WHY DO JAPANESE WORKING IN NETWORK MARKETING ORGANIZATIONS SHOW SUCH STRONGLY ENTREPRENEURIAL BEHAVIOR?
Noriko Taji, Kochi University of Technology
Mitsuo Kono, Chuo University
Takeru Ohe, T. Ohe & Associates, Inc. |
Many distributors engaged in multi-level marketing businesses in Japan, which has the biggest market in the world, begin with little or no business experience. In spite of this, they demonstrate a strong entrepreneurial spirit. The objectives of this study were to (1) identify the process by which these inexperienced distributors become motivated and empowered, conduct recruiting activities, and maintain their networks, and (2) show how this process correlates with performance. As a preliminary study, we focused on novice distributors who have less than 18 months' experience as members of NMOs, and compared them with more experienced distributors.
We designed a questionnaire with 61 questions covering four phases: 32 on motivation, 23 on empowerment, 4 on effort, and 2 on performance. The 122 items of data on novice distributors and 67 items of data on experienced individuals were gathered via a mail survey between December 2000 and February 2001 through 40 NMOs.
In the motivation and empowerment stages, we used factor analysis to identify the four key factors in each group. We used quantitative indices of effort and performance: recruiting activity, network maintenance activity, number of new recruiters and income from commission and markups. To investigate if any stage correlated with the other stages, we conducted multiple regression analyses.
In this study, we showed that NMO distributors proceeded in a multiple-stage manner, from motivation to performance. We analyzed the behavior of novice distributors and divided them into three distinct patterns. (1) Building of social activity networks: Those who found reward in building social activity networks vigorously conduct recruiting and maintenance activities, and try to link them to performance. Those who follow this behavioral pattern typically find value in the building of the network itself and demonstrate entrepreneurship. (2)Acquisition of income: Those who aim at maximizing their income concentrate on gaining short-term profit, and are less intent on expanding the scope of their activities than those who follow the "building of social activity networks" behavioral pattern. (3)Enhancement of personal skills: Those who try to enhance their personal skills try to improve their performance regardless of their motivation to expand the scope of their activities. All the novice distributors were motivated not by monetary factors, but by one of the following non-monetary factors: mentoring of up-line distributors, trust in the NMOs' management policies, or up-line distributors' objective product assessment capabilities. In other words, NMOs can expand their networks by boosting these motivating factors. |