信義房屋個案討論 :Competitive Strategies of Shinyi Real Estate Corporation: Transaction Cost

Entrepreneurship and Institution Change

顏厚棟 (Ho-don Yan)

逢甲大學經濟系

March 15, 2013

Economic Analysis: Macro and Micro Level

• Macro level: aggregate data, nation (Solow model).– Macroeconomic analysis– Productionless (Input-> output, a black box)

• Micro level: Firm (quality vs. quantity) and market– Market equilibrium (efficiency resource allocation,

given prices known under perfect competition) vs inequilibrium (Market Process, I. Kirzner)

– Product development, production process, management, marketing

• Market process needs entrepreneurship

ENTREPRENEURSHIP

The Purpose of Entrepreneurship

• Creating Wealth (productive vs non-productive)

• Adding Value (personal or societal)

• Making Profit (social entrepreneurship)

Defining Entrepreneurship

Synonyms: Innovation, change, middleman, etc.

– An activity that involves the discovery, evaluation and exploitation of opportunities to introduce new goods and services, ways of organizing, markets, processes, and raw materials through organizing efforts that previously had not existed.

(Shane and Venkataraman, 2000)

EntrepreneursMisbehavior, misfit (Economist, Jan. 2012)

– Asperger’s syndrome: an obsessive interest in narrow subjects; a passion for numbers, patterns and machines; an addiction to repetitive tasks; and a lack of sensitivity to social cues.

– “The people who run them are sort of autistic.”– “the Geek Syndrom”: – Prominent dyslexics include the founders of Ford, General Electric,

IBM and IKEA, not to mention more recent successes such as Charles Schwab (the founder of a stockbroker), Richard Branson (the Virgin Group), John Chambers (Cisco) and Steve Jobs (Apple).

– Dyslexics learn how to delegate tasks early (getting other people to do their homework, for example). They gravitate to activities that require few formal qualifications and demand little reading or writing.

Types of Entrepreneurship

– Adaptive vs. revolutionary– Kirznerian vs. Schumpeterian – Immitative vs. innovative – Productive, unproductive, and destructive– Strategic entrepreneurship– Institutional entrepreneurship– etc….

Institutional Entrepreneurship

• Activities of actors who have an interests in particular institutional arrangement and who leverage resources to create new institutions or to transform existing ones.

– (Maguire, Hardy, & Lawrence, 2004:657)

Typology of Entrepreneurship

Example:Legal: complying with law.Legitimate: fair, morally or ethically acceptable.It may be legal to infect a computer with a virus, if there is still no law against it. But it isn't legitimate.Gay marriage is not legal in some places, but some people think that they have a legitimate claim for it to become legal.He is not guilty, but he is responsible.

Entrepreneurial Process

Existence of opportunity Discovery of opportunity Decision to exploit opportunity Resource acquisition Entrepreneurial strategy Organizing process

Performance

Entrepreneurial Process (Yu, 2011)

Effective Entrepreneurial Action

• “Effective entrepreneurial action usually includes opportunity discovery and involves leadership, strategic planning, and competitive advantage creation.”

» (Alvarez and Barney, 2007)

• Combining with:– Strategic management– Leadership

TRANSACTION COST

諾貝爾經濟學獎得主

Ronald Coase(1991) Oliver E. Williamson(2009)

Transaction Cost Theory

• The decision to organize transactions within the firm as opposed to the open market – the “make or buy decision” – depends on the relative costs of internal versus external exchange (Williamson, 1975). – To buy: if external transaction cost is lower– To make: if internal transaction cost is lower

Transaction Cost: A Workable Concept

• Transaction costs occur due to the information gap during the transaction process, involving such items as searching for information, bargaining about the price, signing the contract, and monitoring and enforcing the contract (Dahlman, 1979).

• A workable concept of transaction costs included search and information costs, bargaining and decision costs, and policing and enforcement costs.

Dimensions of Transaction Cost

• Williamson (1985, 1989) further expounded on transaction costs by demonstrating that each transaction has different dimensions, such as frequency of transaction, asset specificity, and level of uncertainty that can be found in quality measurement and governance. Each dimension alters the transaction cost and therefore creates different opportunities for entrepreneurial endeavors.

Uncertainty and Transaction costs

• Transaction costs are caused by uncertainties, which can be found in quality measurement and governance of transaction costs (Williamson, 1985).

Quality Measurement

• The difficulty of distinguishing good quality from bad is inherent in the business world and this may be one of the more important aspects of uncertainty (Akerlof, 1970: 38).

• Quality is defined in various ways, such as technical performance, conformance to standards, reliability in use, and others (Garvin, 1987).

• In the absence of quality measurement, a market cannot form (Akerlof, 1970; Milgrom, 1981).

Governance

• Uncertainty can be created by the presence of opportunism, or the tendency of individuals to seek self-interest by means of guile.

• The prospect of future transactions reduces the risk of opportunism.

• Overconfident entrepreneurs might be unable to deliver on the commitments necessary to fulfill the transaction, and this is deemed as an identity risk (Busenitz, and Barney, 1997).

• Identity risk is the risk that the effort of the entrepreneur is directed toward the interest of the customer, yet the effort is insufficient to achieve the task (Michael, 2007).

• To grapple with the issue of identity risk, staged commitment can be a useful tool.

Asset Specificity• Refers to durable investments that are undertaken in support of

particular transactions (Williamson, 1985). • Applies to capital designed to have a single function, or labor trained

to perform a single task. • In principle, the more specific an asset is, the lower its potential resale

value or redeployability. • Six different types of asset specificity are usefully distinguished: site

specificity, physical asset specificity, human asset specificity, dedicated assets, brand name capital, and temporal specificity (Leiblein, 2003).

• If specific assets are the sub-components obtained through the exchange of the market transaction, it is easily to be the target for opportunism and the cause for the “hold up” problem.

信義房屋個案TRANSACTION COST ENTREPRENEURSHIP

•信義房屋仲介股份有限公司 ( 周俊吉 )

• 設立於 1981 年，其時政府尚未核准仲介公司營業，因此以「信義代書事務所」提供房屋買賣仲介服務，至1987 年正式成立「信義房屋仲介股份有限公司」。

• 信義房屋於 1999 年股票上櫃，並於 2001 年申請上市成功，為台灣地區唯一股票上市的房仲公司。

• 直營分店涵蓋台北市、新北市、桃園、新竹、台中、台南、高雄等都會區，為台灣地區直營分店最多的仲介公司，目前全球企業總部設於台北市信義路五段信義大樓。

Transaction Cost Entrepreneurship

• In this consumer-centric world, the goal of entrepreneurs is to propose a transaction that causes the customer to change from providing a product or service for himself to buying it from an outsider. In other words, the entrepreneur persuades the customers to choose to “buy” rather than to “make,” or to induce customers to do vertical de-integration.

Transaction Cost Entrepreneurship and the Case of Sinyi Real Estate Co.

• Transaction Cost: Coase, Williamson• Exchange through market to “buy” or “make” (vertical integration)

– “Buy”, or “make” the “service” of finding house.

• Production side and consumer side

• Where there is transaction cost, there is opportunity for entrepreneurship.

• The Emergence of Real Estate Agent– High transaction cost (to buy): quality measurement,

governance, and asset specificity– High opportunity cost: (to make) searching houses

從交易成本企業家精神分析信義房屋

• Transaction cost:– External transaction cost: 吸引顧客

– Internal transaction cost: 內部管理

信義房屋 – Chen and Yu

• Entrepreneur’s Alertness to the Market Opportunity

• The Institutional Innovation of Fixed-Percentage Commission

• The Institutional Innovation of Real Estate Disclosure Statement and After-Sale Guarantee– Real Estate Disclosure Statement– After-Sale Guarantee

External Transaction Cost

To reduce the external transaction to win customers.

• Quality measurement: uncertainty – Disclosure Statement (房屋現況說明書)– Fixed-Percentage Commission (固定比例服務費用, 日本)

• Governance: identity risk, opportunism– 履約保證制度– After-Sale Guarantee

• Asset specificity: – A.??? 在不動產交易中由於資產特殊性的原因，要釐清不動產交易的權利，則需要付出相當高的交易成本。– B.??? 周俊吉創新仲介制度並經由不斷的修正制度，以降低不動產交易成本與糾紛，提供更完善的交易流程。經

由仲介進行不動產交易、收取固定比例服務費如表不僅降低消費者與仲介之間因為賺取價差所產生的糾紛；也降低買賣雙方進行不動產交易所需付出的搜尋成本。在不動產說明書中，提供不動產清楚的產權與不動產現況的資訊，主要降低不動產交易中的資訊成本。在簽約至交屋的流程中，則以履約保證制度降低交易後的高風險、執行成本與降低拿翹的問題產生，賣方能順利拿到售屋的價金，買方能順利拿到產權。藉由此三項制度來保障消費者從委託至交屋的交易流程。

• •

Internal Transaction Costs

• Better governance system to avoid shirking and enhance virtuous competition and team work– A. 固定比例服務費用 – (avoiding opportunism)– B. 薪獎金制度 – (preventing employees from

shirking (or sabotage), encouraging team work, promoting educational training)

– C. Employees’ Education and Training (Create sustainable competitive advantages) 從薪獎金制度部分

獎金用 為員工教育訓練的支出