• Title/Summary/Keyword: distribution modeling

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Geochemical Characteristics of the Gyeongju LILW Repository II. Rock and Mineral (중.저준위 방사성폐기물 처분부지의 지구화학 특성 II. 암석 및 광물)

  • Kim, Geon-Young;Koh, Yong-Kwon;Choi, Byoung-Young;Shin, Seon-Ho;Kim, Doo-Haeng
    • Journal of Nuclear Fuel Cycle and Waste Technology(JNFCWT)
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    • v.6 no.4
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    • pp.307-327
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    • 2008
  • Geochemical study on the rocks and minerals of the Gyeongju low and intermediate level waste repository was carried out in order to provide geochemical data for the safety assessment and geochemical modeling. Polarized microscopy, X-ray diffraction method, chemical analysis for the major and trace elements, scanning electron microscopy(SEM), and stable isotope analysis were applied. Fracture zones are locally developed with various degrees of alteration in the study area. The study area is mainly composed of granodiorite and diorite and their relation is gradational in the field. However, they could be easily distinguished by their chemical property. The granodiorite showed higher $SiO_2$ content and lower MgO and $Fe_2O_3$ contents than the diorite. Variation trends of the major elements of the granodiorite and diorite were plotted on the same line according to the increase of $SiO_2$ content suggesting that they were differentiated from the same magma. Spatial distribution of the various elements showed that the diorite region had lower $SiO_2,\;Al_2O_3,\;Na_2O\;and\;K_2O$ contents, and higher CaO, $Fe_2O_3$ contents than the granodiorite region. Especially, because the differences in the CaO and $Na_2O$ distribution were most distinct and their trends were reciprocal, the chemical variation of the plagioclase of the granitic rocks was the main parameter of the chemical variation of the host rocks in the study area. Identified fracture-filling minerals from the drill core were montmorillonite, zeolite minerals, chlorite, illite, calcite and pyrite. Especially pyrite and laumontite, which are known as indicating minerals of hydrothermal alteration, were widely distributed in the study area indicating that the study area was affected by mineralization and/or hydrothermal alteration. Sulfur isotope analysis for the pyrite and oxygen-hydrogen stable isotope analysis for the clay minerals indicated that they were originated from the magma. Therefore, it is considered that the fracture-filling minerals from the study area were affected by the hydrothermal solution as well as the simply water-rock interaction.

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Experimental Analysis of Nodal Head-outflow Relationship Using a Model Water Supply Network for Pressure Driven Analysis of Water Distribution System (상수관망 압력기반 수리해석을 위한 모의 실험시설 기반 절점의 압력-유량 관계 분석)

  • Chang, Dongeil;Kang, Kihoon
    • Journal of Korean Society of Environmental Engineers
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    • v.36 no.6
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    • pp.421-428
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    • 2014
  • For the analysis of water supply network, demand-driven and pressure-driven analysis methods have been proposed. Of the two methods, demand-driven analysis (DDA) can only be used in a normal operation condition to evaluate hydraulic status of a pipe network. Under abnormal conditions, i.e., unexpected pipe destruction, or abnormal low pressure conditions, pressure-driven analysis (PDA) method should be used to estimate the suppliable flowrate at each node in a network. In order to carry out the pressure-driven analysis, head-outflow relationship (HOR), which estimates flowrate at a certain pressure at each node, should be first determined. Most previous studies empirically suggested that each node possesses its own characteristic head-outflow relationship, which, therefore, requires verification by using actual field data for proper application in PDA modeling. In this study, a model pipe network was constructed, and various operation scenarios of normal and abnormal conditions, which cannot be realized in real pipe networks, were established. Using the model network, data on pressure and flowrate at each node were obtained at each operation condition. Using the data obtained, previously proposed HOR equations were evaluated. In addition, head-outflow relationship at each node was analyzed especially under multiple pipe destruction events. By analyzing the experimental data obtained from the model network, it was found that flowrate reduction corresponding to a certain pressure drop (by pipe destruction at one or multiple points on the network) followed intrinsic head-outflow relationship of each node. By comparing the experimentally obtained head-outflow relationship with various HOR equations proposed by previous studies, the one proposed by Wagner et al. showed the best agreement with the exponential parameter, m of 3.0.

Prediction of a hit drama with a pattern analysis on early viewing ratings (초기 시청시간 패턴 분석을 통한 대흥행 드라마 예측)

  • Nam, Kihwan;Seong, Nohyoon
    • Journal of Intelligence and Information Systems
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    • v.24 no.4
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    • pp.33-49
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    • 2018
  • The impact of TV Drama success on TV Rating and the channel promotion effectiveness is very high. The cultural and business impact has been also demonstrated through the Korean Wave. Therefore, the early prediction of the blockbuster success of TV Drama is very important from the strategic perspective of the media industry. Previous studies have tried to predict the audience ratings and success of drama based on various methods. However, most of the studies have made simple predictions using intuitive methods such as the main actor and time zone. These studies have limitations in predicting. In this study, we propose a model for predicting the popularity of drama by analyzing the customer's viewing pattern based on various theories. This is not only a theoretical contribution but also has a contribution from the practical point of view that can be used in actual broadcasting companies. In this study, we collected data of 280 TV mini-series dramas, broadcasted over the terrestrial channels for 10 years from 2003 to 2012. From the data, we selected the most highly ranked and the least highly ranked 45 TV drama and analyzed the viewing patterns of them by 11-step. The various assumptions and conditions for modeling are based on existing studies, or by the opinions of actual broadcasters and by data mining techniques. Then, we developed a prediction model by measuring the viewing-time distance (difference) using Euclidean and Correlation method, which is termed in our study similarity (the sum of distance). Through the similarity measure, we predicted the success of dramas from the viewer's initial viewing-time pattern distribution using 1~5 episodes. In order to confirm that the model is shaken according to the measurement method, various distance measurement methods were applied and the model was checked for its dryness. And when the model was established, we could make a more predictive model using a grid search. Furthermore, we classified the viewers who had watched TV drama more than 70% of the total airtime as the "passionate viewer" when a new drama is broadcasted. Then we compared the drama's passionate viewer percentage the most highly ranked and the least highly ranked dramas. So that we can determine the possibility of blockbuster TV mini-series. We find that the initial viewing-time pattern is the key factor for the prediction of blockbuster dramas. From our model, block-buster dramas were correctly classified with the 75.47% accuracy with the initial viewing-time pattern analysis. This paper shows high prediction rate while suggesting audience rating method different from existing ones. Currently, broadcasters rely heavily on some famous actors called so-called star systems, so they are in more severe competition than ever due to rising production costs of broadcasting programs, long-term recession, aggressive investment in comprehensive programming channels and large corporations. Everyone is in a financially difficult situation. The basic revenue model of these broadcasters is advertising, and the execution of advertising is based on audience rating as a basic index. In the drama, there is uncertainty in the drama market that it is difficult to forecast the demand due to the nature of the commodity, while the drama market has a high financial contribution in the success of various contents of the broadcasting company. Therefore, to minimize the risk of failure. Thus, by analyzing the distribution of the first-time viewing time, it can be a practical help to establish a response strategy (organization/ marketing/story change, etc.) of the related company. Also, in this paper, we found that the behavior of the audience is crucial to the success of the program. In this paper, we define TV viewing as a measure of how enthusiastically watching TV is watched. We can predict the success of the program successfully by calculating the loyalty of the customer with the hot blood. This way of calculating loyalty can also be used to calculate loyalty to various platforms. It can also be used for marketing programs such as highlights, script previews, making movies, characters, games, and other marketing projects.

Modeling and mapping fuel moisture content using equilibrium moisture content computed from weather data of the automatic mountain meteorology observation system (AMOS) (산악기상자료와 목재평형함수율에 기반한 산림연료습도 추정식 개발)

  • Lee, HoonTaek;WON, Myoung-Soo;YOON, Suk-Hee;JANG, Keun-Chang
    • Journal of the Korean Association of Geographic Information Studies
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    • v.22 no.3
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    • pp.21-36
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    • 2019
  • Dead fuel moisture content is a key variable in fire danger rating as it affects fire ignition and behavior. This study evaluates simple regression models estimating the moisture content of standardized 10-h fuel stick (10-h FMC) at three sites with different characteristics(urban and outside/inside the forest). Equilibrium moisture content (EMC) was used as an independent variable, and in-situ measured 10-h FMC was used as a dependent variable and validation data. 10-h FMC spatial distribution maps were created for dates with the most frequent fire occurrence during 2013-2018. Also, 10-h FMC values of the dates were analyzed to investigate under which 10-h FMC condition forest fire is likely to occur. As the results, fitted equations could explain considerable part of the variance in 10-h FMC (62~78%). Compared to the validation data, the models performed well with R2 ranged from 0.53 to 0.68, root mean squared error (RMSE) ranged from 2.52% to 3.43%, and bias ranged from -0.41% to 1.10%. When the 10-h FMC model fitted for one site was applied to the other sites, $R^2$ was maintained as the same while RMSE and bias increased up to 5.13% and 3.68%, respectively. The major deficiency of the 10-h FMC model was that it poorly caught the difference in the drying process after rainfall between 10-h FMC and EMC. From the analysis of 10-h FMC during the dates fire occurred, more than 70% of the fires occurred under a 10-h FMC condition of less than 10.5%. Overall, the present study suggested a simple model estimating 10-h FMC with acceptable performance. Applying the 10-h FMC model to the automatic mountain weather observation system was successfully tested to produce a national-scale 10-h FMC spatial distribution map. This data will be fundamental information for forest fire research, and will support the policy maker.

Potential Habitat Area Based on Natural Environment Survey Time Series Data for Conservation of Otter (Lutra lutra) - Case Study for Gangwon-do - (수달의 보전을 위한 전국자연환경조사 시계열 자료 기반 잠재 서식적합지역 분석 - 강원도를 대상으로 -)

  • Kim, Ho Gul;Mo, Yongwon
    • Korean Journal of Environment and Ecology
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    • v.35 no.1
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    • pp.24-36
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    • 2021
  • Countries around the world, including the Republic of Korea, are participating in efforts to preserve biodiversity. Concerning species, in particular, studies that aim to find potential habitats and establish conservation plans by conducting habitat suitability analysis for specific species are actively ongoing. However, few studies on mid- to long-term changes in suitable habitat areas are based on accumulated information. Therefore, this study aimed to analyze the time-series changes in the habitat suitable area and examine the otters' changing pattern (Lutra lutra) designated as Level 1 endangered wildlife in Gangwon-do. The time-series change analysis used the data on otter species' presence points from the 2nd, 3rd, and 4th national natural environment surveys conducted for about 20 years. Moreover, it utilized the land cover map consistent with the survey period to create environmental variables to reflect each survey period's habitat environment. The suitable habitat area analysis used the MaxEnt model that can run based only on the species presence information, and it has been proven to be reliable by previous studies. The study derived the habitat suitability map for otters in each survey period, and it showed a tendency that habitats were distributed around rivers. Comparing the response curves of the environmental variables derived from the modeling identified the characteristics of the habitat favored by otters. The examination of habitats' change by survey period showed that the habitats based on the 2nd National Natural Environment Survey had the widest distribution. The habitats of the 3rd and 4th surveys showed a tendency of decrease in area. Moreover, the study aggregated the analysis results of the three survey periods and analyzed and categorized the habitat's changing pattern. The type of change proposed different conservation plans, such as field surveys, monitoring, protected area establishment, and restoration plan. This study is significant because it produced a comprehensive analysis map that showed the time-series changes of the location and area of the otter habitat and proposed a conservation plan that is necessary according to the type of habitat change by region. We believe that the method proposed in this study and its results can be used as reference data for establishing a habitat conservation and management plan in the future.

Vegetation classification based on remote sensing data for river management (하천 관리를 위한 원격탐사 자료 기반 식생 분류 기법)

  • Lee, Chanjoo;Rogers, Christine;Geerling, Gertjan;Pennin, Ellis
    • Proceedings of the Korea Water Resources Association Conference
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    • 2021.06a
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    • pp.6-7
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    • 2021
  • Vegetation development in rivers is one of the important issues not only in academic fields such as geomorphology, ecology, hydraulics, etc., but also in river management practices. The problem of river vegetation is directly connected to the harmony of conflicting values of flood management and ecosystem conservation. In Korea, since the 2000s, the issue of river vegetation and land formation has been continuously raised under various conditions, such as the regulating rivers downstream of the dams, the small eutrophicated tributary rivers, and the floodplain sites for the four major river projects. In this background, this study proposes a method for classifying the distribution of vegetation in rivers based on remote sensing data, and presents the results of applying this to the Naeseong Stream. The Naeseong Stream is a representative example of the river landscape that has changed due to vegetation development from 2014 to the latest. The remote sensing data used in the study are images of Sentinel 1 and 2 satellites, which is operated by the European Aerospace Administration (ESA), and provided by Google Earth Engine. For the ground truth, manually classified dataset on the surface of the Naeseong Stream in 2016 were used, where the area is divided into eight types including water, sand and herbaceous and woody vegetation. The classification method used a random forest classification technique, one of the machine learning algorithms. 1,000 samples were extracted from 10 pre-selected polygon regions, each half of them were used as training and verification data. The accuracy based on the verification data was found to be 82~85%. The model established through training was also applied to images from 2016 to 2020, and the process of changes in vegetation zones according to the year was presented. The technical limitations and improvement measures of this paper were considered. By providing quantitative information of the vegetation distribution, this technique is expected to be useful in practical management of vegetation such as thinning and rejuvenation of river vegetation as well as technical fields such as flood level calculation and flow-vegetation coupled modeling in rivers.

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Cooperative Sales Promotion in Manufacturer-Retailer Channel under Unplanned Buying Potential (비계획구매를 고려한 제조업체와 유통업체의 판매촉진 비용 분담)

  • Kim, Hyun Sik
    • Journal of Distribution Research
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    • v.17 no.4
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    • pp.29-53
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    • 2012
  • As so many marketers get to use diverse sales promotion methods, manufacturer and retailer in a channel often use them too. In this context, diverse issues on sales promotion management arise. One of them is the issue of unplanned buying. Consumers' unplanned buying is clearly better off for the retailer but not for manufacturer. This asymmetric influence of unplanned buying should be dealt with prudently because of its possibility of provocation of channel conflict. However, there have been scarce studies on the sales promotion management strategy considering the unplanned buying and its asymmetric effect on retailer and manufacturer. In this paper, we try to find a better way for a manufacturer in a channel to promote performance through the retailer's sales promotion efforts when there is potential of unplanned buying effect. We investigate via game-theoretic modeling what is the optimal cost sharing level between the manufacturer and retailer when there is unplanned buying effect. We investigated following issues about the topic as follows: (1) What structure of cost sharing mechanism should the manufacturer and retailer in a channel choose when unplanned buying effect is strong (or weak)? (2) How much payoff could the manufacturer and retailer in a channel get when unplanned buying effect is strong (or weak)? We focus on the impact of unplanned buying effect on the optimal cost sharing mechanism for sales promotions between a manufacturer and a retailer in a same channel. So we consider two players in the game, a manufacturer and a retailer who are interacting in a same distribution channel. The model is of complete information game type. In the model, the manufacturer is the Stackelberg leader and the retailer is the follower. Variables in the model are as following table. Manufacturer's objective function in the basic game is as follows: ${\Pi}={\Pi}_1+{\Pi}_2$, where, ${\Pi}_1=w_1(1+L-p_1)-{\psi}^2$, ${\Pi}_2=w_2(1-{\epsilon}L-p_2)$. And retailer's is as follows: ${\pi}={\pi}_1+{\pi}_2$, where, ${\pi}_1=(p_1-w_1)(1+L-p_1)-L(L-{\psi})+p_u(b+L-p_u)$, ${\pi}_2=(p_2-w_2)(1-{\epsilon}L-p_2)$. The model is of four stages in two periods. Stages of the game are as follows. (Stage 1) Manufacturer sets wholesale price of the first period($w_1$) and cost sharing level of channel sales promotion(${\Psi}$). (Stage 2) Retailer sets retail price of the focal brand($p_1$), the unplanned buying item($p_u$), and sales promotion level(L). (Stage 3) Manufacturer sets wholesale price of the second period($w_2$). (Stage 4) Retailer sets retail price of the second period($p_2$). Since the model is a kind of dynamic games, we try to find a subgame perfect equilibrium to derive some theoretical and managerial implications. In order to obtain the subgame perfect equilibrium, we use the backward induction method. In using backward induction approach, we solve the problems backward from stage 4 to stage 1. By completely knowing follower's optimal reaction to the leader's potential actions, we can fold the game tree backward. Equilibrium of each variable in the basic game is as following table. We conducted more analysis of additional game about diverse cost level of manufacturer. Manufacturer's objective function in the additional game is same with that of the basic game as follows: ${\Pi}={\Pi}_1+{\Pi}_2$, where, ${\Pi}_1=w_1(1+L-p_1)-{\psi}^2$, ${\Pi}_2=w_2(1-{\epsilon}L-p_2)$. But retailer's objective function is different from that of the basic game as follows: ${\pi}={\pi}_1+{\pi}_2$, where, ${\pi}_1=(p_1-w_1)(1+L-p_1)-L(L-{\psi})+(p_u-c)(b+L-p_u)$, ${\pi}_2=(p_2-w_2)(1-{\epsilon}L-p_2)$. Equilibrium of each variable in this additional game is as following table. Major findings of the current study are as follows: (1) As the unplanned buying effect gets stronger, manufacturer and retailer had better increase the cost for sales promotion. (2) As the unplanned buying effect gets stronger, manufacturer had better decrease the cost sharing portion of total cost for sales promotion. (3) Manufacturer's profit is increasing function of the unplanned buying effect. (4) All results of (1),(2),(3) are alleviated by the increase of retailer's procurement cost to acquire unplanned buying items. The authors discuss the implications of those results for the marketers in manufacturers or retailers. The current study firstly suggests some managerial implications for the manufacturer how to share the sales promotion cost with the retailer in a channel to the high or low level of the consumers' unplanned buying potential.

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Analysis of Twitter for 2012 South Korea Presidential Election by Text Mining Techniques (텍스트 마이닝을 이용한 2012년 한국대선 관련 트위터 분석)

  • Bae, Jung-Hwan;Son, Ji-Eun;Song, Min
    • Journal of Intelligence and Information Systems
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    • v.19 no.3
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    • pp.141-156
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    • 2013
  • Social media is a representative form of the Web 2.0 that shapes the change of a user's information behavior by allowing users to produce their own contents without any expert skills. In particular, as a new communication medium, it has a profound impact on the social change by enabling users to communicate with the masses and acquaintances their opinions and thoughts. Social media data plays a significant role in an emerging Big Data arena. A variety of research areas such as social network analysis, opinion mining, and so on, therefore, have paid attention to discover meaningful information from vast amounts of data buried in social media. Social media has recently become main foci to the field of Information Retrieval and Text Mining because not only it produces massive unstructured textual data in real-time but also it serves as an influential channel for opinion leading. But most of the previous studies have adopted broad-brush and limited approaches. These approaches have made it difficult to find and analyze new information. To overcome these limitations, we developed a real-time Twitter trend mining system to capture the trend in real-time processing big stream datasets of Twitter. The system offers the functions of term co-occurrence retrieval, visualization of Twitter users by query, similarity calculation between two users, topic modeling to keep track of changes of topical trend, and mention-based user network analysis. In addition, we conducted a case study on the 2012 Korean presidential election. We collected 1,737,969 tweets which contain candidates' name and election on Twitter in Korea (http://www.twitter.com/) for one month in 2012 (October 1 to October 31). The case study shows that the system provides useful information and detects the trend of society effectively. The system also retrieves the list of terms co-occurred by given query terms. We compare the results of term co-occurrence retrieval by giving influential candidates' name, 'Geun Hae Park', 'Jae In Moon', and 'Chul Su Ahn' as query terms. General terms which are related to presidential election such as 'Presidential Election', 'Proclamation in Support', Public opinion poll' appear frequently. Also the results show specific terms that differentiate each candidate's feature such as 'Park Jung Hee' and 'Yuk Young Su' from the query 'Guen Hae Park', 'a single candidacy agreement' and 'Time of voting extension' from the query 'Jae In Moon' and 'a single candidacy agreement' and 'down contract' from the query 'Chul Su Ahn'. Our system not only extracts 10 topics along with related terms but also shows topics' dynamic changes over time by employing the multinomial Latent Dirichlet Allocation technique. Each topic can show one of two types of patterns-Rising tendency and Falling tendencydepending on the change of the probability distribution. To determine the relationship between topic trends in Twitter and social issues in the real world, we compare topic trends with related news articles. We are able to identify that Twitter can track the issue faster than the other media, newspapers. The user network in Twitter is different from those of other social media because of distinctive characteristics of making relationships in Twitter. Twitter users can make their relationships by exchanging mentions. We visualize and analyze mention based networks of 136,754 users. We put three candidates' name as query terms-Geun Hae Park', 'Jae In Moon', and 'Chul Su Ahn'. The results show that Twitter users mention all candidates' name regardless of their political tendencies. This case study discloses that Twitter could be an effective tool to detect and predict dynamic changes of social issues, and mention-based user networks could show different aspects of user behavior as a unique network that is uniquely found in Twitter.

The Causes of Conflict and the Effect of Control Mechanisms on Conflict Resolution between Manufacturer and Supplier (제조-공급자간 갈등 원인과 거래조정 방식의 갈등관리 효과)

  • Rhee, Jin Hwa
    • Journal of Distribution Research
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    • v.17 no.4
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    • pp.55-80
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    • 2012
  • I. Introduction Developing the relationships between companies is very important issue to ensure a competitive advantage in today's business environment (Bleeke & Ernst 1991; Mohr & Spekman 1994; Powell 1990). Partnerships between companies are based on having same goals, pursuing mutual understanding, and having a professional level of interdependence. By having such a partnerships and cooperative efforts between companies, they will achieve efficiency and effectiveness of their business (Mohr and Spekman, 1994). However, it is difficult to expect these ideal results only in the B2B corporate transaction. According to agency theory which is the well-accepted theory in various fields of business strategy, organization, and marketing, the two independent companies have fundamentally different corporate purposes. Also there is a higher chance of developing opportunism and conflict due to natures of human(organization), such as self-interest, bounded rationality, risk aversion, and environment factor as imbalance of information (Eisenhardt 1989). That is, especially partnerships between principal(or buyer) and agent(or supplier) of companies within supply chain, the business contract itself will not provide competitive advantage. But managing partnership between companies is the key to success. Therefore, managing partnership between manufacturer and supplier, and finding causes of conflict are essential to improve B2B performance. In conclusion, based on prior researches and Agency theory, this study will clarify how business hazards cause conflicts on supply chain and then identify how developed conflicts have been managed by two control mechanisms. II. Research model III. Method In order to validate our research model, this study gathered questionnaires from small and medium sized enterprises(SMEs). In Korea, SMEs mean the firms whose employee is under 300 and capital is under 8 billion won(about 7.2 million dollar). We asked the manufacturer's perception about the relationship with the biggest supplier, and our key informants are denied to a person responsible for buying(ex)CEO, executives, managers of purchasing department, and so on). In detail, we contact by telephone to our initial sample(about 1,200 firms) and introduce our research motivation and send our questionnaires by e-mail, mail, and direct survey. Finally we received 361 data and eliminate 32 inappropriate questionnaires. We use 329 manufactures' data on analysis. The purpose of this study is to identify the anticipant role of business hazard (environmental dynamism, asset specificity) and investigate the moderating effect of control mechanism(formal control, social control) on conflict-performance relationship. To find out moderating effect of control methods, we need to compare the regression weight between low versus. high group(about level of exercised control methods). Therefore we choose the structural equation modeling method that is proper to do multi-group analysis. The data analysis is performed by AMOS 17.0 software, and model fits are good statically (CMIN/DF=1.982, p<.000, CFI=.936, IFI=.937, RMSEA=.056). IV. Result V. Discussion Results show that the higher environmental dynamism and asset specificity(on particular supplier) buyer(manufacturer) has, the more B2B conflict exists. And this conflict affect relationship quality and financial outcomes negatively. In addition, social control and formal control could weaken the negative effect of conflict on relationship quality significantly. However, unlikely to assure conflict resolution effect of control mechanisms on relationship quality, financial outcomes are changed by neither social control nor formal control. We could explain this results with the characteristics of our sample, SMEs(Small and Medium sized Enterprises). Financial outcomes of these SMEs(manufacturer or principal) are affected by their customer(usually major company) more easily than their supplier(or agent). And, in recent few years, most of companies have suffered from financial problems because of global economic recession. It means that it is hard to evaluate the contribution of supplier(agent). Therefore we also support the suggestion of Gladstein(1984), Poppo & Zenger(2002) that relational performance variable can capture the focal outcomes of relationship(exchange) better than financial performance variable. This study has some implications that it tests the sources of conflict and investigates the effect of resolution methods of B2B conflict empirically. And, especially, it finds out the significant moderating effect of formal control which past B2B management studies have ignored in Korea.

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Antecedents of Manufacturer's Private Label Program Engagement : A Focus on Strategic Market Management Perspective (제조업체 Private Labels 도입의 선행요인 : 전략적 시장관리 관점을 중심으로)

  • Lim, Chae-Un;Yi, Ho-Taek
    • Journal of Distribution Research
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    • v.17 no.1
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    • pp.65-86
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    • 2012
  • The $20^{th}$ century was the era of manufacturer brands which built higher brand equity for consumers. Consumers moved from generic products of inconsistent quality produced by local factories in the $19^{th}$ century to branded products from global manufacturers and manufacturer brands reached consumers through distributors and retailers. Retailers were relatively small compared to their largest suppliers. However, sometime in the 1970s, things began to slowly change as retailers started to develop their own national chains and began international expansion, and consolidation of the retail industry from mom-and-pop stores to global players was well under way (Kumar and Steenkamp 2007, p.2) In South Korea, since the middle of the 1990s, the bulking up of retailers that started then has changed the balance of power between manufacturers and retailers. Retailer private labels, generally referred to as own labels, store brands, distributors own private-label, home brand or own label brand have also been performing strongly in every single local market (Bushman 1993; De Wulf et al. 2005). Private labels now account for one out of every five items sold every day in U.S. supermarkets, drug chains, and mass merchandisers (Kumar and Steenkamp 2007), and the market share in Western Europe is even larger (Euromonitor 2007). In the UK, grocery market share of private labels grew from 39% of sales in 2008 to 41% in 2010 (Marian 2010). Planet Retail (2007, p.1) recently concluded that "[PLs] are set for accelerated growth, with the majority of the world's leading grocers increasing their own label penetration." Private labels have gained wide attention both in the academic literature and popular business press and there is a glowing academic research to the perspective of manufacturers and retailers. Empirical research on private labels has mainly studies the factors explaining private labels market shares across product categories and/or retail chains (Dahr and Hoch 1997; Hoch and Banerji, 1993), factors influencing the private labels proneness of consumers (Baltas and Doyle 1998; Burton et al. 1998; Richardson et al. 1996) and factors how to react brand manufacturers towards PLs (Dunne and Narasimhan 1999; Hoch 1996; Quelch and Harding 1996; Verhoef et al. 2000). Nevertheless, empirical research on factors influencing the production in terms of a manufacturer-retailer is rather anecdotal than theory-based. The objective of this paper is to bridge the gap in these two types of research and explore the factors which influence on manufacturer's private label production based on two competing theories: S-C-P (Structure - Conduct - Performance) paradigm and resource-based theory. In order to do so, the authors used in-depth interview with marketing managers, reviewed retail press and research and presents the conceptual framework that integrates the major determinants of private labels production. From a manufacturer's perspective, supplying private labels often starts on a strategic basis. When a manufacturer engages in private labels, the manufacturer does not have to spend on advertising, retailer promotions or maintain a dedicated sales force. Moreover, if a manufacturer has weak marketing capabilities, the manufacturer can make use of retailer's marketing capability to produce private labels and lessen its marketing cost and increases its profit margin. Figure 1. is the theoretical framework based on a strategic market management perspective, integrated concept of both S-C-P paradigm and resource-based theory. The model includes one mediate variable, marketing capabilities, and the other moderate variable, competitive intensity. Manufacturer's national brand reputation, firm's marketing investment, and product portfolio, which are hypothesized to positively affected manufacturer's marketing capabilities. Then, marketing capabilities has negatively effected on private label production. Moderating effects of competitive intensity are hypothesized on the relationship between marketing capabilities and private label production. To verify the proposed research model and hypotheses, data were collected from 192 manufacturers (212 responses) who are producing private labels in South Korea. Cronbach's alpha test, explanatory / comfirmatory factor analysis, and correlation analysis were employed to validate hypotheses. The following results were drawing using structural equation modeling and all hypotheses are supported. Findings indicate that manufacturer's private label production is strongly related to its marketing capabilities. Consumer marketing capabilities, in turn, is directly connected with the 3 strategic factors (e.g., marketing investment, manufacturer's national brand reputation, and product portfolio). It is moderated by competitive intensity between marketing capabilities and private label production. In conclusion, this research may be the first study to investigate the reasons manufacturers engage in private labels based on two competing theoretic views, S-C-P paradigm and resource-based theory. The private label phenomenon has received growing attention by marketing scholars. In many industries, private labels represent formidable competition to manufacturer brands and manufacturers have a dilemma with selling to as well as competing with their retailers. The current study suggests key factors when manufacturers consider engaging in private label production.

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