 6a: Cross-functional learning moderates the effect of perceived marketing-

sales mindset differences on perceived information novelty. Specif ically, under low level of









cross-functional I~(learning. marketing people 's perceived nzarketing-sales mindset differences will

be less likely to be positively related to their perceived novelty of information sent by sales.

Hypothesis 6b: Cross-functional learning moderates the effect of perceived marketing-

sales mindset differences on perceived information novelty. Specif ically, under low level of

cross-functional I~(learning. salespeople 's perceived nzarketing-sales mindset differences will be

less likely to be positively related to their perceived novelty of information sent by marketing.

Consequences of Marketing-Sales Mindset Differences

Relationship Conflict, Perceived Information Novelty, and Behavioral Cooperation

In the inter-group relationship research setting, relationship conflict refers to the perception

of animosities and incompatibility among members from different groups and typically includes

tension, annoyance, and frustration among these members. Relationship conflict is expected to

be negatively related to behavioral cooperation between marketing and sales. Literature in group

conflict provides several arguments supporting this prediction (Jehn 1995, Pelled 1995). First,

relationship conflict makes marketing and sales people experience frustration, strain, and

uneasiness with others in the counterpart function. This negative affective reaction typically

results in psychological and physical withdrawal from the cross-functional interaction, and thus,

inhibiting the potential behavioral cooperation between these two functions. Second, the

affective friction resulting from the relationship conflict makes members from marketing and

sales less receptive to the ideas and information from the other function, reducing their potential

ability to assess new information provided by the other function and thus, reducing the quality of

cooperation between these two functions. Third, the time and energy that should be devoted to

the cross-functional cooperation is wasted to discuss and resolve the relationship conflict

between marketing and sales, largely limiting the resource needed for effective cooperation

between these two functions. As such,










Hypothesis 7a: Marketing people perceived relationship conflict is negatively related to

the behavioral cooperation between marketing and sales.

Hypothesis 7b: Salespeople perceived relationship conflict is negatively related to the

behavioral cooperation between marketing and sales.

Prior research in market intelligence suggests that perceived information quality is

positively associated with the use of this information (Deshpande and Zaltman 1982; Menon and

Vradaraj an 1992; Maltz and Kohli 1996). Perceived information quality refers to the extent to

which the information received from the sender as being accurate, relevant, and novel

(Deshpande and Zaltman 1982; Montgomery and Weinberg 1979). When members from one

function perceive that the information sent by the other function is highly novel, they are highly

motivated to use and incorporate this novel information in their work. The better decision

making quality and superior performance resulting from this information incorporation will

motive the information receiver to work with the information sender, resulting in a high level of

behavioral cooperation between each other. Thus, it is expected that when marketing and sales

people perceive high novelty of the information sent by the other function, they will be more

likely to use the novel information and are motivated to cooperate with each other. As such,

Hypothesis 8a: Marketing people's perceived novelty of information sent f ~on salespeople

is positively related to the behavioral cooperation between marketing and sales.

Hypothesis 8b: Salespeople 's perceived novelty of information sent fiom marketing people

is positively related to the behavioral cooperation between marketing and sales.

Behavioral Cooperation and Firm Performance

Research in cross-functional integration suggests that when different functions work

closely together, firms will be able effectively integrate the diverse internal functional

competence residing in different functions. This function integration will help firms develop










unique competitive advantages over their competitors and obtain superior performance. Thus, it

is expected that,

Hypothesis 9: Behavioral cooperation is positively related' to the firm performance.












Table 3-1. Marketing-sales mindset differences dimension discussed in prior literature
Dimensions of marketing-sales mindset differences
Rouzies et al. (2005)
Customer versus product
Personal relationship versus analysis
Continuous daily activity versus sporadic proj ects
Field versus office
Results versus process
Short-term versus long-term orientation
Homburg and Jensen (200 7)
Customer versus product orientation
Short-term versus long term orientation
Quantitative versus qualitative orientation
Analytical versus intuitive orientation
Ability to deal with structured versus unstructured problems
Emotional orientations (high versus low arousal)
Positive versus negative outlook
Expressive versus non-expressive attitude














Antecedents Processes Consequences


Org. Recruitment Social Categorization Process
oo of Employees
with Cross-
Functional..
Working .Orgamizational.
WorkingIdentification
Experience in
Marketing and
Sales Relationship
Conflict


Org. Training
ooof Employees I UActual Perceived
with Cross- Marketing- Marketing- Behavioral
Functional Sls aesCooperation 1 Per
Training in Mindset Mindset
Marketing and I [Differences Differences
Sales

Perceived

I Information
Ore. Socialization Novelty
Institutionalized
Socialization Cross-Functional
Inc tirc I Learning

Information Processing Process






Figure 3-1. General conceptual framework of the dual-process model of marketing-sales
mindset differences












Antecedents


Processes


Consequences


Note: The letters) in the parentheses indicates the sources of the data collected for each of the
variables beside the specific parentheses in the framework. Specifically, the letter "M" in the
parentheses indicates that the variable is reported by the marketing respondents. The letter "S" in
the parentheses indicates that the variable is reported by the sales respondents. And the letter
"MS" in the parentheses indicates that the variable combines both marketing and sales people's
responses.

Figure 3-2. Detail conceptual framework of the dual-process model of marketing-sales mindset
differences









CHAPTER 4
IVETHOD S

Overview

Two studies were conducted for this dissertation. The first study (the initial study) is used

to develop and pretest scales to assess the mindsets of marketing and sales people. The purpose

for the second study (the main study) is to use the measures developed in the first study to test

the entire conceptual framework of the dual-process model of marketing-sales mindset

differences presented by Figure 3-2.

Initial Study: Developing and Pre-testing the Scale of Marketing and Sales Mindsets

To assess the marketing-sales mindset differences, I first developed a new scale of

marketing and sales mindsets. Following O'Reilly and his colleagues' (1991) approach, I

developed a value profie including a set of value statements that ideographically characterize the

mindsets of both marketing and sales. This value profie was then pre-tested by an online survey

with 290 senior marketing and sales managers. Based upon the developed value profie,

participating marketing and sales managers were asked to rate the extent to which each of the

values statements in the value profie characterizes their marketing and sales people. Several

steps involving in this scale development process are described as follows.

Step 1: Describing the Mindsets of Marketing and Sales

To develop a list of potential mindset differences, an extensive review of academic and

practical literature on marketing and sales relationships and mindset differences, value

congruence, and organizational culture and subculture (Cespedes 1992, 1994, 1995; Dawes and

Massey 2001, 2005; Dewsnap and Jobber 2002; Hardy 1987; Lorge 1999; O'Reilly, Chatman,

and Caldwell 1991; Rokeach 1968; Rouzies et al. 2005; Schultz 2003; Strahle, Spiro, and Acito

1996) was conducted. In addition to the literature review, telephone interviews with eight senior









marketing and sales managers (four from marketing and four from sales) were conducted. Each

of the eight managers was asked to describe the typical marketing and sales people in general

(not necessarily the marketing and sales people from their own companies) using a set of short

statements (words). The literature review and telephone interview, together with the discussion

with academic scholars in the related research areas, arrive at an initial pool of 86 value

statements that characterize marketing and sales people in general.

This initial pool of 86 value statements that describe the marketing and sales mindsets

were then narrowed by using the following recommended criteria suggested by O'Reilly and his

colleagues (1991): (1) generality a value statement should be relevant to any type of companies

in the current research context, regardless of size, industry, and composition; (2) readability the

value statements should be easily understandable to facilitate their commonly shared meanings;

and (3) non-redundancy the value statements should have enough distinct meanings so that

they cannot be replaced by one another. This process results in a narrowed value profile,

consisting of 60 value statements that describe marketing and sales mindsets. (See Table 4-1 for

detail)

Step 2: Pre-testing the Value Profile Describing the Mindsets of Marketing and Sales

This narrowed value profie with 60 value statements that describe marketing and sales

mindsets was then pre-tested by an online survey of senior marketing and sales managers in B-

to-B businesses. I obtained a random sample of senior marketing and sales managers from a

commercial list provider. The sample was stratified by industry type to ensure that this sample

covers a wide range of industries. The Einal stratified sample consists of 3000 senior marketing

and sales managers (1500 for marketing and 1500 for sales). These managers were then

contacted by a soliciting email. This email includes a cover letter describing the nature of this

study and an online survey URL link directing to the pretest survey. Of 3000 senior marketing









and sales managers contacted, 290 marketing and sales managers (54% of marketing and 46% of

sales) finally completed this online pretest survey (a 9.67% response rate).

In this online pretest survey, respondents were asked to: "Rate the extent to which each of

the following words characterizes the marketing (sales) people in your firm/SBU". Based upon

each of the 60 value statements in the narrowed value profile, respondents were asked to rate

respectively the marketing and sales groups in their firms/SBUs. They were also asked to

provide value statements that are not included but important to characterize marketing and sales

people in general.

Based on the respondents' reported rating scores of each of the 60 value statements, an

exploratory factor analysis with varimax rotation was conducted. Since this factor analysis

combines both marketing and sales data, I conducted separated exploratory factor analysis for

marketing and sales data individually to ensure the similar factor structure between marketing

and sales data before combining the data. I estimated the factor structures of both marketing and

sales data and found similar structure between marketing and sales data. I thus combined the

marketing and sales responses and conducted the exploratory factor analysis for combined data

to develop the final marketing and sales mindset measure. Consistent with prior research (e.g.,

O'Reilly, Chatman, and Caldwell 1991; Spiro and Weitz 1990), items with factor loading lower

than .40 or with cross-loadings higher than .40 are dropped.

The second criterion to select the appropriate value statements is the requirement of

commensurate value measurement (Kristof 1996). Commensurate measurement refers to

describing both marketing and sales mindsets with the same value content structures and

dimensions. Commensurate measurement is often recommended for assessing congruence (or

difference) because it ensures mutual relevance of the characteristics under investigation (e.g.,










Caplan 1987; Edward 1991; French, Rogers, and Cobb 1974). To achieve the commensurate

value measurement, I compared the content and structure of marketing data with those of sales. I

only remained those value statements that both appear in marketing and sales data under the

similar dimensions.

The third criterion to select the appropriate value statements that describing marketing and

sales mindset is the added value statements recommended by both marketing and sales

respondents. Remind that in the online pretest survey, both marketing and sales respondents were

asked to suggest value statements that are not included in the provided list but important in

describing marketing and sales mindsets. Seven statements are recommended by both marketing

and sales respondents and thus added to the final value profile.

As such, the final value profile that describes marketing and sales mindsets constitutes 36

value statements (including seven added value statements that are suggested to be important but

not included in the prior value profile. (See Table 4-2 for detail). These 36 value statements will

be used to assess the marketing-sales mindset differences in the main study. The detail of

marketing-sales mindset differences assessment will be explained in the following section.

Main Study: Testing the Entire Conceptual Framework

Sample and Data Collection Overview

The sample of senior marketing and sales executives who participated into this main study

was obtained from the following procedure. The American Marketing Association (AMA) and

the Institute of Study for Business Markets (ISBM) at Penn State University were contacted and

agree to provide access to their membership company lists. A soliciting email/letter with a cover

letter describing the nature of the study, the incentive of participation, the researcher' s contact

information, and a URL link directing to a short initial online survey was sent to the potential

participating marketing and sales professionals through AMA and ISBM. AMA and ISBM









members who received the soliciting email/letter and were interested in participating in this

study were then asked to login on the initial online survey through the provided URL link and

complete the short initial online survey. In this short initial online survey, respondents were

asked to provide their names, titles, company names, contact information including their email

addresses and work phone numbers. Four hundred and fourteen marketing and sales executives

(including 366 from AMA and 51 from ISBM) completed this short initial online survey.

Each of the initial online survey respondents was then called individually by the researcher

via their provided work phone numbers. In each phone call, the researcher typically spent about

10-20 minutes talking with individual initial survey respondent. Several maj or points were

emphasized during this phone call: (1) highlighting the nature of this study and the participation

incentive for an executive benchmark report upon participants' completion of both marketing

and sales surveys; (2) ensuring that there are separate marketing and sales functions in the initial

survey respondents' firms/SBUs; (3) asking each of the initial survey respondents to identify an

appropriate senior marketing executive and an appropriate senior sales manager from the same

firm/SBU in their companies. These initial survey respondents were also asked to agree on

distributing a marketing survey to the identified marketing executive and a sales survey to the

identified sales executive in the same firm/SBU. These two identified executives should not be

the same person, ensuring that the marketing and the sale surveys are completed by different

people. Also, these two identified executives should work in their current firm/SBU for at least

one year, long enough for them to familiar with the interaction between marketing and sales in

their current firm/SBU. During the phone conversation, some of the initial survey respondents

were found to be qualified for completing both marketing and sales surveys. Under this situation,

these respondents were only allowed to complete one side of the surveys (either marketing or









sales survey), and then asked to distribute the other side of the surveys to another qualified

executive in the counterpart function to complete. Three hundred and seventy-three initial survey

respondents (330 from AMA and 43 from ISBM) identified their qualified marketing and sales

executives in the same firm/SBU and agreed to distribute the marketing and sales surveys to their

identified marketing and sales executives.

Thus, 373 pairs of marketing and sales surveys were distributed by either mail or email

with PDF format attachment. One hundred and twenty-two marketing executives returned their

completed marketing surveys, and 113 sales managers returned their completed sales surveys.

Among these returned surveys, 88 pairs of marketing and sales surveys are matched (including

76 completed pairs from AMA sample and 12 completed pairs from ISBM sample. Thus, the

total response rate is 23.60% (with 23.03% response rate for AMA sample, and 27.90% response

rate for ISBM sample).

Among 88 pairs of completed marketing and sales surveys, 23.86% of responses are from

the consumer packaging goods/electronics industry, 21.60% from the machinery/capital

equi pm ent indu stry, 1 4.7 7% from the te chnol ogy/s oftware/con sulti ng i ndu stry, 1 3.64% from the

chemical/pharmaceutical industry, 10.23% from the financial/insurance services industry, 6.82%

from the non-profit institution industry, and 9.08% from the other industries. Among the 176

respondents who have matched responses from the counterpart function in the same firm/SBU,

the average length of working experience in their current company is 8.33 years (7.24 years for

marketing respondents and 9.42 years for sales respondents). The test of the conceptual

framework of the dual-process model of marketing-sales mindset differences (depicted by Figure

3-2) in the next chapter is basing upon these 88 pairs of completed responses.










I tested the conceptual model depicted by Figure 3-2 using these 88 matched pairs of

marketing and sales surveys from senior marketing executive and a senior sales executive from

the same firm or strategic business units (SBUs). In the marketing survey, the marketing

executives were asked to evaluate the extent to which each of the 36 value statements that

describe marketing and sales mindsets (developed in the initial study, see Table 4-2 for detail)

characterizes their own marketing groups in their firms/SBUs. Meanwhile, they were also asked

to evaluate their counterpart sales groups from the same firm/SBU along the identical 36 value

statements. Similarly, in the sales survey, the sales executives in the same firm/SBU were also

asked to do the same evaluation for their own sales groups as well as their counterpart marketing

groups. The marketing and sales executives' rating scores of these 36 value statements on both

marketing and sales groups were then used to assess the actual and perceived marketing-sales

(the detail of the difference score assessment will be discussed in the measure section below). In

both marketing and sales surveys, marketing and sales executives were also asked to provided

information regarding the demographic background of their marketing and sales groups, their

organizational socialization tactics, level of perceived relationship conflict between marketing

and sales in their firms/SBUs, level of perceived organizational identification, their perceived

novelty of information sent by the counterpart function, the level of cross-functional learning

between marketing and sales, the level of behavioral cooperation between marketing and sales,

and their firm performance.

Measures

All the scales in the Figure 3-2 are described as follows. Appendix lists the details of all

the scales except the calculated scales of actual and perceived marketing-sales mindset

differences.










Percentage of Employees 11 id;r Cross-Functional Working Experience in Marketing and'

Sales. I adapt Chattopadhyay and his colleagues' (2004) scale to measure the percentage of

employees with cross-functional working experience in marketing and sales. Specifically, the

marketing respondents were asked to answer the question: "What percentage of marketing

employees has previously worked in sales area?" In the meantime, the sales respondents from the

same firm/SBU were asked to answer the question: "What percentage of sales employees has

previously worked in marketing area?" The average score of these two answers is then used to

measure the percentage of employees with cross-functional working experience in marketing and

sales.

Percentage of Employees 11 id;r Cross-Functional Training in Marketing and' Sales.

Similarly, I adapt Chattopadhyay and his colleagues' (2004) scale to measure the percentage of

employees with cross-functional training in marketing and sales. Specifically, the marketing

respondents were asked to answer the question: "What percentage of marketing employees has

some training or education in sales area?" In the meantime, the sales respondents from the same

firm/SBU were asked to answer the question: "What percentage of sales employees has some

training or education in marketing area?" The average score of these two answers is then used to

measure the percentage of employees with cross-functional training in marketing and sales.

Institutionalized Socialization Tactics. Adapting from the previous organizational

socialization studies (e.g., Kim, Cable, and Kim 2005; Cable and Parson 2001; Jones 1986), I

include four items to measure the institutionalized socialization tactics scale. Both marketing and

sales respondents from the same firm/SBU were asked to evaluate the extent to which they agree

or disagree with each of the four items based upon a 7-point scale ranging from 1 (strongly

disagree) to 7 (strongly agree). One item was dropped, due to the low reliability score for sales'










response. The remaining three items are then used to measure the institutionalized socialization

tactics. A sample item is, "Our company/division puts all of the new recruits through the same

set of learning experiences, regardless of their functional areas." The reliability of

institutionalized socialization tactics for marketing and sales are .79 and .80 respectively. The

marketing and sales' scores of institutionalized socialization tactics are then averaged to measure

the level of institutionalized socialization tactics for the participating firm/SBU.

Actual and' Perceived Ma'~rketing-Saless Mindset Differences. The rating scores of marketing

and sales mindsets are used to assess marketing-sales mindset differences. Remind that in the

both marketing and sales surveys in the main study, marketing and sales respondents were asked

to evaluate the extent to which each of the 36 value statements characterizes both their own

functional groups and their counterpart functional groups in the same firms/SBUs. The actual

marketing-sales mindset differences are assessed by comparing marketing people's self-

evaluated their own mindsets with salespeople's self-evaluated their own mindsets. Whereas,

perceived marketing-sales mindset differences are assessed by comparing marketing sales's

self-evaluated their own mindsets with marketing sales's evaluated sales (marketing)'

mindsets .

Kristof (1996) suggested two maj or measures to assess difference scores based upon the

rating scores: (1) squared differences (D2) between marketing and sales scores of the same value

statement; (2) profile correlation which correlates marketing and sales scores of the same value

statements. Both measures have their advantages in assessing difference scores. Squared

differences measure eliminates the potential problem of negative differences and gives more

weight to larger absolute differences cases. The profile correlation measure, on the other hand,

provides information about the extent to which the overall pattern of values is similar (or









dissimilar). That is, on each consecutive value statements, as one score goes up, then down, then

up, so does the counterpart' s scores, regardless of the absolute level of the scores. As long as the

pattern of highs and lows is similar (or dissimilar), then the profile correlation will be high (or

low).

Consistent with theoretical conceptualization (e.g., Chatman 1989; Kristof 1996) and as

recommended and used in prior research (e.g., O'Reilly, Chatman, and Caldwell 1991; Cable and

Judge 1997), the profile correlation measure were used to assess the marketing-sales mindset

differences scores. Specifically, the actual marketing-sales mindset differences scores were

calculated by correlating marketing respondents' evaluation of their own mindsets with sales

respondents' evaluation of their own mindsets. The resulting set of correlation scores indicates

the similarity between actual marketing and sales mindset. Thus, the actual marketing-sales

mindset differences scores are just negative to the obtained correlation scores.

As for the perceived marketing-sales mindset differences scales, the marketing's perceived

marketing-sales mindset differences scores were calculated by correlating marketing

respondents' evaluation of their own mindsets with their evaluation of the mindsets of sales in

the same firms/SBUs. Similarly, the negative of the obtained correlation scores indicate the

marketing's perceived marketing-sales mindset differences.

In a similar vein, the sales' perceived marketing-sales mindset differences scores were

calculated by correlating sales respondents' evaluation of their own mindsets with their

evaluation of the mindsets of marketing in the same firms/SBUs. Again, the negative of the

obtained correlation scores indicate the sales perceived marketing-sales mindset differences.

Relationship Conflict. Adapted from Jehn's (1995) and Pelled and her colleagues' (1999)

works, a five-item scale is developed to measure the level of relationship conflict between









marketing and sales. Specifically, marketing respondents reported marketing's perceived

relationship conflict with sales, and sales respondents in the same firm/SBU reported sales'

perceived relationship conflict with marketing on a 7-point scale ranging from 1 (strongly

disagree) to 7 (strongly agree). A sample item is, "There are lots of personal frictions between

individuals from each of the functional areas (marketing and sales)." The reliability of

marketing's perceived relationship conflict is .93, same as the reliability score for sales'

perceived relationship conflict.

Organi~zationallIdentification. Based upon Fisher and his colleagues' (1997) study, a six-

item scale is developed to measure the level of organizational identification in the participating

firm/SBU. Specifically, marketing respondents reported marketing's perceived organizational

identification in their firm/SBU, and sales respondents reported sales' perceived organizational

identification in the same firm/SBU on a 7-point scale ranging from 1 (strongly disagree) to 7

(strongly agree). A sample item is, "Marketing people (salespeople) in our functional area feel

emotionally attached to the entire company." The reliability for marketing's perceived

organizational identification is .95. The reliability score for sales' perceived organizational

identification is .90.

Perceived Information Novelty. A five-item scale of perceived information novelty is

developed from the works by Moenaert and Souder (1990), Maltz and Kohli (1996), and Simons

and his colleagues (1999). Marketing respondents reported marketing's perceived novelty of

information sent by sales; and sales respondents in the same firm/SBU reported sales' perceived

novelty of information sent by marketing on a 7-point scale ranging from 1 (strongly disagree) to

7 (strongly agree). A sample item is, "The information sent by sales (marketing) often provides









us with novel perspectives." The reliability of marketing' s perceived information novelty is .85.

And the reliability of sales' perceived information novelty is .87.

Cross-Functional Learning. Adapted from Van der Vergt and Van de Vliert' s (2005)

study, a three-item scale of cross-functional learning is developed. Specifically, marketing

respondents reported their perceived level of cross-functional learning between marketing and

sales, and sales respondents in the same firm/SBU reported their perceived level of cross-

functional learning between marketing and sales on a 7-point scale ranging from 1 (strongly

disagree) to 7 (strongly agree). Due to the low reliability of marketing' s perceived cross-

functional learning, one item was dropped from the original three-item scale. The new reliability

of marketing' s perceived cross-functional learning is .61, and the new reliability score for sales'

perceived cross-functional learning is .76. A sample item is, "Marketing and sales freely

challenge the assumptions underlying each other' s ideas and perspectives in order to improve

performance .

Behavioral Cooperation. To fit the marketing-sale cooperation setting, the behavioral

cooperation scale is specially created for this study. Specifically, a thirteen-item scale covering

various aspects of marketing-sales cooperation is developed. Marketing and sales respondents

were respectively asked to evaluate the level of support in thirteen aspects provided by the

counterpart function in the same firm/SBU along a 7-point scale ranging from 1 (poor) to 7

(excellent). Their responses were then averaged to measure the level of behavioral cooperation in

their firm/SBU. A sample item is, "Following up leads generated by marketing (Generating high

quality sales leads)." The reliability of marketing' s reported behavioral cooperation is .93, and

the reliability of sales' reported behavioral cooperation is .90.









Firm Performance. The firm performance scale includes sixteen items, ranging from

market share growth, sale growth, profit growth, account loss, turnover, innovativeness, new

product success, return on sales, to customer satisfaction. Adapted from Moorman and Rust' s

(1999) study, both marketing and sales respondents from the same firm/SBU were asked to rate

their firm/SBU' s performance as compared to their major competitors along the sixteen

dimensions. The reliability of marketing' s reported firm performance is .89, and the reliability of

sales' reported firm performance is .90. Marketing and sales responses are then averaged to

measure the level of performance of their firm/SBU.

Control variables. Several control variables are added based upon the prior research.

Specially, five control variables (i.e., goal congruence, market dynamics, complexity of selling

task, selling situation-new buy, status equality) are added when considering the social

categorization process of marketing-sales mindset differences. Song and his colleagues' (2000)

study evidences that goal congruence is an important factor influencing the cross-functional

relationship. Maltz and Kohli's (1996) work suggests another important context variable, market

dynamics, that affects the cross-functional relationship. Dynamic market creates more

uncertainties that require high level of coordination between marketing and sales. This high level

coordination requirement raises potential relationship conflict between marketing and sales. John

and Weitz' s (1990) research suggests other two context variables, the complexity of selling task

and the selling situation-new buy, that can potentially influence relationship between marketing

and sales. When the selling task is more complex, or the product/service is rather a new purchase

situation for buy, marketing and sales need more efforts to coordination. This extra coordination

requirement thus increases potential relationship conflict between marketing and sales. Status

equality between marketing and sales also influence the level of relationship conflict between









marketing and sales. Unequal status between marketing and sales is more likely to result in high

level of relationship conflict between these two functions (Song, Xie, and Dyer 2000).

Three control variables are considered when examining the relationship between

behavioral cooperation and firm performance. These three control variables are market

dynamics, complexity of selling task, and selling situation-new buy. Firms generally need extra

efforts to obtain desired performance, when the market is dynamic, selling task is complicated,

or the purchase situation is new to their customers.











Table 4-1. Narrowed value profile of marketing and sales mindsets (60 items)
Value statement Value statement
Flexible Demanding
Adaptive Take individual responsibility
Stable Have high expectations for performance
Predictable Offer praise for good performance
Innovative Create conflicts
Quick to take advantage of opportunities Confront conflict directly
Willing to experiment Friendly
Risk taking Fit in
Careful Collaborative
Independent Enthusiastic
Rule-oriented Hard working
Analytical Not constrained by many rules
Detail-oriented Being distinctive/different from others
Precise Socially responsible
Team-oriented Result-oriented
Share information freely Have a clear guiding philosophy
Emphasize a unique culture for functional Competitive
area
People-oriented Organized
Respect for individuals Political
Tolerant Planner
Informal Implementer
Easy going Doer
Energetic Data-driven
Supportive Outcome-oriented
Aggressive Process-oriented
Decisive Bureaucratic
Action-oriented Diplomatic
Take initiative Creative
Reflective Short-term oriented
Achi evement-ori ented Long-term oriented











Table 4-2. Final value profile of marketing and sales mindsets (36 items)
Value statement
People-oriented
Friendly
Respect for individuals
Supportive
Collaborative
Relationship-oriented*
Result-oriented
Achi evement-ori ented
Outcome-oriented
Competitive
Aggressive
Action-oriented
Analytical
Detail-oriented
Precise
Organized
Process-oriented
Data-driven
Innovative
Creative
Willingness to experiment
Risk Taking
Adaptive
Flexible
Bureaucratic
Political
Authoritative*
Diplomatic
Admini strative*"
Rule-oriented
Long-term oriented
Seeking immediate benefit*
Planning for future*
Farsighted*
Willingness to sacrifice for the future*
Short-term oriented
Note: -- Denotes that value statements are important but were not included in the narrowed value
profile. These value statements were added to the final value profile in consistent with the
recommendation by both marketing and sales respondents in the online pretest survey.









CHAPTER 5
DATA ANLYSES AND RESULTS

Multiple regressions were used to analyze the structural model presented by Figure 3-2.

Before analyzing the structural model, measurement model test using LISREL were conducted to

test the convergent and discriminant validity of the measures in the model. Meanwhile, before

the measurement and structural model tests, reliability for all the measures was also checked

(See Appendix for the reliability of all related scales). Table 5-1 provides the means, standard

deviations and correlations for the measures.

Measurement Model Estimation

Construct Validity

Because some of the measures were newly created and some others were adapted from the

previous studies, I conducted a confirmatory factor analysis (CFA) to assess the construct

validity of the measures used. Due to the small sample size to number of items ratio, this

confirmatory factor analysis includes measures from the two maj or processes (the social

categorization and information processing processes) in the conceptual framework in Figure 3-2.

Specifically, the items from the scales of perceived marketing-sales mindset differences,

relationship conflict, perceived information novelty, and the two moderating variables of

organizational identification and cross-functional learning for both marketing and sales responses

were included in the CFA. The CFA showed good fit of the models to the data. The Root Mean

Square Error of Approximation (RMSEA) index is .08, an indicative of reasonable model fit

(Browne and Cudeck 1993). Also, the Comparative Fit Index (CFI) and the Non-Normed Fit

Index (NNFI) are .85 and .87 respectively, very close to the normal cut-off point value of .90

(Bagozzi and Yi 1988). Combined together, these indices indicate a reasonable overall fit of this









model to the data and show an acceptable convergent and discriminant validity of the measures

in the model.

Common Method Variance

Note that while the data in the main study is dyadic data in nature, the data for the social

categorization and information process processes parts in the conceptual framework were

collected using survey measures from a single source (either from marketing or from sales). As

such, several steps were taken to address potential concerns about common method bias

(Podsakoff et al. 2003). Procedural remedies to avoid these biases included protecting

respondent confidentiality, reducing item ambiguity, separating items for marketing and sales

mindset and outcome variables (i.e., relationship conflict, and perceived information novelty)

(about two survey pages apart). Moreover, several statistical remedies were also undertaken.

First, Harman's one-factor test (Podsakoff and Organ 1986) was conducted. Specifically, several

separate exploratory factor analyses (EFAs) were conducted using principal component analysis

and varimax rotations for all independent and dependent variables in both the social

categorization and information processing processes in the model. No single maj or factor

emerges to account for a maj ority of the variances explained by the models (among the most

extreme situation among the four EFAs, the first factor accounts for only 18 percent of variance

explained by the model), providing preliminary evidence that no substantial common method

bias exists in the data. Further, a partial correlation adjustment test suggested by Lindell and

Whitney (2001) to control for common method variance was also conducted. Lindell and

Whitney (2001) state that a variable that is theoretically unrelated to at least one other variable

(preferably the dependent variable) in the study can be used as a marker variable in a partial

correlation adjustment test. The item about the last year' s total compensation of the respondent









was used as the marker variable (The item has non-signifieant correlations with all variables in

the investigated model, thus suggesting its appropriateness to serve as a marker variable). A

review of each of the partial correlation matrices indicates that all significant zero-order

correlations remain significant after the partial correlation adjustment, which further confirms

that common method bias is not a serious problem in this study.

Structural Model Estimation

I used multiple regression analysis to test the proposed hypotheses. The results are shown

in Table 5-2 and Table 5-3.

Hypothesis la and lb propose that actual marketing-sales mindset differences are

positively related to both marketing people and salespeople's perceived marketing-sales mindset

differences respectively. The results are reported in Table 5-2. Consistent with both hypotheses,

actual marketing-sales mindset differences are positively related to both perceived marketing-

sales mindset differences (B marketing = .49, p < .01; a sales = .32, p < .01). Therefore, Hypothesis la

and lb are supported.

Hypothesis 2a proposes that percentage of marketing and sales employees with cross-

functional working experience in both marketing and sales is negatively related to the actual

marketing-sales mindset difference. Regression results are reported in Table 5-2. While the

direction of the regression coefficient is consistent with expectation, the regression coefficient is

not significant (B = -. 10, n.s.). Thus, Hypothesis 2a is not supported.

Hypothesis 2b proposes that percentage of marketing and sales employees with cross-

functional training in both marketing and sales is negatively related to the actual marketing-sales

mindset difference. Supporting this hypothesis, the regression coefficient (shown in Table 5-2) is

negative and significant (B = -.29, p < .05). Thus, Hypothesis 2b is supported.










Hypothesis 2c proposes that institutionalized socialization tactics is negatively related to

the actual marketing-sales mindset differences. As seen in Table mindset difference is positively

related to conflict. As seen in Table 5-2, institutionalized socialization tactics is negatively

related to the actual marketing-sales mindset differences, but this relationship doesn't show the

significance (B= -.06, n.s.). As such, Hypothesis 2c is not supported.

Hypothesis 3a proposes that marketing people's perceived marketing-sales mindset

differences are positively related to their reported relationship conflict between marketing and

sales. As presented by Table 5-3, marketing people's perceived marketing-sales mindset

differences is positively but insignificantly related to relationship conflict (B= .19, n.s.). Thus,

this hypothesis is not supported.

Hypothesis 3b proposes that salespeople's perceived marketing-sales mindset differences

are positively related to their reported relationship conflict between marketing and sales.

Consistent with the hypothesis, Table 5-3 shows that salespeople's perceived marketing-sales

mindset differences is positively and significantly relate to the relationship conflict (B= .28, p <

.01). Thus, Hypothesis 3b is supported.

Hypothesis 4a proposes the organizational identification moderates the effect of marketing

people's perceived marketing-sales mindset differences on their reported relationship conflict

between marketing and sales. Inconsistent with the expectation, the interaction term shown in

Table 5-3 is not significant (B= -.10, n.s.). Therefore, Hypothesis 4a is not supported.

Hypothesis 4b proposes the organizational identification also moderates the effect of

salespeople's perceived marketing-sales mindset differences on their reported relationship

conflict between marketing and sales. Consistent with the hypothesis, the interaction term shown

in Table 5-3 is significant (B= -.24, p < .01). Therefore, Hypothesis 4b is supported.










Hypothesis Sa proposes that marketing people's perceived marketing-sales mindset

differences are positively related to their perceived novelty of information sent by the sales. As

shown by Table 5-3, the corresponding regression coefficient is insignificant and negative (B= -

.12, n.s.). Thus, Hypothesis Sa is not supported.

Hypothesis 5b proposes that salespeople's perceived marketing-sales mindset differences

are positively related to their perceived novelty of information sent by the marketing. Contrary to

the hypothesis, this relationship (presented by Table 5-3) shows to be negative and insignificant

(B= -.10, n.s.). Therefore, Hypothesis 5b is not supported

Hypothesis 6a proposes that cross-functional learning moderates the effect of marketing' s

perceived marketing-sales mindset differences on their perceived novelty of information sent by

the sales. Consistent with the hypothesis, the proposed the interaction term (shown in Table 5-3)

is significant (B= .31, p < .01). Thus, Hypothesis 6a is supported.

Hypothesis 6b proposes that cross-functional learning moderates the effect of salespeople's

perceived marketing-sales mindset differences on their perceived novelty of information sent by

the marketing. Supporting this hypothesis, the corresponding interaction term is positive and

significant (B= .26, p < .01). As such, Hypothesis 6b is supported.

Hypothesis 7a proposes that marketing people's perceived relationship conflict with sales

is negatively related to the behavioral cooperation between these two functions. The regression

results show in Table 5-2. Partially supporting the hypothesis, the regression coefficient is

negatively but marginally significant (B= -. 14, p < .1). Thus, Hypothesis 7a is partially

supported.

Hypothesis 7b proposes that salespeople's perceived relationship conflict with marketing is

negatively related to their behavioral cooperation with marketing. As seen in Table 5-2,









salespeople' perceived relationship conflict is negatively and significantly related to the

behavioral cooperation between marketing and sales (B = -.20, p < .05). Therefore, Hypothesis

7b is supported.

Hypothesis 8a proposes that marketing people's perceived information novelty is

positively related to their behavioral cooperation with sales. Consistent with the hypothesis,

marketing people's perceived information novelty is positively and significantly related to

behavioral cooperation between marketing and sales (B = .37, p < .01) (shown in Table 5-2).

Consequently, Hypothesis 8a is supported.

Hypothesis 8b proposes that salespeople's perceived information novelty is positively

related to the behavioral cooperation between marketing and sales. Again, in consistent with the

expectation, this relationship (see in Table 5-2) is shown to be significant and positive (B = .36, p

< .01). Thus, Hypothesis 8b is supported.

Hypothesis 9 proposes that behavioral cooperation is positively related to firm

performance. This hypothesis receives the support. As indicated by Table 5-2, behavioral

cooperation is positively and significantly related to firm performance (B = .37, p < .01)

Table 5-4 summarizes the results of hypothesis testing.

Elaboration of Moderation Effects in the Dual-Process Model

This section further elaborates the two hypothesized moderating effects using the detail

graphs. Note that Hypothesis 4a and Hypothesis 4b propose the moderating effect of

organizational identification on the relationship between perceived marketing-sales mindset

differences and relationship conflict. Specifically, these two hypotheses propose that under high

level of organizational identification, perceived marketing-sales mindset differences are less

likely to be positively related to the relationship conflict between marketing and sales. Figure 5-1

and Figure 5-2 show the details of this moderating interaction effect. Figure 5-1 presents the









details interaction graph for the marketing data and Figure 5-2 for the sales data. As presented by

these two graphs, while the moderating effect of organizational identification in the marketing

data is not significant, both graphs clearly show that the slope indicating the positive relationship

between perceived marketing-sales mindset differences and relationship conflict (the negative

aspect of marketing-sales mindset differences) is becoming flatter under the high level of

organizational identification as compared to the low level of organizational identification. It

means that organizational identification helps to mitigate the negative effect of mindset

differences on marketing-sales relationship. Also, the steeper slop of the low organization

identification lines in both figures indicates that the lack of organizational identification building

will worsen the negative effect of marketing-sales mindset differences on their relationship.

Figure 5-3 and Figure 5-4 elaborate the details of moderating effect of cross-functional

learning. Figure 5-3 shows the marketing data and Figure 5-4 presents the sales data. Note that

Hypothesis 6a and Hypothesis 6b propose the moderating effect of cross-functional learning on

the relationship between perceived marketing-sales mindset differences and perceived

information novelty (the positive aspect of marketing-sales mindset differences). Specifically,

these two hypotheses propose that under low level of cross-functional learning, perceive

marketing-sales mindset differences will be less likely to be positively related to the perceived

information novelty. Supporting both hypotheses, both figures show that under low level of

cross-functional learning, perceived marketing-sales mindset differences are not only less likely

to be positively related to the perceived information novelty, they are also turning to be

negatively related to perceived information novelty. A further investigation of both figures finds

that the positive relationship between perceived marketing-sales mindset differences and

perceived information novelty only exists under the high level of cross-functional learning









situation. Therefore, the investigation of both figures concludes that the positive effect of

marketing-sales mindset differences on perceived information novelty is not universal. This

positive effect exists only when firms advocate high level of cross-functional learning. In

addition, both figures also show that the positive effect of perceived marketing-sales mindset

differences on information novelty might turn to be negative when the level of cross-functional

learning between marketing and sales is getting lower.













Table 5-1. Means, standard deviations, and intercorrelations among variables
Mean SD 1 2 3 4 5 6 7 8 9 1() 11 12 13 14 15


% of Employees with
cross functional
working experience mn
marketing and sales
% of Employees ivith
2 cross functional training
in marketing and sales
3Institutionalized
socialization tactics
4Actual marketing-sales
mmndset differences
Perceived marketing-
5 sales mindset
differences (marketing)
Perceived marketing-
6 sales mindset
differences (sales)
_17 Relationship conflict
W (marketing)
Organizational
8 identification
(marketing)
9 Relationship conflict
(sales)
1() Organizational
identification (sales)
11Perceived information
novelty marketingg)
12Cross-fumctional
learning (marketing)
13Perceived information
novelty (sales)
14Cross-fumctional
learning (sales)
15 Behavioral cooperation

16 Firm performance
N=88: tivo-tail test; p<.()5


18.66 16.13



37.95 24.82 .39*


3.()8 1.12 -.()4 .17

-.22 .28 -.21 -.35* -.13


-.22 .38 -.2() -.17 -.16 .48*


-.22 .38 -.()1 -.2() .()9 .32* -.13


2.62 1.36 -.24* -.25* .()6 .()3 .28* -.()2


5.()( 1.3() -.14 -.1() .()( .()4 -.33* .()1 -.2()


2.58 1.19 .()4 -.38* -.1() .25* .()6 .36* .()9 .12

5.12 1.()4 -.13 .15 .()6 -.13 -.14 -.()9 -.13 .13 -.22*

4.36 .94 -.()6 .33* .2() -.16 -.22* .()4 -.25* .2() -.23* .21

4.69 1.()7 .13 .25* .19 -.()2 -.19 .19 -.45* .13 -.()5 -.()8 .27*

4.38 1.()2 -.()9 .16 .25* -.()3 .()4 -.()8 .()3 -.()4 -.39* .()4 .()7 .24*

4.59 1.17 -.()6 .21 .()9 -.()6 -.()7 -.()2 -.()9 .()2 -.()5 .46* .2() .()7 .16

3.96 .88 .16 .4()* .37* -.18 -.28* -.13 -.24* .()9 -.43* .()8 .47* .42* .46* .15

4.68 .69 -.18 .()5 .19 -.()1 -.()8 .()1 -.()8 .37* -.()2 .41* .34* .16 .17 .13 .37*














Table 5-2. Regression analyses for antecedents and consequences of marketing-sales mindset differences
Dependent variable Actual marketing-sales Perceived marketing-sales Perceived marketing- Behavioral Firm Performance
mindset differences mindset differences sales mindset cooperation
(marketing) differences (sales)
B Se B Se B Se B Se B Se


Note: p<.10, p <.05, p <.01


Controls
Market dynamics
Complexity of selling task
Selling situation-new buy


-07 .10
.17 .11
-.0 .12


Antecedents
% of Employees with cross functional
working experience in marketing and
sales
% of Employees with cross functional
training in marketing and sales
Institutionalized socialization tactics

Focal variables
Actual marketing-sales mindset
differences

Consequences
Relationship conflict (marketing)
Relationship conflict (sales)
Perceived information novelty
(marketing)
Perceived information novelty (sales)
Behavioral cooperation


10 .32**


-.141 .08
-.20* .09

.37** .09

.36** .09


.37**


Full Model F
Adjusted R'


3.92*


25.83**
.23


9.44**
.09


17.61**
.43


3.98**
.12














Table 5-3. Regression analyses for dual-process of marketing-sales mindset differences
Dependent variable Relationship conflict Relationship Conflict Perceived information Perceived information
(marketing) (sales) novelty (marketing) novelty (sales)
B Se B Se B Se B Se


Note: p<.10, p<.05, p < .01


Controls
Status equality (marketing)
Market dynamics (marketing)
Complexity of selling task (marketing)
Selling situation-new buy (marketing)
Goal congruence (marketing)
Status equality (sales)
Market dynamics (sales)
Complexity of selling task (sales)
Selling situation-new buy (sales)
Goal congruence (sales)
Task routineness (marketing)
Task routineness (sales)


.02
.02
.03
.04
-.35**


-04
.09
-03
-01
-51**


Moderating variables
Organizational identification (marketing)
Organizational identification (sales)
Cross-functional training (marketing)
Cross-functional training (sales)

Independent variables
Perceived marketing-sales mindset differences (marketing)
Perceived marketing-sales mindset differences (sales)

Interaction variables
Perceived marketing-sales mindset differences (marketing)
*organizational identification (marketing)
Perceived marketing-sales mindset differences (sales)
*organizational identification (sales)
Perceived marketing-sales mindset differences (marketing)
*cross-functional training (marketing)
Perceived marketing-sales mindset differences (sales)
*cross-functional training (sales)


.00 I4


-.19*


.19 .11


.10 .11


Full Model F
Adjusted R'


2.72*
.14


8.06**
.41


4.73*
.15


2.70*
.08










Table 5-4. Summary of hypothesis testing
Hypothesis Support status
Focal variables
Hla: Actual mindset differences + perceived mindset differences Supported
(marketing)
Hlb: Actual mindset differences + perceived mindset differences Supported
(sales)
Antecedents
H2a: Percentage of employees with cross-functional working Not supported
experience in both marketing and sales & actual mindset
differences
H2b: Percentage of employees with cross-functional training in Supported
both marketing and sales & actual mindset differences
H2c: Institutionalized socialization tactics + actual mindset Not supported
differences
Social categorization process
H3a: Perceived mindset differences (marketing)+ relationship Not supported
conflict (marketing)
H3b: Perceived mindset differences (sales) + relationship conflict Supported
(sales)
H4a: Moderating effect of organizational identification Not supported
(marketing)
H4b: Moderating effect of organizational identification (sales) Supported
Information processing4 process
H5a: Perceived mindset differences (marketing) + perceived Not supported
information novelty (marketing)
H5b: Perceived mindset differences (sales) + perceived Not supported
information novelty (sales)
H6a: Moderating effect of cross-functional learning (marketing) Supported
H6b: Moderating effect f cross-functional learning (sales) Supported
Consequences
H7a: Relationship conflict (marketing) + behavioral cooperation Partially supported
H7b: Relationship conflict (sales) + behavioral cooperation Supported
H8a: Perceived information novelty (marketing) + behavioral Supported
cooperation
H8b: Perceived information novelty (sales) + behavioral Supported
cooperation
H9: Behavioral cooperation 4 firm performance Supported























.I
.'~
.',
"'


Identification
- -- High Org.
Identification


Low Mindset Diff~erences


High Mindset Differences


Figure 5-1. Interaction graph for the moderating effect of organizational identification
(marketing data)



















....-


-* Low Org.
Identification
- -- High Org.
Identification


Low Mindset Diff~erences


High Mindset Differences


Figure 5-2. Interaction graph for the moderating effect of organizational identification (sales
data)


















,o 3 1 ILow Cross-
I I functional
S41 Learning
..----" -- -- -- High Cross-
31 .-- functional
I I Learning
~2-





Low Mindset Diff~erences High Mindset Ditfferences





Figure 5-3. Interaction graph for the moderating effect of cross-functional learning (marketing
data)

















O I -*- Low Cross-
51 functional
I I Learning
S4-
--- High Cross-
3 ....- -m functional
..- -- Learming







Low Mindset Ditfferences High Mindset Ditfferences




Figure 5-4. Interaction graph for the moderating effect of cross-functional learning (sales data)









CHAPTER 6
DISCUSSION AND FUTURE RESEARCH

This research empirically investigates the role of mindset differences in marketing-sales

integration. Specifically, this research proposes a dual-process model (i.e., social categorization

process and information processing process) of marketing-sales mindset differences and explores

both the negative and positive sides of marketing-sales mindset differences. It suggests that

marketing-sales mindset differences not only trigger relational tension in their relational

exchange; they also bring informational benefits to their information exchange.

This research also explores the factors affecting the marketing-sales mindset differences

and the factors moderating the effect of the marketing-sales mindset differences on their

relational and informational exchanges. The empirical results show that by recruiting more

employees with cross-functional training in both marketing and sales, firms can lower the level

of marketing-sales mindset differences in their company. Also, the empirical results indicate that

by building high level of organizational identification, firms can mitigate the negative effect of

marketing-sales mindset differences on their relational exchange. In addition, by advocating high

level of cross-functional learning between marketing and sales, firms can also secure the benefit

of marketing-sales mindset differences to their informational exchange.

Besides the dual-process model, this research also develops a new scale including a

comprehensive set of value profile that describes the unique characteristics of marketing and

sales mindsets. This new scale was used to measure the marketing-sales mindset differences, the

focal construct in this dissertation.

Theoretical Implications

This dissertation provides the following two contributions to the literature in marketing-

sales cooperation/conflict.









First, this dissertation is first empirical research using dyadic data from both marketing

sales sides in the same business to investigate the role of mindset differences in marketing-sales

integration. Also, this dissertation also develops and empirically validates a new scale of

marketing and sales mindsets used to assess marketing-sales mindset differences. Echoing

Homburg and Jensen's (2007) call, this new scale of marketing-sales mindsets covers

comprehensive aspects of marketing and sales' thought-worlds and consists of a comprehensive

value profile that characterizes the mindset of marketing and sales. Based upon this new scale,

marketing-sales mindset differences were calculated and used to investigate its impact on

marketing-sales relational and informational exchange. To the researcher' s best knowledge, it is

the first study that develops such comprehensive set of value profile adequately measuring the

marketing-sales mindsets.

Second, this dissertation is the first study that explicitly examines both the negative and

positive effect of marketing-sales mindset differences. Prior research has largely focused on the

negative effect of marketing-sales mindset differences on their relational exchange. This

dissertation also investigates the positive effect of marketing-sales mindset differences and

integrates both positive and negative sides of mindset differences in the dual-process model of

marketing-sales mindset differences. Specifically, on the positive side, it proposes an information

processing process where marketing-sales mindset differences bring informational benefits to

their informational exchange. On the negative side, it proposes a social categorization process

where marketing-sales mindset differences trigger the relational tension between marketing and

sales. In addition, this dissertation also proposes factors moderating these two underlying

processes. In specific, organizational identification is proposed to moderate the social

categorization process and mitigate the negative effect of mindset differences on marketing-sales










relational exchange. And cross-functional learning is proposed to moderate the information

processing process and facilitate the positive effect of mindset differences on perceived quality

of information exchanged between marketing and sales.

The empirical results in this dissertation generally support this dual-process model of

marketing-sales mindset differences. Perceived marketing-sales mindset differences are found to

be positively related to the relationship conflict between marketing and sales for the sales data.

Also, both the marketing and sales data show that perceived marketing-sales mindset differences

are positively related to their perceived novelty of information sent the counterpart functions

when the level of cross-functional learning between marketing and sales is high.

This dual-process model of marketing-sales mindset differences contributes to the

marketing-sales interface literature in general and marketing-sales mindset differences in specific

in that it moves from a single negative view of mindset differences in marketing-sales integration

and incorporates both the negative and positive view of mindset differences in marketing-sales

integration.

Managerial Implications

This dissertation also suggests several approaches to mitigate the negative effects of

marketing-sales mindset differences and also to explore the potential benefits of marketing-sales

mindset differences.

Specifically, this dissertation suggests the moderating effect of organizational

identification on the social categorization process of the marketing-sales mindset difference. This

moderating effect implies that by building strong organizational identification, firms can mitigate

the relational tension between marketing and sales. Also, this dissertation suggests the

moderating effect of cross-functional learning on the information processing process of the

marketing-sales mindset differences. This moderating effect implies that in order to explore the









benefits of marketing-sales mindset differences on their information exchange, firms have to

advocate a high level of cross-functional learning between marketing and sales. Combining

together, firms are able to realize that mindset differences between marketing and sales functions

are not always a cost. If they manage the mindset differences correctly (i.e., by building up

strong organizational identification and promoting high level of cross-functional learning), firms

actually can avoid the negative impact and at the same time, rear the potential benefits brought

by the different mindsets in their marketing and sales functions.

Additionally, this dissertation also provides approach for firms to mitigate the mindset

differences at the very beginning stage. The investigation of the antecedent of marketing-sales

mindset differences shows that the percentage of employees with cross-functional training both

marketing and sales is negatively related to marketing-sales mindset differences. This finding

implies that firms can strategically use their human resources management policy when

recruiting their new marketing and sales employees. If firms are confident about their capabilities

in building strong organizational identification and cross-functional learning, they can

intentionally recruit more marketing and sale employees without cross-functional training

background, hoping that the cross-functional learning among differentiated mindsets employees

arrives in more innovative business approaches. However, if firms realize that they do not have

such capabilities at the current stage, they'd better recruit more marketing and sales employees

with cross-functional training background in order to avoid the potential relational conflicts

associated with differentiated mindsets employees.

Limitations

There are several limitations in this dissertation. First, two of the expected antecedents of

marketing-sales mindset differences, the percentage of the employees with cross-functional

working experience in both marketing and sales and the institutionalized socialization tactics, do









not show the significant results in the empirical investigation. A possible reason for the first

insignificant antecedent is that the cross-functional working experience might not necessarily

change the employee's original mindsets or allow them to accommodate other' s differentiated

mindsets. It might be possible that working experience in other functions further strengthens the

employees' original mindsets, thus further amplifying the differences with other functions. A

possible reason for the second insignificant antecedent is that the effect of institutionalized

organizational socialization between new employees might not strong enough to compensate the

effect when the newcomers interact with colleagues from their own functions and adopt the

existing functional mindsets. Also, the adapted institutionalized socialization tactics scale in this

dissertation is a short scale. It might not capture the full meaning of institutionalized

socialization tactics as compared to the full scale in the original literature (e.g., Jones 1986).

Second, in the empirical investigation of the social categorization process of the dual-

process model, the main effect of perceived marketing-sales mindset differences on relationship

conflict and the moderating effect of organizational identification are only significant for the

sales data, but not the marketing's data. It might be possible that the pressure to meet the

periodical sales quota makes salespeople more alert to the relationship friction with the

marketing people in the same company. For marketing people, since their compensation doesn't

directly link to the concrete market performance in most situations, they might not be sensitive to

the relationship quality with sales when obtaining their compensation in the company.

Third, in the empirical examination of the information process of the dual-process model,

the main effect of the perceived marketing-sales mindset differences on perceived information

novelty is significant only under the high cross-functional learning situation. Under low level of

cross-functional learning between marketing-sales, the expected positive main effect of










perceived marketing-sales mindset differences on perceived information novelty disappears. A

possible explanation is that the positive effect of marketing-sales mindset differences is not a

nature process. The potential benefit of marketing-sales mindset differences can only be realized

by the proactive activities, such as the cross-functional learning.

Fourth, while this dissertation investigates the impact of marketing-sales mindset

differences on their relationship conflict, it doesn't examine how marketing-sales mindset

differences also affect their task conflict. Jehn's (1995) research suggested that there are at least

two types of conflict, relationship and task conflict, involving in intergroup interaction. In

addition, relationship conflict and task conflict are suggested to have differential antecedents and

consequence in the intergroup interaction process. The future research on marketing-sales

mindset differences may also consider including the task conflict variable and investigate its

relationship with mindset differences in marketing-sales interaction.

Fifth, although this dissertation suggests the directional effect of mindset differences on

marketing-sales relationship conflict, this cross-section study cannot exclude the potential

reverse causal relationship in that severe relationship conflict between marketing and sales will

further widen the mindset gaps between these two functions. In any model in which causality is

suggested, longitudinal studies provide stronger inferences. Thus, the model developed and

tested in this study could benefit from future a longitudinal design.

In the methodological part, there are also some limitations in this paper. First, since the

independent and dependent variables in the social categorization process and information

processing process were both assessed using responses by the same person to a questionnaire, a

potential for a bias towards significance due to common method variance exists. I attempted to









minimize this problem by the aforementioned stringent data collection procedures, careful survey

design including a marker variable, as well as a series of statistical examinations.

Second, although our theory suggests the directional effects of mindset differences on

marketing-sales relationship conflict, the cross-sectional study in this dissertation cannot exclude

the reverse causal relationship in that high relationship conflict between marketing and sales

people will further widen the mindset gaps between marketing and sales people. In any model in

which causality is suggested, longitudinal studies provide stronger inferences. Thus, the model

developed and tested in this study could benefit from a longitudinal design.

Third, the variables in the antecedent and consequence parts of the conceptual framework

in Figure 3-2 combine both marketing and sales responses in the same firm/SBU. While this

combination is basing upon the high reliability score between marketing and sales responses in

the same firm/SBU, advanced investigation (i.e., interclass correlation analysis, Shrout and Fleiss

1979) can be conducted to ensure the validity of this data combination

Fourth, in the initial study that protests the newly developed scale of marketing and sales

mindsets, the marketing and sales responses on their own mindsets and their perceived mindsets

are combined to the exploratory factor analysis. This combination assumes that the underlying

structure of marketing' s mindsets and that of the sales mindsets are identical. Rather than

assuming the identical underlying structure, additional structure equivalence analysis should be

conducted. A brief version of such structure equivalence analysis was conducted in the post

analysis. This brief analysis involves two separate exploratory factor analyses for marketing's

own mindsets evaluation data and sales own mindset evaluation data respectively. A comparison

between the results of these two factor analyses exhibits the similar structure dimension between

marketing and sales data, indicating the general validity in data combination.









Fifth, mindset differences scores were calculated using the rating score of marketing and

sales mindset evaluation. Other researchers (e.g., Kristof 1996; Cable and Judge 1997) suggests

that the ranking score is better than the rating score in assess the congruence/differences scores.

While ranking score has its own merit, Edwards (2001) argues that the rating score can also

adequately assess the congruence/differences scores. In addition, rating score also has its

advantage in mitigating the burden of survey respondents in making the evaluation.

Sixth, this dissertation uses profile correlation method (Cable and Judge 1997, O'Reilly,

Chatman, and Caldwell 1991) to assess the differences between marketing and sales mindsets.

While profile correlation method has its unique advantages in assessing differences scores

(Kristof 1996), it also has some potential disadvantages, such as conceptual ambiguity,

discarding information, insensitivity to the sources of profile differences, and overly restrictive

constraints on the coefficients (Edwards 1993). Future research can also consider applying the

polynomial regression method suggested by Edwards (1993).

Seventh, sample size is not large enough. Currently, this dissertation only includes 88 pairs

of completed marketing and sales data. Further data collection is needed to expand the sample

size and is expected to avoid problems associated with small sample size.

Directions for Further Research

Future research might consider other moderating factors that affect the social

categorization and information processing process of the marketing-sales mindset differences.

For instances, organizational learning orientation might moderate the information processing

process in that under high level of learning orientation, perceived mindset differences will be

more likely to be positively related to perceived information novelty. Also, the nature of

information communicated between marketing and sales and media of communication might

also moderate the social categorization process. For example, when communicated information









is more tacit and the communication media is less lean in nature, perceived marketing-sales

mindset differences will be more likely to be positively related to relationship conflict between

marketing and sales.

Future research could also investigate the j oint effects of mindset differences and other

cross-functional integration mechanisms (e.g., goal congruence) on marketing-sales

cooperation/conflict. A potential hypothesis could be that goal congruence will moderate the

negative effect of mindset differences on cooperation. When marketing and sales people in

specific company highly agree on the goals in j oint tasks, they can still achieve high level of

cooperation and performance even they have different mindsets.

Another direction for future research is to extend the concept of mindset differences in

other research contexts. For example, future research can examine the effect of channel member

mindset differences on the channel relationship. Also, future research can extend to the Merger

& Acquisition (M&A) research context and investigate the effect of mindset differences between

CEOs in both merger and acquisition companies on the success of the M&A activities. A recent

success M&A between Google and YouTube provides a vivid practical example that instead of

the financial offer involving in the M&A, the mindset similarity between the leaders in both

merger and acquisition companies is a key driving factor predicting the success of M&A.










APPENDIX
MEASUREMENT SCALE

Antecedent Variables
Percentage of Employees with Cross-Functional Working Experience in Marketing and
Sales (adapted from Chattopadhyay, George, and Lawrence 2004)
1. What percentage of marketing employees has previously worked in sales area?
(%) (answered by marketing respondent)
2. What percentage of sales employees has previously worked in marketing area?
(%) (answered by sales respondent)

Percentage of Employees with Cross-Functional Training in Marketing and Sales (adapted
from Chattopadhyay, George, and Lawrence 2004)
1. What percentage of marketing employees has some training or education in sales area
(%) (answered by marketing respondent)
2. What percentage of sales employees has some training or education in marketing area
(%) (answered by sales respondent)

Institutionalized Socialization Tactics a (adapted from Kim, Cable, and Kim 2005; Cable and
Parson 2001; Jones 1996)
1. Our company/division puts all of the new recruits through the same set of learning
experiences, regardless of their functional areas.
2. Once recruited, all of the new employees extensively involve with each other in common,
j ob related training activities, regardless of their functional areas.
3. For most of the new recruits in our functional area, their training have been carried' out
apart f~om the newcomers in other~fm~ctional areas. (R)b
4. There is a sense of "being in the same boat" amongst all of the new recruits across
different functional areas in our company/division.
(Reliability: Cronbach'S aniaketing = .79; Cronbach's asal,, = .80)

Process Variables
Relationship Conflict a (adapted from Jehn 1995; Pelled, Eisenhard, and Xin 1999)
1. There are lots of personal frictions between individuals from each of the functional areas
(marketing and sales).
2. There is lots of tension between individuals from each of the functional areas (marketing
and sales).
3. There are lots of personality clashes evident between individuals from each of the
functional areas (marketing and sales).
4. Individuals from each of the functional areas (marketing and sales) often involve
emotional conflict.
5. There are lots of jealousy and rivalry between individuals from each of the functional
areas (marketing and sales).
(Reliability: Cronbach'S aniaketing = .93; Cronbach's asal,, = .93)

Organizational Identification a (adapted from Cadogan et al. 2005; Fisher, Maltz, and Jawarski
1997)









Marketing people (salespeople) in our functional area ..
1. feel emotionally attached to the entire company.
2. feel a strong sense of belonging to the entire company.
3. feel as if the problems in the entire company are their own.
4. feel like part of the family of the entire company.
5. feel strong tie to the entire company.
6. feel they have a personal stake in the success of the entire company.
(Reliability: Cronbach'S aniaketing = .95; Cronbach's asales = .90)

Perceived Information Novelty a (adapted from Moenaert and Souder 1990; Maltz and Kohli
1996; Simons, Pelled, and Smith 1999)
1. The information sent by sales (marketing) often provides us with novel perspectives.
2. The information sent by sales (marketing) often includes something new to us.
3. The information sent by sales (marketing) often provides us with alternative perspectives.
4. The information sent by sales (marketing) often complements to what we already had.
5. The information sent by sales (marketing) often includes diverse evaluation criteria.
(Reliability: Cronbach'S aniaketing = .85; Cronbach's asal,, = .87)

Cross-Functional Learning a (adapted from Van der Vegt and Van de Vliert 2005)
1. Marketing and sales freely challenge the assumptions underlying each other's ideas and
perspectives in order to improve performance.
2. Marketing and sales criticize each other 's work in order to improve performance.
3. Marketing and sales freely utilize different opinions from the other party in order to
obtain the optimal performance.
(Reliability: Cronbach'S aniaketing = .61; Cronbach's asal,, = .76)

Consequence Variables
Behavioral Cooperation (created for this study)
Please evaluate the support that sales (marketing) provides for marketing (sales) in the following
areas: (1=poor; 4=average; excellent)
1. Following up leads generated by marketing. (Generating high quality sales leads.)
2. Accurately articulating the corporate brand band value proposition. (Creating strong
brand reputation that makes it easier to sell our product/services.)
3. Involving marketing in sales calls. (Making calls with salespeople.)
4. Improving marketing's understanding of customer needs. (Improving product knowledge
of salespeople.)
5. Providing useful information to help marketing better target key accounts. (Identifying
accounts to target.)
6. Effectively using collateral materials developed by marketing. (Providing effective
collateral materials.)
7. Informing marketing about the changing customer needs. (Informing sales about
products/services in development.)
8. Supporting new product launches (Facilitating new product/services in development).
9. Providing useful information about competitors. (Providing useful information about
competitors.)










10. Providing useful information about the changing market conditions. (Providing useful
information about the changing market conditions.)
11. Providing background information about key accounts. (Providing background
information about key accounts.)
12. Using tools developed by marketing to help sell product/service. (Developing tools to
help sell product/services.)
13. Providing information about competitors' best marketing practices. (Providing
information about competitors' best selling practices.)
(Reliability: Cronbach'S mar~keting = .93; Cronbach's asales = .90)

Firm Performance (adapted from Luo, Slotegraaf, and Xing 2006; Moorman and Rust 1999;
Narver and Slater 1990)
Compared with the maj or competitors, how is your company/division performing on: (1=worse;
4=on par; 7=better)
1. sales growth
2. market share growth
3. profit growth
4. account loss
5. reduction in selling cost
6. turnover
7. number of new product/service launched
8. speed of new product/service launched
9. new product/service success
10. innovativeness of new product/service
1 1. innovativeness of go-to-market strategy
12. ROI (Return On Investment)
13. ROS (Return On Sales)
14. customer loyalty
15. customer satisfaction
16. customer retention
(Reliability: Cronbach'S mar~keting = .89; Cronbach's asales = .90)

Control Variables
Goal Congruence a (adapted from Jap 1999; Jap and Anderson 2003; Song, Xie, and Dyer 2000)
1. Marketing and sales share the same goals.
2. Marketing and sales have the compatible goals.
3. The goals are different between marketing and sales. (R)
(Reliability: Cronbach'S mar~keting = .79; Cronbach's asales = .77)

Status Equality a (Created for this study)
1. Marketing and sales have equal status in our company/division.
2. Marketing and sales can equally influence our company/division's decision.
3. Marketing and sales have the equal level of position in top management' s minds.
(Reliability: Cronbach'S mar~keting = .86; Cronbach's asales = .88)

Market Dynamics a (adapted from Maltz and Kohli 1996)









1. Our customers' preferences for product features change very fast.
2. Our customers require very specialized care and services.
3. Our customers' needs are very different, requiring different types of product, brands,
services, knowledge, and skills to deal with.
4. Our competitors' products and models change very frequently.
5. Our competitors' selling strategies changes very often.
6. Our competitors' promoting/advertising strategies changes very often.
(Reliability: Cronbach'S mar~keting = .80; Cronbach's asales = .77)

Complexity of Selling Task a (adapted from Anderson, Chu, and Weitz 1987; John and Weitz
1989)
1. Most of our customers made their purchase decisions with our company/division very
quickly. (R)
2. Generally, a number of people are involved in our customers' purchase decision.
3. Most of our customers need a lot of information before deciding to purchase from our
company/divi si on.
4. Most of our customers consider their purchase decision with our company/division to be
routine. (R)
(Reliability: Cronbach'S mar~keting = .74; Cronbach's asales = .64)

Selling Situation--New Buy a (adapted from Anderson, Chu, and Weitz 1987; John and Weitz
1989)
1. Most of our customers' purchase decisions with our company/division evolve a long time
period.
2. Most of our customers have limited knowledge about what features of our
company/division's products are needed to solve their problems.
3. Most of our customers have no prior experience in how to deal with the produces
purchased from our company/division.
4. Our company's products are still a new purchase for most of our customers.
(Reliability: Cronbach'S mar~keting = .77; Cronbach's asales = .63)

Task Routineness (adapted from Pelled, Eisenhardt, and Xin 1999)
1. The j oint tasks between marketing and sales are very routine.

R: Denotes reverse coded
a: Scale: 1= Strongly Disagree; 4=Neutral; 7= Strongly Agree
b: Dropped due to low reliability










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BIOGRAPHICAL SKETCH

Jun Xu is a PhD candidate in marketing at the University of Florida. He graduated from

East China University of Science and Technology in China for his bachelor degree in

Management and Fudan University in China for his master degree in Management. His current

maj or research interests include selling effectiveness, marketing-sales relationship, internal

selling, and inter-organizational relationship and innovation. His doctoral dissertation proposal

on marketing-sales integration was given several awards by American Marketing Association

(AMA) Sales SIG and the Institute for the Study of Business Markets (ISBM). He already had

several papers published at the Journal of Marketing, the International Journal of Research in

Marketing, and the Journal of Vocational Behavior.





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1 MARKETING-SALES INTEGRATION: TH E ROLE OF MINDSET DIFFERENCES By JUN XU A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLOR IDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY UNIVERSITY OF FLORIDA 2008

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2 2008 Jun Xu

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3 To my parents, my wife, and my daughter

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4 ACKNOWLEDGMENTS I would lik e to thank my parents for their en dless support for my academic pursuit. Also, I would like to thank my wife, who is now a mana gement professor, for her support in both my academic and family sides of life. I would also like to thank my daughter, who has provided me with tremendous happiness and motivation during my Ph.D. study. Finally, I especially thank Dr. Bart Weitz, my supervisory committee chair. Wit hout Bart, I would not be able to even make any academic advancement during my Ph.D. study. Our relationship is not just an advisorstudent relationship. It is also a lifetime friendship!

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5 TABLE OF CONTENTS page ACKNOWLEDGMENTS...............................................................................................................4 LIST OF TABLES................................................................................................................. ..........7 LIST OF FIGURES.........................................................................................................................8 ABSTRACT.....................................................................................................................................9 CHAP TER 1 INTRODUCTION..................................................................................................................12 2 LITERATURE REVIEW.......................................................................................................18 Literature Focusing on the Generic Fact ors Leading to the Marketing-S ales Cooperation/Conflict...........................................................................................................19 Literature Focusing on the Marketing-Sales Interface Specific Factors L eading to the Marketing-Sales Cooperation/Conflict............................................................................... 24 Summary of Extant Marketing-Sales Conflict Research ........................................................26 3 CONCEPTUAL FRAMEWORK........................................................................................... 30 Focal Construct: MarketingSales Mindset Differences .........................................................31 Actual and Perceived Mindset Differences .....................................................................32 Antecedents of Marketing-Sales Mindset Differences........................................................... 33 Cross-Functional Working Experience and Training, and Actual Marketing-Sales Mindset Dif ferences..................................................................................................... 34 Organizational Socialization Tactics and Actual Marketing-Sales Mindset Differences ...................................................................................................................35 Processes of the Marketing-Sales Mindset Differences Impact............................................. 37 Dual-Process Model of Marketing-Sales Mindset Differences....................................... 37 Social Categorization Process: Pe rceived Mindset Differences and Relationship Conflict ............................................................................................38 Social Categorization Process: Mo derating Effect of Organizational Identification .........................................................................................................39 Information Processing Process: Percei ved Mindset Differences and Perceived Inform ation Novelty............................................................................................. 41 Information Processing Process: Mode rating Effect of Cross-Functional Learning ................................................................................................................42 Consequences of MarketingSales Mindset Differences ........................................................43 Relationship Conflict, Perceived Information Novelty, and Behavioral Cooperation .... 43 Behavioral Cooperation a nd Firm Performance.............................................................. 44

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6 4 METHODS.............................................................................................................................49 Overview....................................................................................................................... ..........49 Initial Study: Developing and Pre-testing th e Scale of Marketing and Sales Mindsets ......... 49 Step 1: Describing the Mindsets of Marketing and Sales ................................................ 49 Step 2: Pre-testing the Value Profile Describing the Mindsets of Marketing and Sales .............................................................................................................................50 Main Study: Testing the Entire Conceptual F ramework........................................................52 Sample and Data Collection Overview...........................................................................52 Measures..........................................................................................................................55 5 DATA ANLYSES AND RESULTS...................................................................................... 65 Measurement Model Estimation............................................................................................. 65 Construct Validity........................................................................................................... 65 Common Method Variance.............................................................................................66 Structural Model Estimation................................................................................................... 67 Elaboration of Moderation Effect s in the Dual-Process Model .............................................. 70 6 DISCUSSION AND FUTURE RESEARCH......................................................................... 81 Theoretical Implications....................................................................................................... ..81 Managerial Implications........................................................................................................ .83 Limitations.................................................................................................................... ..........84 Directions for Further Research.............................................................................................. 88 APPENDIX MEASUREMENT SCALE..................................................................................... 90 LIST OF REFERENCES...............................................................................................................94 BIOGRAPHICAL SKETCH.......................................................................................................100

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7 LIST OF TABLES Table page 3-1 Marketing-sales mindset differences di m ension discussed in prior literature................... 46 4-1 Narrowed value profile of marke ting and sales m indsets (60 items).................................63 4-2 Final value profile of market ing and sales m indsets (36 items)........................................ 64 5-1 Means, standard deviations, and intercorrelations am ong variables.................................. 73 5-2 Regression analyses for antecedents and consequ ences of marketing-sales mindset differences..........................................................................................................................74 5-3 Regression analyses for dual-process of m arketing-sales mindset differences................. 75 5-4 Summary of hypot hesis testing .......................................................................................... 76

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8 LIST OF FIGURES Figure page 3-1 General conceptual framework of the dua l-process m odel of ma rketing-sales mindset differences..........................................................................................................................47 3-2 Detail conceptual framework of the dualprocess m odel of marketing-sales mindset differences..........................................................................................................................48 5-1 Interaction graph for the moderating effect of organiza tiona l identification (marketing data).................................................................................................................77 5-2 Interaction graph for the moderating eff ect of organizational identification (sales data)....................................................................................................................................78 5-3 Interaction graph for the moderating eff ect of cross-functional learning (m arketing data)....................................................................................................................................79 5-4 Interaction graph for the moderating effect of cross-functional le arning (sales data) ....... 80

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9 Abstract of Dissertation Pres ented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy MARKETING-SALES INTEGRATION: TH E ROLE OF MINDSET DIFFERENCES By Jun Xu August 2008 Chair: Barton Weitz Major: Business Administration This dissertation focuses on the mindset differences between marketing and sales employees (e.g., short-term versus long-term orie ntation, result versus process orientation, and relationship versus product orientat ion) to explore issues related to the integration of activities performed by these two functional areas. Drawing from the research in social categorization and organizational diversity, a dual-process model of marketing-sales mindset differences is outlined. In this model, both the positive and negative aspects of marketing-sales mindset differences are examined. Specifically, two underlying processes, the social categorization process and the information processing process, are proposed to i nvolve in the effect of mindset differences on marketing-sales integration. In the social categorization proce ss, perceived marketing-sales mindset differences are proposed to be positivel y related to the relatio nship conflict between these two functions, indicating the negative aspect of marketing-sa les mindset differences. In the information processing process, perceived marke ting-sales mindset differences are proposed to be positively related to the perceived novelty of information sent betw een these two functions, indicating the positiv e aspect of marketing-sales mindset di fferences. This model also suggests that organizational identification moderates the social categorization process and crossfunctional learning moderates the in formation processing process.

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10 This dissertation also explores the antecedents and conse quence of the marketing-sales mindset differences. Specificall y, three factors are proposed to a ffect the actual marketing-sales mindset differences: the selec tion of marketing and sales em ployees with cross-functional working experiences in both marketing and sale s areas, the cross-functi onal training of current marketing and sales employees in both marke ting and sales areas, and the adoption of the institutionalized organizational socialization tactics. In a ddition, marketing-sales mindset differences are also proposed to eventually aff ect the behavioral cooper ation between marketing and sales and the subsequent firm performance. Methodologically, th is dissertation also develops and validates a new scale of marketing and sales mindset to measure the marketing-sales mindset differences. I tested the conceptual framework by using a cr oss-sectional survey de sign collecting data from 88 matched pairs of senior marketing and sales executives from the same businesses. The empirical results generally support the proposed dual-process model of ma rketing-sales mindset differences. Specifically, the results show that perceived mindset differences are positively related to the relationship conflict between ma rketing and sales, and this relationship is moderated by the level of organizational identific ation in the sale data. Also, in both marketing and sales data, the results show that perceived mindset differences is pos itively related to the perceived novelty of information sent between marketing and sales when the level of crossfunctional learning between marketi ng and sales is high. The results al so show that percentage of marketing and sales employees with cross-functional working experience in both marketing and sales areas is negatively related to the actual ma rketing-sales mindset differences. These results suggests that firms can manage the marketingsales mindset differen ces by developing strong organizational identification and by promoting hi gh level of cross-functi onal learning between

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11 marketing and sales. Also, the resu lts suggest that firm can adjust the level of the marketing-sales mindset differences by adjusting thei r organizational re cruitment policy.

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12 CHAPTER 1 INTRODUCTION Marketings interfaces with other business functions within the company have attracted considerable attention. Eff ective coordination between functional areas with diverse competences enables firms to exploit synergies and develop competitive advantage. Coordinating marketing's activit ies with other functi onal is particularly important because marketing is responsible for the relationship between the firm and its customers. Compared to marketings other interfaces (e.g., marketings interface with R&D, with manufacturing, and with finance), the interface be tween marketing and sales has received little attention in academic research. Mo st of marketing scholars tend to treat sales as a function within the marketing domain, and thus assume that cooperation between marketing and sales is automatically achieved through hierarchical contro l. However, in most companies, marketing and sales are separate functi ons (Kotler, Rachham, and Gr uner 2006; Homburg, Jensen 2007; Homburg, Jensen, and Krohmer 2008). Moreover, cooperation between these two separa te functions is far from harmonious in business practice. For example, marketing often complains that salespeople ignore corporate branding and positioning standards in a rush to close the sales. Sales responds by stating that the one-size-fits-all type of gene ric corporate message made by marketing impedes their sales efforts (B to B 2003, p. 17). Similarly, marketing maintains that we develop good leads at trade shows, but sales doesnt follow up. On the ot her side, sales argues that marketing wouldnt know a qualified lead if it is tri pped on one. Marketing is locked in an ivory tower and doesnt have a clue as to what customers really want (Sales & Marketing Management 1999, p. 27). A recent survey of senior executives from a wide range of industries reports that improving

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13 marketing and sales cooperation would have th e greatest impact on firm performance (The Economist-Accenture 2003). The friction between marketing and sales is cost ly. For example, it is estimated that as much as eighty percent of marketings expenditu res on lead generation a nd sales collateral are wastedignored as irrelevant or unhelpful by sales. On the sales side, it is reported that forty to sixty hours out of a typical sale spersons month are devoted to redoing, often poorly, collateral materials that marketing should have genera ted in the first places (Aberdeen Group 2002). Rouzies and her colleagues (2005) suggested th at an important impediment to marketingsales cooperation is the mindset differences different perspectives on issues and approaches for addressing problems between marketing and sales f unctions. Rather than the differences in the observed behaviors, mindset differences refer to the differences in cognition between marketing and sales. Mindset differences ar e believed to impair marketing-sa les cooperation independent of goal differences, a commonly believed impediment to cross functional coope ration. For example, in an interview with both mark eting and sales managers, Schultz (2003) found that when asked to implement the same decision of increasi ng customer awareness, marketing managers interpreted it as doing more advertising, whereas sales managers view this decision as hiring more salespeople. Similarly, in a dialogue between marketing and sales, Cespedes (1995) showed that both marketing and sales reached th e consensus on mutual information exchange. But sales thought that the critical information to be shared is the timely information from customers, whereas marketing believed that the most important information to be exchanged is about the customers expectation of tomorrow. Following the anecdotal evidence and prior co nceptual speculation, Homburg and Jensen (2007) conducted the first empiri cal study related to the marketin g-sales mindset differences.

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14 Their study showed the existence and the impact of mindset differen ces on marketing-sales relationship and firm performance. Despite of this pioneering study, there are still some important issues left unaddressed. First, extant marketing-sales interface research has mostly c oncentrated on the negative aspects of mindset differences, that is, the rela tional tension between marketing and sales created by their different mindsets in their social exch ange. Little research, however, has explicitly investigated the potential benefits that marketingsales mindset differences can bring to the firm by melding different perspectives to devel op creative approaches to business problems. Second, existing marketing-sale s interface research has basically focused on providing evidence on the existence and the impact of marketing-sale minds et differences on the related outcomes. Few studies have advanced to the next step in managing the marketing-sales mindset differences in business operation. Third, despite the prior conceptual articles, the nature of marketing-sales mindset differences has not been thoroughly examined. Sp ecifically, the content a nd underlying structure of marketing-sales mindset diffe rences have not been compressi vely understood. Note that in their pioneering empirical study, Homburg and Jensen (2007) developed a scale of marketingsales thought-world differences. This scale includes both the cognitive orientation differences and the competence differences between marke ting and sales. However, their cognitive orientation differences measure only covers a limited number of the components of marketingsales mindset differences (i.e., customer versus product orientation, and short-term versus longterm orientation). As they point ed out in their discussion section, their scale of thought-world differences doesnt cover all of the dimensi ons of marketing-sales cognitive orientation

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15 differences. They called for future research to explore more comprehensive aspects of cognitive orientation that describe the ma rketing-sales mindset differences. Last, in research methodology, past empirical research has collected the mindset differences responses largely from single side of dyads, either fr om marketing or sales side. Few studies, however, have collected measures from the matched pairs of both marketing and sales informants in the same business. In this dissertation, I attempt to address these gaps. First, I investigate both the negative and positive aspects of marketing-sales minds et differences. Specifically, I propose a dualprocess model of marketing-sales mindset differe nces. Drawing from the similarity-attraction theory (Byrne 1971) and self-cat egorization theory (Turner et al. 1987), I propose a social categorization perspective of marketing-sa les mindset differences. Under the social categorization process, marketing-sales mindset di fferences are proposed to create the relational tension between marketing and sales in their social exchange, indicating th e negative aspect of marketing-sales mindset differences. Meanwhile, borrowing from the diversity research (Jehn, Northcraft, and Neale 1999; Pe lled, Eisenhart, and Xin 1999), I also suggest an information processing perspective of marketing-sales mindset differences. Under the information processing process, marketing-sales differences can actually bring potential benefits to marketing and sales in their informational exchange. This informa tional benefit constitutes the positive aspect of marketing-sales mindset differences. Collectiv ely, my dissertation combines both positive and negative aspects of marketing-sales mindset differences in a united research framework. Second, my dissertation provides insight for firms to manage the marketing-sales mindset differences in their business operations. Specifi cally, I investigate the moderating effect of organizational identification in the social categ orization process of marketing-sales mindset

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16 differences. I suggest that by developing strong organizational identification, firms can mitigate the negative impact of marketing-sales mindset di fferences on their relational exchange. I also examine moderating effect of cross-functional le arning in the information processing process of marketing-sales mindset differences. I suggest th at by promoting active cross-functional learning between marketing and sales, firm can actually realize the potential informational benefits of marketing-sales mindset differences in their informational exchange. In addition to these moderating effects, I also explore the antecede nts of marketing-sales mindset differences by examining the effects of organi zational recruitment, training a nd socialization practices (e.g., marketing and sales employees cross-functiona l working experiences and training, and the organizational socializ ation tactics). Third, I develop a new measure of mark eting-sales mindsets that includes the comprehensive aspects of cognitive orientations of marketing and sales. Based on this new measure, the scale of marketing-sales mindset differences is thoroughl y assessed. Specifically, drawing upon value congruence research (e.g., OReilly, Chatman and Caldwell 1991), I examine the contents and structures of marke ting and sales mindsets by assessing the underlying values held by these two functional areas. Minds ets are defined as the internalized normative beliefs about specific modes of conduct or end-state of existence that is personally or socially preferable to an opposite or c onverse mode of conduct or endstate existence (Rokeach 1973). I assess marketing-sales mindset differences by comp aring marketings and sales value profiles. The resultant value differences indicate the degree to which marketing and sales differ in their mindsets. Finally, in research design, I co llect data from the matched pair of marketing and sales managers from the same strategic business un its (SBUs). A total of 88 matched pairs of

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17 marketing and sales senior executives in the same SBUs have already been collected. The analyses and the empirical result s are based upon these 88 dyadic data. The dissertation is organized as follows. In Chapter 2, I review the literature on the marketing-sales interface, with a focus on the research that has expl icitly addressed the marketing-sales cooperation/conflict. Then, I present my conceptual framework of the dualprocess model of marketing-sales mindset differences and propose each of the individual hypotheses in Chapter 3. In Chapter 4, I de scribe the overview of the methodology, the development of the marketing-sales mindset diff erences measure, the data collection process, and the description of the sample data collect ed. Afterwards, I provide the empirical results based upon the 88 matched pairs of marketing and sales executives responses in Chapter 5. In the last chapter, the Chapter 6, I discuss the theoretical and empirical implications of my dissertation, and the limitation, a nd the direction for the future research in marketing-sales interface research.

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18 CHAPTER 2 LITERATURE REVIEW The prior literature relevant to m y dissertat ion is the research, primarily in management, that has examined the factors affecting cross-func tional conflict and coordination in general. The literature review in this section will focus on extant research that has specifically addressed the interface between mark eting and sales. An overview of the past resear ch in marketing-sales interface arrives at the following two conclusions. First, since most of the marketings cross-functional research often treats marketing and sales synonymously, only a limited number of st udies have explicitly addressed the interface between marketing and sales. Second, among thes e limited body of studies, most of them view the marketing-sales interface as a mere subset of the cross-functional interf aces. Therefore, they addressed the marketing-sales cooperation/conflict largely by extending the generic findings identified in other cross-functional interfaces to the context of mark eting-sales interface (Dewsnap and Jobber 2000). Specifically, this line of research focus on the generic factors that result in marketing-sales cooperation/conflict, ranging from goal c ongruity, bidirectional communication, trust, to the norms of information sharing. While these studies have highlighted the co mmonality between marketing-sales interface and other cross-functional researc h, little research, however, has examined the factors that are unique in marketing-sales interface and considered the inherent characteristics of marketing-sales interface (i.e., the mindset differences) that l ead to marketing-sales cooperation/conflict. Whereas the generic factors (e.g., goal congruity bidirectional communica tion, trust, norms of information exchange) have their own merits in explaining the ma rketing-sales interface cooperation/conflict, the more uni que and subtle factor (e.g., mi ndset differences) that is

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19 inherently associated with marketing-sale s interface and leads to the marketing-sales cooperation/conflict has yet to be extensively explored. Recently, there are a small but growing number of research that start to emphasize the uniqueness of marketing-sales interface, focusing on certain specific characteristics that are more salient but very important in driving marketingsales cooperation/conflic t in specific (e.g., the thought-world differences in Homburg, Jensens (2007) paper). As such, this section will first review the literature that focuses on the ge neric factor leading to the marketing-sales cooperation/conflict. Next, it will look at the extant research that concen trates on those factors that are unique and inherently associated w ith marketing-sales interface in causing the marketing-sales cooperation/conflict. This section will support my contention and the contributions of this research that there is a need to a. empirically address those factors that are unique and inherently associated with marketing-sales interface in causing the marketing-sales cooperation/conflict; b. explore both the positive and negative aspects of the marketing-sales mindset differences; c. develop a comprehensive scale measuring marketing-sales mindset differences; d. collect data from both sides of marketin g-sales dyads in the same business. Literature Focusing on the Generic Fa ctors Leading to th e Marketing-Sales Cooperation/Conflict Table 2-1 describes the summary of reviewed extant marketing-sales cooperation/conflict research in detail. In their study of consumer grocery produc t firms, Strahle and his colleagues (1996) examined the degree of alignment between busin ess level marketing stra tegies and functional level sales objectives an d activities. They found discrepancie s between marketing executives and

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20 sales managers with regard to specific produc t strategies. When marketing executives specify hold, harvest, or divest product strategies, sale s managers did not establish corresponding sales objectives that were consistent w ith those specified strategies. Subs equently, this could result in sales managers promoting products that marketin g executives did not plan to support in the long run, while also providing inadequate support to the products that marke ting executives intended to promote. Obviously, such misalignment between marketing and sales generates the marketingsales conflict. In the post-survey interviews, Strahle and hi s colleagues (1996) al so investigated the possible reasons for the misalignment between marketing executives and sales managers. One of the primary reasons was the lack of goal congrue ncy. They found that sales managers always aim at generating sales volume, whic h was incongruent with the goal of marketing executives when the marketing product strategies moved on to hold, ha rvest, or divest stages. As such, Strahle and his colleagues study focused on the inconsistent communications between marketing and sales and they suggested these inconsistent communicati ons can be traced back to the differences in goals between marketing and sales. In sum, St rahle and his colleagues (1996) research focused on the generic factors, such as goal incongruence and inconsistent communication, to explain the marketing-sales interface conflict. Their research didnt address those factors that are uniquely associated with the marketing-sales interface. Dewsnap and Jobber (2002) employed a similar approach to explain the marketing-sales conflict in the fast moving consumer good (F MCG) companies. FMCG companies are often faced with powerful channel members as well as sophisticated end consumers. Drawing from the realistic group conflict theory, Dewsnap and Jobb er pointed out that the goal conflict between brand-focused marketing personnel and channelfocused sales personnel is one of the major

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21 reasons for the marketing-sales conflict in FM CG companies. Specifically, marketing personnel focus on product brands with the goal of meeti ng the needs of the end consumers. Conversely, sales personnel concentrate on th e retail channels with the go al of satisfying the powerful channel members. Any discrepancy between thes e two sets of customers and their goals can create the potential tens ion between marketing and sales personnel, which in turn, leads to the marketing-sales conflict. In another study on the same FMCG industr y, Dewsnap and Jobber (2000) went beyond the single factor of goa l conflict and advanced a comprehens ive framework to explain the intergroup integration (the opposite of the conflict) between brand-focused marketing and channelfocused sales personnel. In this framework Dews nap and Jobber (2000) co nsidered other factors contributing to the inter-group integration, incl uding employee participa tion, physical proximity, joint reward, and early involvement. Specifically they proposed that the higher the degree of employee participation, joint reward, and involveme nt in the earlier stag e of the joint project between marketing and sales, the closer the physical lo cations of marketing and sales functions, the greater the perceived level of integration be tween marketing and sales. Clearly, in both of Dewsnap and his colleagues ( 2000, 2002) studies, they didnt go beyond the generic factors that could also found in other cross-functional inte rface research to explai n the marketing-sales interface conflict and didnt consider those factors th at are unique and inherently associated with marketing-sales interface in causing the marketin g-sales conflict. In addition, both of their studies are conceptual in nature. Rouzies and her colleagues (2005) proposed a comprehensive framework for explaining the marketing-sales conflict. In th eir conceptual paper, they suggest ed several sets of integrating mechanisms in developing the marketing-sales in tegration (just the oppos ite of the marketing-

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22 sales conflict). These integrating mechanisms include various behavior al factors such as decentralization, communications, and job rotation. Specifically, they proposed that decentralization of marketing and sale functions has a positive e ffect on the degree of marketingsales integration. In addition, they proposed an inverted-U shared relationship between communication and the degree of marketing-sales in tegration. Specifically, th ey pointed out that both formal and informal communications posi tively affect marketing-sales integration. However, information about strategic directions and regularly occurring information exchanges are best done through formal communications, wh ereas information about unstructured problems is best done through informal comm unications. Similarly, job rotation is also considered to have an inverted U-shaped relationship with the mark eting-sales integration. The modest level of job rotation is intended to result in the highest level of marketing-sales integration. Rouzies and her colleagues (2005) also raised the issue of mindset differences in their conceptual work but they did not empirically te st their framework. Dawes and Massey (2005) focused on the e ffect of communication on marketing-sales conflict and found that bidire ctional communication has posi tive effects on the perceived relationship effectiveness between marketing and sales managers. In addition, they found that although the use of threat as a communicati on influence strategy increases a marketing managers amount of manifest influence, it re duces the perceived relationship effectiveness between marketing and sales managers. However, they did not explore the underlying factor of mindset differences that potentially cause the communication failures. Smith, Gopalakrishna, and Chatterjee (2006) didnt directly st udy the impact of organizational behaviors and inte r-functional relationshi p on marketing-sales interface. Instead, they modeled the sales response to marketing communication efforts. Their study focus on the

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23 timing and budget allocation of marketing communicat ion in effectively generating sales leads, sales appointments, and sales closures. They f ound that there is a complicated interplay among the marketing communication efforts, delays in sales follow-up, and sales efficiency. Their study stressed the importance of the internal co llaboration between marketing communication and sales leads follow-up efforts but did not prov ide much guidance about how to create such collaboration. At a more macro-level, Cesped es (1993) advanced several orga nizational level factors that can mitigate the conflict between marketing a nd sales managers. These organizational level factors involve several structur al changes including setting up liaison units at the headquarters level to link marketing and sales activities, es tablishing multifunctional account teams, and altering existing career paths and training programs for both marketing and sales. Cespedes (1993) research only extended the generic findings in other cro ss-functional interfaces to the marketing-sales interface. He didnt consider the marketing-sales mindset differences, the factor that is inherently associated with marketing-sales interface and potentially causes the marketingsales conflict. Dawes and Massey (2001) conducted one of th e few empirical studies that address the marketing-sales conflict. Using a sample of 200 firms from the United Kingdom and Australia, Dawes and Massey (2001) examined the perceived relationship effectiveness between marketing and sales managers. Focusing on the relational persp ective, they found that trust has strong direct effects on perceived relationship effectiveness. In addition, they show ed that it also has indirect effects on perceived relationship effectivene ss via bidirectional communications between marketing and sales managers. While this study is one of the pioneering st udies that empirically examined the marketing-sales in terface conflict, it only addre ssed marketing-sales interface

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24 conflict by extending the generic findings in ot her cross-functional in terface research. The factors that lead to the marketing-sales interface conflict and also are inhe rently associated with the marketing-sales interface (i.e., mindset differences) was not explored. Homburg, Jensen, and Krohmer (2008) develo ped a multidimensional model of marketingsales interface. They identified five archetypes describing the marketi ng-sales interface: Ivory Tower, Brand-Focused Professionals, Sales Ru les, Marketing-Driven Devils Advocacy, and Sales-Driven Symbiosis. Their findings suggest ed that the most successful marketing-sales interface configurations are char acterized by a strong structural linkage between marketing and sales and the high level of marketing knowledge in marketing. Basically, their study emphasized the importance of identifying the structur al configurations in marketing-sales cooperation/conflict. It did not ex plicitly examine the actions that can be used to develop an effective interface. Literature Focusing on the Marketing-Sales Interface Specific Factors Leading to the Marketing-Sales Cooperation /Conflict Only two studies explicitly examined the marketing-sales cooperation/conflict by investigating the factors that are unique and inherently associated with the marketing-sales interface. In his interview with six industrial firms, Cespedes (1994) examined the interface coordination among product manage ment (one major sub-functi on in industrial marketing department), sales, and customer services units. He found that the conflict between these units is partly due to the implicit disagreements a bout what constitutes success in performing marketing activities. Managers in each unit may agree that success is ultimately defined by the customer. But these units that are jointly responsible for customer satisfaction perceive the customer differently. Using a cognitive concept of hierarchy of attention, Cespedes further explained that each unit differs in placing thei r priorities and allocate s their attention along

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25 different lines. Therefore, the resultant patterns of attention are incons istent among these units. These inconsistencies lead each uni t to perceive the customer diffe rently, which ultimately drives the marketing-sales conflict. In conclusion, Cesp edes (1994) explicitly co nsidered the cognitive factors that are inherently associated with ma rketing-sales interface, but he did not develop measures of different marketingsales mindsets or empirically te st his theory. Also, Cespedes (1994) research only considered the negative aspect of those cognitive factors that are inherently associated with marketing-sales interface. He di dnt explore the potential positive aspect of those cognitive factors that influence ma rketing-sales interface interaction. Homburg and Jensens (2007) study on the t hought-world differences addressed the marketing-sales cooperation/conflict by considering the factors that are unique to the marketingsales interface. Their scale of marketing-sales thought-world differences includes both the competence differences and the cognitive orientation differences between marketing and sales. They found the negative impact of the cognitive orientation differences on marketing-sales relationship quality. Note that their measure of the cognitive orientation differences between marketing and sales only includes customer (ver sus product) orientation and short-term (versus long-term) orientation. Realizing that their t hought-world differences scale does not cover all dimensions of the cognitive orie ntation differences between marke ting and sales, they called for future research to explore the comprehensive aspects of the cognitive orientation differences between marketing and sales and to validate their findings in the comprehensive scale. In sum, this study explicitly considers and measures th e though-world differences measure, a cognitive factor that uniquely characterize marketing-sa les interface. However, a comprehensive set of mindset differences dimension was not fully de veloped in this study. Al so, this study mostly focused on the negative aspect of the thought-wor ld differences between marketing and sales,

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26 although the positive side was implied. Additionally, their empirical test was largely on the data from the single side of marketing-sales dyads. Two other papers did not explicitly address, but imply, the marketing-sales cooperation/conflict by considering the uniquene ss of marketing-sales interface. In their conceptual paper, Rouzies and her colleagues ( 2005) suggested that a major impediment to coordinating the activities between marketing an d sales is that marke ting and sales personnel have different mindsets. Although not explicitly st ated in their paper, these mindset differences were assumed to lead to potenti al conflict between marketing and sales and were not empirically tested. Using a different concept of organizational subculture, Kotler, Rachham, and Krishnaswamy (2006) pointed out that the misalign ment between marketing and sales is partially due to the culture conflict between marketing a nd sales. Marketing people are more analytical, data oriented, and projected focused, whereas salespeople are more relationship oriented and willing to talk to the existing and potential custom ers rather than playing with the number behind the office desk. This subculture conflict make s it hard for marketing and sales to work well together. While this study suggested some dimens ion of marketing-sales mindset differences in causing the marketing-sales conflict, it didnt develop a comprehensive set of mindset differences dimensions and only concentrate on the negative aspect of subculture differences between marketing and sales. Additionally, this study is al so conceptual in nature. Summary of Extant Marketing-Sales Conflict Research Extant m arketing-sales cooperation/conflict resear ch has several characte ristics. First, most of the studies are conceptual, normative and even anecdotal in nature. The only empirical paper examining the factors that are i nherently associated with the ma rketing-sales interface in causing

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27 the marketing-sales cooperati on/conflict is Homburg and Jensens (2007) study. Further empirical evidence is needed to understand the marketingsales cooperation/conflict. Second, only a limited number of extant marke ting-sales interface research considers the factors that inherently characte rize the marketing-sales interface in causing the marketing-sales cooperation/conflict. Among the ex isting twelve marketing-sales interface research, only four papers, two explicitly and two implicitly, addressed the marketing-sales conflict by investigating those marketing-sales interface specific factors, such as the thought-world differences (Homburg and Jensen 2007), mindset differences (Rouzies et al. 2006), subcultu re conflict (Kotler, Rachham, and Krishnaswamy 2006), and hierarchy of attention (Cespedes 1994). Moreover, among these four papers, only one (i.e., Homburg and Jensen 2007) has explicitly examined the content of the mindset differences between mark eting and sales. Yet, as Homburg and Jensen (2007) pointed out, their measure only partially covers the wide range of the marketing-sales mindset differences. Future research is called fo r further study on this un der-explored concept. Third, almost all of the existing marketingsales interface research has focused on the negative impact of the marketi ng-sales mindset differences on marketing-sales integration. No research has explicitly addressed the positive imp act of the marketing-sales mindset differences. Note that Homburg and Jensens (2007) study resu lt implies that there is some positive impact of marketing-sales thought-world differe nces on firm performance. However, they did not explicitly investigate underlying process of this positive as pect, thus failing to show the mechanism how both positive and negative aspects of the mark eting-sales mindset differences affect the marketing-sales interface.

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28 Last, all of the past marketing-sales interf ace studies only collected information from the single side of the marketing-sales dyads. Future re search need to build its solid evidence based upon the response from the both side of the marketing-sales dyads. Based upon above review, my dissertation will a ddress these gaps and further the research in marketing-sales interface by: (1) investig ating both positive and negative aspects of marketing-sales mindset differences; (2) examining the underlying process of both positive and negative impact of marketing-sales mindset diff erences, thus providing suggestions in how to manage the marketing-sales mindset differences; (3) exploring the comprehensive dimensions of marketing-sales mindset differences to help unde rstand the content and un derlying structure of mindset differences between marketing and sales; and (4) testing the evidence of marketing-sales mindset difference using data from ma tch pairs of marketing-sales dyads.

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29 Table 2-1. Summary of extant ma rketing-sales conflict research Paper Types Major account for conflict Positive/negative impact focus Construct developed for mindset differences Dyadic data Cespedes (1993) Conceptual Liaison unit, multifunctional team, career oath, and training program Negative No No Cespedes (1994) Conceptual Hierar chy of attention Negative No No Strahle, Spiro, and Actio (1996) Conceptual Goal congruence Negative No No Dewsnap and Jobber (2000) Conceptual Employee participation, joint reward, and early involvement Negative No No Dewsnap and Jobber (2002) Conceptual Goal congruence Negative No No Dawes and Massey (2001) Empirical Bidirectional communication and trust Negative No No Dawes and Massey (2005) Conceptual Bidirectional communication Negative No No Homburg and Jensen (2007) Empirical Thought-world differences Negative and positive (implied) Yes (but not comprehensive) No Homburg, Jensen, and Krohmer (2008) Empirical Structural configuration Negative No No Kotler, Rachham, and Krishnaswamy (2006) Conceptual Subculture differences Negative No No Rouzies et. al (2005) Conceptual Decentralization, communication, job rotation, and mindset differences Negative No No Smith, Gopalakrishna, and Chatterjee (2006) Empirical Timing, and budget of communication Negative No No

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30 CHAPTER 3 CONCEPTUAL FRAMEWORK A fra mework of the dual-process model of marketing-sales mindset differences is presented in Figure 3-1 and Figur e 3-2. Figure 3-1 depicts the general conceptual framework and Figure 3-2 shows the detail concep tual framework of the dual-pro cess model of marketing-sales mindset differences. As depicted by Figure 3-1, two types of marketing-sales mindset di fferences (actual and perceived mindset differences) ar e investigated. Actual marketing-sales mindset differences are proposed to affect the perceived marketing-sales mindset differences. The left hand-side of the general conceptual framework presents the an tecedents of actual marketing-sales mindset differences. Actual marketing-sales mindset di fferences are affected by the cross-functional working experiences, training, and socializa tion for the marketing and sales employees. Perceived marketing-sales mindset differences a ffect both the relationship conflict between the marketing and sales functions and the perceived novelty of the information provided by the employees in the counterpart functions. Two underlying processes of the impact of marketing-sales mindset differences are considered. The first process is called the social categorization process (indicated by the dot-line rectangle). Under the social categorization process, perceived marketing-sales mindset differences arise when marketing or sales em ployees categorize them selves in their own functional area and emphasize the differences be tween their function a nd the other function. This social categorization leads to the increas ed conflict between marketing and sales. This social categorization process is moderated by the level of marketi ng and sales employees organizational identification, th at is, the organizational iden tification reduces the social categorization effect.

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31 The second process is called th e information processing proce ss (indicated by the dash-line rectangle). Under this process, perceived marke ting-sales mindset differences lead the marketing and sales employees to feel that people from th e other function have unique perspectives and novel information that can provide the basis for innovative solutions This process is moderated by the level of the cross-functiona l learning that exploits the diffe rences in perspectives from people in the other function. The right hand-side of the ge neral conceptual framework s hows the consequence of the marketing-sales mindset differences, where rela tionship conflict positively influences and perceived information novelty positively affects the behavioral cooperation between marketing and sales, which subsequently affects the firm performance. Figure 3-2 expands the conceptual framework shown in the Figure 3-1. The major differences between these two figures are that: (1 ) Figure 3-2 also provides the source of data (indicated by the letters in the parentheses) collected for each of the variables shown in the figure; and (2) Figure 3-2 separates sales and ma rketings responses in each of the proposed processes. The following hypotheses developm ent will base upon the detail conceptual framework depicted in Figure 3-2. Focal Construct: Marketing-Sales Mindset Differences Marketing-sales m indset differences refer to the different perspectives on issues and approaches for addressing problems between mark eting and sales function s (Rouzies et al. 2005; Ancona and Caldwell 1992). Homburg and Jensen (2007) used a similar concept of thoughtworld differences to describe the mindset di fferences between marketing and sales. Their concept of thought-world differences is broa der in that it include s both orientation and competence differences between marketing and sa les. The marketing-sales mindset differences

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32 concept in this dissertation con centrates only on the orientati on differences dimension of the thought-world differences concept described in Homburg and Jensen (2007) paper. An extensive review of prior marketing-sales mindset differen ce literature (i.e., Cespedes 1992, 1994, 1995; Rouzies et al. 2005; Homburg and Jensen 2007) indicates that marketing-sales mindset differences have several sub-dimensions. Rouzies and her colleague s (2005) conceptual paper suggested six dimensions of marketing-sales mindset diffe rences. These six dimensions include customer versus product orientation, personal re lationship versus an alysis orientation, continuous daily activity versus sp oradic projects orientation, field versus office orientation, results and process orientation, and short-term versus long-term orientation. In Homburg and Jensens (2007) thought-world differences study, they described the marketing-sales mindset differences using two sub-dimensi ons, customer versus product orientation and short-term versus long-term orientation dimensi on. Recognizing that their concep t of thought-world difference didnt cover the comprehensive aspects of mark eting-sales mindset differences, Homburg and Jensen (2007) further discussed the marketing-sa les mindset differences in the limitation section and recommended more mindset differences dimensions including quantitative versus qualitative orientation, analytical versus in tuitive orientation, ability to deal with structured versus unstructured problems, high versus low emotiona l arousal, positive versus negative outlook, and expressive versus non-expressive attitude. The Table 3-1 su mmarizes the descriptions of marketing-sales mindset dimensi on in the extant literature. Despite of the conceptual discussion, prior literature did not dis tinguish two types of marketing-sales mindset differences, that is, the actual and the perceive d mindset differences. Actual and Perceived Mindset Differences Actual m indset differences refer to the diffe rences between marketing peoples perception of their own mindsets and salesp eoples perception of their ow n mindsets. Whereas, perceived

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33 mindset differences refer to the differences between marketing/sales peoples perceptions of their own and their perceptions of their counterpart functions mindsets. The distinction between actual and perceived mindset differences is made because prior literature shows that it is the perception of differences, not ne cessarily the actual differences themselves, that leads to the subsequent attit udes and behaviors (Riord an 2000; Turner et al. 1987). For instance, in performance appraisal res earch, Pulakos and Wexley (1983) indicate that perceived similarity/dissimilarity is a more effective predictor of subordinate performance evaluations than actual similarity /dissimilarity. Also, Cable and Judge (1997) found that actual similarity has relatively weaker effect than perceived similarity on job applicant selection decisions, because comparing to perceived similarity s direct influence, actual similarity only has a relative distal influence on the attitudinal and behavioral outco mes. Harrison and his colleagues further (2002) suggest that if di fferences are to be meaningful, they must be perceived. Based on these above arguments, the first hypo theses reiterate this premise. Hypothesis 1a: Actual marketi ng-sales mindset differences ar e positively related to the marketing peoples perceived marketing-sales mindset differences. Hypothesis 1b: Actual marketi ng-sales mindset differences ar e positively related to the salespeoples perceived marketi ng-sales mindset differences. Antecedents of Marketing-Sa les Mindset Differences The three factors examined in this research that affect the degree of actual marketingsales mindset differences are per centage of marketing and sales employees with cross-functional working experiences in both marketing and sales, percentage of marketing and sales employees with cross-functional training in both marketing and sa les, and the nature of the organizational socialization tactics.

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34 Cross-Functional Working Experience and Training, and Actual Marketing-Sales Mindset Differ ences Upper echelons theory (Hambrick and Mason 1984) suggests that employees functional background affects how they understand, interpre t, and comprehend their surrounding business environment. Employees functional training, for in stance, serves as a cognitive filter to direct their perceptions of the outside world in acco rdance with their functional background. Similarly, selective perception theory (D earborn and Simon 1958) suggests that employees functional working experiences selectively channel th eir perceptions of the surrounding working environment. For example, Beyer and her co lleagues (1997) found that even when facing the same events, managers tended to narrow their atte ntion to the information related to the areas where they have working experiences. Thus, it is expected that em ployees from two different functional areas will understand, interpret, and comprehend the same business envi ronment differently, if they only have working experience and training in their own functional area. It is also expected th at employees from two different functional areas will understand, inte rpret, and comprehend the same business environment similarly, if they have working e xperience and training from not only their own but also their counterparts functional areas. In other word, employ ees with cross-functional working experience and training from both their own and c ounterparts functional ar eas are more likely to arrive at the similar environment judgments and reach consensus with colleagues in their counterparts function, because their cross-f unctional working experience and training background allows them to unders tand, interpret, and compre hend the outside information consistent with not only their own but also thei r counterparts functional areas. In the long run, employees with cross-functional background are mo re likely to develop similar mindsets with their colleagues in the counterpart functional area Operationally, it is expected that when an

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35 organization recruits high per centage of marketing and sales employees with cross-functional working experience in both marketing and sales areas, and when an organization invests much resources to train its marketing and sales empl oyees in both marketing and sales areas and maintain a high percentage of cross-functi onal training marketing and sales employees, marketing and sales employees in this organiza tion are more likely to develop similar business orientations and belief systems, and less likely to have high leve l of mindset differences between each other. Thus, Hypothesis 2a: Percentage of employees in marketing and sales functions who have working experiences in both marketing and sale s areas is negatively related to the actual marketing-sales mindset differences. Hypothesis 2b: Percentage of employees in marketing and sales functions who have crossfunctional training in both marke ting and sales areas is negatively related to the marketing-sales mindset differences. Organizational Socialization Tactics and Ac tual Marketing -Sales Mindset Differences Organizational socialization refers to the process by which new employees make their transition from organizational outsi ders to insiders. Literature in organizational socialization has developed through several stages. Van Maan en and Scheins (1979) pioneering work conceptualizes six organizational socialization ta ctics: collective-indivi dual, formal-informal, sequential-fixed, variable-random, serial-disjunc tive and investiture-divestiture. Jones (1986) subsequently groups these six soci alization tactics into three broader factors: context, content, and social aspects of organizati onal socialization tactics. Consid ering the sizable level of intercorrelations between the socializa tion tactics factors found in Jones' (1986) works, some scholars have recommended that organizational socializati on tactics can be further arranged on a single continuum ranging from institutionalized to individualized (e. g., Bauer et al., 1998).

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36 Institutionalized socialization tact ics refer to a systematic, struct ured, and planned set of program where organizations group new employees together and put them through a common set of learning experiences. Individualized socialization tactics re flect a relative absence of a structured socialization program where organizations place ne w employees alone in their jobs to sink or swim and let them to develop their own approach es to their roles and situations in the new organization. Compared to individualized so cialization tactics, institutionalized socialization tactics encourages new employees to accept the preset organizational values and norms, ensuring that new employees receive a common message about the organizational values and how they should perceive, interpret, and respond to different situ ations (Van Maanen and Schein 1979). As such, in organizations where the inst itutionalized sociali zation tactics are adopted, new employees from different functions are more likely to interpret and respond to the same business environment in the similar ways, arrive at th e common business environment judgments in the short run, and in the long run, reac h consensuses in their values a nd internal belief systems about their business environment. Applying this lo gic to the current marketing-sales mindset differences research setting, it is expected that marketing and sale s people are less like to have different mindsets when their organizations adopt the institutionalized socialization tactics, as compared to those whose organizations adopt the i ndividualized socialization tactics. Therefore, Hypothesis 2c: Institutionalized socialization tactics is negatively related to the actual marketing-sales mindset differences, such that the high level of institutionalized socialization tactics the firm uses, the lower level of actual marketing-sales mindset differences the firm will have.

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37 Processes of the Marketing-Sa les Mindset Differences Impact Dual-Process Model of Marketing-Sales Mindset Differences Research in work group diversity provides two distinctive perspectives toward the im pact of inter-group differences on subsequent inter-group attitudes and beha viors (van Knippenberg, De Dreu, and Homan 2004; van Knippenberg an d Schippers 2007). The so cial categorization perspective suggests that a social categorization process involves in the inter-group integration, where the differences between groups form the basis for categorizing self and others between members from different groups. The result of this social categor ization process may be that people tend to favor ingroup members ove r outgroup members, to be more attracted by ingroup members than by outgroup members, and to be more willing to cooperate with ingroup members than outgroup members (Tajfel and Turner 1986). The social cate gorization perspective concentrates on the relational as pect of inter-group integration and emphasizes the negative effect of inter-group differences. The information processing perspective, howev er, focuses on the informational aspect of inter-group integration and highlights the positive effect of inte r-group differences. It suggests that an information processing process invol ves in the inter-group integration, where the differences between groups are rather viewed as a pool of diverse information, knowledge, skills, and capabilities contributed by di fferent groups. Integrating this pool of diverse resources may result in more creative problem-solving appro aches, more comprehensive decision making, and superior performance. Extending these two perspectives, I propose a dual-process model of marketing-sales mindset differences. In this model, two processe s are proposed to simultaneously involve in the effect of marketing-sales minds et differences on their inter-gr oup integration, where the social categorization process highlights the impact of marketing-sales mindset differences on their

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38 relational integration, and the information processing process emphasizes the effect of marketing-sales mindset differences on their info rmational integration. The detail of this dualprocess model is described as follows. Social Categorization Process: Perceived Minds et Differences and Relationship Conflict Self-categorization theory (T urner et al. 1987) provides th e theoretical foundation that elaborates the proposed social categorization process, wher e the m arketing-sales mindset differences negatively influence the relationship between market ing and sales, resulting in potential relationship conflict be tween these two functions. Acco rding to self-categorization theory, marketing-sales mindset differences in crease group distinctiven ess between marketing and sales through the cognitive processes of meta-c ontrast and comparative fit. This increased group distinctiveness heighten s the prominence of group boundaries between marketing and sales, and also raises the level of group di fferentiation between thes e two functions. Because highly differentiated groups us ually have different standard s for guiding behaviors (Rokeach 1968), members from one function will find greater di fficulty in predicting the behaviors of the members from the other function. Also, because the highly differentiated groups usually have different ways to interpret the same situa tion events (Rokeach 1968), inter-group communication between these highly differentiated groups become s more difficult. Therefore, due to the low predictability and poor communi cation, cross-functional cooperat ion between the differentiated marketing and sales functions is less likely to achieve and the relatio nship conflict between marketing and sales is more likely to occur. Several other theories support the predicti on that perceived minds et differences are positively related to the relationship conflict between marketing and sales. Similarity-attractions theory (e.g., Byrne 1971) suggests that while perc eived similarity between group members (i.e., marketing and sales people) evokes attraction and liking, perceived dissimilarity produces

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39 divisive tensions and disliking (Tziner 1986). Research in this paradigm finds that disliked dissimilar group members are evaluated more ne gatively and elicit less cooperation and more relational conflict (Kraus s 1966), whereas liked similar group me mbers are expected to generate more cooperation. In a similar vein, belief c ongruence theory (e.g., Bryne, 1971) provides the same prediction. Belief congruence theory investigat es the effects of simila rity (or dissimilarity) on relations between members from different gro ups. Research in this framework finds that perceived dissimilarity between own beliefs a nd those of an outgroup member is positively related to inter-group discrimination (Insko, Nacoste, and Moe 1983). This inter-group discrimination, thus, creates potential inter-gr oup conflict. In sum, because marketing-sales mindset differences creates both cognitive (i.e., heightened group boundaries, low pr edictability, and poor communication) and affective (i.e., disliking, unattractive, and inte r-group discrimination) barriers between marketing and sales, marketing-sales mindset differences is proposed to be positively relate d to the relationship conflict between marketing and sales. Thus, two following hypotheses regarding this social categorization process of marketing-sales mindset differences are described as, Hypothesis 3a: Marketing peoples perceived marketing-sales mindset differences are positively related to their perceived relationship conflict with sales. Hypothesis 3b: Salespeoples pe rceived marketing-sales mindse t differences are positively related to their perceived relationship conflict with marketing. Social Categorization Process: Moderating Effec t of Organizati onal Identification Van Knippenberg and his colleague (2004) suggest that the extent to which the differences (e.g., mindset differences) engender the social cate gorization process is co ntingent upon several factors. One important contingent factor is cognitive accessibility. Cognitive accessibility refers to how easily the social categorization pr ocess implied by the differences (e.g., mindset

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40 differences) is cognitively activated. The existenc e of the cognitive accessib ility implies that the inter-group differences dont necess arily trigger the social categor ization process. If certain environment variables suppress the social categ orization process, that is, deactivating the cognitive accessibility of the inter-group diffe rences, the negative impact of the inter-group differences on inter-group relationship will not be ab le to realize. In the current marketing-sales mindset differences research sett ing, one such potential suppre ssing variable is the role of organizational identification. Organizational identification refers to the extent to which organization members are committed to and identified with their organi zation in terms of the common organizational values, norms, and cultures. Gaertner and hi s colleagues (1993) common in-group identify model suggests that by building up a high level of organization identification, former ingroup and outgroup members can be read ily re-categorized from former functional identity to a new common superordinate identity (e .g., from marketing or sales f unctional identity to a common organizational identity). In that way, the former functional identity b ecomes less accessible and the new common organizational identity becomes mo re accessible. As such, the negative impact of mindset differences on mark eting-sales relationship is less likely to occur, because the presence of the organizational identity suppresse s the formal functional identity created by the mindset differences between marketing and sales, motivating the marketi ng and sales people to work together in accordance w ith the common organizational valu es rather than their former functional values. In other word, under the high level of organizati onal identification, the marketing-sales mindset differences is less cogni tively accessible and thus, less likely to affect the relationship conflic t between marketing and sales. Thus,

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41 Hypothesis 4a: Organizational id entification moderate s the effect of pe rceived marketingsales mindset differences on relationship conflic t between marketing and sales. Specifically, under high level of organizational identification, marketing peoples perceived marketing-sales mindset differences will be less lik ely to be positively related to their perceived relationship conflict with sales. Hypothesis 4b: Organizational id entification moderate s the effect of pe rceived marketingsales mindset differences on relationship conflic t between marketing and sales. Specifically, under high level of organizational identificati on, salespeoples perceived marketing-sales mindset differences will be less lik ely to be positively related to their perceived relationship conflict with marketing. Information Processing Process: Perceived Mindset Differences and Perceived Information Novelty In contrast to the social categorization pr ocess, the information processing process emphasizes the positive effect of inter-group diff erences. Research in work group diversity and top management team (TMT) provides the theore tical foundation that ela borates this process (Van Knippenberg, De Dreu, a nd Homan 2004; Simons, Pelled, and Smith 1999). It starts with the notion that the differences from other gr oup introduce a new set of information, knowledge, skills, and capabilities to the original group. In addition, the differences from the other group also bring new perspectives and opinions to the or iginal group. Members from both groups will be more likely to perceive the novel information a nd ideas, when they are exposed to the diverse resources and perspectives from the other groups. The addition of new resources and perspectives also allow both groups to genera te innovative and creative approaches when the diverse information and perspectives are effectiv ely integrated. In the current marketing-sales mindset differences research setting, because the different mindsets from the other function

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42 introduce new information, values and perspectives about how to deal with the same business environment, it is expected that marketing a nd sales people are more likely to perceived the novelty of the information sent from the other fu nctions when they are exposed to the diverse information, values, and perspectives introdu ced by the different mindsets from the other function. Thus, Hypothesis 5a: Marketing peoples perceived marketing-sales mindset differences are positively related to their perceived novelty of information sent by sales. Hypothesis 5b: Salespeoples pe rceived marketing-sales mindse t differences are positively related to their perceived novelty of information sent by marketing. Information Processing Process: Moderating Effect of Cross-Functional Learning Van Knippenberg and his colleague (2004) suggest that the extent to which the inter-group differences (e.g., m indset differences) bring the positive effect to inter-group informational integration depends on one important contingency, th at is, the elaboration of diverse information and perspectives from the other group. When exposed to the diverse information and perspectives from other groups, members may not able to perceive the novelty of the added information and perspectives, thus reaping the expected informa tion benefit, if they do not actively engage in learning, elaborating, and integrating the new information and perspectives from the other groups. In the current marketing-sa les mindset differences research setting, it is expected that marketing and sale s people with different mindsets will not necessarily perceive the novelty of information sent from the other function, if the level of the cross-functional learning from the othe r function is low. Hypothesis 6a: Cross-functional learning mode rates the effect of perceived marketingsales mindset differences on perceived informat ion novelty. Specifically, under low level of

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43 cross-functional learning, marketing peoples perceived marketingsales mindset differences will be less likely to be positively re lated to their perceived novelty of information sent by sales. Hypothesis 6b: Cross-functional learning mode rates the effect of perceived marketingsales mindset differences on perceived informat ion novelty. Specifically, under low level of cross-functional learning, salespeoples perceive d marketing-sales mindset differences will be less likely to be positively rela ted to their perceived novelty of information sent by marketing. Consequences of MarketingSales Mindset Differences Relationship Conflict, Perceived Informat ion Novelty, and Behavioral Cooperation In the inter-group relationship research setting, relationship conflict refers to the perception of anim osities and incompatibility among members from different groups and typically includes tension, annoyance, and frustrat ion among these members. Relations hip conflict is expected to be negatively related to behavi oral cooperation between marketing and sales. Literature in group conflict provides several arguments supporting th is prediction (Jehn 1995, Pelled 1995). First, relationship conflict makes marketing and sale s people experience fr ustration, strain, and uneasiness with others in the counterpart function. This negativ e affective reac tion typically results in psychological and physical withdrawal from the cross-functional interaction, and thus, inhibiting the potential beha vioral cooperation between th ese two functions. Second, the affective friction resulting from the relations hip conflict makes members from marketing and sales less receptive to th e ideas and information from the ot her function, reduci ng their potential ability to assess new information provided by the other function and thus, reducing the quality of cooperation between these two func tions. Third, the time and ener gy that should be devoted to the cross-functional cooperation is wasted to discuss and resolve th e relationship conflict between marketing and sales, largely limiting the re source needed for effective cooperation between these two functions. As such,

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44 Hypothesis 7a: Marketing peopl e perceived relationship conflic t is negatively related to the behavioral cooperation betw een marketing and sales. Hypothesis 7b: Salespeople perc eived relationship conflict is negatively related to the behavioral cooperation between marketing and sales. Prior research in market intelligence sugge sts that perceived information quality is positively associated with the use of this information (Deshpande and Zaltman 1982; Menon and Vradarajan 1992; Maltz and Kohli 1996). Perceived information quality refers to the extent to which the information received from the se nder as being accurate, relevant, and novel (Deshpande and Zaltman 1982; Montgomery and Weinberg 1979). When members from one function perceive that the inform ation sent by the other function is highly novel, they are highly motivated to use and incorporat e this novel information in th eir work. The better decision making quality and superior performance resulting from this information incorporation will motive the information receiver to work with the information sender, resulting in a high level of behavioral cooperation between each other. Thus, it is expected that when marketing and sales people perceive high novelty of the information sent by the othe r function, they will be more likely to use the novel information and are motivated to cooperate with each other. As such, Hypothesis 8a: Marketing people s perceived novelty of inform ation sent from salespeople is positively related to th e behavioral cooperation betw een marketing and sales. Hypothesis 8b: Salespeoples pe rceived novelty of informati on sent from marketing people is positively related to th e behavioral cooperation between marketing and sales. Behavioral Cooperation and Firm Performance Research in cross-functional integration suggests that when different functions work close ly together, firms will be able effectiv ely integrate the diverse internal functional competence residing in different functions. This function integration will help firms develop

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45 unique competitive advantages over their competitors and obtain superior performance. Thus, it is expected that, Hypothesis 9: Behavioral cooperation is positiv ely related to the firm performance.

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46 Table 3-1. Marketing-sales mindset differences dimension discussed in prior literature Dimensions of marketingsales mindset differences Rouzies et al. (2005) Customer versus product Personal relationship versus analysis Continuous daily activity ve rsus sporadic projects Field versus office Results versus process Short-term versus long-term orientation Homburg and Jensen (2007) Customer versus product orientation Short-term versus long term orientation Quantitative versus qualitative orientation Analytical versus intuitive orientation Ability to deal with structured versus unstructured problems Emotional orientations (h igh versus low arousal) Positive versus negative outlook Expressive versus nonexpressive attitude

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47 Figure 3-1. General conceptual framework of the dual-process model of marketing-sales mindset differences Perceived MarketingSales Mindset Differences Relationship Conflict Perceived Information Novelty Behavioral Cooperation Firm Performance Actual MarketingSales Mindset Differences Organizational Identification Cross-Functional Learning Org. Recruitment % of Employees with CrossFunctional Working Experience in Marketing and Sales Org. Training % of Employees with CrossFunctional Training in Marketing and Sales Org. Socialization Institutionalized Socialization Tactics Antecedents Processes Consequences Social Categorization Process Information Processing Process

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48 Note: The letter(s) in the parentheses indicates the sources of the data collected for each of the variables beside the spec ific parentheses in the framework. Specifically, the letter M in the parentheses indicates that the vari able is reported by the marketi ng respondents. The letter S in the parentheses indicates that th e variable is reported by the sa les respondents. And the letter MS in the parentheses indicate s that the variable combines both marketing and sales peoples responses. Figure 3-2. Detail conceptual fr amework of the dual-process mode l of marketing-sales mindset differences Perceived MarketingSales Mindset Differences (M) Perceived MarketingSales Mindset Differences (S) Relationship Conflict (M) Relationship Conflict (S) Perceived Information Novelty (M) Perceived Information Novelty (S) Behavioral Cooperation (MS) Firm Performance (MS) Actual MarketingSales Mindset Differences (MS) Organizational Identification (M) Organizational Identification (S) Cross-Functional Learning (M) Cross-Functional Learning (S) Org. Recruitment % of Employees with CrossFunctional Working Experience in Marketing and Sales (MS) Org. Training % of Employees with CrossFunctional Training in Marketing and Sales (MS) Org. Socialization Institutionalized Socialization Tactics (MS) Antecedents Processes Consequences

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49 CHAPTER 4 METHODS Overview Two studies were conducted for th is dissertation. The first study (the initial study) is used to develop and pretest scales to assess the m indsets of marketing and sales people. The purpose for the second study (the main study) is to use th e measures developed in the first study to test the entire conceptual framework of the dua l-process model of marketing-sales mindset differences presented by Figure 3-2. Initial Study: Developing and Pre-testing th e Scale of Ma rketing and Sales Mindsets To assess the marketing-sales mindset differences, I first developed a new scale of marketing and sales mindsets. Following ORe illy and his colleague s (1991) approach, I developed a value profile including a set of value statements that ideographically characterize the mindsets of both marketing and sales. This value profile was then pre-tested by an online survey with 290 senior marketing and sales managers. Based upon the developed value profile, participating marketing and sales managers were asked to rate the extent to which each of the values statements in the value profile characte rizes their marketing and sales people. Several steps involving in this scale developm ent process are described as follows. Step 1: Describing the Mindsets o f Marketing and Sales To develop a list of potential mindset differe nces, an extensive review of academic and practical literature on market ing and sales relationships a nd mindset differences, value congruence, and organizational culture and subculture (Cespedes 1992, 1994, 1995; Dawes and Massey 2001, 2005; Dewsnap and Jobber 2002; Ha rdy 1987; Lorge 1999; OReilly, Chatman, and Caldwell 1991; Rokeach 1968; Rouzies et al. 2005; Schultz 2003; Strahle, Spiro, and Acito 1996) was conducted. In addition to the literature review, telephone interviews with eight senior

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50 marketing and sales managers (four from marke ting and four from sales) were conducted. Each of the eight managers was asked to describe th e typical marketing and sales people in general (not necessarily the marketing and sales people from their own companies) using a set of short statements (words). The literature review and telephone interview, together with the discussion with academic scholars in the related research areas, arrive at an initial pool of 86 value statements that characterize marketing and sales people in general. This initial pool of 86 value statements th at describe the marketing and sales mindsets were then narrowed by using the following reco mmended criteria suggested by OReilly and his colleagues (1991): (1) generality a value statement should be relevant to any type of companies in the current research context, regardless of size, industry, and composition; (2) readability the value statements should be easily understandable to f acilitate their commonly shared meanings; and (3) non-redundancy the value statements sh ould have enough distinct meanings so that they cannot be replaced by one another. This process results in a narrowed value profile, consisting of 60 value statements that describe marketing and sales mindsets. (See Table 4-1 for detail) Step 2: Pre-testing the Value Profile Desc ribin g the Mindsets of Marketing and Sales This narrowed value profile with 60 value stat ements that describe marketing and sales mindsets was then pre-tested by an online survey of senior marketing and sales managers in Bto-B businesses. I obtained a random sample of senior marketing and sales managers from a commercial list provider. The sample was stratified by industry type to ensure that this sample covers a wide range of industries. The final stra tified sample consists of 3000 senior marketing and sales managers (1500 for marketing and 1500 for sales). These managers were then contacted by a soliciting email. This email includ es a cover letter describi ng the nature of this study and an online survey URL li nk directing to the pretest su rvey. Of 3000 senior marketing

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51 and sales managers contacted, 290 marketing and sa les managers (54% of marketing and 46% of sales) finally completed this online pr etest survey (a 9.67% response rate). In this online pretest survey, respondents were asked to: Rat e the extent to which each of the following words characterizes the marketing (sales) people in your firm/SBU. Based upon each of the 60 value statements in the narrowed value profile, respondents were asked to rate respectively the marketing and sales groups in their firms/SBUs. They were also asked to provide value statements that ar e not included but important to characterize marketing and sales people in general. Based on the respondents reported rating scor es of each of the 60 value statements, an exploratory factor analysis with varimax rota tion was conducted. Since this factor analysis combines both marketing and sales data, I conduct ed separated explorator y factor analysis for marketing and sales data individu ally to ensure the similar fact or structure between marketing and sales data before combining the data. I estimated the factor structures of both marketing and sales data and found similar stru cture between marketing and sale s data. I thus combined the marketing and sales responses a nd conducted the exploratory factor analysis for combined data to develop the final marketing and sales mindset measure. Consistent with prior research (e.g., OReilly, Chatman, and Caldwell 1991; Spiro and We itz 1990), items with factor loading lower than .40 or with cross-loadings higher than .40 are dropped. The second criterion to select the appropriate value statements is the requirement of commensurate value measurement (Kristof 1996) Commensurate measurement refers to describing both marketing and sales mindsets w ith the same value content structures and dimensions. Commensurate measurement is often recommended for assessing congruence (or difference) because it ensures mutual relevance of the characteristics under investigation (e.g.,

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52 Caplan 1987; Edward 1991; French, Rogers, a nd Cobb 1974). To achieve the commensurate value measurement, I compared the content and stru cture of marketing data with those of sales. I only remained those value statements that both appear in marketing and sales data under the similar dimensions. The third criterion to select the appropriate value statements that describing marketing and sales mindset is the added value statemen ts recommended by both marketing and sales respondents. Remind that in the online pretest survey, both market ing and sales respondents were asked to suggest value statements that are no t included in the provided list but important in describing marketing and sales mindsets. Seve n statements are recommended by both marketing and sales respondents and thus adde d to the final value profile. As such, the final value profile that descri bes marketing and sales mindsets constitutes 36 value statements (including seven added value stat ements that are suggested to be important but not included in the prior value profile. (See Table 4-2 for detail). These 36 value statements will be used to assess the marketi ng-sales mindset differences in the main study. The detail of marketing-sales mindset differences assessmen t will be explained in the following section. Main Study: Testing the Entire Conceptual Framework Sample and Data Collection Overview The sam ple of senior marketing and sales execu tives who participated into this main study was obtained from the following procedure. Th e American Marketing Association (AMA) and the Institute of Study for Busine ss Markets (ISBM) at Penn State University were contacted and agree to provide access to their membership comp any lists. A soliciting email/letter with a cover letter describing the nature of the study, the ince ntive of participation, the researchers contact information, and a URL link directin g to a short initial online surv ey was sent to the potential participating marketing and sales professi onals through AMA and ISBM. AMA and ISBM

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53 members who received the soliciting email/letter a nd were interested in participating in this study were then asked to login on the initial online survey through the provided URL link and complete the short initial onlin e survey. In this sh ort initial on line survey, respondents were asked to provide their names, titles, company names, contact information including their email addresses and work phone numbers. Four hundred and fourteen marketing and sales executives (including 366 from AMA and 51 from ISBM) co mpleted this short initial online survey. Each of the initial online surv ey respondents was then called individually by the researcher via their provided work phone numbers. In each phone call, the researcher typically spent about 10-20 minutes talking with individual initial su rvey respondent. Several major points were emphasized during this phone call: (1 ) highlighting the natu re of this study a nd the participation incentive for an executive benchmark report upo n participants comple tion of both marketing and sales surveys; (2) ensuring that there are separate marketing and sales functions in the initial survey respondents firms/SBUs; (3) asking each of the initial su rvey respondents to identify an appropriate senior marketing execu tive and an appropriate senior sales manager from the same firm/SBU in their companies. These initial su rvey respondents were also asked to agree on distributing a marketing survey to the identified marketing executive and a sales survey to the identified sales executive in the same firm/SBU These two identified executives should not be the same person, ensuring that the marketing an d the sale surveys are completed by different people. Also, these two identified executives should work in their current firm/SBU for at least one year, long enough for them to familiar with th e interaction between marketing and sales in their current firm/SBU. During the phone conversation, some of the init ial survey respondents were found to be qualified for completing both mark eting and sales surveys. Under this situation, these respondents were only allowed to complete one side of the surveys (either marketing or

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54 sales survey), and then asked to distribute the other side of the survey s to another qualified executive in the counterpart function to complete Three hundred and sevent y-three initial survey respondents (330 from AMA and 43 from ISBM) id entified their qualified marketing and sales executives in the same firm/SBU and agreed to di stribute the marketing and sales surveys to their identified marketing and sales executives. Thus, 373 pairs of marketing and sales surveys were distributed by either mail or email with PDF format attachment. One hundred and twenty-two marketing executives returned their completed marketing surveys, and 113 sales manage rs returned their comp leted sales surveys. Among these returned surveys, 88 pairs of mark eting and sales surveys are matched (including 76 completed pairs from AMA sample and 12 completed pairs from ISBM sample. Thus, the total response rate is 23.60% (with 23.03% response rate for AMA sample, and 27.90% response rate for ISBM sample). Among 88 pairs of completed marketing and sa les surveys, 23.86% of responses are from the consumer packaging goods/electronics industry, 21.60% from the machinery/capital equipment industry, 14.77% from the technology /software/consulting industry, 13.64% from the chemical/pharmaceutical industry, 10.23% from th e financial/insurance services industry, 6.82% from the non-profit institution industry, and 9.08% from the other industries. Among the 176 respondents who have matched responses from th e counterpart function in the same firm/SBU, the average length of working experience in th eir current company is 8.33 years (7.24 years for marketing respondents and 9.42 years for sales respondents). The test of the conceptual framework of the dual-process model of marketi ng-sales mindset differences (depicted by Figure 3-2) in the next chapter is basing upon these 88 pairs of completed responses.

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55 I tested the conceptual model depicted by Figure 3-2 using these 88 matched pairs of marketing and sales surveys from senior marketing executive and a senior sales executive from the same firm or strategic business units (S BUs). In the marketing survey, the marketing executives were asked to evaluate the extent to which each of the 36 value statements that describe marketing and sales mindsets (developed in the initial study, see Table 4-2 for detail) characterizes their own marketing groups in their firms/SBUs. Mean while, they were also asked to evaluate their counterpart sales groups from the same firm/SBU along the identical 36 value statements. Similarly, in the sales survey, the sales executives in the same firm/SBU were also asked to do the same evaluation for their own sale s groups as well as their counterpart marketing groups. The marketing and sales executives rati ng scores of these 36 value statements on both marketing and sales groups were then used to assess the actual and perceived marketing-sales (the detail of the difference score assessment will be discussed in the measure section below). In both marketing and sales surveys, marketing and sales executives were also asked to provided information regarding the demographic backgro und of their marketing and sales groups, their organizational socialization tactics, level of perceived relationship conflict between marketing and sales in their firms/SBUs, level of percei ved organizational identif ication, their perceived novelty of information sent by th e counterpart function, the leve l of cross-functional learning between marketing and sales, th e level of behavioral cooperati on between marketing and sales, and their firm performance. Measures All the s cales in the Figure 3-2 are described as follows. A ppendix lists the details of all the scales except the calculated scales of actual and perceived marketing-sales mindset differences.

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56 Percentage of Employees with Cross-Functi onal Working Experience in Marketing and Sales I adapt Chattopadhyay and his colleagues (2004) scale to measure the percentage of employees with cross-functional working experien ce in marketing and sales. Specifically, the marketing respondents were asked to answer th e question: What percentage of marketing employees has previously worked in sales area? In the meantime, the sales respondents from the same firm/SBU were asked to answer the ques tion: What percentage of sales employees has previously worked in marketing area? The averag e score of these two answ ers is then used to measure the percentage of employees with cros s-functional working experience in marketing and sales. Percentage of Employees with Cross-F unctional Training in Marketing and Sales. Similarly, I adapt Chattopadhyay and his colleagues (2004) scale to measur e the percentage of employees with cross-functional training in mark eting and sales. Specif ically, the marketing respondents were asked to answer the question: What percentage of marketing employees has some training or education in sales area? In the meantime, the sales respondents from the same firm/SBU were asked to answer the question: What percentage of sales employees has some training or education in marketing area? The average score of thes e two answers is then used to measure the percentage of employees with cros s-functional training in marketing and sales. Institutionalized Socialization Tactics. Adapting from the previous organizational socialization studies (e.g., Kim, Cable, and Kim 2005; Cable and Parson 2001; Jones 1986), I include four items to measure the institutionalized socialization tactics scale. Both marketing and sales respondents from the same firm/SBU were as ked to evaluate the extent to which they agree or disagree with each of the four items base d upon a 7-point scale ranging from 1 (strongly disagree) to 7 (strongly agree). One item was dropped, due to the low reliability score for sales

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57 response. The remaining three items are then used to measure the institu tionalized socialization tactics. A sample item is, Our company/division puts all of the new r ecruits through the same set of learning experiences, re gardless of their functional areas. The reliability of institutionalized socialization tactics for marketing and sales are .79 and .80 respectively. The marketing and sales scores of in stitutionalized socialization tactic s are then averaged to measure the level of institutionalized socialization tactics for the participating firm/SBU. Actual and Perceived Marketi ng-Sales Mindset Differences. The rating scores of marketing and sales mindsets are used to assess marketingsales mindset differences. Remind that in the both marketing and sales surveys in the main study, marketing and sales respondents were asked to evaluate the extent to which each of the 36 value statements characterizes both their own functional groups and their coun terpart functional groups in th e same firms/SBUs. The actual marketing-sales mindset differences are as sessed by comparing marketing peoples selfevaluated their own mindsets with salespeoples self-evaluated their own mindsets. Whereas, perceived marketing-sales mindset differences ar e assessed by comparing marketing (sales)s self-evaluated their own minds ets with marketing (sales)s evaluated sales (marketing) mindsets. Kristof (1996) suggested two major measures to assess difference scores based upon the rating scores: (1) squared differences (D2) between marketing and sales scores of the same value statement; (2) profile correlation which correlates marketing and sales scores of the same value statements. Both measures have their advant ages in assessing diffe rence scores. Squared differences measure eliminates the potential pr oblem of negative differences and gives more weight to larger absolute di fferences cases. The profile corre lation measure, on the other hand, provides information about the extent to which the overall pattern of values is similar (or

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58 dissimilar). That is, on each consecutive value st atements, as one score goes up, then down, then up, so does the counterparts scores, regardless of th e absolute level of the scores. As long as the pattern of highs and lows is sim ilar (or dissimilar), then the prof ile correlation will be high (or low). Consistent with theoretical conceptualization (e .g., Chatman 1989; Kristof 1996) and as recommended and used in prior research (e.g., OReilly, Chatman, and Caldwell 1991; Cable and Judge 1997), the profile correlati on measure were used to assess the marketing-sales mindset differences scores. Specifically, the actual ma rketing-sales mindset differences scores were calculated by correlating marketing respondents evaluation of their own mindsets with sales respondents evaluation of their ow n mindsets. The resulting set of correlation scores indicates the similarity between actual marketing and sa les mindset. Thus, the actual marketing-sales mindset differences scores are just negative to the obtained correlation scores. As for the perceived marketing-sales mindset differences scales, the marketings perceived marketing-sales mindset differences scores were calculated by correlating marketing respondents evaluation of their own mindsets with their evaluati on of the mindsets of sales in the same firms/SBUs. Similarly, the negative of the obtained correlation scores indicate the marketings perceived marketi ng-sales mindset differences. In a similar vein, the sales perceived mark eting-sales mindset differences scores were calculated by correlating sale s respondents evaluation of their own mindsets with their evaluation of the mindsets of ma rketing in the same firms/SBUs Again, the negative of the obtained correlation scores indi cate the sales perceived marketi ng-sales mindset differences. Relationship Conflict Adapted from Jehns (1995) and Pelled and her colleagues (1999) works, a five-item scale is developed to meas ure the level of relati onship conflict between

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59 marketing and sales. Specifically, marketing respondents reported marketings perceived relationship conflict with sales, and sales respondents in the same firm/SBU reported sales perceived relationship conflict with marketing on a 7-point scale ranging from 1 (strongly disagree) to 7 (strongly agree). A sample item is, There are lots of personal frictions between individuals from each of the functional areas (marketing and sales). The reliability of marketings perceived relationship conflict is .93, same as the reliability score for sales perceived relationship conflict. Organizational Identification Based upon Fisher and his co lleagues (1997) study, a sixitem scale is developed to measur e the level of organizational identification in the participating firm/SBU. Specifically, marketing respondents re ported marketings perceived organizational identification in their firm/SBU, and sales respon dents reported sales perceived organizational identification in the same firm/SBU on a 7-point scale ranging from 1 (strongly disagree) to 7 (strongly agree). A sample item is, Marketing pe ople (salespeople) in ou r functional area feel emotionally attached to the entire company. The reliability for marketings perceived organizational identification is .95. The reliabil ity score for sales perceived organizational identification is .90. Perceived Information Novelty A five-item scale of perceived information novelty is developed from the works by Moenaert and Soude r (1990), Maltz and Kohli (1996), and Simons and his colleagues (1999). Marketing respondent s reported marketings perceived novelty of information sent by sales; and sales respondents in the same firm/SBU reported sales perceived novelty of information sent by marketing on a 7-point scale ranging from 1 (strongly disagree) to 7 (strongly agree). A sample item is, The info rmation sent by sales (marketing) often provides

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60 us with novel perspectives. Th e reliability of marketings pe rceived information novelty is .85. And the reliability of sales pe rceived information novelty is .87. Cross-Functional Learning. Adapted from Van der Vergt and Van de Vlierts (2005) study, a three-item scale of cr oss-functional learning is deve loped. Specifically, marketing respondents reported their percei ved level of cross-functional learning between marketing and sales, and sales respondents in the same firm/SBU reported th eir perceived level of crossfunctional learning between mark eting and sales on a 7-point sc ale ranging from 1 (strongly disagree) to 7 (strongly agree). Due to the lo w reliability of marketings perceived crossfunctional learning, one item was dr opped from the original threeitem scale. The new reliability of marketings perceived cross-functional learning is .61, and th e new reliability score for sales perceived cross-functional learning is .76. A sa mple item is, Marketing and sales freely challenge the assumptions underlying each others ideas and perspectives in order to improve performance. Behavioral Cooperation To fit the marketing-sale cooperation setting, the behavioral cooperation scale is specially created for this study. Specifically, a thir teen-item scale covering various aspects of marketing-sales cooperation is developed. Marketing and sales respondents were respectively asked to evaluate the leve l of support in thirteen aspects provided by the counterpart function in the same firm/SBU al ong a 7-point scale ranging from 1 (poor) to 7 (excellent). Their responses were then averaged to measure the level of be havioral cooperation in their firm/SBU. A sample item is, Following up leads generated by marketing (Generating high quality sales leads). The reliab ility of marketings reported behavioral cooperation is .93, and the reliability of sales reporte d behavioral cooperation is .90.

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61 Firm Performance The firm performance scale includes sixteen items, ranging from market share growth, sale growth, profit grow th, account loss, turnover, innovativeness, new product success, return on sales, to customer satisfaction. Adapted from Moorman and Rusts (1999) study, both marketing and sales respondents from the same firm/SBU were asked to rate their firm/SBUs performance as compared to their major competitors along the sixteen dimensions. The reliability of ma rketings reported firm performan ce is .89, and the reliability of sales reported firm performance is .90. Marketi ng and sales responses are then averaged to measure the level of performance of their firm/SBU. Control variables. Several control variables are a dded based upon the prior research. Specially, five control variables (i.e., goal c ongruence, market dynamics, complexity of selling task, selling situation-new buy, status equal ity) are added when considering the social categorization process of marketing-sales minds et differences. Song and his colleagues (2000) study evidences that goal congruence is an impor tant factor influenci ng the cross-functional relationship. Maltz and Kohlis ( 1996) work suggests another impor tant context variable, market dynamics, that affects the cross-functional relationship. Dynamic market creates more uncertainties that require high le vel of coordination between market ing and sales. This high level coordination requirement raises potential relations hip conflict between mark eting and sales. John and Weitzs (1990) research suggest s other two context variables, th e complexity of selling task and the selling situation-new buy, that can potent ially influence relationship between marketing and sales. When the selling task is more comple x, or the product/service is rather a new purchase situation for buy, marketing and sales need more efforts to coordination. This extra coordination requirement thus increases poten tial relationship conflict between marketing and sales. Status equality between marketing and sales also infl uence the level of rela tionship conflict between

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62 marketing and sales. Unequal status between mark eting and sales is more likely to result in high level of relationship conflict between thes e two functions (Song, Xi e, and Dyer 2000). Three control variables are considered when examining the relationship between behavioral cooperation and firm performance. These three control variables are market dynamics, complexity of selling task, and selli ng situation-new buy. Firms generally need extra efforts to obtain desired performance, when the market is dynamic, selling task is complicated, or the purchase situation is new to their customers.

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63 Table 4-1. Narrowed value profile of marketing and sales mindsets (60 items) Value statement Value statement Flexible Demanding Adaptive Take individual responsibility Stable Have high expectations for performance Predictable Offer praise for good performance Innovative Create conflicts Quick to take advantage of opport unities Confront conflict directly Willing to experiment Friendly Risk taking Fit in Careful Collaborative Independent Enthusiastic Rule-oriented Hard working Analytical Not constrained by many rules Detail-oriented Being distinc tive/different from others Precise Socially responsible Team-oriented Result-oriented Share information freely Have a clear guiding philosophy Emphasize a unique culture for functional area Competitive People-oriented Organized Respect for individuals Political Tolerant Planner Informal Implementer Easy going Doer Energetic Data-driven Supportive Outcome-oriented Aggressive Process-oriented Decisive Bureaucratic Action-oriented Diplomatic Take initiative Creative Reflective Short-term oriented Achievement-oriented Long-term oriented

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64 Table 4-2. Final value profile of ma rketing and sales mindsets (36 items) Value statement People-oriented Friendly Respect for individuals Supportive Collaborative Relationship-oriented* Result-oriented Achievement-oriented Outcome-oriented Competitive Aggressive Action-oriented Analytical Detail-oriented Precise Organized Process-oriented Data-driven Innovative Creative Willingness to experiment Risk Taking Adaptive Flexible Bureaucratic Political Authoritative* Diplomatic Administrative* Rule-oriented Long-term oriented Seeking immediate benefit* Planning for future* Farsighted* Willingness to sacrifice for the future* Short-term oriented Note: -Denotes that value statements are important but were not included in the narrowed value profile. These value statements were added to th e final value profile in consistent with the recommendation by both marketing and sales r espondents in the online pretest survey.

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65 CHAPTER 5 DATA ANLYSES AND RESULTS Multip le regressions were used to analyze the structural model presented by Figure 3-2. Before analyzing the structural model, measur ement model test using LISREL were conducted to test the convergent and discriminant validity of the measures in the model. Meanwhile, before the measurement and structural model tests, reli ability for all the measures was also checked (See Appendix for the reliability of all related sc ales). Table 5-1 provides the means, standard deviations and correlations for the measures. Measurement Model Estimation Construct Validity Because so me of the measures were newly cr eated and some others were adapted from the previous studies, I conducted a confirmatory factor analysis (CFA) to assess the construct validity of the measures used. Due to the small sample size to number of items ratio, this confirmatory factor analysis includes measur es from the two major processes (the social categorization and information processing processe s) in the conceptual framework in Figure 3-2. Specifically, the items from the scales of pe rceived marketing-sales mindset differences, relationship conflict, perceived information novelty, and the two mode rating variables of organizational identification and cross-functional learning for both marketing and sales responses were included in the CFA. The CFA showed good f it of the models to th e data. The Root Mean Square Error of Approximation (RMSEA) index is .08, an indica tive of reasonable model fit (Browne and Cudeck 1993). Also, the Comparativ e Fit Index (CFI) and the Non-Normed Fit Index (NNFI) are .85 and .87 respectively, very cl ose to the normal cut-off point value of .90 (Bagozzi and Yi 1988). Combined together, these i ndices indicate a reasonable overall fit of this

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66 model to the data and show an acceptable converg ent and discriminant validity of the measures in the model. Common Method Variance Note that while the data in the main study is dyadic data in nature, th e data for the social categorization and information process processe s parts in the conceptual framework were collected using survey measures from a single s ource (either from marketing or from sales). As such, several steps were taken to address pot ential concerns about common method bias (Podsakoff et al. 2003). Pro cedural remedies to avoid these biases included protecting respondent confidentiality, reduci ng item ambiguity, separating items for marketing and sales mindset and outcome variables (i.e., relationship conflict, and percei ved information novelty) (about two survey pages apart). Moreover, severa l statistical remedies were also undertaken. First, Harmans one-factor test (Podsakoff and Organ 1986) was conducted. Specifically, several separate exploratory factor analyses (EFAs) we re conducted using principal component analysis and varimax rotations for all independent a nd dependent variables in both the social categorization and information processing proce sses in the model. No single major factor emerges to account for a majority of the varian ces explained by the models (among the most extreme situation among the four EFAs, the first factor accounts for only 18 percent of variance explained by the model), providing preliminar y evidence that no substantial common method bias exists in the data. Furthe r, a partial correlation adjustme nt test suggested by Lindell and Whitney (2001) to control for common met hod variance was also c onducted. Lindell and Whitney (2001) state that a variable that is theo retically unrelated to at least one other variable (preferably the dependent variable) in the study ca n be used as a marker variable in a partial correlation adjustment test. The item about the last years total compen sation of the respondent

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67 was used as the marker variable (The item has non-significant correlations with all variables in the investigated model, thus suggesting its approp riateness to serve as a marker variable). A review of each of the partial correlation matrices indicate s that all significant zero-order correlations remain significant after the partial correlation adjustment, which further confirms that common method bias is not a serious problem in this study. Structural Model Estimation I used m ultiple regression analysis to test the proposed hypotheses. The results are shown in Table 5-2 and Table 5-3. Hypothesis 1a and 1b propose that actual marketing-sales mindset differences are positively related to both marketing people and sa lespeoples perceived marketing-sales mindset differences respectively. The results are reported in Table 5-2. Consistent with both hypotheses, actual marketing-sales mindset differences are positively related to both perceived marketingsales mindset differences ( marketing = .49, p < .01; sales = .32, p < .01). Therefore, Hypothesis 1a and 1b are supported. Hypothesis 2a proposes that pe rcentage of marketing and sales employees with crossfunctional working experience in both marketing and sales is nega tively related to the actual marketing-sales mindset difference. Regression results are reported in Table 5-2. While the direction of the regression coeffi cient is consistent with expectat ion, the regression coefficient is not significant ( = -.10, n.s. ). Thus, Hypothesis 2a is not supported. Hypothesis 2b proposes that pe rcentage of marketing and sales employees with crossfunctional training in both marketing and sales is negatively related to the actual marketing-sales mindset difference. Supporting this hypothesis, the regression coeffi cient (shown in Table 5-2) is negative and significant ( = -.29, p < .05). Thus, Hypothesis 2b is supported.

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68 Hypothesis 2c proposes that institutionalized so cialization tactics is negatively related to the actual marketing-sales mindset differences. As seen in Table mindset difference is positively related to conflict. As seen in Table 5-2, institutionalized soci alization tactics is negatively related to the actual marketing-sales mindset diff erences, but this relationship doesnt show the significance ( = -.06, n.s. ). As such, Hypothesis 2c is not supported. Hypothesis 3a proposes that marketing pe oples perceived marketing-sales mindset differences are positively relate d to their reported relationship conflict between marketing and sales. As presented by Table 5-3, marketing peoples perceived marketing-sales mindset differences is positively but insignifican tly related to relationship conflict ( = .19, n.s. ). Thus, this hypothesis is not supported. Hypothesis 3b proposes that sale speoples perceived marketi ng-sales mindset differences are positively related to their reported relati onship conflict between marketing and sales. Consistent with the hypothesis, Table 5-3 shows that salespeoples pe rceived marketing-sales mindset differences is positively and significantly relate to the relationship conflict ( = .28, p < .01). Thus, Hypothesis 3b is supported. Hypothesis 4a proposes the orga nizational identification modera tes the effect of marketing peoples perceived marketing-sa les mindset differences on thei r reported relationship conflict between marketing and sales. Inconsistent with the expectation, the inte raction term shown in Table 5-3 is not significant ( = -.10, n.s.). Therefore, Hypothesi s 4a is not supported. Hypothesis 4b proposes the organizational iden tification also modera tes the effect of salespeoples perceived marketing-sales mindset differences on their reported relationship conflict between marketing and sale s. Consistent with the hypothesi s, the interaction term shown in Table 5-3 is significant ( = -.24, p < .01). Therefore, Hypothesis 4b is supported.

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69 Hypothesis 5a proposes that marketing pe oples perceived marketing-sales mindset differences are positively related to their perceived novelty of info rmation sent by the sales. As shown by Table 5-3, the corresponding regression coefficient is insigni ficant and negative ( = .12, n.s.). Thus, Hypothesis 5a is not supported. Hypothesis 5b proposes that sale speoples perceived marketi ng-sales mindset differences are positively related to their pe rceived novelty of information sent by the marketing. Contrary to the hypothesis, this relationship (presented by Ta ble 5-3) shows to be negative and insignificant ( = -.10, n.s. ). Therefore, Hypothesis 5b is not supported Hypothesis 6a proposes that cr oss-functional learning moderate s the effect of marketings perceived marketing-sales mindset differences on their perceive d novelty of information sent by the sales. Consistent with the hypothesis, the proposed the inter action term (shown in Table 5-3) is significant ( = .31, p < .01). Thus, Hypothesis 6a is supported. Hypothesis 6b proposes that cro ss-functional learning moderates the effect of salespeoples perceived marketing-sales mindset differences on their perceive d novelty of information sent by the marketing. Supporting this hypo thesis, the correspond ing interaction term is positive and significant ( = .26, p < .01). As such, Hypothesis 6b is supported. Hypothesis 7a proposes that marketing people s perceived relationshi p conflict with sales is negatively related to the behavioral cooperation between these two functions. The regression results show in Table 5-2. Partially supporting the hypothesis, the regression coefficient is negatively but marginally significant ( = -.14, p < .1). Thus, Hypothesis 7a is partially supported. Hypothesis 7b proposes that salesp eoples perceived relationship conflict with marketing is negatively related to their behavioral coopera tion with marketing. As seen in Table 5-2,

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70 salespeople perceived relati onship conflict is negatively an d significantly related to the behavioral cooperation between marketing and sales ( = -.20, p < .05). Therefore, Hypothesis 7b is supported. Hypothesis 8a proposes that marketing pe oples perceived information novelty is positively related to their behavioral cooperation with sales. Consistent with the hypothesis, marketing peoples perceived information novelty is positively and si gnificantly related to behavioral cooperation between marketing and sales ( = .37, p < .01) (shown in Table 5-2). Consequently, Hypothesis 8a is supported. Hypothesis 8b proposes that sa lespeoples perceived inform ation novelty is positively related to the behavioral coopera tion between marketing and sales. Again, in consistent with the expectation, this relationship (see in Table 52) is shown to be si gnificant and positive ( = .36, p < .01). Thus, Hypothesis 8b is supported. Hypothesis 9 proposes that behavioral cooperation is positively related to firm performance. This hypothesis receives the s upport. As indicated by Table 5-2, behavioral cooperation is positively and significa ntly related to firm performance ( = .37, p < .01) Table 5-4 summarizes the re sults of hypothesis testing. Elaboration of Moderation Effects in the Dual-Process Model This section further elaborat es the two hypothesized m oderating effects using the detail graphs. Note that Hypothesis 4a and Hypothesis 4b propose the moderating effect of organizational identification on the relationshi p between perceived marketing-sales mindset differences and relationship c onflict. Specifically, these two hypotheses propose that under high level of organizational identification, perceived marketing-sales mindset differences are less likely to be positively related to the relationship conflict between marketing and sales. Figure 5-1 and Figure 5-2 show the details of this modera ting interaction effect. Figure 5-1 presents the

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71 details interaction graph for the marketing data and Figure 5-2 for the sales data. As presented by these two graphs, while the moderating effect of organizational identification in the marketing data is not significant, both graphs clearly show that the slope indicati ng the positive relationship between perceived marketing-sales mindset diff erences and relationship conflict (the negative aspect of marketing-sales mi ndset differences) is becoming flatter under the high level of organizational identification as compared to the low level of organizational identification. It means that organizational identification helps to mitigate the negative effect of mindset differences on marketing-sales relationship. Also, the steeper slop of the low organization identification lines in both figures indicates that the lack of organizati onal identification building will worsen the negative effect of marketingsales mindset differences on their relationship. Figure 5-3 and Figure 5-4 elaborate the details of moderating effect of cross-functional learning. Figure 5-3 shows the marketing data and Figure 5-4 presents the sales data. Note that Hypothesis 6a and Hypothesis 6b propose the mode rating effect of cross-functional learning on the relationship between perceived marketi ng-sales mindset differences and perceived information novelty (the positive aspect of mark eting-sales mindset differences). Specifically, these two hypotheses propose that under low le vel of cross-functiona l learning, perceive marketing-sales mindset differences will be less li kely to be positively related to the perceived information novelty. Supporting bo th hypotheses, both figures show that under low level of cross-functional learning, perceive d marketing-sales mindset differe nces are not only less likely to be positively related to the perceived info rmation novelty, they are also turning to be negatively related to perceived information novelt y. A further investigation of both figures finds that the positive relationship between percei ved marketing-sales mindset differences and perceived information novelty only exists under the high level of cross-functional learning

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72 situation. Therefore, the investigation of both figures concludes that the positive effect of marketing-sales mindset differences on perceive d information novelty is not universal. This positive effect exists only when firms advocate high level of cross-functional learning. In addition, both figures also show that the positiv e effect of perceived marketing-sales mindset differences on information novelty might turn to be negative when the level of cross-functional learning between marketing a nd sales is getting lower.

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73 Table 5-1. Means, standard deviations and intercorrelations among variables Mean SD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 % of Employees with cross functional working experience in marketing and sales 18.66 16.13 2 % of Employees with cross functional training in marketing and sales 37.95 24.82 .39* 3 Institutionalized socialization tactics 3.08 1.12 -.04 .17 4 Actual marketing-sales mindset differences -.22 .28 -.21 -.35* -.13 5 Perceived marketingsales mindset differences (marketing) -.22 .38 -.20 -.17 -.16 .48* 6 Perceived marketingsales mindset differences (sales) -.22 .38 -.01 -.20 .09 .32* -.13 7 Relationship conflict (marketing) 2.62 1.36 -.24* -.25* .06 .03 28* -.02 8 Organizational identification (marketing) 5.00 1.30 -.14 -.10 .00 .04 -. 33* .01 -.20 9 Relationship conflict (sales) 2.58 1.19 .04 -.38* -.10 .25* .06 .36* .09 .12 10 Organizational identification (sales) 5.12 1.04 -.13 .15 .06 -.13 -.14 -.09 -.13 .13 -.22* 11 Perceived information novelty (marketing) 4.36 .94 -.06 .33* .20 -.16 -.22* 04 -.25* .20 -.23* .21 12 Cross-functional learning (marketing) 4.69 1.07 .13 .25* .19 -.02 -.19 19 -.45* .13 -.05 -.08 .27* 13 Perceived information novelty (sales) 4.38 1.02 -.09 .16 .25* -. 03 .04 -.08 .03 -.04 -. 39* .04 .07 .24* 14 Cross-functional learning (sales) 4.59 1.17 -.06 .21 .09 -. 06 -.07 -.02 -.09 .02 -.05 .46* .20 .07 .16 15 Behavioral cooperation 3.96 88 .16 .40* .37* -.18 -.28* -.13 -.24* .09 -.43* .08 .47* .42* .46* .15 16 Firm performance 4.68 .69 -. 18 .05 .19 -.01 -.08 .01 -.08 .37* -.02 .41* .34* .16 .17 .13 .37* N=88; two-tail test; p<.05

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74 Table 5-2. Regression analyses for antecedents and consequences of marketing-sales mindset differences Dependent variable Actual marketing-sales mindset differences Perceived marketing-sales mindset differences (marketing) Perceived marketingsales mindset differences (sales) Behavioral cooperation Firm Performance Se Se Se Se Se C o n t r o l s Market dynamics -.07 .10 Complexity of selling task .17 .11 Selling situation-new buy -.08 .12 Antecedents % of Employees with cross functional working experience in marketing and sales -.10 .11 % of Employees with cross functional training in marketing and sales -.29* .12 Institutionalized socialization tactics -.06 .11 Focal variables Actual marketing-sales mindset differences .49** .10 .32** .10 Consequences Relationship conflict (marketing) -.14 .08 Relationship conflict (sales) -.20* .09 Perceived information novelty (marketing) .37** .09 Perceived information novelty (sales) .36** .09 Behavioral cooperation .37** .10 Full Model F 3.92* 25.83** 9.44** 17.61** 3.98** Adjusted R2 .10 .23 .09 .43 .12 Note: p <.10, p <.05, ** p < .01

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75 Table 5-3. Regression analyses for dual-process of marketing-sales mindset differences Dependent variable Relationship conflict (marketing) Relationship Conflict (sales) Perceived information novelty (marketing) Perceived information novelty (sales) Se Se Se Se C o n t r o l s Status equality (marketing) .02 .11 Market dynamics (marketing) .02 .11 Complexity of selling task (marketing) .03 .12 Selling situation-new buy (marketing) .04 .12 Goal congruence (marketing) -.35** .11 Status equality (sales) -.04 .09 Market dynamics (sales) .09 .09 Complexity of selling task (sales) -.03 .09 Selling situation-new buy (sales) -.01 .09 Goal congruence (sales) -.51** .09 Task routineness (marketing) .08 .10 Task routineness (sales) .20 .11 Moderating variables Organizational identification (m arketing) .00 .14 Organizational identification (sales) -.19* .09 Cross-functional training (mar keting) .30** .10 Cross-functional training (sales) .21 .12 Independent variables Perceived marketing-sales mi ndset differences (marketing) .19 .11 -.12 .10 Perceived marketing-sales mindset differences (sales) .28** .09 -.10 .11 Interaction variables Perceived marketing-sales minds et differences (marketing) *organizational identification (marketing) -.10 .11 Perceived marketing-sales mindset differences (sales) *organizational identification (sales) -.24** .09 Perceived marketing-sales minds et differences (marketing) *cross-functional training (marketing) .31** .11 Perceived marketing-sales mindset differences (sales) *cross-functional training (sales) .26* .12 Full Model F 2.72* 8.06** 4.73* 2.70* Adjusted R2 .14 .41 .15 .08 Note: p <.10, p <.05, ** p < .01

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76 Table 5-4. Summary of hypothesis testing Hypothesis Support status Focal variables H1a: Actual mindset differences perceived mindset differences (marketing) Supported H1b: Actual mindset differences perceived mindset differences (sales) Supported Antecedents H2a: Percentage of employees with cross-functional working experience in both marketing and sales actual mindset differences Not supported H2b: Percentage of employees w ith cross-functional training in both marketing and sales actual mindset differences Supported H2c: Institutionalized socialization tactics actual mindset differences Not supported Social categorization process H3a: Perceived mindset differences (marketing) relationship conflict (marketing) Not supported H3b: Perceived mindset differences (sales) relationship conflict (sales) Supported H4a: Moderating effect of organizational identification (marketing) Not supported H4b: Moderating effect of organiza tional identificati on (sales) Supported Information processing process H5a: Perceived mindset differences (marketing) perceived information novelty (marketing) Not supported H5b: Perceived mindset differences (sales) perceived information novelty (sales) Not supported H6a: Moderating effect of cross-f unctional learning (marketing) Supported H6b: Moderating effect f cross-f unctional learning (sales) Supported Consequences H7a: Relationship conflict (marketing) behavioral cooperati on Partially supported H7b: Relationship conflict (sales) behavioral cooperation Supported H8a: Perceived information novelty (marketing) behavioral cooperation Supported H8b: Perceived information novelty (sales) behavioral cooperation Supported H9: Behavioral cooperation firm performance Supported

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77 0 1 2 3 4 5 6 7 Low Mindset DifferencesHigh Mindset DifferencesRelationship conflict (marketing ) Low Org. Identification High Org. Identification Figure 5-1. Interaction graph for the modera ting effect of organi zational identification (marketing data)

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78 0 1 2 3 4 5 6 7 Low Mindset DifferencesHigh Mindset DifferencesRelationship conflict (sales) Low Org. Identification High Org. Identification Figure 5-2. Interaction graph fo r the moderating effect of orga nizational identification (sales data)

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79 0 1 2 3 4 5 6 7 Low Mindset DifferencesHigh Mindset DifferencesPerceived information novelty (marketing ) Low Crossfunctional Learning High Crossfunctional Learning Figure 5-3. Interaction graph fo r the moderating effect of cro ss-functional learning (marketing data)

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80 0 1 2 3 4 5 6 7 Low Mindset DifferencesHigh Mindset DifferencesPerceived information novelty (sales) Low Crossfunctional Learning High Crossfunctional Learning Figure 5-4. Interaction graph for the moderating effect of cross-functional learning (sales data)

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81 CHAPTER 6 DISCUSSION AND FUTURE RESEARCH This research em pirically investigates the role of mindset differences in marketing-sales integration. Specifically, this re search proposes a dual-process m odel (i.e., social categorization process and information processing process) of marketing-sales mindset differences and explores both the negative and positive sides of marketing-sales mindset differences. It suggests that marketing-sales mindset differences not only tr igger relational tension in their relational exchange; they also bring in formational benefits to their information exchange. This research also explores the factors aff ecting the marketing-sales mindset differences and the factors moderating the effect of the marketing-sales mindset differences on their relational and informational exchanges. The empi rical results show that by recruiting more employees with cross-functional training in both marketing and sa les, firms can lower the level of marketing-sales mindset differe nces in their company. Also, the empirical results indicate that by building high level of organiza tional identification, firms can m itigate the negative effect of marketing-sales mindset differences on their re lational exchange. In addition, by advocating high level of cross-functional learning between marketing and sales, firm s can also secure the benefit of marketing-sales mindset differences to their in formational exchange. Besides the dual-process model, this research also deve lops a new scale including a comprehensive set of value prof ile that describes the unique ch aracteristics of marketing and sales mindsets. This new scale was used to measure the marketing-sales mindset differences, the focal construct in this dissertation. Theoretical Implications This dissertation provides the following two contributions to the litera ture in marketingsales cooperation/conflict.

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82 First, this dissertation is first empirical re search using dyadic data from both marketing sales sides in the same business to investigate th e role of mindset differences in marketing-sales integration. Also, this dissertation also devel ops and empirically validates a new scale of marketing and sales mindsets used to assess ma rketing-sales mindset differences. Echoing Homburg and Jensens (2007) call, this new scale of marketing-sa les mindsets covers comprehensive aspects of marketing and sales thought-worlds and consists of a comprehensive value profile that characterizes the mindset of marketing and sales. Based upon this new scale, marketing-sales mindset differences were calcu lated and used to investigate its impact on marketing-sales relational and informational excha nge. To the researchers best knowledge, it is the first study that develops such comprehensiv e set of value profile adequately measuring the marketing-sales mindsets. Second, this dissertation is the first study th at explicitly examines both the negative and positive effect of marketing-sales mindset differences. Prior research has largely focused on the negative effect of marketing-sales mindset di fferences on their rela tional exchange. This dissertation also investigates the positive eff ect of marketing-sales mindset differences and integrates both positive and negative sides of mindset differences in th e dual-process model of marketing-sales mindset differences. Specifically, on the positive side, it proposes an information processing process where marketing-sales mindset differences bring informational benefits to their informational exchange. On the negative side, it proposes a social categorization process where marketing-sales mindset differences trigge r the relational tension between marketing and sales. In addition, this disse rtation also proposes factors moderating these two underlying processes. In specific, organizational identification is proposed to moderate the social categorization process and mitigate the negative e ffect of mindset differences on marketing-sales

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83 relational exchange. And cross-functional learning is proposed to moderate the information processing process and facilitate the positive eff ect of mindset differences on perceived quality of information exchanged between marketing and sales. The empirical results in this dissertation generally support this dual-process model of marketing-sales mindset differen ces. Perceived marketing-sales mindset differences are found to be positively related to the relationship conflict between marketing and sales for the sales data. Also, both the marketing and sales data show that perceived marketing-sales mindset differences are positively related to their perceived novelty of information sent the counterpart functions when the level of cross-functional learni ng between marketing and sales is high. This dual-process model of marketing-sale s mindset differences contributes to the marketing-sales interface li terature in general and marketing-sa les mindset differences in specific in that it moves from a single negative view of mindset differences in marketing-sales integration and incorporates both the negative and positive vi ew of mindset differences in marketing-sales integration. Managerial Implications This disse rtation also suggests several appr oaches to mitigate the negative effects of marketing-sales mindset differences and also to explore the potent ial benefits of marketing-sales mindset differences. Specifically, this dissertation suggests the moderating effect of organizational identification on the social categor ization process of the marketingsales mindset difference. This moderating effect implies that by building strong organizational identificat ion, firms can mitigate the relational tension between marketing and sales. Also, th is dissertation suggests the moderating effect of cross-functional learning on the informa tion processing process of the marketing-sales mindset differences. This moderati ng effect implies that in order to explore the

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84 benefits of marketing-sales mindset differences on their information exchange, firms have to advocate a high level of crossfunctional learning between marketing and sales. Combining together, firms are able to realize that mindset differences between marketing and sales functions are not always a cost. If they manage the mi ndset differences correc tly (i.e., by building up strong organizational identificati on and promoting high level of cr oss-functional learning), firms actually can avoid the negative impact and at th e same time, rear the potential benefits brought by the different mindsets in their marketing and sales functions. Additionally, this dissertation also provides approach for firms to mitigate the mindset differences at the very beginning stage. The investigation of the antecedent of marketing-sales mindset differences shows that the percentage of employees with cross-functional training both marketing and sales is negatively related to ma rketing-sales mindset differences. This finding implies that firms can strategically use th eir human resources management policy when recruiting their new marketing and sales employees. If firms are confident about their capabilities in building strong organizational identification and cross-functional learning, they can intentionally recruit more marketing and sale employees without cr oss-functional training background, hoping that the cros s-functional learning among diffe rentiated mindsets employees arrives in more innovative business approaches. Howe ver, if firms realize that they do not have such capabilities at the current stage, theyd better recruit more marketing and sales employees with cross-functional training background in orde r to avoid the potential relational conflicts associated with differentiated mindsets employees. Limitations There are several lim itations in this dissertation. First, two of the expected antecedents of marketing-sales mindset differences, the percen tage of the employees with cross-functional working experience in both marketing and sales a nd the institutionalized socialization tactics, do

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85 not show the significant results in the empirical inve stigation. A possible reason for the first insignificant antecedent is that the cross-func tional working experience might not necessarily change the employees original mindsets or al low them to accommodate others differentiated mindsets. It might be possible th at working experience in other f unctions further strengthens the employees original mindsets, thus further amp lifying the differences with other functions. A possible reason for the second insign ificant antecedent is that th e effect of institutionalized organizational socialization betw een new employees might not st rong enough to compensate the effect when the newcomers interact with coll eagues from their own functions and adopt the existing functional mindsets. Also, the adapted ins titutionalized socialization tactics scale in this dissertation is a short scale. It might not capture the full meaning of institutionalized socialization tactics as compared to the full scale in the original literature (e.g., Jones 1986). Second, in the empirical invest igation of the social categor ization process of the dualprocess model, the main effect of perceived ma rketing-sales mindset differences on relationship conflict and the moderating effect of organizatio nal identification are only significant for the sales data, but not the marketings data. It might be possible that the pressure to meet the periodical sales quota makes salespeople more alert to the relationship friction with the marketing people in the same company. For mark eting people, since their compensation doesn't directly link to the concrete market performance in most situations, they might not be sensitive to the relationship quality with sales when obt aining their compensation in the company. Third, in the empirical examination of the in formation process of the dual-process model, the main effect of the perceived marketing-sa les mindset differences on perceived information novelty is significant only under the high cross-f unctional learning situati on. Under low level of cross-functional learning between marketing-sales, the expected positive main effect of

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86 perceived marketing-sales mindset differences on perceived information novelty disappears. A possible explanation is that the positive effect of marketing-sales mindset differences is not a nature process. The potential bene fit of marketing-sale s mindset differences can only be realized by the proactive activities, such as the cross-functional learning. Fourth, while this dissertation investigates the impact of marketing-sales mindset differences on their relationship conflict, it doesnt examine how ma rketing-sales mindset differences also affect their task conflict. Jehns (1995) research suggested that there are at least two types of conflict, relationship and task conf lict, involving in intergroup interaction. In addition, relationship conflict and ta sk conflict are suggested to ha ve differential antecedents and consequence in the intergroup interaction pro cess. The future research on marketing-sales mindset differences may also consider including the task conflict variable and investigate its relationship with mindset differences in marketing-sales interaction. Fifth, although this dissertation suggests the directional eff ect of mindset differences on marketing-sales relationship conflict, this cross-section study cannot exclude the potential reverse causal relationship in that severe rela tionship conflict between marketing and sales will further widen the mindset gaps between these two functions. In any model in which causality is suggested, longitudinal studies provide stronger inferences. T hus, the model developed and tested in this study could benefit from future a longitudinal design. In the methodological part, there are also some limitations in this paper. First, since the independent and dependent variables in the so cial categorization process and information processing process were both asse ssed using responses by the same person to a questionnaire, a potential for a bias towards si gnificance due to common method va riance exists. I attempted to

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87 minimize this problem by the aforementioned stringe nt data collection procedures, careful survey design including a marker variable, as well as a series of statistical examinations. Second, although our theory suggests the direct ional effects of mindset differences on marketing-sales relationship conflict, the cross-sectional study in this dissertation cannot exclude the reverse causal relationship in that high relationship confli ct between marketing and sales people will further widen the minds et gaps between marketing and sales people. In any model in which causality is suggested, longitudinal studies provide stronger inferences. Thus, the model developed and tested in this study coul d benefit from a longitudinal design. Third, the variables in the antecedent and c onsequence parts of the conceptual framework in Figure 3-2 combine both marketing and sales responses in the same firm/SBU. While this combination is basing upon the high reliability sc ore between marketing and sales responses in the same firm/SBU, advanced investigation (i.e., interclass correlation analysis, Shrout and Fleiss 1979) can be conducted to ensure the validity of this data combination Fourth, in the initial study that pretests th e newly developed scale of marketing and sales mindsets, the marketing and sales responses on their own mindsets and th eir perceived mindsets are combined to the exploratory factor analysis This combination assumes that the underlying structure of marketings mindsets and that of the sales mindsets are identical. Rather than assuming the identical underlying structure, addi tional structure equivale nce analysis should be conducted. A brief version of such structure e quivalence analysis was conducted in the post analysis. This brief analysis i nvolves two separate exploratory factor analyses for marketings own mindsets evaluation data a nd sales own mindset evaluation data respectively. A comparison between the results of these two factor analyses exhibits the similar structure dimension between marketing and sales data, indicating the general validity in data combination.

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88 Fifth, mindset differences scor es were calculated using the rating score of marketing and sales mindset evaluation. Other researchers (e.g., Kristof 1996; Cable and Judge 1997) suggests that the ranking score is better than the rating score in assess th e congruence/differences scores. While ranking score has its own merit, Edwards (2001) argues that the rating score can also adequately assess the congruence/differences sc ores. In addition, rating score also has its advantage in mitigating the burden of su rvey respondents in making the evaluation. Sixth, this dissertation uses profile correlation method (C able and Judge 1997, OReilly, Chatman, and Caldwell 1991) to assess the differe nces between marketing and sales mindsets. While profile correlation method has its unique advantages in assessing differences scores (Kristof 1996), it also has some potential disadvantages, su ch as conceptual ambiguity, discarding information, insensitivity to the source s of profile differences and overly restrictive constraints on the coefficients (Edwards 1993). Future research can also consider applying the polynomial regression method suggested by Edwards (1993). Seventh, sample size is not la rge enough. Currently, this dissertation only includes 88 pairs of completed marketing and sales data. Further data collection is needed to expand the sample size and is expected to avoid problems associated with small sample size. Directions for Further Research Future research m ight consider other m oderating factors that affect the social categorization and information processing proce ss of the marketing-sales mindset differences. For instances, organizational learning orientat ion might moderate the information processing process in that under high level of learning or ientation, perceived mindset differences will be more likely to be positively related to perc eived information novelty. Also, the nature of information communicated between marketing and sales and media of communication might also moderate the social categorization proce ss. For example, when communicated information

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89 is more tacit and the communication media is le ss lean in nature, perceived marketing-sales mindset differences will be more likely to be positively related to relationship conflict between marketing and sales. Future research could also investigate the jo int effects of mindset differences and other cross-functional integration mechanisms (e.g., goal congruence) on marketing-sales cooperation/conflict. A potential hypothesis coul d be that goal congruence will moderate the negative effect of mindset differences on coope ration. When marketing and sales people in specific company highly agree on the goals in join t tasks, they can still achieve high level of cooperation and performance even they have different mindsets. Another direction for future research is to extend the concept of mi ndset differences in other research contexts. For example, future rese arch can examine the effect of channel member mindset differences on the channe l relationship. Also, future rese arch can extend to the Merger & Acquisition (M&A) research cont ext and investigate the effect of mindset differences between CEOs in both merger and acquisition companies on the success of the M&A activities. A recent success M&A between Google and YouTube provides a vivid practical example that instead of the financial offer involving in the M&A, the mi ndset similarity between the leaders in both merger and acquisition companies is a key driv ing factor predicting the success of M&A.

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90 APPENDIX MEASUREMENT SCALE Antecedent Variables Percentage of Employees with Cross-Functi onal Working Experience in Marketing and Sales (adapted from Chattopadhyay, George, and Lawrence 2004) 1. What percentage of marketing employees has previously worked in sales area? (%)____(answered by marketing respondent) 2. What percentage of sales employees has previously worked in marketing area? (%)____(answered by sales respondent) Percentage of Employees with Cross-Functi onal Training in Marketing and Sales (adapted from Chattopadhyay, George, and Lawrence 2004) 1. What percentage of marketing employees has some training or education in sales area (%) _____(answered by marketing respondent) 2. What percentage of sales employees has some training or education in marketing area (%) _____(answered by sales respondent) Institutionalized Socialization Tactics a (adapted from Kim, Cable, and Kim 2005; Cable and Parson 2001; Jones 1996) 1. Our company/division puts all of the new recruits through the same set of learning experiences, regardless of their functional areas. 2. Once recruited, all of the new employees extensively involve with each other in common, job related training activities, re gardless of their functional areas. 3. For most of the new recruits in our functional area, their trainings have been carried out apart from the newcomers in other functional areas. (R)b 4. There is a sense of being in the same boat amongst all of th e new recruits across different functional areas in our company/division. (Reliability: Cronbachs marketing = .79; Cronbachs sales = .80) Process Variables Relationship Conflict a (adapted from Jehn 1995; Pell ed, Eisenhard, and Xin 1999) 1. There are lots of personal frictions between i ndividuals from each of the functional areas (marketing and sales). 2. There is lots of tension between individuals from each of the functional areas (marketing and sales). 3. There are lots of personality clashes evid ent between individuals from each of the functional areas (marketing and sales). 4. Individuals from each of the functional ar eas (marketing and sales) often involve emotional conflict. 5. There are lots of jealousy and rivalry betw een individuals from each of the functional areas (marketing and sales). (Reliability: Cronbachs marketing = .93; Cronbachs sales = .93) Organizational Identification a (adapted from Cadogan et al. 2005; Fisher, Maltz, and Jawarski 1997)

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91 Marketing people (salespeople) in our functional area 1. feel emotionally attached to the entire company. 2. feel a strong sense of bel onging to the entire company. 3. feel as if the problems in th e entire company are their own. 4. feel like part of the family of the entire company. 5. feel strong tie to the entire company. 6. feel they have a personal stake in the success of the entire company. (Reliability: Cronbachs marketing = .95; Cronbachs sales = .90) Perceived Information Novelty a (adapted from Moenaert and Souder 1990; Maltz and Kohli 1996; Simons, Pelled, and Smith 1999) 1. The information sent by sales (marketing) often provides us with novel perspectives. 2. The information sent by sales (marketing) often includes something new to us. 3. The information sent by sales (marketing) ofte n provides us with alte rnative perspectives. 4. The information sent by sales (marketing) of ten complements to what we already had. 5. The information sent by sales (marketing) of ten includes diverse ev aluation criteria. (Reliability: Cronbachs marketing = .85; Cronbachs sales = .87) Cross-Functional Learning a (adapted from Van der Vegt and Van de Vliert 2005) 1. Marketing and sales freely challenge the a ssumptions underlying each others ideas and perspectives in order to improve performance. 2. Marketing and sales criticize each other s work in order to improve performance. b 3. Marketing and sales freely utilize different opinions from the other party in order to obtain the optimal performance. (Reliability: Cronbachs marketing = .61; Cronbachs sales = .76) Consequence Variables Behavioral Cooperation (created for this study) Please evaluate the support that sales (marketing) provides for marketing (sales) in the following areas: (1=poor; 4=average; 7=excellent) 1. Following up leads generated by marketing. (Generating high quality sales leads.) 2. Accurately articulating the corporate br and band value propos ition. (Creating strong brand reputation that makes it easie r to sell our product/services.) 3. Involving marketing in sales calls. (Making calls with salespeople.) 4. Improving marketings understanding of cu stomer needs. (Improving product knowledge of salespeople.) 5. Providing useful information to help marke ting better target key accounts. (Identifying accounts to target.) 6. Effectively using collateral materials developed by mark eting. (Providing effective collateral materials.) 7. Informing marketing about the changing cu stomer needs. (Informing sales about products/services in development.) 8. Supporting new product launches (Facilitating new product/services in development). 9. Providing useful information about competitors. (Providing useful information about competitors.)

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92 10. Providing useful information about the cha nging market conditions. (Providing useful information about the changing market conditions.) 11. Providing background information about key accounts. (Providing background information about key accounts.) 12. Using tools developed by marketing to help sell product/service. (Developing tools to help sell product/services.) 13. Providing information about competitors best marketing practices. (Providing information about competitors best selling practices.) (Reliability: Cronbachs marketing = .93; Cronbachs sales = .90) Firm Performance (adapted from Luo, Slotegraaf, and Xing 2006; Moorman and Rust 1999; Narver and Slater 1990) Compared with the major competitors, how is your company/division performing on: (1=worse; 4=on par; 7=better) 1. sales growth 2. market share growth 3. profit growth 4. account loss 5. reduction in selling cost 6. turnover 7. number of new product/service launched 8. speed of new product/service launched 9. new product/service success 10. innovativeness of new product/service 11. innovativeness of go-to-market strategy 12. ROI (Return On Investment) 13. ROS (Return On Sales) 14. customer loyalty 15. customer satisfaction 16. customer retention (Reliability: Cronbachs marketing = .89; Cronbachs sales = .90) Control Variables Goal Congruence a (adapted from Jap 1999; Jap and Anderson 2003; Song, Xie, and Dyer 2000) 1. Marketing and sales share the same goals. 2. Marketing and sales have the compatible goals. 3. The goals are different between marketing and sales. (R) (Reliability: Cronbachs marketing = .79; Cronbachs sales = .77) Status Equality a (Created for this study) 1. Marketing and sales have equal st atus in our company/division. 2. Marketing and sales can equally influe nce our company/divisions decision. 3. Marketing and sales have the equal level of position in top managements minds. (Reliability: Cronbachs marketing = .86; Cronbachs sales = .88) Market Dynamics a (adapted from Maltz and Kohli 1996)

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93 1. Our customers preferences for prod uct features change very fast. 2. Our customers require very sp ecialized care and services. 3. Our customers needs are very different, re quiring different types of product, brands, services, knowledge, and skills to deal with. 4. Our competitors products and models change very frequently. 5. Our competitors selling strategies changes very often. 6. Our competitors promoting/advertising strategies changes very often. (Reliability: Cronbachs marketing = .80; Cronbachs sales = .77) Complexity of Selling Task a (adapted from Anderson, Chu, and Weitz 1987; John and Weitz 1989) 1. Most of our customers made their purchase decisions with our company/division very quickly. (R) 2. Generally, a number of people are involved in our cu stomers purchase decision. 3. Most of our customers need a lot of inform ation before deciding to purchase from our company/division. 4. Most of our customers consider their purchas e decision with our co mpany/division to be routine. (R) (Reliability: Cronbachs marketing = .74; Cronbachs sales = .64) Selling SituationNew Buy a (adapted from Anderson, Chu, and Weitz 1987; John and Weitz 1989) 1. Most of our customers purch ase decisions with our compan y/division evolve a long time period. 2. Most of our customers have limited know ledge about what features of our company/divisions products are ne eded to solve their problems. 3. Most of our customers have no prior expe rience in how to deal with the produces purchased from our company/division. 4. Our companys products are still a new purchase for most of our customers. (Reliability: Cronbachs marketing = .77; Cronbachs sales = .63) Task Routineness (adapted from Pelled, Eisenhardt, and Xin 1999) 1. The joint tasks between marketi ng and sales are very routine. R: Denotes reverse coded a: Scale: 1=Strongly Disagree ; 4=Neutral; 7=Strongly Agree b: Dropped due to low reliability

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100 BIOGRAPHICAL SKETCH Jun Xu is a PhD candidate in m arketing at th e University of Florida. He graduated from East China University of Science and Technol ogy in China for his bachelor degree in Management and Fudan University in China for his master degree in Management. His current major research interests include selling effectiveness, marketing-sale s relationship, internal selling, and inter-organizational relationship and innovation. His doctoral dissertation proposal on marketing-sales integration was given several awards by Am erican Marketing Association (AMA) Sales SIG and the Institu te for the Study of Business Markets (ISBM). He already had several papers published at the J ournal of Marketing, the Interna tional Journal of Research in Marketing, and the Journal of Vocational Behavior.