Beyond the sales pitch

dc.contributor.advisorGross, C.
dc.contributor.authorKlok, Roel van de
dc.description.abstractThe MLM industry and its business model are frequently criticized for its legal and ethical problems (among others Keep & Van der Nat, 2014). This research investigates the lack of accountability in the Multi-Level Marketing (MLM) industry. The autonomy, flexibility and independence of distributors in this industry have been argued to result in a lack of accountability (Groß & Vriens, 2017). Accordingly, MLM companies seem to avoid their accountability by hiding behind the distributors’ independence. At the same time, it is unclear if and how distributors handle accountability. A thorough understanding of this problem is not perceptible in the MLM literature. Nonetheless, the concept of accountability is better explored in the literature on self-managing teams (SMT). This study utilizes the concept of SMT as a conceptual lens to investigate accountability problems in the MLM industry. As a result, the purpose of this research is to explore the problem’s appearance, explain its underlying causes, and address accountability in a team of distributors. This to create a better understanding of the lack of accountability. Practically, the research aims to explore if and how guidelines and mechanisms that enhance accountability in SMT, can be applied in MLM companies to understand the lack of accountability. Therefore, the research is concentrated on the MLM company ‘Amway’. This company is recently criticized for misleading claims being made by its distributors. Data was obtained using a variety of methods due to the use of a case study. Eight semi-structured interviews with former and active Amway distributors were conducted. In addition, a weekly team meeting was observed, and several Amway documents were analyzed. The research shows that accountability in Amway is lacking at various levels. At the organizational level, Amway avoids their accountability hiding behind their documents and contracts. Additionally, Amway indirectly urges their distributors to avoid their individual accountability. Whereas SMT uses mutual accountability to hold team members accountable, this concept is difficult to apply in Amway due to distributors’ limited control over their downline. However, mutual accountability appears to be present when criticizing the Amway business. The MLM industry interprets this term differently than the SMT literature. Additionally, it is discovered that the lack of a collective understanding of accountability, controllability and proper consequences for misleading claims makes it difficult for distributors to handle accountability. Three of the mechanisms appear to be present in Amway. However, the focus of these mechanisms is on sales and recruitment which hinders the topic of accountability to be handled by distributors. While some concepts of the SMT literature are similar to Amway, the guidelines and mechanisms are not applicable within the MLM industry due to the many differences between how a SMT handles accountability and how this is being handled in Amway. To allow the SMT elements to be applied in the MLM industry, there is a need for a more ethical focus where misleading claims are rejected, and accountability is being handled.
dc.thesis.facultyFaculteit der Managementwetenschappen
dc.thesis.specialisationspecialisations::Faculteit der Managementwetenschappen::Master Business Administration::Organizational Design & Development
dc.thesis.studyprogrammestudyprogrammes::Faculteit der Managementwetenschappen::Master Business Administration
dc.titleBeyond the sales pitch
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