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A Model of Agency Client Transaction

Permanent Link: http://ufdc.ufl.edu/UFE0043059/00001

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Title: A Model of Agency Client Transaction Testing the Effect of Two-Way Symmetrical Communication on the Agency Client Relationship
Physical Description: 1 online resource (91 p.)
Language: english
Creator: PARK,NAYOUNG
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2011

Subjects

Subjects / Keywords: AGENCY -- CLIENT -- COMMUNICATION -- CONTRACT -- COORIENTATION -- EXPERIMENT -- MODEL -- POWER -- PR -- RELATIONSHIP -- RESOURCE -- SYMMETRICAL -- TRANSACTION
Journalism and Communications -- Dissertations, Academic -- UF
Genre: Mass Communication thesis, M.A.M.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: A MODEL OF AGENCY CLIENT TRANSACTION:TESTING THE EFFECT OF TWO WAY SYMMETRICAL COMMUNICATION ON THE AGENCY CLIENT RELATIONSHIP The purpose of this study was to test the effect of two-way symmetrical communication on the agency-client relationship. In particular, this study developed a model of agency-client transaction to investigate if two-way symmetrical communication would bring about the mutually beneficial trade of concessions between clients, who have bargaining power before a service contract is signed, and agencies, who have information power after a signed service contract. The hypotheses were tested with an experiment consisting of three decision-making games corresponding closely to the proposed model (Game I: A model of agency-client transaction in the baseline condition; Game II: A model of agency-client transaction with power relations; and Game III: A model of agency-client transaction with two-way symmetrical communication). This study modified previous resource allocation decision-making games by introducing the client?s bargaining power condition, the agency?s information power condition and two-way symmetrical communication condition. In particular, this study integrated the coorientation model to examine the effect of two-way symmetrical communication on the coorientation states as well as on decision making. A mixed within-(Game I?Game II?Game III) and between-(Agency?Client) subject design was used. The results demonstrate the applicability of excellence theory to the particular public?agencies or clients?in the particular context?transaction. Both the Agency Group and the Client Group made a mutually beneficial choice as a result of two-way symmetrical communication. Also, both groups? coorientation states improved as a whole. This study approached the agency-client relationship from the two-way symmetrical perspective. The results suggest that 1) the agency-client transaction is not a zero-sum game but a positive sum game, 2) not only agencies but also clients should be willing to change their own behavior to increase the size of pie, and 3) both agencies and clients can have bigger pie through mutually beneficial trade of concessions.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by NAYOUNG PARK.
Thesis: Thesis (M.A.M.C.)--University of Florida, 2011.
Local: Adviser: Kiousis, Spiro K.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2011
System ID: UFE0043059:00001

Permanent Link: http://ufdc.ufl.edu/UFE0043059/00001

Material Information

Title: A Model of Agency Client Transaction Testing the Effect of Two-Way Symmetrical Communication on the Agency Client Relationship
Physical Description: 1 online resource (91 p.)
Language: english
Creator: PARK,NAYOUNG
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2011

Subjects

Subjects / Keywords: AGENCY -- CLIENT -- COMMUNICATION -- CONTRACT -- COORIENTATION -- EXPERIMENT -- MODEL -- POWER -- PR -- RELATIONSHIP -- RESOURCE -- SYMMETRICAL -- TRANSACTION
Journalism and Communications -- Dissertations, Academic -- UF
Genre: Mass Communication thesis, M.A.M.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: A MODEL OF AGENCY CLIENT TRANSACTION:TESTING THE EFFECT OF TWO WAY SYMMETRICAL COMMUNICATION ON THE AGENCY CLIENT RELATIONSHIP The purpose of this study was to test the effect of two-way symmetrical communication on the agency-client relationship. In particular, this study developed a model of agency-client transaction to investigate if two-way symmetrical communication would bring about the mutually beneficial trade of concessions between clients, who have bargaining power before a service contract is signed, and agencies, who have information power after a signed service contract. The hypotheses were tested with an experiment consisting of three decision-making games corresponding closely to the proposed model (Game I: A model of agency-client transaction in the baseline condition; Game II: A model of agency-client transaction with power relations; and Game III: A model of agency-client transaction with two-way symmetrical communication). This study modified previous resource allocation decision-making games by introducing the client?s bargaining power condition, the agency?s information power condition and two-way symmetrical communication condition. In particular, this study integrated the coorientation model to examine the effect of two-way symmetrical communication on the coorientation states as well as on decision making. A mixed within-(Game I?Game II?Game III) and between-(Agency?Client) subject design was used. The results demonstrate the applicability of excellence theory to the particular public?agencies or clients?in the particular context?transaction. Both the Agency Group and the Client Group made a mutually beneficial choice as a result of two-way symmetrical communication. Also, both groups? coorientation states improved as a whole. This study approached the agency-client relationship from the two-way symmetrical perspective. The results suggest that 1) the agency-client transaction is not a zero-sum game but a positive sum game, 2) not only agencies but also clients should be willing to change their own behavior to increase the size of pie, and 3) both agencies and clients can have bigger pie through mutually beneficial trade of concessions.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by NAYOUNG PARK.
Thesis: Thesis (M.A.M.C.)--University of Florida, 2011.
Local: Adviser: Kiousis, Spiro K.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2011
System ID: UFE0043059:00001


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1 A MODEL OF AGENCY CLIENT TRANSACTION: TESTING THE EFFECT O F TWO WAY SYMMETRICAL COMM UNICATION ON THE AGENCY CLIENT RELATIONSHIP By NAYOUNG PARK A THESIS PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PAR TIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS IN MASS COMMUNICATION UNIVERSITY OF FLORIDA 2011

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2 2011 NaYoung Park

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3 To my father, KyungIl Park, my mother, OkMok Lee, my sister, HyeSun Park, my aunt, DoYeon Lee, and the cutest puppy in the world, KyumDaeng Park

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4 ACKNOWLEDGMENTS First of all, I would like to thank my committee members: my chair, Professor Spiro K. Kiousis Professor Juan Carlos Molleda, and Professor Deanna Pelfrey. They believed in me and provided me with invaluable advice and suggestions. I also would like to thank Professor Belio A. Martinez. Thanks to his guidance, I had the opportunity to be selected by the Public Relations Advisory Council Research Committee and to present my research proposal at the Public Relations Advisory Council meeting. Dr. Jangyul R. Kim, a professor in the Department of Journalism and Technical Communication at Colorado State University and the president of KorCom Porter Novelli, deserves recognition. He was the person wh to specialize in agency client partnership design consultation. JinHwan Ann and EnHee Im also deserve recognition. Thanks to their recommendation, I had the opportunity to translate Faster Cheaper Better: The 9 Levers for Transforming How Work Gets Done written by Michael Hammer, co author of Reengineering the Corporation. The book is about process design to get things done faster, cheaper, and better, which is greatly related to the main idea of this stu dy as well as my consulting career. I would like to express my gratitude to Jody Hedge. I am sure that she is the greatest program assistant in the world. I want to give my love and thanks to my Gator Dinner Club members, HyeYoung Hong, HweeRin Son, Gooh o Jung and SangHoon Han. They literally and figuratively nourished me here in Gainesville. I also want to send my love and thanks to my loving friends and friendly colleagues, including JinHee Kim, JiSu Min, Yurina Kim, HyeWon Ryu, MiSoo Kim, YoonJin Jo, J unYoung Kim, YooJung Sul, JiYeon Lee, HeeJung Park, KyungHee Jeon, NaYoung Kim, KunYoung Kim, SunYoung Yoon, Heri Choi, SeoYoon Choi, YoungShin Hong, TaeYoon Kim,

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5 DongHun Shin, BongWoo Lee, YoungSuk Kim, BoHwan Yoon, SeJung Oh, DeukJin Jeon, OhBong Kwon, J unMo Kang and SungMin Kang. My special love and thanks go to my parents, sister, aunt and puppy. I know what unconditional love is, thanks to them.

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6 TABLE OF CONTENTS page ACKNOWLEDGMENTS ................................ ................................ ................................ ............... 4 LIST OF TABLES ................................ ................................ ................................ ........................... 8 LIST OF FIGURES ................................ ................................ ................................ ......................... 9 ABSTRACT ................................ ................................ ................................ ................................ ... 10 CHAPTER 1 INTRODUCTIO N ................................ ................................ ................................ .................. 12 2 LITERATURE REVIEW ................................ ................................ ................................ ....... 15 ................................ ................................ ................................ ...... 15 ................................ ................................ ................................ ...... 16 ................................ ................................ ................................ 16 ................................ ................................ .................. 17 Coorientational Approach to the Agency Compensation Issue ................................ .............. 17 Two Way Symmetrical Communication for Win Win Solutions ................................ .......... 20 Win Win Solutions ................................ ................................ ................................ ................. 20 Win Win Solutions through Two Way Symmetrical Communication ................................ .. 21 Summary ................................ ................................ ................................ ................................ 22 3 A MODEL OF AGENCY CLIENT TRANSACTION AND HYPO THESES ..................... 24 4 METHODOLOGY ................................ ................................ ................................ ................. 29 Pretests ................................ ................................ ................................ ................................ .... 29 Subjects ................................ ................................ ................................ ................................ ... 29 Procedures ................................ ................................ ................................ ............................... 30 Experimental Conditions ................................ ................................ ................................ ........ 32 ................................ ................................ .............................. 32 ................................ ................................ .......................... 33 Two Way Symmetrical Communication ................................ ................................ ......... 33 5 RESULTS ................................ ................................ ................................ ............................... 35 Hypotheses Testing ................................ ................................ ................................ ................. 35 Model Evaluation ................................ ................................ ................................ .................... 44 6 DISCUSSION ................................ ................................ ................................ ......................... 56 Summary of Findings ................................ ................................ ................................ ............. 56

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7 Decision Making in the Baseline Condition ................................ ................................ ... 56 The Effect of Power Relations ................................ ................................ ........................ 57 The Effect of Two Way Symmetrical Communication ................................ .................. 58 Implication ................................ ................................ ................................ .............................. 59 Limit ation and Recommendations for Future Research ................................ ......................... 63 APPENDIX A INSTRUCTIONS ................................ ................................ ................................ ................... 67 Instructions for Agency Group ................................ ................................ ............................... 67 Instructions for Client Group ................................ ................................ ................................ .. 73 B COMMUNICATION MESSAGES ................................ ................................ ........................ 81 LIST OF REFERENCES ................................ ................................ ................................ ............... 83 BIOGRAPHICAL SKETCH ................................ ................................ ................................ ......... 91

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8 LIST OF TABLES Table page 5 1 Tests of between subjects effects ................................ ................................ ....................... 38 5 2 The least signi ficant differences (LSD) post hoc test ................................ ........................ 39 5 3 Summary of results ................................ ................................ ................................ ............ 46 5 4 Summary of the changes in coorientation st ates ................................ ................................ 48 6 1 Summary of hypothesis testing results ................................ ................................ .............. 56

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9 LIST OF FIGURES Figure page 3 1 A model of agency client transaction in the baseline condition ................................ ........ 25 3 2 A model of agency client transaction with power relations ................................ .............. 27 3 3 A model of agency client transaction with two way symmetrical communication .......... 28 4 1 Within and between subject design ................................ ................................ .................. 30 5 1 Accuracy on A I ................................ ................................ ................................ .................. 40 5 2 Accuracy on A II ................................ ................................ ................................ .................. 41 5 3 The changes in decision about A I ................................ ................................ ...................... 44 5 4 The changes in decision about A II ................................ ................................ ..................... 45 5 5 The changes in A I + A II ................................ ................................ ................................ ...... 45 5 6 The changes in benefits ................................ ................................ ................................ ...... 46 5 7 The changes in agreement (A I ) ................................ ................................ ......................... 50 5 8 The changes in agreement (A II ) ................................ ................................ ........................ 50 5 9 The changes in congruency (A I ) ................................ ................................ ....................... 51 5 10 The changes in cong ruency (A II ) ................................ ................................ ...................... 52 5 11 The changes in accuracy (A I ) ................................ ................................ ............................ 54 5 1 2 The changes in accuracy (A II ) ................................ ................................ ........................... 54 5 13 In depth analysis of the changes in accuracy (A I ) ................................ ............................. 55 5 14 In depth analysis of the changes in accuracy (A II ) ................................ ........................... 55

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10 Abstract of Thesis Presented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Master of Arts in Mass Communication A MODEL OF AGENCY CLIENT TRANSACTIO N: TESTING THE EFFECT O F TWO WAY SYMMETRICAL COMM UNICATION ON THE AGENCY CLIENT RELATIONSHIP By NaYoung Park May 2011 Chair: Spiro K. Kiousis Major: Mass Communication The purpose of th is study was to test the effect of two way symmetrical communicatio n on the agency client relationship. In particular, this study developed a model of agency client transaction to investigate if two way symmetrical communication would bring about the mutually beneficial trade of concessions between clients, who have barga ining power before a service contract is signed and agencies, who have information power after a signed service contract. The hypotheses were tested with an experiment consisting of three decision making games corresponding closely to the proposed model (Game I: A model of agency client transaction in the baseline condition ; Game II: A model of agency client transaction with power relations ; and Game III: A model of agency client transaction with two way symmetrical communication). This study modified pre vious resource allocation decision making games by introducing the way symmetrical communication condition. In particular, this study integrated the coorientation model t o examine the effect of two way symmetrical communication on the coorientation states

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11 as well as on decision making. A mixed within (Game I Game II Game III) and be tween (Agency Client) subject design was used. The results demonstrate the applicability of excellence theory to the particular public agencies or clients in the particular context transaction. Both the Agency Group and the Client Group made a mutually beneficial choice as a result of two way symmetrical This study approached the agency client relationship from the two way symmetrical perspective. The resu lts suggest that 1) the agency client transaction is not a zero sum game but a positive sum game, 2) not only agencies but also clients should be willing to change their own behavior to increase the size of pie, and 3) both agencies and clients can have bi gger pie through mutually beneficial trade of concessions.

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12 CHAPTER 1 INTRODUCTION T he Excellence S tudy suggests that tw o way symmetrical communication can develo p win win solution s for conflict s establish and maintain long term relationship s and increa se organizational effectiveness ( Dozier, L. Grunig & J. Grunig 1995; L. Grunig, J. Grunig & Dozier, 2002 ). Through two way symmetrical communication a ccording to the study organizations can practice the most effective and ethical public relations nam ely excellent public relations. What i s worth noting is the assertion from Dozier et al. (1995) that communi cation excellence is universal. That is, th e concept of communication excellence is applicable to any particular public or context In that case would two way symmetrical communication contribut e to the relationship between a gencies and client s ? While several studies have attempted to test e xcellence t heory on i e., L. Grunig, 19 92 ; Zoller, 2004; Stokes & Rubin, 2010), media ( i.e., Habbersett, 1983; Theus, 1988; J. G runig, 1990 ; Callison & Seltzer, 2010 ), employees ( i.e., McCown 2007; Kim, 2007 ), investors ( i.e., Kelly, Laskin & Rosenstein, 2010) and the general public ( i.e., Foreman Wernet & Dervin, C lients are crucial publics to agenc ies and agencies are crucial publics to client s Fo r clients, failed relationship with an agency means loss of time and budget, the discontinuance of programs and another agency selection proc ess (Quinn, 1978; Michell, 1986) For agencies they can lose millions of dollars and reputation from client losse s (Bourland Davis, 1997).

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13 Warner (1992) pointed out he traditional notion of the agency client (p. 20) Agencies and clients come together after a time consuming and labor intensive agency selection process, but the relat ionship is filled with misunderstanding and anxiety ( Marconi, 1998). When Salz Survey of Advertiser Agency Relations ( 200 5) asked about their relationship with each other, 46 % of the agency respondent the second highest level since 1986 said there were mor e hassles than the previous year, and 41 % of the client respondent the highest level since 1986 said there was more tension than the previous year (Elliot, 200 6 ). As a result, the average agency client relationship tenure decreased from 7.2 years in 1984 t o 5.3 years in 1997 (Gleason, 1997). Dan (2008) pointed out that the agency client relationship was three (p.18). The p ublic relations and advertising literatures in this area ha ve focu sed on the client s expectations of agenc ies ( i.e. Lace, 1998 ; Fam & Waller, 2000 Crutchfield, Spake, D'Souza, & Morgan, 2003 ) conflict issues ( i.e. Pincus, Acharya, Trotter & Michel, 1991; Bourland, 1993; Devinney & Dowling, 1999 ) and reasons for re lationship success or failure ( i.e. Doyle, Jens, & Michell, 1980; Ghosh & Taylor, 1999 ; Bennett, 1999 ) However, f ew studies have approached from a relationship perspective Further, the relationship has not been examined from the two way symmetrical perspective. Most previous studies of the agency client relationship have emphasized only the responsible for relationship outcomes ( Lee, Huynh, Chi wai & Pi, 2000 ) For example, Lab a hn (1996) concluded in his study on the agency client relationship that agencies have to behave cooperatively and to attend diligently to problems in order to improve the relationship Similarly, Chia (2008) suggest ed that agencies need to adapt to client for the successful relationship management.

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14 Business management and economics studies on agency theory c onsider mon itoring or incentive as a remedy for problems from the con flict of interest between agencies and client s ( i.e. Nayyar, 19 90; Demougin & Fluet, 2001; Tosi, Brownlee, Silva, & Katz, 2003; F ong & Tosi, 2007 ; Carson, 2008 ) However, those solutions are not only asymmetrical but also one sided. Those are far from an attempt to establish mutually beneficial solution s through mutua l understanding. Would two way symmetrical communication develop win win soluti ons for conflicts between agencies and client s establish and maintain long term relationships, and increase organizational effectiveness? C ould agenc ies and client s practice e xcellent client relations and excellent agency relations through two way symmetrical communication? The purpose of this study is to test the effect of two way symmetrical communication on the agency client relationship. In particular, a theoretical model of agency client transaction is presented to investigate if two way symmetrical communication will lead a win win relationship between agencies and clients. A laboratory experiment is conducted to test the hypotheses and to evaluate the predictions in the proposed model. The theoretical and practical implication as well as limitations and recommendations for future research is discussed at the end of the paper.

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15 CHAPTER 2 LITERATURE REVIEW In this chapter, the issues in the agency client transaction will b e elaborated to develop a model of agency client transaction The chapter begins with a discussion of issues derived from a service contract is signed and i ssues derived from the after a sign ed service contract Next, it explores the possible role of two way symmetrical communication in finding win win solutions Finally, it examines the comparative value of mutually beneficial trade of concessions through two way symmetrical communication in relation to incentive or monitoring. Client s Business to business (B2B) service customers, unlike business to customer (B2C) service customers, have significant bargaining power ( Lovelock & Wirtz 2003 ). Especially in the agency client r elationship, according to Marconi (1998), it is an open secret that some clients are ncies than varieties of grapes p. 14 ). The power a symmetry between agencies and clien t s considerable dependency on clients. In fact the prosperity of agencies depends in large part on clients (Sekely & Blakney, 1996). As Croft (1993) pointed out, agencies swing between ecstasy and despair, depending on whether the y win a new client or lose an old one. Based on game theory, Pavlik (1989) suggested that organizations with greater power than the public would get the greatest payoff from asymmetrical public relatio ns. Considering that both agencies and client s act in their own best interest, it is reasonable that clients exert their power as much as they can (Ellis & Johnson 1993) In their study on the power balance in the agency client relationship, Zolkiewski et al (2008) suggested that the power asymmetry b etween

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16 agencies and clients would have a negative impact on the relationship a nd the performance of agencies. According to Cameron et al. (2001), h owever, clients are not likely to change their position, unless situational variables, such as potential cost/benef it and power relations, are powerful enough to i nfluence their decision making. When organization s look for a new agency, they traditionally conduct a time consuming and labor intensive agency selection process, inviting several agencies to submit an extensive proposal and to make a speculative presentation (Kotowski, 1992). Accord ingly, a large portion time and talent is running into the agency selection process ( Michell, 1986; Bourland Davis, 1997 ) For i nstance, adv $200,000 to $1 million (Steinberg, 2007, p. B2). N ot only large agencies but also small and medium size agencies are hiring highly specialized professionals, who command salaries of $300,000 to $400,00 0 a year, just for the agency selection process (Foltz, 1990). According to Lovelock and Wirtz (2003), agencies might spend 25 % of their service value in the agency selection process, if clients required extensive proposal work and frequent bidding. Va n Re nsburg et al. (2010) pointed out that the average amount of time spent by pitching agencies was about 11 % In the relationship between agencies and client s agencies always have more information than clients (Fudenberg, Holmstrom & Milgrom, 1990). Only agencies know what they did to achieve goal, and only agencies have access to the specialized knowledge on the specific kind of service (Carson, 2008). Clients are generally uncertain about either the minimum quality guaranteeing price or the actual quality of agency service ( Kleinand & Leffler, 1981; McCluskey, 2000). Agencies may recommend unnecessary but more profitable services and

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17 shirk necessary but less profitable services (Emons, 1997). In addi tion, the chances of clients The information advantage grants agencies a different kind of power namely information power (Bok, 1989). Agencies Budget Adjustment Based on contingency theory, Shin and Cameron ( 200 4) implied that agencies who wanted would be more accommodative than clients who had more bargaining power than agencies. Based on their analysis on the agenc contractual performance, however, Kleinand and Leffler (1981) suggested that agencies would not keep their promise to provide high quality service, unless agency compensation was sufficiently above the cost. According to McAfee and McMillan (1987), ag encies choose the level of service quality once they w on in the agency selection process. That is, i n the agency client transaction there is always a possibility of the agenc ies internal budget adjustment. Tosi et al. (1997) suggested that sions about resource allocation would be influenced by how the decisions affect ed their profitability. If agencies decide tha t a certain account was less profit able they might utilize their authority for the budget execution to secure their profit, reduci ng the level of service quality or assigning less qualified staff (Cummings, 1991; Abou A I sh, Kortam & Hassan, 2008). If clients ignore therefore, it may not bring about the expected benefits (Caillaud & Hermalin, 2000). Coorientational Approach to the Agency Compensation Issue Sekely and Blakney (1996) wrote [n] o one issue has divided agencies and c lients more than compensation (p. 28) T he issue of agency compe nsation is at the center of the conflict of interest between agencies and clients. A gencies think that the co mpensation is unfair because clients pay less and want more (McMains, 2009). In the 2009 Client Quality Survey, agencies

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18 rate d current age ncy and service level % % 6 % (McMains, 2009). Meanwhile, clients think tha t agency compensation is unfair because it does not correspond to service quality (Aarikka Stenroos & Halinen, 2007). In his study on conflict issues in the agency client relationship Bourland Davis (1997) found that clients viewed ones s and suboptimal decisions (Alba, Broniarczyk, Shimp, & Urbany, 1994; p. 221). Ali et al. (2003) implied that clients high agency were possible cause s of misunderstanding about agency compensation and consequently perception of compensation unfairness For instance clients might think that agencies would absorb the transaction costs, while agencies think it the other way around. The coorientational model of communication has been widely used to compare the perceptions of different groups (i.e., Sallot, Cameron, & Weaver Lariscy, 1997; R eber, Cropp, & Cameron, 2001; Shin & Cameron, 2004; Ver i Ver i & Laco, 2006 ; Kutzschenbach & Bronn, 2006 ). In particular, the coorientation model enables the identification of whether two groups are consensual or conflicting regarding particular issue (Shin & Cameron, 2004; p.12). The coorientation mod el assumes that each party party thinks about the issue (Kutzschenbach & Br o nn, 2006; p. 306).

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19 evaluation of is similar to his. Accuracy occ evaluation (Chaffee & McLeod, 1968). Based on the coorientation model, Dozier and Ehling (1992) suggested that two way symmetrical communication could reduce conflict based on misunderstanding by improving the level of accuracy They explained: The two way symmetrical model of public relations suggests that communication, including mediated communication, is indeed effective at achieving symmetrical goals and objectives. The coorientation model suggests that increases in accuracy as we ll as agreement are worthwhile objectives for communication programs to pursue. The concept of symmetry suggests that the organization itself and especially the dominant coalition should adjust and adapt to publics upon whom survival and growth depends. In the process, the organization itself changes. (Dozier & Ehling, 1992, p. 182) Kutzschenbach and Bronn (2006) also suggested the effectiveness of two way symmetrical communication in improving the level of accuracy : A central assumption of co orientation t heory is that information exchange through Communication leads to changes in cognitions in both the organization and the public towards an issue, thus increasing accuracy. (Kutzschenbach & Bronn, 2006, p.3 15 ) According to Ver i et al. (2006), strategies based on inaccurate understanding of the other beneficial transaction, agencies and clients will communicate what they seek, wh at they have, what they are willing to concede, and the relative importance of each concession (Ross & Stillinger, 1991). If each party gain ed a more accurate understanding of they would be able to select the most beneficial strategy based on the newly acquired knowledge (Beach & Mitchell, 1978).

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20 Two Way Symmetrical Communication for Win Win Solutions In a B2B transaction, it is common to approach negotiations from a win lose perspective, although win win negotiations are the key to successful conflict resolution (Ehling, 1992). Organizations with a win changing their own behavior (Kelly, Laskin, & Rosenstein, 2010). To achieve win win solutions, however, they have to be willing to change their own behavior (J. Grunig & Hunt, 1984; Dozier, L. Grunig, & J. Grunig, 1995). Two compromise on their own ideas, attitudes, and behaviors (J. Grunig, 1990 p. 21 ). J. Grunig (1997) asserted that the two way symmetrical model of public relations provides a forum for dialogue, and Zoller (2004) suggested that the fo rum for dialogue provides people with different values with a chance to discuss their value s, to improve mutual understanding, to manage conflicts and to reach a compromise. While two way asymmetrical communication is a zero sum game that one player must lose if the other player w ins two way symmetrical communication is a positive sum game tha t both players can win (Leichty, 1997). Two way symmetrical communication between organization and public generates mutual understanding to develop mutually beneficial relationships (J. Grunig & L. Grunig, 1992). Especially in a conflict situation, organiz win solutions through two way symmetrical communication (Dozier, L. Grunig, & J. Grunig, 1995; Huang, 1997). Win Win Solution s A gencies need to control the level of service quality because t hey have a limited amount of resources and higher service quality requires higher service cost (Kleinand & Leffler, 1981; Schmidt, 2000). According to Lovelock and Wirtz (2003 ), agencies control the level of service

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21 lity. That is, agencies might increase the level of service, assign more qualified staff, or provide some exclusive benefits that are not available to other clients if they decide that a certain account is more profitable than others. Lal and Staeli n (198 6) suggested that adjustment problem by designing a compensation system that aligns the interests with In fact, c lients can make their account more profitable not just by increasing agenc y compensation but also by reducing waste of time, money and talent (Shingo, 1988). For instance members of CAANZ (Communication Agencies Association of New Zealand) criticize d wa o produce best practice, creat ed extended timeframes and inflat ed wa Another way is to reduce the costs of non value adding activities (Koskela, 1997). C lient s can select the most valued ones among several service options (Ehling, 1992). For example, according to Naumann (1995), ded in the agency compensation If organization s valued service quality higher than their marketing and sales effort, they could design more effective and less time consuming and labor intensive agency selection process through two wa y symmetrical communication with agencies Win Win Solution s through Two Way Symmetrical Communication Rao and Bergen (1992) asserted that the willingness of quality conscious clients to pay price premium the excess price above the minimum quality guaranteeing price wa s economically rational. Incentive is generally considered as a way to motivate agencies to provide high qualit y service ( Kleinand & Leffler 1981 ; D'Souza, 1999).

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22 Monitoring is another way to ensure a service quality. C lient s establish monitoring systems to ensure the consistency of behavior with their best interest (Abou A I sh, Kortam & Hass an, 2008). The problem is that both incentive and monitoring are not only asymmetrical but also one sided. Clients manage incentive or monitoring system on their own at their own cost (D'Souza, 1999). The goal is not in finding mutually beneficial solutio ns but in maximizing their own benefits (Spake, D Souza, Crutchfield, & Morgan, 1999). In fact, those solutions assume are naturally If clients assume that the size of pie is fixed, however, they will fail to reach a win win compromise, which increases the size of pie (Neale & Baserman, 1991 ; Ellis & Johnson, 1993 ). Mutually beneficial trade of concessions will become impossible (Ross & Stillinger, 1991). If agenc ies and client s reached goal congruity through two way symmetrical communication, agencies would behave in the direction that maximizes the client s regardless of incentive or monitoring (Ellis & Johnson, 1993; D'Souza, 1999). Mutual understanding o n what goals are important or unimportant and appropriate or inappropriate can serve as a direct precursor of relationship commitment and trust (Morgan & Hunt, 1994). Committe d and trusted business partners cooperate with each other to achieve better outco mes (LaBahn & Kohli, 1995; Hunt, Arnett & Madhavaram, 2006). Summary The agency client transaction is a complex situation. First, there exist common and conflicting interests between agencies and clients. Both agencies and clients want to maximize the se rvice quality. However, clients want to minimize the agency compensation, while agencies want to maximize their net income. Second, there exist s information asymmetry as well as power

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23 asymmetry. Clients have bargaining power before contract, while agencies have information power after contract. Finally, both agencies and clients value the agency service hi gher than the agency proposal. To develop win win solutions both agencies and clients have to (1) satisfy not only their own goals but also the other par and behaviors. Mutually beneficial trade of concessions through two way symmetrical communication may regardless of incentive or moni toring.

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24 CHAPTER 3 A MODEL OF AGENCY CLIENT TRANSACTION AND HYPOTHESES This study present s a model of agency client transaction to investigate if two way symmetrical communication will lead to a mutually beneficial trade of concession s between agencies and clients. This study use s the term model to mean an abstract r epresentation of phenomena when particular variables are included or excluded (Kulhavy & Stock 19 89 ; Overstr eet, Nance, & Balci, 2002) The following is a graphic representation of a model o f agency client transaction in the baseline condition ( Figure 3 1 ), a model of agency client transaction with power relations ( Figure 3 2 ), and a model of agency client transaction with two way symmetrical communication ( Figure 3 3 ). In the proposed model of agency client transaction in the baseline condition the a gency and the client trade their resources (time, money, effort, knowledge, etc.) for the benefit s of the transaction which include both financial and non financial benefits. The amount of reso urces in transaction (A, C) and the rela tive value of the transaction (r) determines the benefit s from the transaction (Isaac & Mark, 1988) Specifically, the a benefits from the transaction and the (A + C) r A and (A + C) r C respectively It is assumed that ( 1) e ach party controls the amount of resource s in transaction based on th e benefit s from the transaction and ( 2) each party consider s the and respo nd s to them reciprocally, following Cason and Khan (1999) In the proposed model of agency client transaction with power relations, the agency client transaction is divided into transaction before a contract is signed (agency selection stage) and transact ion after a signed contract (agency service stage). Transaction before contract and transaction after contract are considered as a whole, so each party controls the amount of

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25 resource in each transaction within the amount of resource in total transaction ( A I + A II = A, C I + C II = C). Figure 3 1. A model of agency client transaction in the baseline condition It is based on the assumption that ( 1) viable firms adjust their budget considering transaction costs following Kleinand and Leffler ( 1981) and ( 2) transaction costs are generally included in the agency compensation following Naumann ( 1995). This study use s the term t ransaction cost to mean the amount of resource used to select an agency ( C I ) or to be selected as an agency ( A I ) ( McMullen, Bagby & Palich, 2008). It is assumed that the value of the transaction after contract ( r II ) is higher than the value of the transaction before contract ( r I ).

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26 Before contract, the client has bargaining power to control the amount of the in transa ction After contract, the agency has information power to internally adjust the amount of their resource in transaction Based on the preceding literature review, the following hypotheses are posed: H ypothesis 1 (a): power will lead clients to make a Hypothesis 1 (b): overspend to be selected. Hypothesis 2 : In the presence of power relations agenc service qua lity will be lower than the demanded service quality from clients. Hypothesis 3 (a): from the transaction in the presence of power relations will be less than in the absence of power relations. Hypothesis 3 (b): from the transaction in the presence of power relations will be less than in the absence of power relations. In the proposed model of agency client transaction with two way symmetrical communication, two way symmetrical communication leads to a mutually benefi cial trade of concessions between agency and client. It is based on the assumption that two way symmetrical communication can ( 1) reduce conflict based on misunderstanding by improving the level of accuracy, following Dozier and Ehling (1992), and ( 2) gene rate mutual understanding to develop mutually beneficial solutions, following J. Grunig and L. Grunig (1992). That is: Hypothesis 4: Two way symmetrical communication will lead agencies and clients to

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27 F igure 3 2. A model of agency client transaction with power relations Hypothesis 5 (a): Two way symmetrical communication will lead clients to make a mutually beneficial choice before contract, reducing Hypothesis 5 (b): Two way symmetrical communication will lead agencies to make a s Hypothesis 6 (a): from the transaction in the presence of two way symmetrical communication will be greater than in the absence of two way symmetrical communication. Hypothesis 6 (b): from the transaction in the presence of two way symmetrical communication will be greater than in the absence of two way symmetrical communication.

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28 Figure 3 3. A model o f agency client transaction with two way symmetrical communication

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29 CHAPTER 4 METHODOLOGY The h ypotheses were tes ted with a laboratory experiment consisting of three decision making games corresponding closely to the proposed model s ( Game I: A model of age ncy client transaction in the baseline condition ; Game II : A model of agency client transaction with power relations ; and Game II I: A model of agency client transaction with two way symmetrical communication) This study modified previous experiments in ec onomics, politics and psychology on resource allocation decision making ( Samuelson, Messick, Rutte, & Wilke, 1984; Isaac & Walker 1988; Cooper, DeJong, Forsythe, & Ross, 1989 ; Cooper, DeJong, Forsythe, & Ross, 1992; Hackett, Dudley, & Walker, 1994; Weiman n, 1994; Fisher, Isaac, & Schatzberg, 1995; Tosi, Katz, & Gomez Mejia, 1997; Cason & Khan, 1999; Croson, Fats, & Neugebauer, 2005; Bochet, Page, & Putterman, 2006; Croson, Fats, & Neugebauer, 2006; Croson, 2007; Choi, Laibson, & Madrian, 2010; Grosse, Pu tterman, & Rockenbach, 2010) by introducing conditions to simulate the proposed model Pret est s Two pre test s were conducted to check the appropriateness of the manipulations and the clarity of the instructions. Based on the results of the pretests, the in structions were revised to about the agency client transaction. Subjects A t otal of 83 subjects were recruited among students in the College of Journalism and Co mmunications at University of Florida. All subjects were at the junior (51.8%) senior (31.3%) or graduate (16.9%) level s Subjects were eligible for this study if they had work experience if they were member s of Public Relations Society of America ( PRSA ) or International Association

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30 of Business Communicators ( IABC ) or if th ey have taken more than one management course ( e.g., strategy, campaign, sales, etc.). Extra credit was given to the subjects if the instructor of the course from where the subjects w ere recruited decided to do so. Each subject was randomly assigned to the role of agency ( Agency Group ) or client ( Client Group ). To make decisions incentive compatible, each subject was told that he /she would receive a bonus based on his /her performance ( above average: 6 chocolates ; average: 3 chocolates ; below average: none) (Choi, Laibson, & Madrian, 2010). Subjects were told that their decision would not be revealed to anyone. This study used a mixed within (Game I Game II Game III) and between (Agency Client) subject design (Figure 4 1 ). Figure 4 1. Within and between subject design Procedures Subjects were seated at separate computer terminals and a ll instructions (reproduced in Appendix A) were given throu gh the computer screen to minimize experimenter subject interaction (Isaac & Walker, 1988; Hackett, Dudley, & Walker, 1994). To confirm that all subjects had understood their mission and the rules, the four step process of Croson et al. (2006) was adopted with modification First, general instructions were typed at a reading pace of approximately 2.5 words per second on the computer screen Second,

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31 specific instructions were typed at a reading pace of approximately 2.5 words per second on the computer scre en Then, subjects took a quiz about the salient instructions Thereafter, the correct answer s to the quiz were typed at a reading pace of approximately 2.5 words per second on the computer screen. All subjects participated in three decision making games. In each game subjects participated in the agency client transaction resource ( C = C I + C II = $10,000) w resource ( A = A I + A II = an unspecified amount of time). It was quality. The A gency Group subjects were told as follows: Clients hire a public relations agency to manage their public relations program. In this game, you will perform as a public relations agency. Your mission i s to The Client Group subjects were told as follows: Clients hire a public relations agency to manage their public relations program. In this game, you will perform as a client. Your mission is to ma service quality and to make your public relations program more successful. In Game I, subjects were asked to make a decision about resource in Transaction I ( A I ) and Transaction II ( A II ) when C I : C II = r I : r I I = 1: 9. The instructions are in the Appendix A. In Game II and Game III, the transaction was divided into t ransaction before contract (agency selection stage ) and transaction after contract (agency service stage ) The t ransaction before contract was des igned to simulate a dictator game as closely as possible (Forsythe, Horowitz, Savin, & Sefton, 1994). A dictator game is a take it game. One subject decides, and the other subject has to follow the decision. That is, t he Client Group subjects were told tha t the agency would certainly follow their decision. The t ransaction after contract was designed to simulate an ultimatum game as closely as possible (Forsythe, Horowitz, Savin, & Sefton, 1994).

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32 An ultimatum game is a take it or leave it game. One subject p roposes something, and the other subject can either accept or reject the proposal. That is, the Agency Group subjects were told that In Game II, subjects were asked to make a decision about the amount of the resource in transaction before contract ( A I ) and in transaction after contract ( A II ) when C I : C II = r I : r II = 1: 9. In Game III, the Agency Group subjects and the Client Group subjects exchanged messages about their game rules, find ings, suggestions and feedbacks. Then, subjects were asked to make a decision about the amount of the A I ) and in transaction after contract ( A II ), when C I : C II = r I : r II = 1: 9. The instructions are in the Appendix A. The Agency Group subjects were told that they would go into the red if A I + A II > 1, 000, and the quality, if A I < 100 or A II < 900. The first rule imposed a budget constraint, while the second rule imposed an obligation to protect a budget (Bochet, Page, & Putterman, 2006). It was assumed that the value of $1 00 of the client was equivalent to the value of 1 hour of the agency After making a decision, the Age ncy Group subjects were asked to estimate demand about the amount of their resource in transaction before contract ( A I ) and in transaction after contract ( A II ) and the Client Group subjects were asked to estimate the actual amount of the agenc A I ) and in transaction after contract ( A II ). After completing the experiment, subjects were debriefed. Experimental Conditions Bargaining Power bargaining power condition was manipulated by en dowing the client with the power to decide resource in transaction b efore contract In Game II

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33 and Game III, the Client Group subjects were told that the agency would certainly follow the decision before contract Meanwh ile, the Agency Group subjects were told that they Information Power information power condition was manipulated by endowing the agency with the power to decide the amount of their resource in transaction after contract knowledge (Hackett, Dudley, & Walker, 1994). In Game II and Game III, the Agency Group subjects were told that ision and their decision would not be disclosed to the client. Two Way Symmetrical Communication At the beginning of Game III, the Agency Group subjects and the Client Group subjects were asked to exchange messages about their game rules, findings, sugges tions and feedback The messages were developed to provide subjects with a chance to accurately understand the position and to find mutually beneficial solutions in a conflict situation The messages are in the Appendix B. First, the Agency Group subject s were asked to open their Message 1 envelope They were told that it was prepared by their public relations department. After reading the following message, they handed it to the assigned Client Group subject. After reading the message, the Client Group subjects open ed their Message 1 envelope. They were told that it was prepared by their public relations department. After reading the following message, they handed it to the paired Agency Group subject. After reading the message, the Agency Group subjects opened their Message 2 envelope. After reading the following message, they handed it to the paired Client Group subject.

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34 After reading the message, the Client Group subjects opened their Message 2 envelope. After reading the following messa ge, they handed it to the paired Agency Group subject. After reading the message, the Agency Group subjects opened their Message 3 envelope. After reading the following message, they handed it to the paired Client Group subject. After reading the message the Client Group subjects opened their Message 3 envelope. After reading the following message, they handed it to the paired Agency Group subject. And, they were asked to go back to their computer screen and press Enter to continue the experiment. After reading the message, the Agency Group subjects were asked to go back to their computer screen and press Enter to continue the experiment. The pairings of the subjects were randomly determined before the beginning of the experiment by the computer (Cooper DeJong, Forsythe, & Ross, 1989). It was controlled communication that each subject delivered particular messages. This allowed us to eliminate the possibility of subjects at tempt ing to change the setting of the game in order to generate better outcomes ( Cooper, DeJong, Forsythe, & Ross, 1989).

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35 CHAPTER 5 RESULTS This chapter presents the result s of the ex periment outlined in Chapter 4. The chapter begins by analyzing the resu lting data to test the hypothese s. It is followed by the evaluation of predictio ns in the model. Hypotheses Testing H ypothesis 1 (a) : It p redicted that before contract, would lead First, an analysis of variance (ANOVA) was conducted to assess if the C lient Group wanted the agency to spend more time on the public relations proposal when they had bargaining power than when they did not have bargaining power. T he Client Group wanted the agency to spend more time on the public relations proposal when they had bargaining power ( M = 418.38 SD = 217.97 ) than when they did not have bargaining power ( M = 187.10 SD = 229.93 ). The l east s ignificant d ifference (LSD) post hoc test showed that the difference was statistically significant ( mean difference = 231.29 p < .001). Next, one sample t test was conducted to test if the Client Group wanted the agency to spend more time on the public relations proposal than the value of compensation they provided (test value = 100). When the Client Group did not have bargaini ng power, no significant provided (mean difference = 87.10 NS: not significant ) When the Client Group had bargaining power, however, the Client Group want ed the age ncy to spend more time on the public relations proposal than the value of compensation they provided. The mean difference was statistically significant ( mean difference = 318.38 ; t = 9.47 df = 4 1 .00, p < .001). Therefore, Hypothesis 1 ( a ) was supported.

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36 Hypothesis 1 (b) : It agencies to overspend to be selected. First, an ANOVA was conducted to assess if the Agency Group was willing to spend more time on the public relations proposal when the client had bargaining power than when the client did not have bargaining power. T he Agency Group was willing to spend more time on the public relations proposal when the client had bargaining power ( M = 219.71 SD = 197.61 ) than when the client did no t have bargaining power ( M = 81.66 SD = 37.85 ). The LSD post hoc test showed that the difference was statistically significant ( mean difference = 138.05 p < .001). Next, one sample t test was conducted to test if the Agency Group was willing to spend mo re time on the public relations proposal than the value of compensation the client provided (test value = 100). The Agency Group was unwilling to spend more time than the value of compensation the client provided when the client did not have bargaining pow er (mean difference = 18.34; t = 3.103, df = 40.00, p < .005). When the client had bargaining power, however, the Agency Group was willing to spend more time than the value of compensation the client provided (mean difference = 119.71; t = 3.879, df = 40 .00, p < .001). Therefore, Hypothesis 1 ( b ) was supported. Hypothesis 2 : It predicted that in the presence of power relations, would be lower than the demanded service quality from clients An i ndependent samples t test was used to test this hypothesis. T he demanded service quality from the Client Group ( M = 1 185 .0 5 SD = 896.41 ) was higher than the Agency Group decision about service quality ( M = 746.29 SD = 194.74 ) The difference was statistically significant ( t = 3.10 df = 44.95 p < .00 5 ). T herefore, Hypothesis 2 was supported.

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37 Hypothesis 3 (a) : It predicted that from the transaction in the presence of power relations would be less than in the absence of power relations. An ANOVA was conducted to test t his hypothesis. The benefit s from the transaction was calculated as { (100 + A I ) + 9 ( 900 + 1000 A I ) } 0.5 1000, reflecting the assumptions in the proposed model The benefits from the transaction in the presence of power re lations ( M = 5926.48 SD = 871.87 ) was less than in the absence of power relations ( M = 6851.62 SD = 919.71 ) The LSD post hoc test showed that the difference was statistically significant ( mean difference = 925.14 p < .001). Therefore, Hypothesis 3 (a) was supported. Hypothesis 3 (b) : It of power relations would be less than in the absence of power relations. An ANOVA was conducted to test this hypothesis. The s benefit s from the transaction was calculated as {(100 + A I ) + 9 ( 900 + A I I )} 0.5 ( A I + A I I ) if A I + A I I 1000 and {(100 + A I ) + 9 (900 + 1000 A I )} 0.5 1000 if A I + A I I > 1000 reflecting the assumptions in the proposed model The s benefits from the transaction in the presence of power relations ( M = 6423.07 SD = 861.67 ) was less than in the absence of power relations ( M = 6511.48 SD = 695.69 ) However, the LSD post hoc test showed that the difference was not statistically significant ( mean difference = 88.40, NS: not significant). Therefore, Hypothesis 3 (b) was partially supported. H ypothesis 4 : It predicted that two way symmetrical communication would lead agencies Accuracy was measured by To determine if there was a difference between accuracy before two way symmetrical communication and accuracy after two way symmetrical communication, a multivariate analysis of variance (MANOVA) was

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38 conducted. The independent variables were the s decision, the s estimation, the s decision and the s estimation, and the dependent variables were A I and A II before two way symmetrical communication and A I and A II after two way symmetrical communication Table 5 1 shows the results of tests of between subjects effects. The results indicate a statistically significant difference among the independent variables in A I ( F = 10.18, p < .001) a nd A II ( F = 4.08, p < .01) before two way symmetrical communication and A I ( F = 4.53, p < .005) after two way symmetrical communication. Therefore, null hypothesis (H0 : the Agency was rejected except in A II ( F = 1.45, NS: not signifi cant) after two way symmetrical communication Table 5 1. Tests of between subjects effects Source Dependent Variable F Sig. Intercept A I before communication 361.38 0.000 A II before communication 454.59 0.000 A I after communication 116.17 0.00 0 A II after communication 142.40 0.000 Coorientation Variable A I before communication 10.18 0.000*** A II before communication m 4.08 0.008* A I after communication 4.53 0.004** A II after communication 1.45 0.230 p < .01 ** p < .005 *** p < .001 The results of the LSD Post Hoc Test are given in Table 5 2 As shown in Figure 5 1, the A I ( mean difference = 207.76, p < .001) b efore tw o way symmetrical communi cation. After two way symmetrical communication, the degree of accuracy was noticeably increased ( 153.72 ), and the gap not statistically significant ( mean difference = 153.72, NS: not significant) As shown in Figure 5 2, the Agency

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39 Group was accurately estimat ing A II No significant difference Table 5 2. The least significant differences (LSD) post hoc test Dependent Variable Independent Variable Mean Difference Sig.(a) A I before comm 9.08 0.838 198.67 0.000*** 112.84 0.011 9.08 0.838 207.7 6 0.000*** 121.92 0.006** 198.67 0.000*** 207.76 0.000*** 85.83 0.050 112.84 0.011 121.92 0.006** on 85.83 0.050 A II before comm 214.48 0.108 438.75 0.001** 329.56 0.013 214.48 0.108 224.27 0.091 115.08 0.385 438.75 0.001** 224.27 0.091 109.19 0.404 329.56 0.013 115.08 0.385 109.19 0.404 A I after comm stimation 1.63 0.978 155.35 0.010* 156.28 0.009* 1.63 0.978 153.72 0.011 154.65 0.010 155.35 0.010* mation 153.72 0.011 0.93 0.987 156.28 0.009* 154.65 0.010 0.93 0.987 A II after comm 101.17 0.680 338.65 0.163

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40 Table 5 2. Continued Independent Variable Mean Difference Sig.(a) 445.81 0.067 101.17 0.680 237.48 0.330 344.64 0.159 338.65 0.163 237.48 0.330 107.17 0.656 445.81 0.067 344.64 0.159 107.17 0.656 Based on estimated marginal means p < .01 ** p < .005 *** p < .001 a. Adjustme nt for multiple comparisons: Least Significant Difference (equivalent to no adjustments). Figure 5 1. Accuracy on A I

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41 Figure 5 2 Accuracy on A II As shown in Figure 5 1, the Client Group was accurately estimating about A I before two way symmetrical communication. No significant difference between the Client Agency ( mean difference = 112.84, NS: not significant) Interestingly, the degree of accuracy decreased after two way sym metrical communication The mean difference was statistically significant ( mean difference = 156.28, p < .01) This result will be further discussed in the next section. As shown in Figure 5 2, the Client Group was accurately estimat ing decision a bout A II H ypothesis 4 was partially supported. Hypothesis 5 (a) : It predicted that two way symmetrical communication would lead clients to make a m First, the results of ANOVA used to test Hypothesis 1 (a) were used to test this hypothesis. The Client

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42 Group wanted the agency to spend less time on the public relations proposal after tw o way symmetrical communication ( M = 303.60 SD = 365.65 ) than before two way symmetrical communication ( M = 418.38 SD = 217.97 ). However, t he LSD post hoc test showed that the difference was not statistically significant ( mean difference = 114.79 NS: n ot significant ). Next, one sample t test was conducted to test if the Client Group wanted the agency to spend relatively less time on the public relations proposal, regarding the value of compensation they provided (test value = 100). T he Client Group want ed the agency to spend relatively less time on the public relations proposal, regarding the value of compensation they provided after two way symmetrical communication ( mean difference = 203.60 ; t = 3.61 df = 41.00 p < .005 ) than before two way symmetri cal communication ( mean difference = 318.38 ; t = 9.47 df = 41.00 p < .001). H ypothesis 5 (a) was partially supported. Hypothesis 5 (b) : It predicted that two way symmetrical communication would lead agencies to make a mutually beneficial choice after con First, an ANOVA was conducted to test if the Agency Gro up was willing to spend more time on the public relations proposal after two way symmetrical c ommunication than before two way symmetrical communication The Agency Group was willing to spend more time on the public relations proposal after two way symmetrical communication ( M = 801.80 SD = 207.62 ) than before two way symmetrical communication ( M = 746.29 SD = 194.74 ) However, t he LSD post hoc test showed that the difference was not statistically significant ( mean difference = 55.51 NS: not significant ). Next, one sample t test was conducted to test if the Agency Group was willing to spend relatively more time on the public relations proposal, regarding the value of compensation the client provided (test value= 9 00). T he Agency Group was willing to spend relatively more time

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43 on the public relations proposal, regarding the value of compensation the client provided after two way symmetrical communication ( mean differ ence = 98.20 ; t = 3.03 df = 40.00 p < .00 5 ) than before two way symmetrical communication ( mean difference = 153.71 ; t = 5.05 df = 40.00 p < .001). H ypothesis 5 ( b ) was partially supported. Hypothesis 6 (a) : It the transaction in the presence of two way symmetrical communication would be greater than in the absence of two way symmetrical communication. The results of ANOVA used to test Hypothesis 3 (a) were used to test this hypothesis. ts from the transaction w ere calculated using the same equation as used to test Hypothesis 3 (a). in the presence of two way symmetrical communication ( M = 6385.62 SD = 1462.58 ) was greater than in the abse nce of two way symmetrical communication ( M = 5926.48 SD = 871.87 ). However, t he LSD post hoc test showed that the difference was not statistically significant ( mean difference = 459.14 NS: not significant ). Therefore, Hypothesis 6 (a) was partially supp orted. Hypothesis 6 (b) : It in the presence of two way symmetrical communication would be greater than in the absence of two way symmetrical communication. The results of ANOVA used to test Hypothesis 3 (b) were used to test this hypothesis. benefits from the transaction were calculated using the same equation as used to test Hypothesis 3 (b). transaction in the presence of two way symmetrical com munication ( M = 6708.59 SD = 731.68 ) was greater than in the absence of two way symmetrical communication ( M = 6423.07 SD = 861.67 ) However, t he LSD post hoc test showed that the difference was not statistically

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44 significant ( mean difference = 285.51 NS: not si gnificant ). Therefore, Hypothesis 6 (b) was partially supported. Model Evaluation A model of agency client transaction presented in Chapter 3 predicted that ( 1) power relations between agencies and clients would make it difficult for each party to make a mutually beneficial choice and ( 2) even in the presence of power relations, two way symmetrical communication would lead to a mutually beneficial trade of concessions between agencies and clients Figure s 5 3 5 4 5 5 and 5 6 summarize results by graphing the changes in decision about A I decision about A II A I + A II (the total amount of ansaction ), and b enefits (benefits from the transaction) as each group prog ressed from Game I to Game III, respectively. The results are summarized in Table 5 3 Figure 5 3. The changes in decision about A I

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45 Figure 5 4. The changes in decision about A II Figure 5 5. The changes in A I + A II

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46 Figure 5 6 The changes in benefits Table 5 3. Summary of results Agency Client Mean Std. Deviation Mean Std. Deviation Game I A I 81.66 37.85 187.10 229.93 A II 706.76 204.95 1010.79 594.43 A I + A II 788.41 219.59 1197.88 675.24 Benefits 6511.48 695.69 6851.62 919.71 Game II A I 219.71 197.61 418.38 217.97 A II 746.29 194.74 1185.05 896.41 A I + A II 966.00 257.50 1603.43 950.00 Benefits 6423.07 861.67 5926.48 871.87 Game III A I 148.24 144.66 303.60 365.65 A II 801.80 207.62 1140.45 1251.94 A I + A II 950.05 223.37 1444.05 1412.41 Benefits 6708.59 731.68 6385.62 1462.58 In Game I, corresponding to the proposed model of agency client transaction in t he baseline condition, both the Client Group and the Agency Group tended to make a decision mainly based on A I ( M = 187.10 SD = 229.93 ) to A II ( M = 1010.79 SD = 594.43 ) was close to the proportion of the value of Transaction I to the value of Transaction II ( 1.6 : 8.4 A I ( M = 81.66 SD = 37.85 ) to A II ( M = 706.76 SD = 204.95 ) exactly accord ed with the proportion of the value of Transaction I to the value of T ransaction II (1:9). The results are consistent with the

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47 assumption of the proposed model of agency client transaction in the baseline condition ( A I : A II = C I : C II = r I : r II ). In Game II, corresponding to the proposed model of agency client transaction wit h power relations, both the Client Group ( M = 187.10, SD = M = 418.38, SD = 217.97) and the Agency Group ( M = 81.66, SD = M = 219.71, SD = 197.61) increased A I The results are consistent with the first prediction of the proposed model of agency client transaction with power relations ( A I A I ). Even though both groups were informed explicitly that the value of transaction after contract was nine times higher than the value of transaction before contract, the Client Group chose to use their bargaining power in order to increase A I ( A I A I ) and t he A I A I ). In particular, the Client Group A I + A II increased by 3 4 % ( M = 1197.88, SD = M = 1603.43, SD = 950.00). As a result, both the Agency Group ( M = 6511.48 SD = 695.69 M = 6423.07 SD = 861.67 ) and the Client Group ( M = 6851.62 SD = 919.71 M = 5926.48 SD = 871.87 ) achieved less benefits from the transaction relative to their benefits from the transaction in the absence of power relations. Meanwhile the Agency Group chose to increa se A II ( M = 706.76, SD = M = 746.29, SD = 194.74) despite their information power, contrary to the second prediction of the proposed model of agency client transaction with power relations ( A II A II ). Although the difference was not statisticall y significant ( mean difference = 39.54 NS: not significant), it was surprising result. overwhelmed by the client's bargaining power. Another possibility is that the Agency Group subj ects view ed the use of information power as morally wrong (Samuelson, Messick, Rutte, & Wilke, 1984). A II ( M = 746.29, SD = 194.74) was significantly A II ( M = 1185.05, SD = 896.41) supporting H ypot hesis 2.

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48 In Game III, corresponding to the proposed model of agency client transaction with two way symmetrical communication, the Client Group reduce d both A I ( M = 418.38, SD = 217.97 M = 303.60 SD = 365.65 ) and A II ( M = 1185.05 SD = 896.41 M = 114 0.45 SD = 1251.94 ) while the Agency Group reduce d A I ( M = 219.71 SD = 197.61 M = 148.24 SD = 144.66 ) but increased A II ( M = 746.29 SD = 194.74 M = 801.80 SD = 207.62 ) The results are consistent with the predictions of the proposed model of agenc y client transaction with two way symmetrical communication ( A I A I A II A II Even though the Client Group still had their bargaining power, they chose to reduce A I ( A I A I A I + A II decreased by 10% ( M = 1603.43 SD = 950.00 M = 1444.05 SD = 1412.41 ). Meanwhile, the Agency Group chose to increase A II ( A II A II power. As a result, both the Agency Group ( M = 6423.07 SD = 861.67 M = 6708.59 SD = 731.68 ) and the Clien t Group ( M = 5926.48 SD = 871.87 M = 6385.62 SD = 1462.58 ) achieved greater benefits from the transaction relative to their benefits from the transaction in the absence of two way symmetrical communication. For further analysis, the changes in coorien tation states (agreement, congruency, and accuracy) regarding A I and A II as each group progressed from Game I to Game III were analyzed. The results are summarized in Table 5 4 Table 5 4 Summary of the changes in coorientation states Agency Client Mean Difference Sig.(a) Mean Difference Sig.(a) Game I A I Agreement 105.44 0.514 105.44 0.514 Congruency 9.17 0.955 214.90 0.181 Accuracy 96.27 0.553 320.34 0.048 A II Agreement 304.03 0.003** 304.03 0.003** Congruency 134.44 0.192 40.90 0.685 Accuracy 169.59 0.098 263.12 0.010 Game II A I Agreement 198.67 0.000*** 198.67 0.000***

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49 Table 5 4 Continued Agency Client Mean Difference Sig.(a) Mean Difference Sig.(a) Congruency 9.08 0.838 8 5.83 0.050 Accuracy 207.76 0.000*** 112.84 0.011 A II Agreement 438.75 0.001** 438.75 0.001** Congruency 214.48 0.108 109.19 0.404 Accuracy 224.27 0.091 329.56 0.013 Game III A I Agreement 155.35 0.010* 155.35 0.010* Congruency 1.63 0.978 0.93 0.987 Accuracy 153.72 0.011 156.28 0.009* A II Agreement 338.65 0.163 338.65 0.163 Congruency 101.17 0.680 107.17 0.656 Accuracy 237.48 0.330 445.81 0.067 Based on estimated marginal means p < .01 ** p < .005 *** p < .001 a. Adjustment for multiple comparisons: Least Significant Difference (equivalent to no adjustments). decision Figure s 5 7 and 5 8 present t A I and A II respectively. As shown in Figure 5 7, the degree of agreement regarding A I decreased in ), but increase Figure 5 8 shows the similar pattern. The degree of agreement regarding A II decreased in Game II but increased in Game III ( 438 The results imply the effectiveness of two way symmetrical communication in increasing the level of agreement.

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50 Figure 5 7 The ch anges in agreement (A I ) Figure 5 8. The changes in agreement (A II ) Figure s 5 9 and 5 10 A I and A II respectively As shown in Figure 5 9, t A I was congruent with their estimation in all games. The degree of congruency slightly decreased in opposite directio n ( decreased again in opposite 1.63) in Game III. It seemed that the Agency Group made a decision about A I

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51 made a decision ab out A I in Game I estimating that the agency would spend more time than their decision. The degree of congruency increased in opposite direction ( II, and increased again 0.93) in Game III. As shown i n Figure 5 10, the degree of congruency regarding A II decreased in Game II (Agency: 214.48, increased in Game III (Agency: 101.17, Client: 109.19 1 07.17) Taken as a whole, both the Agency Group and the Client Group seemed to ma k e a decision in Game III with confidence that the other party would make a similar decision as them. T he results imply the effectiveness of two way symmetrical communication in increasing the level of congruency. Figure 5 9. The changes in congruency (A I )

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52 Figure 5 10. The changes in congruency (A II ) decision Figure s 5 11 and 5 1 2 A I and A II respectively. Regarding A I (F igure 5 11 ) the 20 7.76), but decreased in Game III ( 153.72). The result is consistent with our prediction. However the gap between the estimation decreased in Game II increased in Game III (112 The result seem s to be inconsistent with the predictions in the proposed model prediction that two way symmetrical communication would improve the level of accuracy As shown in Figure 5 1 3 however, it w as not because the Client Group less accurately understood position but because the direction as their estimation In fact the Client Group accurately predicted that the agency would re duce A II after two way symmetrical communication. Especially, it seems that the Client Group became assured that the agency understood their value (A I < A II ) through two way symmetrical communication The results suggest that not only the Agency Group but also the Client Group

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53 was more accurately understanding the other party position after two way symmetrical communication. T his in depth analysis provides support for Hypothesis 4. Regarding A I I (F igure 5 1 2 ) the accuracy regarding A II decreased in Game II (Agency: 224.27, Client: 237.48, Client: 329.56 However, the mean differences were not statistically significant. In addition, as shown in Figure 5 14, it was no t because each group less accurately understood the other party position but because decision was actually changed in the same direction as their estimation In fact both the Agency Group and the Client Group were accurately predicting after two way symmetrical communication The Agency Group accurately predicted that the client would reduce A II and t he Client Group accurately predicted that the agency would increase A II Especially, it seems that t he Agency G roup became assured that the client understood their budget constraint through two way symmetrical communication while the Client Group became assured that the agency understood their value (A I < A II ) through two way symmetrical communication This in dep th analysis also provides support for Hypothesis 4. Taken as a whole, t he results imply the effectiveness of two way symmetrical communication in increasing the level of accurate understanding. Despite some conflicting results, the coorientation states (agreement, congruency, and accuracy) improved as a whole after two way symmetrical communication. The results of tests of between subjects effects ( Table 5 1 ) indicates that there are no significant difference among A II after two way symmetrical communication. That is, the Agency Group and the Client Group was in the state of consensus. The coorientation states regarding A II significantly improved af ter two way symmetrical communication ( F =4.08, p <.01

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54 F =1.45, NS: not significant). The coorientation states regarding A I also improved after two way symmetrical communication ( F =10.18, p F =4.53, p <.005). Figure 5 11. The changes in accuracy (A I ) Figure 5 1 2 The changes in accuracy (A II )

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55 Figure 5 13 In depth analysis of the changes in accuracy (A I ) Figure 5 14. In depth analysis of the changes in accuracy (A II )

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56 CHAPTER 6 DISCUSSION This chapter discusses the results of the experiment presented in C hapter 5. The chapter begins with a summary of findings, followed by a discussion of theoretical and practical i as well as recommendations for future research Summary of Findings Decision Ma king in the Baseline Condition The results of hypothesis testing are summarized in Table 6 1. In the baseline condition, both the Client Group and the Agency Group tended to allocate the resource based on the value of the transaction. The Client Group want ed the agency to spend approximately 10 % of its time ( 16 %) in the public relations proposal and approximately 90 % of its time ( 84 %) in the public relations service and the Agency Group was willing to spend exactly 10 % of their time in the public relations proposal and exactly 90 % of their time in the public relations service. Despite some degree of disagreement, they accurately understood Table 6 1. Summary of hypothesis testing results Hypothesis Statistical Test Result 1 (a) Be ANOVA / One sample t test Supported 1 (b) agencies to overspend to be selected. ANOVA / One sample t test Supported 2 quality will be lower than the demanded service quality from clients. Independent samples t test Supported 3 (a) of p ower relations will be less than in the absence of power relations. ANOVA Supported 3 (b) of power relations will be less than in the absence of power relations. ANOVA Partially supported 4 Two wa y symmetrical communication will lead agencies and clients to more accurately understand MANOVA Partially supported

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57 Table 6 1. C ontinued Hypothesis Statistical Test Result 5 (a) Two way symmetrical communication will lead clients to make a mutually beneficial choice before contract, red ANOVA / One sample t test Partially supported 5 (b) Two way symmetrical communication will lead agencies to make a mutually beneficial choice after ANOVA / One sample t test Partially support ed 6 (a) of two way symmetrical communication will be greater than in the absence of two way symmetrical communication. ANOVA Partially supported 6 (b) presence of two way symmetrical communication will be greater than in the absence of two way symmetrical communication. ANOVA Partially supported The Effect of Power Relations making pattern took on an entirely different aspe ct in the presence of power relations. the Client Group chose to [ Hypothesis 1 (a) ] and the Agency Group decided to follow the decision to win in t he agency selection process [ Hypothesis 1 (b) ] the Agency Group chose to internally adjust their time in the public relations service (Hypothesis 2). The results a re consistent with the finding of Tosi et al. that agencies tend to have their net income in mind when they allocate resources. As a result, the Client G slightly increased 648 2.93). In total total benefits from the transaction decreased relative to their benefits in the absence of power relations [ Hypothesis 3 (a), 3 (b) ]

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58 T he analysis of coorientation states however, suggested that their decisions were not a st Interestingly, the t seemed tha t the Agency Group was inaccurately assuming that the client would be aware of their budget constraint. The Effect of Two Way Symmetrical Communication The results from Game III, corresponding to the proposed model of agency client transaction with two wa y symmetrical communication, demonstrated the strength of two way symmetrical communication in the complex situation where common and conflicting interests between agencies and clients differing values of each transaction, power asymmetry and information asymmetry were inextricably interwoven finding that the efficiency of communication decreased as the condition became more complex, the results are particularly noteworthy. Both group made a mutually beneficial choic e after two way symmetrical communication. The their bargaining power [ Hypothesis 5 (a) ] and the Agency Group decided to increase their time in the public relations service despite their information power [ Hypothesis 5 (b) ] from the transaction increased from their benefits in the absence of two way symmetrical communication [ H ypothesis 6 (a), 6 (b) ] In particular, both the Agency Group and the Client Group was accurately estimating value (Hypothesis 4) That is, their decision appears to be a strategic choi ce based on the accurate understanding of each position

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59 Implication The transaction between agencies and clients includes both common and conflicting com their net income. This study developed a model of agency client transaction to investigate if two way symmetrical communication would lead to a mutually beneficial tr ade of concessions between clients, who have bargaining power before contract, and agencies, who have information power after contract. In particular, the model integrated agency selection stage (transaction before contract) and agency service stage (trans action after contract) to examine how the decision making in one stage and the decision making in another stage are interrelated. Integrating these two stages in one model combines approaches of previous studies that have either only looked at the issues d erived from the bargaining power or only looked at the issues derived from information power. T he proposed model with power relations predicted that in the presence of power relations, (1) clients would use their bargaining power to increase the s in the agency selection process but expect the same level of service quality after a signed service contract (2) agencies would power by overspending in the agency selection process, but u se their information power to internally adjust th e level of service quality after a signed service contract and (3) as a result, relations. Meanwhile, the propos ed model with two way symmetrical communication predicted that after two way symmetrical communication, (1) clients would make a concession in the agency selection stage despite their bargaining power, (2) agencies would make a concession in the service st from the transaction would be greater than before two way symmetrical communication. The

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60 results suggest that two way symmetrical communication can be an effective way t o balance the after contract and thereby bring about a mutually beneficial trade of concessions between agencies and clients In the experiment, for example, the Agency Group e ffort to communicate and game rules concession in the agency selection stage, the s concession in the agency selection stage concession in the agency servic e stage, and as a result both the Client Group and the Agency Group succeeded in increasing their benefits To select a right agency is an important task. However, extensive proposal work and frequent bidding does not guarantee the best agency. The basic c oncept of the model of agency client transaction is that to design a more effective but less time consuming and labor intensive agency selection process can be an initiative of mutually beneficial trade of concessions. The insight can be utilized by both a gencies and clients to fine tune their client relations strategy or agency relations strategy to achieve what they really want from the transaction. For example, clients may want to design a more time efficient agency selection process through two way symm etrical communication with agencies in order to Unlike incentive or monitoring, it is two way symmetrical approach in that ( 1) both parties are involved in the process ( 2) both parties are willing to concede and ( 3 ) the goal is to find mutually beneficial solution s It would be worthwhile if future study compare the effect of two way symmetrical communicatio resource allocation decision making with incentive or monitoring to examine in which case age This study integrated the coorientational model to examine the effect of two way decision

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61 making Based on the suggestion from Dozier and Ehling (1992) that increases in accuracy may not result in agreement, but will reduce conflict based on misunderstanding the primary concern of the coorientational approach was the changes in the d egree of accuracy after two way symmetrical communication. The results provide support for the hypothesis that two way symmetrical communication will lead agencies and clients to more accurately understand each Considering that the Client Group tended to overlook constraint and the Agency Group tended to inaccurately assume that the client would be aware of their budget constraint expectations, s et al. (2006) suggested, it is possible for either agencies or clients to develop internal and external strategies to resolve conflicts based on misunderstanding by improving the ac curacy of both parties. When the Client Group gained bargaining power for example, they wanted the agency to provide much more time (1 603 hours) than the value of compensation they provided (1 00 0 hours), allocating more resources to less value adding pr ocess (A I : 187 hours II : 185 hours). When the Client Group s budget constraint through two way symmetri cal communication, however, they reduced their demand (1,603 hours to more value adding process (A I : 418 II : 1 140 hours). Not only the Client Group who were but also the Agency Group, who informed the clie nt of their budget constraint, benefited from the change. Therefore, a pre proposal meeting should be strategically utilized as an opportunity to improve the accuracy of both parties by openly discussing what they have what they seek, what they are willin g to concede, and the relative importance of each conces sion (Ross & Stillinger, 1991).

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62 excellent client relations, few studies have approached the agency client rela tionship from the two way symmetrical perspective. Based on the suggestion from Dozier et al. (1995) that communication excellence is universal, this study attempted to test the applicability of excellence theory to the particular publics agencies or clien ts in the particular context transaction. To a chieve the purpose, this study followed previous experiments on resource allocation decision making in various fields E xisting studies (i.e., Isaac & Walker, 1988; Cooper, DeJong, Forsythe, & Ross, 1989; Coope r, DeJong, Forsythe, & Ross, 1992; Sally, 1995; Bochet, Page, & Putterman, 2006) have proved that communication led to the play of the Pareto dominant Nash equilibrium in the resource allocation decision making game. In particular, Sally (1995) found that communication had a stronger effect on cooperation than any other experimental conditions. However, the role of communication was limited to the announcement optimal strategy and to t he strategy. This study is interesting from the public relations perspective in that it applied the concept of two way symmetrical communication to the resource allocation decision making game by providing subjects a forum for dialogue, which people with d ifferent values discuss their values, improve mutual understanding, and find mutually beneficial solutions ( Grunig, 1997; Zoller, 200 4). Particularly, this study was able to quantitatively measure and present the effect of two way symmetrical communication with this approach. Considering the agency client transaction is a highly budget and time sensitive situation, the results will provide both agencies and clients with more visible effects of two way symmetrical communication. In the experiment, for exampl e, both the Agency Group ( M = 6423.07 SD = 861.67 M = 6708.59 SD = 731.68 ) and the Client Group ( M =5926.48, SD =871.87 M =6385.62, SD =1462.58 ) achieved greater

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63 benefits as a result of mutually beneficial trade of concessions through two way symmetrical communication. The more interesting result is that the The results suggest that it would be not only the profitability. Most previous studies on t he agency client relationship have not approached the issue from the two way symmetrical perspective. The results of this study suggest that 1) the agency client transaction is not a zero sum game but a positive sum game, 2) not only agencies but also clie nts have to be willing to change their own behavior to increase the size of pie, and 3) both agencies and clients can have bigger pie through mutually beneficial trade of concessions. Limitation and Recommendations for Future Research The most important l imitation is the use of students as subjects. M ost of them had only a limited knowledge or experience of the age ncy client transaction so had to imagine the situation to make a decision In order to improve external validity, f uture research should test t he hypotheses and evaluate the predictions in the proposed model using a field study method with real agencies and clients as subjects. As Glac (2009) pointed out, however low experimental validity is a mostly unavoidable dr awback in experimental studies. Despite the drawback, laboratory experiment allows a controlled examination of decision making pattern by creating conditions corresponding to the specific model manipulating them and isolating other factors affecting the decision making (T osi, Katz, & Gomez Mejia, 1997). In the experiment, subjects actually changed their decision as they progressed from Game I to Game III. Also, their coorientation states actually improved as a result of two way symmetrical communication. Another important point is that the subjects are future professionals. All subjects were undergraduate students at the junior or senior level (83.1%) and graduate students (16.9%) in the College of Journalism and Communications at University of Florida In addition, this st udy

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64 only recruited students who ha d work experience, students who were a member of professional n etwork or students who had some course knowledge of management Another important limitation is the lack of sufficient incentives for the subjects. The subjec ts were told that they would receive a bonus based on his performance (above average: six chocolates, average: three chocolates, below average: none) Considering the competitive nature of the agency client transaction, however the incentives were too wea k to motivate them to perform as they would do in the real world. To deal with this issue, previous studies on resource allocation decision making provided subjects monetary incentives based on their performance (i.e., Cooper, DeJong, Forsythe, & Ross, 199 2; Forsythe, Horowitz, Savin, & Sefton, 1994; Fisher, Isaac, Schatzberg, 1995; Bochet, Page, & Putterman, 2006; Choi, Laibson, & Madrian, 2010). Future research may replicate this study by adding high incentives and direct competition to manipulate the com petitive nature of the agency client transaction. To simplify the experimental condition, service. Future research may consider including compe tence. For example, subjects may be asked how they would like to assign several staff, each representing different level of experience and competence, to the proposal team before a service contract is signed and to the ac count team after a signed service c ontract. Also, this study should be replicated by varying the number of agencies and clients as well information power First, i f the Client Group had to pay proposal fee to multiple agencies competing for the contract or if the

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65 Agency Group had to allocate their resource s to several clients, each representing different level of profitability, they might make a different decision. Next decision might be influenced by their relat iv e power in the relationship For example, future study may integrate contingency theory to examine if small sized agencies are more likely to be accommodative than large global agencies. Most importantly it will better represent the real agency client t ransaction. T his study only included two way symmetrical communication condition to test the applicability of excellence theory. To further expand the study of the effect of two way symmetrical communication on the agency client relationship, f uture resea rch should compare the effect of two way symmetrical communication with two way asymmetrical communication as well as one wa y commu nication. should be considered. In particular, T se et al. (1988) emphasized the importance of the effect of cultural norms on business decision making: Some cultures emphasize the processes of decision making (e.g., obtaining a consensus ) more than the quality of the decision reached. A culture may affect business decisions by generally influencing risk taking patterns (e.g., promoting caution and discouraging gambling or prescribing a pattern of tradeoffs between risk and return.) (Tse et al. 1988, p. 84 ) Therefore, future study shoul d consider a cross cultural study to examine to what extent the This study suggested that mutually beneficial trade of concessions through two way symmetrical communication can be an eff ective way to increase without increasing the agency compensation Unlike incentive or monitoring, two way symmetrical communication does not require additional monetary expenses. However, it requires to make an effort to find win win solutions. One of the most important

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66 remaining tasks is to examine if agencies and clients are willing to make the effort. In particular, f uture study should conduct a field study to question the assumption in the proposed model that clients are quality conscious and to examine to what extent clients are willing to make an effort

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67 APPENDIX A INSTRUCTIONS Instructions for Agency Group General Information This is an experiment to s tudy how individuals make decisions in certain contexts. Course of Action The experiment consists of three decision making games: GAME I, GAME II, and GAME III. In each game, you will read specific instructions, take a quiz, make a decision, and estimat e the Your Role Clients hire a public relations agency to manage their public relations program. In this game, you will perform as a public relations agency You will keep your role during the entire experiment. Your decisions wi ll not be revealed to anyone. Your Mission a bonus based on your performance (above average: 6 chocolates, average: 3 chocolates, below average: none). N ow we will begin the experiment. Good luck! GAME I You have 10 minutes to complete this game. Public Relations Service I The client will pay $10,000 for your public relations service I, and you will spend A I hours on the service I. As you spend less t ime, your net income will be increased. As you spend more time, your service quality will be increased, and consequently, the client will be more satisfied. If you spend more than 100 hours, you will go into the red. That is, you will not be able to pay your staff. Public Relations Service II

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68 The client will pay $90,000 for your public relations service II, and you will spend A II hours on the service II. As you spend less time, your net income will be increased. As you spend more time, your service q uality will be increased, and consequently, the client will be more satisfied. If you spend more than 900 hours, you will go into the red. That is, you will not be able to pay your staff. Public Relations Service I < Public Relations Service II The cl ient will pay $10,000 for your public relations service I and $90,000 for your public relations service II, because (s)he values the service II nine times higher than the service I. Accordingly, the client will be more satisfied when you spend more time on the service II. Please turn Answer Sheet 1 over. Quiz: Please select the correct answer on Answer Sheet 1. 1. You will go into the red, if you spend more than ( ) hours on your public relations service I. (a) 100 (b) 1,000 2. You will go into the red, if you spend more than ( ) hours on your public relations service II. (a) 900 (b) 9,000 3. The client will be more satisfied when you spend more time on ( ). (a) your public relations service I (b) your public relations service II Your Decision: Please write down your decision on Answer Sheet 1. You will spend ( A I = ) hours on your public relations service I. You will spend ( A II = ) hours on your public relations service II. stimation on Answer Sheet 1. The client will want you to spend ( A I = ) hours on your public relations service I. The client will want you to spend ( A II = ) hours on your public relations service II.

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69 Please turn Answer Sheet 1 face d own. You are not allowed to go back to Answer Sheet 1. GAME I I You have 15 minutes to complete this game. Public Relations Proposal Now, you want to be hired The client will pay $10,000 for your public relations proposal for his (her) agency selectio n process, and you will spend A I hours on the proposal. As you spend more time, your proposal quality will be increased, and consequently, your chance to win in the agency selection process will be increased. As you spend less time, your net loss (incom e) will be reduced (increased). If you spend more than 100 hours, you will go into the red. That is, you will not be able to pay your staff. If you win in the agency selection process, however, the client will pay $90,000 for your public relations service So you must win in the agency selection process to succeed in this consequently, you will fail in this game. Remember, the competition is very tough. You have to compete with other agencies to win in the agency selection process. Even if you spend 300 hours, you will lose if the other agency spends more than 300 hours. Public Relations Service Now, you are hired If you win in the agency selection process the client will pay $90,000 for your public relations service. Then you will spend A II hours on the service. As you spend less time, your net loss (income) will be reduced (increased). As you spend more time, your service quality will be increased, and consequently, the client will be more satisfied. The client wants you to spend more than 900 hours on your public relations service, but it is up to you to decide the amount of A II The exact amount of A II will not be disclosed to the client. You will spend A I hours on your public relations proposal, and A II hours on your public relations service. If the sum of A I and A II exceeds 1,000 hours, you will go into the red. That is, you will not be able to pay your staff. Public Relations Proposal < Public Relations Service The client will pay $10,000 for your public relations proposal for his(her) agency selection process and $90,000 for your public relations service, because (s)he values the service nine times

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70 higher than the proposal. Accordingly, the c lient will be more satisfied when you spend more time on the service. Please turn Answer Sheet 2 over. Quiz: Please select the correct answer on Answer Sheet 2. 1. If you spend 300 hours on your public relations proposal and the other agency spends 40 0 hours on his (her) public relations proposal, (a) you will win in the agency selection process. (b) the other agency will win in the agency selection process. 2. You will go into the red, if the sum of A I and A II exceeds ( ) hours. (a) 100 (b) 900 (c) 1,000 3 The client will be more satisfied when you spend more time on ( ). (a) your public relations proposal (b) your public relations service Your Decision: Please write down your decision on Answer Sheet 2. You will spend ( A I = ) hours on your public relations proposal. You will spend ( A II = ) hours on your public relations service. The client will want you to spend ( A I = ) hours on your public relations proposal. The client will want you to spend ( A II = ) hours on your public relations service. Please turn Answer Sheet 2 face down. You are not allowed to go back to Answer Sheet 2. GAME I II You have 20 minutes to complete this game Communication Session with the Client 1. Open your Message 1 envelope, which is prepared by your public relations department. After reading your message, hand it to your partner client (assigned in your Message 1). 2. You will receive a message from your partner client 3. After reading the message, open your Message 2 envelope, which is prepared by your public relations department. After reading your message, hand it to your partner client.

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71 4. You will receive a message from your partner client. 5. After readi ng the message, open your Message 3 envelope, which is prepared by your public relations department. After reading your message, hand it to your partner client. 6. You will receive a message from your partner client. 7. After reading the message, go back to yo ur computer screen and press Enter to continue. Public Relations Proposal Now, you want to be hired The client will pay $10,000 for your public relations proposal for his (her) agency selection process, and you will spend A I hours on the proposal. As you spend more time, your proposal quality will be increased, and consequently, your chance to win in the agency selection process will be increased. As you spend less time, your net loss (income) will be reduced (increased). If you spend more than 100 hours, you will go into the red. That is, you will not be able to pay your staff. If you win in the agency selection process, however, the client will pay $90,000 for your public relations service. So you must win in the agency selection process to succee d in this consequently, you will fail in this game. Remember, the competition is very tough. You have to compete with other agencies to win in the agency se lection process. Even if you spend 300 hours, you will lose if the other agency spends more than 300 hours. Public Relations Service Now, you are hired If you win in the agency selection process, the client will pay $90,000 for your public relations ser vice. Then, you will spend A II hours on the service. As you spend less time, your net loss (income) will be reduced (increased). As you spend more time, your service quality will be increased, and consequently, the client will be more satisfied. The cl ient wants you to spend more than 900 hours for your public relations service, but it is up to you to decide the amount of A II The exact amount of A II will not be disclosed to the client. You will spend A I hours on your public relations proposal, and A I I hours on your public relations service. If the sum of A I and A II exceeds 1,000 hours, you will go into the red. That is, you will not be able to pay your staff. Public Relations Proposal < Public Relations Service The client will pay $10,000 for your public relations proposal for his(her) agency selection process and $90,000 for your public relations service, because (s)he values the service nine times

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72 higher than the proposal. Accordingly, the client will be more satisfied when you spend more time on the service. Please turn Answer Sheet 3 over. Quiz: Please select the correct answer on Answer Sheet 3. 1. The client will be more satisfied when you spend more time on ( ). (a) your public relations proposal (b) your public relations service 2. I n the communication session, the client suggested that (s)he was willing to help you spend less time on ( ). (a) your public relations proposal (b) your public relations service 3. In the communication session, the client suggested that (s)he was willi ng to help you spend less time on your public relations proposal, (a) if you are willing to spend less time on your public relations service. (b) if you are willing to spend more time on your public relations service. 4. You will go into the red, if the sum of A I and A II exceeds ( ) hours. (a) 100 (b) 900 (c) 1,000 Your Decision: Please write down your decision on Answer Sheet 3. You will spend ( A I = ) hours on your public relations proposal. You will spend ( A II = ) hours on your public rela tions service. The client will want you to spend ( A I = ) hours on your public relations proposal. The client will want you to spend ( A II = ) hours on your public relations service. Please turn Answer Sheet 3 face down. You are not allowed to go back to Answer Sheet 3. Please turn Answer Sheet 4 over. Demographic Questionnaire Please select the items that describe you best or fill in the blank on Answe r Sheet 4.

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73 Gender Male ( ) Female ( ) Age ( ) Major Advertising ( ) Journalism ( ) Public Relations ( ) Telecommunication ( ) Grade year Junior ( ) Senior ( ) Graduate ( ) Ethnicity White Non Hispanic ( ) Hispanic American ( ) African American ( ) Native American ( ) Asian/Pacific Islander ( ) Others (Please specify) ( ) The experimental session is over. Please raise your hand to turn in Answer Sheets. We wish you success! Instru ctions for Client Group General Information This is an experiment to study how individuals make decisions in certain contexts. Course of Action The experiment consists of three decision making games: GAME I, GAME II, and GAME III. In each game, you wi ll read specific instructions, take a quiz, and make a decision. Your Role Clients hire a public relations agency to manage their public relations program. In this game, you will perform as a client You will keep your role during the entire experiment. Your decisions will not be revealed to anyone. Your Mission program more successful. You will receive a bonus based on your performance (above average: 6 ch ocolates, average: 3 chocolates, below average: none). Now we will begin the experiment. Good luck!

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74 GAME I You have 10 minutes to complete this game. Public Relations Service I ant the agency to spend A I hours on the service I. As the agency spends less time, the service quality will be decreased, and consequently, your public relations program will be less successful. As the agency spends more time, the service quality will be increased, and consequently, your public relations program will be more successful. If the agency spends less time than 100 hours, you will get less than you paid for. That is, you Public Relations Se rvice II spend A II hours on the service II. As the agency spends less time, the service quality will be decreased, and consequently, your public relations prog ram will be less successful. As the agency spends more time, the service quality will be increased, and consequently, your public relations program will be more successful. If the agency spends less time than 900 hours, you will get less than you paid for That is, you Public Relations Service I < Public Relations Service II public relations service II, becaus e you value the service II nine times higher than the service I. Your public relations program will be more successful when the agency spends more time on the service II. Please turn Answer Sheet 1 over. Quiz: Please select the correct answer on Answer Sheet 1. ( ) hours on his (her) public relations service I. (a) 100 (b) 1,000

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75 s than ( ) hours on his (her) public relations service II. (a) 900 (b) 9,000 3. Your public relations program will be more successful when the agency spends more time on ( ). (a) his (her) public relations service I (b) his (her) public relations serv ice II Your Decision: Please write down your decision on Answer Sheet 1. You want the agency to spend ( A I = ) hours on his (her) public relations service I. You want the agency to spend ( A II = ) hours on his (her) public relations s ervice II. Please write down your estimation on Answer Sheet 1. The agency is likely to spend ( A I = ) hours on his (her) public relations service I. The agency is likely to spend ( A II = ) hours on his (her) public relations service II. Please turn Answer Sheet 1 face down. You are not allowed to go back to Answer Sheet 2. GAME I I You have 15 minutes to complete this game. Public Relations Proposal Now, the agency wants to be hired spend A I hours on the proposal. As the agency spends less time, the proposal quality will be decreased, and consequently, the agen cy will be less likely to provide high quality public relations service. As the agency spends more time, the proposal quality will be increased, and consequently, the agency will be more likely to provide high quality public relations service. You have t o hire the best agency to make your public relations program more successful. So you will hold a pre proposal meeting and announce your decision about A I Three agencies will attend the meeting, and they will certainly follow your decision about A I becaus e they want to

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76 be hired. There is no limit to A I If you decide A I = 300, the agencies will spend more than 300 hours on the proposal. If you decide A I = 500, the agencies will spend more than 500 hours on the proposal. If the agency spends less time than 100 hours, you will get less than you paid for. That is, you will fail to choose the best agency. Public Relations Service Now, the agency is hired A II hou rs on the service. As the agency spends less time, the service quality will be decreased, and consequently, your public relations program will be less successful. As the agency spends more time, the service quality will be increased, and consequently, yo ur public relations program will be more successful. There is no limit to A II If the agency spends less than 900 hours, you will get less than you paid for. That is, you will fail Public Relations Proposal < P ublic Relations Service public relations service, because you value the service nine times higher than the proposal. Your public relations program will be more su ccessful when the agency spends more time on the service. Please turn Answer Sheet 2 over. Quiz: Please select the correct answer on Answer Sheet 2. 1. Your chance to make your public relations program more successful will be increased when the agency spends ( ) hours on his (her) public relations proposal. (a) 300 (b) 400 ( ) hours on his (her) public relations service. (a) 900 (b) 9,000 3. Your public r elations program will be more successful when the agency spends more time on ( ).

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77 (a) his (her) public relations service I (b) his (her) public relations service II Your Decision: Please write down your decision on Answer Sheet 2. You want the agency to spend ( A I = ) hours on his (her) public relations proposal. You want the agency to spend ( A II = ) hours on his (her) public relations service. The agenc y is likely to spend ( A I = ) hours on his (her) public relations proposal. The agency is likely to spend ( A II = ) hours on his (her) public relations service. Please turn Answer Sheet 2 face down. You are not allowed to go back to An swer Sheet 2. GAME III You have 25 minutes to complete this game. Communication Session with the Agency 1. You will receive a message from your partner agency. 2. After reading the message, open your Message 1 envelope, which is prepared by your public rela tions department. After reading your message, hand it to your partner agency. 3. You will receive a message from your partner agency. 4. After reading the message, open your Message 2 envelope, which is prepared by your public relations department. After readi ng your message, hand it to your partner agency. 5. You will receive a message from your partner agency. 6. After reading the message, open your Message 3 envelope, which is prepared by your public relations department. After reading your message, hand it to y our partner agency. 7. Then, go back to your computer screen and press Enter to continue. Public Relations Proposal Now, the agency wants to be hired spend A I ho urs on the proposal. As the agency spends less time, the proposal quality will be decreased, and consequently, the agency will be less likely to provide high quality public relations service. As the agency spends more time, the proposal quality will be in creased, and consequently, the agency will be more likely to provide high quality public relations service.

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78 You have to hire the best agency to make your public relations program more successful. So you will hold a pre proposal meeting and announce your decision about A I Three agencies will attend the meeting, and they will certainly follow your decision about A I because they want to be hired. There is no limit to A I If you decide A I = 300, the agencies will spend more than 300 hours on the proposal. If you decide A I = 500, the agencies will spend more than 500 hours on the proposal. If the agency spends less time than 100 hours, you will get less than you paid for. That is, you will fail to choose the best agency. Public Relations Service Now, the ag ency is hired A II hours on the service. As the agency spends less time, the service quality will be decreased, and consequently, your public relations pro gram will be less successful. As the agency spends more time, the service quality will be increased, and consequently, your public relations program will be more successful. There is no limit to A II If the agency spends less than 900 hours, you will ge t less than you paid for. That is, you will fail Public Relations Proposal < Public Relations Service public relations service, because you value the service nine times higher than the proposal. Your public relations program will be more successful when the agency spends more time on the service. Please turn Answer Sheet 3 over. Quiz: Please select the correct answer o n Answer Sheet 3. 1. In the communication session, the agency suggested that (s)he would go into the red, if the sum of A I and A II exceeded ( ) hours. (a) 100 (b) 900 (c) 1,000 2. In the communication session, the agency suggested that s(he) would not spen d more than ( ) hours in total, even if you wanted to.

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79 (a) 100 (b) 900 (c) 1,000 3. Your public relations program will be more successful when the agency spends more time on ( ). (a) his (her) public relations proposal (b) his (her) public relations servi ce Your Decision: Please write down your decision on Answer Sheet 3. You want the agency to spend ( A I = ) hours on his (her) public relations proposal. You want the agency to spend ( A II = ) hours on his (her) public relations servic e. The agency is likely to spend ( A I = ) hours on his (her) public relations proposal. The agency is likely to spend ( A II = ) hours on his (her) public rel ations service. Please turn Answer Sheet 3 face down. You are not allowed to go back to Answer Sheet 3. Please turn Answer Sheet 4 over. Demographic Questionnaire Please select the items that describe you best or fill in the blank on Answer Sheet 4. Gender Male ( ) Female ( ) Age ( ) Major Advertising ( ) Journalism ( ) Public Relations ( ) Telecommunication ( ) Grade year Junior ( ) Senior ( ) Graduate ( ) Ethnicity White Non Hispanic ( ) Hispani c American ( ) African American ( ) Native American ( )

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80 Asian/Pacific Islander ( ) Others (Please specify) ( ) The experimental session is over. Please raise your hand to turn in Answer Sheets. We wish you success!

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81 APPENDIX B COMMUNICATION MESSAGES Hi, I am performing as a public relations agency in this game. I am sending this message, ission and game rules? I hope we can help each other. Our mission is to maximize our net income and your satisfaction. We will succeed, if we spend less time on our public relations proposal and more time for our public relations service. How about yours? Hi, I am performing as a client in this game. Thank you for the message. I also hope we can help each other. Our mission is to max imize your service quality and to make our public relations program more successful. We will succeed, if you spend more time on both your public relations proposal and your public relations service. However, we value your public relations service nine tim es higher than your public relations proposal. Here are my finding and suggestion. It seems that we will both succeed, if you spend more time on your public relations service. Can you spend more time on your public relations service? The Agency Group I am willing to spend more time on my public relations service. However, it is hard to spend more time on my public relations service, because I have to spend more time on my public relations proposal. I will fail this game if I lose in the a gency selection process or if the sum of A I and A II exceeds 1,000 hours.

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82 I do not understand why you cannot spend more than 1,000 hours. In my game, there is no limit to either A I or A II Can you please explain why? The A In my game, I will go into the red if I spend more than 1,000 hours in total. That is, I will not be able to pay my staff. Thank you for letting me know. That is very helpful information. If that is the case, I do not want you to overspend on your public relations proposal. Here is my suggestion. I am willing to design more time efficient agency selection process, if you are willing to spend more time on your public relations service. It looks like a win win solution. What do you think of my suggestion? Would you like to cooperate?

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83 LIST OF REFERENCES Aarikka Stenroos, L., & Halinen, A. (2007). The promoting role of third actors in initiating business relationships. Paper presented at the IMP C onference, Manchester. Abou A i sh, E., Kortam, W., & Hassan, S. (2008). Using agency theory in understanding switching behavior in B2B service industries. Working Paper, The German University in Cairo. Alba, J., Broniarczyk, S., Shimp, T., & Urbany, J. (19 94). The influence of prior beliefs, frequency cues, and magnitude cues on consumers' perceptions of comparative price data. Journal of Consumer Research, 21(2) 219 235. Ali, A., Hwang, L., & Trombley, M. (2003). Arbitrage risk and the book to market anom aly. Journal of Financial Economics, 69 355 373. Beach, L., & Mitchell, T. (1978). A contingency model for the selection of decision strategies. The Academy of Management Review, 3 439 449. Bennett, R. (1999). Agency termination decisions by small to me dium sized charitable organizations. Journal of Marketing Communications, 5(3), 131 142. Bochet, O., Page, T., & Putterman. L. (2006). Communication and punishment in voluntary contribution experiments. Journal of Economic Behavior & Organization, 60(1) 11 26. Bok, S. (1989). Secrets on the ethics of concealment and revelation New York: Vintage Books. Bourland Davis, P. (1997). Critical conflict issues in public relations agency client relationships. Paper presented at the AEJMC Conference, Illinois, Chi cago. Bourland, P. (1993). The nature of conflict in firm client relations: A content analysis of Public Relations Journal, 1980 89. Public Relations Review, 19 385 98. Caillaud, B., & Hermalin, B. (2000). Hidden Action and Incentives Teaching Notes, U .C. Berkeley. Callison, C., Seltzer, T. (2010). Influence of responsiveness, accessibility, and professionalism Public Relations Review, 36(2), 141 146. Cameron, G., Cropp, C., & Reber, B. (2001) Getting past platitudes: Factors limiting accommodation in public relations. Journal of Communication Management, 5(3), 242 261. Carson, K. (2008). Organization theory: A libertarian perspective BookSurge Publishing.

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86 Ghosh, B. &Taylor, D. (1999). Switching advertising agency: A cross country analysis. Marketing Intelligence & Planning, 17, 140 148. Glac, K. (2009). Understanding socially responsible investing: The effect of decision frames and trade off options. Journal of Business Ethics, 87 41 55. Gleason, M. (1997). MIA on Madison Avenue: Agency, client loyalty. Advertising Age 42 44. Grosse, S., Putterman, L., & Rockenbach, B. (2010). Monitoring in teams: Using laboratory experiments t o study a theory of the firm. Journal of the European Economic Association (in press) Grunig, J. (1990). Theory and practice of interactive media relations. Public Relations Quarterly, 35(3) 18 24. Grunig, J. (1997). Public relations management in gover nment and business. In J. Garnett & A. Kouzmin (Eds.), Handbook of Administrative Communication (pp. 241 283). New York: Marcel Dekker. Grunig, J. & Grunig, L. (1992). Models of public relations and communication. In J. Grunig (Ed.), Excellence in public relations and communication management (pp. 285 326). Hillsdale, NJ: Lawrence Erlbaum Associates. Grunig, J. & Hunt, T. (1984). Managing Public Relations. New York: Holt, Rinehart, Winston. Grunig, L. (1992). Activism: how it limits the effectiveness of organizations and how excellent public relations departments respond. In J. Grunig (Ed.), Excellence in public relations and communication management (pp. 503 530). Hillsdale, NJ: Lawrence Erlbaum Associates. Grunig, L., Grunig, J., & Dozier, D. (2002). E xcellent public relations and effective organizations: A study of communication management in three countries Mahwah, NJ: Psychology Press. Habbersett, C. (1983). An exploratory study of media relations: The science journalist and the public relations practitioner. Unpublished m a s ter thesis, University of Maryland, College Park, MD. Hackett, S., Dudley, D. and Walker, J. (1994) Heterogeneities, information, and co nflict resolution: Experimental evidence on sharing contracts. Journal of Theoretical Politics, 6, 495 525. Huang, Y (1997). Public relations, organization public relationships, and conflict management. Unpublished doctoral dissertation, University of Mary land, College Park, MD. Hunt, S., Arnett, D., & Madhavaram, S. (2006). The explanatory foundations of relationship marketing theory. Journal of Business & Industrial Marketing, 21(2), 72 87.

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90 Tosi, H., Brownlee, A., Silva, P., & Katz, J. (2003). An empirical exploration of decision making under agency controls and stewa rdship structure. Journal of Management Studies. 40(8) 2053 2071. Tosi, H., Katz, J., & Gomez Mejia, L. (1997). Disaggregating the agency contract: The effects of monitoring, incentive alignment, and term in office on agent decision making. The Academy of Management Journal, 40 584 602. Tse, D., Lee, K., Vertinsky, I., & Wehrung, D. (1988). Does culture matter? A cross cultural study of executives' choice, decisiveness, and risk adjustment in international marketing. The Journal of Marketing, 52 81 95 Ve r D., Ver A., & Laco, K. (2006). Coorientation theory in international relations: The case of Slovenia and Croatia. Public Relations Review, 32(1), 1 9 Warner, F. (1992). Should you nuke your ad agency? Brandweek, 33(38), 12 21. Weimann, J. (1994) Individual behaviour in a free riding experiment. Journal of Public Economics, 54(2) 185 200. Zolkiewski, J., Burton, J., & Stratoudaki, S. (2008). The delicate power balance in advertising agency client relationships: partnership or battleground? The c ase of the Greek advertising market. Journal of Customer Behaviour, 7 315 332. Zoller, H. (2004). Dialogue as global issue management: Legitimizing corporate influence in the transatlantic business dialogue. Management Communication Quarterly, 18(2), 204 241.

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91 BIOGRAPHICAL SKETCH University, one of the most prestigious colleges in South Korea. degree in Mass Communication with an emphasis in Public Relat ions from University of Florida in the spring of 2011. Before returning to graduate school to further her education, she has worked across multiple communications practices as a consultant Her experience includes marketing communication, corporate commun ication and crisis communication as well as agency client partnership design. She is also a translator of Faster Cheaper Better: The 9 Levers for Transforming How Work Gets Done by Michael Hammer and Lisa W. Hershman, Do More Great Work by Michael Bungay Stanier and by Sean Stephenson. During her graduate study, her particular interest was in the agency client transaction, er further elaborating Pleasant Partnership Design System to specialize in agency client partnership design.