Tuesday, May 31, 2011

ELY Robin J., IBARRA Herminia, KOLB Deborah
Taking Gender into Account: Theory and Design for Women's Leadership Development Programs
Academy of Management Learning & Education Forthcoming

We conceptualize leadership development as identity work and show how subtle forms of gender bias in the culture and in organizations interfere with the identity work of women leaders. Based on this insight, we revisit traditional approaches to standard leadership topics, such as negotiations and leading change, as well as currently popular developmental tools, such as 360-degree feedback and networking; reinterpret them through the lens of women’s experiences in organizations; and revise them in order to meet the particular challenges women face when transitioning to more senior leadership roles. By framing leadership development as identity work, we reveal the gender dynamics involved in becoming a leader, offer a theoretical rationale for teaching leadership in women-only groups, and suggest design and delivery principles to increase the likelihood that women’s leadership programs will help women advance into more senior leadership roles.

Friday, May 27, 2011


MUNRO David, ZEISBERGER Claudia
Demographics: The Ratio of Revolution
INSEAD Working Paper 2011/42/DS 
SSRN's Top Ten download list for Labor: Demographics & Economics of the Family eJournal Take a look at the statistics here

The demographic metrics and inflationary circumstances that framed the January 2011 revolution in Egypt’s Tahrir Square were almost identical to those prevailing in Japan during the 1968 violent student-led revolts, in the United States when millions demonstrated against the Vietnam War in the late 1960s to early 1970s, and in China when hundreds of thousands converged on Tiananmen Square in 1989. Disenchantment by growing numbers of unemployed youth develops into anti-government revolutionary potential when rapidly rising inflation enters the picture. This paper identifies time periods when two demographic metrics suggest a nation is ripe for revolution.
CARTER Nancy M., HAN JungYun
Entrepreneurship in The Blackwell Encyclopedia of Management (vol. III), Blackwell Publishing Forthcoming


The term “nascent entrepreneur” has been added to the literature in the past ten years as researchers focused greater attention on understanding the earliest stages of organization emergence. Studies showing that new businesses provide profound social and economic benefits stimulated researchers and policy-makers to learn more about how new businesses come into existence, how many were being formed, at what rate, and information on the individuals who were starting the businesses. Previous research had relied on retrospective reports of entrepreneurs who already had their businesses established to relate how the entrepreneurial career choice was made, the processes of early creation and launch, and why some start-up efforts were successful while others were discontinued. Concern about the validity of the reminiscences of new firm owners to reflect organization emergence led to efforts to study nascent entrepreneurs – individuals who were actively involved in business start-up activities. So, we put efforts to determine who they are and to track their start-up processes.
ZEISBERGER Claudia, PRAHL Michael
Valuation and Return Measurement in Private Equity: An Overview

© 2011 INSEAD Case Study


The topic of valuation and measurement of return (i.e. investment success) permeates the whole life cycle of private equity (PE). While the valuation part is in many ways similar to other direct investment strategies, the measuring of returns in private equity is a notoriously difficult business, mainly due to the absence of an efficient and transparent market for the asset class. So while theoretically not difficult, the wide range of practical approaches – often designed to produce a specific outcome – tend to be confusing to an outsider or new student of the field. This paper does not attempt to systematically explore all the variations that exist in the market but rather to give an overview of the most common approaches, highlighting their strengths and weaknesses and pointing to major alternative methods.

BOVARD Timothy, CARRICK-CAGNA Anne-Marie
Search Funds: An Alternative Route to Becoming an Equity-Owning Manager
© 2011 INSEAD Case Study

This note is divided into two sections. In the first part, Simon Webster, widely regarded as the pioneer of search funds in the UK, recounts his experience of creating his first search fund, buying a company in 1995, and selling it for £30 million in 2005, making a great return on investment for himself and his investors. The second part introduces four other European search funders who are at different stages - one who has closed his fund and is about to acquire a company; one who has just closed his fund and is looking for a suitable business to purchase; and two who are at the fundraising stage. A discussion ensues between the search funders of their different approaches, the challenges they face and their own experiences of the model.

Pedagogical Objectives: The aim is to introduce the search fund model to students (in particular students studying outside the US where the model is still relatively unknown). The discussion between the search funders allows the students to weigh up the pros and cons of the model - is it the right path for them to acquire a company? It gives responses to the questions frequently asked surrounding the search fund model, offering concrete examples of successful funds and some of the pitfalls to avoid. It gives advice on how to approach potential investors, such as whether to have a partner, and the best time in your career to start a fund.
YANG Anne, ZHANG Hong, SHAH Gourang
Tyco International: Corporate Liquidity Crisis and Treasury Restructuring

© 2011 INSEAD Case Study


In 2002, Tyco International experienced a corporate crisis which put the conglomerate in danger of bankruptcy. The case follows how the company succesfully tackled a short-term liquidity crisis as well as the steps taken to establish a global treasury management structure to position Tyco going forward.

Pedagogical Objectives: This case allows students to learn and understand (i) the role and practice of corporate treasury (ii) the current trend for corporations to move from decentralised to centralised corporate treasury (iii) the regulatory environment of corporate treasury, and (iv) the importance of debt-maturity profile planning to avert a corporate liquidity crisis.
CHANDON Pierre, WANSINK Brian
Is Food Marketing Making us Fat? A Multi-disciplinary Review Foundations and Trends in Marketing 5, 3 (2011) 113-196

Whereas everyone recognizes that increasing obesity rates worldwide are driven by a complex set of interrelated factors, the marketing actions of the food industry are often singled out as one of the main culprits. But how exactly is food marketing making us fat? To answer this question, we review evidence provided by studies in marketing, nutrition, psychology, economics, food science, and related disciplines that have examined the links between food marketing and energy intake but have remained largely disconnected. Starting with the most obtrusive and most studied marketing actions, we explain the multiple ways in which food prices (including temporary price promotions) and marketing communication (including branding and nutrition and health claims) influence consumption volume. We then study the effects of less conspicuous marketing actions which can have powerful effects on eating behavior without being noticed by consumers. We examine the effects on consumption of changes in the food’s quality (including its composition, nutritional and sensory properties) and quantity (including the range, size and shape of the packages and portions in which it is available). Finally, we review the effects of the eating environment, including the availability, salience and convenience of food, the type, size and shape of serving containers, and the atmospherics of the purchase and consumption environment. We conclude with research and policy implications.
CHANDON Pierre, WANSINK Brian
INSEAD Working paper 2011/64/MKT/ISSRC

Whereas everyone recognizes that increasing obesity rates worldwide are driven by a complex set of interrelated factors, the marketing actions of the food industry are often singled out as one of the main culprits. But how exactly is food marketing making us fat? To answer this question, we review evidence provided by studies in marketing, nutrition, psychology, economics, food science, and related disciplines that have examined the links between food marketing and energy intake but have remained largely disconnected. Starting with the most obtrusive and most studied marketing actions, we explain the multiple ways in which food prices (including temporary price promotions) and marketing communication (including branding and nutrition and health claims) influence consumption volume. We then study the effects of less conspicuous marketing actions which can have powerful effects on eating behavior without being noticed by consumers. We examine the effects on consumption of changes in the food’s quality (including its composition, nutritional and sensory properties) and quantity (including the range, size and shape of the packages and portions in which it is available). Finally, we review the effects of the eating environment, including the availability, salience and convenience of food, the type, size and shape of serving containers, and the atmospherics of the purchase and consumption environment. We conclude with research and policy implications.
BURKART Mike, GROMB Denis, MUELLER Holger M., PANUNZI Fausto
INSEAD Working Paper 2011/63/FIN

We study the role of legal investor protection for the efficiency of the market for corporate control. Stronger legal investor protection limits the ease with which an acquirer, once in control, can extract private benefits at the expense of non-controlling investors. This, in turn, increases the acquirer’s capacity to raise outside funds to finance the takeover. Absent effective competition for the target, the increased outside funding capacity does not make efficient takeovers more likely, however, because the bid price, and thus the acquirer’s need for funds, increase in lockstep with his pledgeable income. In contrast, under effective competition, the increased outside funding capacity makes it less likely that the takeover outcome is determined by the bidders’ financing constraints–and thus by their internal funds–and more likely that it is determined by their ability to create value. Accordingly, stronger legal investor protection can improve the efficiency of the takeover outcome. Taking into account the interaction between legal investor protection and financing constraints also provides new insights into the optimal allocation of voting rights, sales of controlling blocks, and the role of legal investor protection in cross-border M&A.

Wednesday, May 25, 2011

Balance Sheet Detective
© 2011 INSEAD Case Study
Also available: Teaching Note

This is an international version of the classic ratio detective exercise that is found in many US-based textbooks and other case series. The objective is to initiate students into balance sheet analysis via the use of common-size balance sheets. The case helps students to understand how the economics of the firm are revealed in the firm’s financial statements. Effectively employed, it can also teach students to think about the links between asset composition and financial structures, and how these relate to industry economics.

PETRIGLIERI Gianpiero, WOOD Jack Denfeld, PETRIGLIERI Jennifer Louise
2011 MED Best Paper in Graduate Management Education AwardAcademy of Management
“Up Close and Personal: Building Foundations for Leaders' Development through the Personalization of Management Learning”

Monday, May 23, 2011

STING Fabian J., MIHM Jürgen, LOCH Christoph H. 
INSEAD Working Paper 2011/62/TOM

Search theory describes how organizations address problems that are too complex to be solved through optimization. Because most high-level strategic initiatives fall into this category, search is at the heart of strategic processes in most organizations. Search theory has examined how aspects of the organizational context (such as cognition, modularity, organizational structures, and decentralization of decision making) influence search performance. In examining organizational processes, search theory has focused on coordination – making separate parallel decision domains mutually compatible. The theory has not incorporated a typical element of search in real organizations: collaboration, or several actors combining their problem solving activities to develop a solution for a common problem. This paper builds a theory of collaborative search. We identify the organizational settings for which collaboration is beneficial, provide guidance on when collaboration does not improve performance, and identify methods for making collaboration effective when it is appropriate.
GOYAL Manu, NETESSINE Serguei

We analyze volume flexibility — the ability to produce above/below the installed capacity for a product — under endogenous pricing in a two-product setting. We discover that the value of volume flexibility is a function of demand correlation between products, an outcome which cannot be explained by classical risk-pooling arguments. Furthermore, while the value of product flexibility always decreases in demand correlation, we show that the value of volume flexibility can increase or decrease in demand correlation depending on whether the products are strategic complements or substitutes. We further find that volume flexibility better combats aggregate demand uncertainty for the two products, while product flexibility is better at mitigating individual demand uncertainty for each product. Our results thus underscore the necessity of analyzing volume flexibility with more than one product, and emphasize the contrast with product flexibility. Furthermore, we highlight the possible pitfalls of combining flexibilities: we show that while adding volume flexibility to product flexibility never hurts performance, adding product flexibility to volume flexibility is not always beneficial, even when such an addition is costless.
CHATAIN Olivier, ZEMSKY Peter
Strategic Management Journal32, 11 (2011) 1206-1231

We use a formal value-based model to study how frictions—incomplete linkages in the industry value chain that keep some parties from meeting and transacting—affect value creation and value capture. Frictions arise from search and switching costs and moderate the intensity of industry rivalry and the efficiency of the market. We find that firms with a competitive advantage prefer industries with less, but not zero, frictions. We show that rivalry interacts nontrivially with other competitive forces to affect industry attractiveness. Firm heterogeneity emerges naturally when we introduce resource development. Heterogeneity falls with frictions, but the sustainability of competitive advantage increases. Overall, we show that introducing frictions makes value-based models very effective at integrating analyses at the industry, firm, and resource levels.

Friday, May 20, 2011

VAN WASSENHOVE Luk, BHATTACHARYA Shantanu, ROBOTIS Andreas
Lifecycle Pricing for Installed Base Management with Constrained Capacity and Remanufacturing Production and Operations Management Journal 21, 2 (2012) 236-252

 Installed base management is the policy in which the manufacturer leases the product to consumers, and bundles repair and maintenance services along with the product. In this paper, we investigate for the optimal leasing price and leasing duration decisions by a monopolist when the production and servicing capacity are constrained. The effect of diffusion of consumers in the installed base is considered, with the ownership of the product resting with the monopolist during the product lifecycle. The monopolist operating the installed base jointly optimizes the profits from leasing the product/service bundle along with maintenance revenues and remanufacturing savings. We formulate the manufacturer's problem as an optimal control problem and show that the optimal pricing strategy of the firm should be a skimming strategy. We also find that the effect of remanufacturing savings on the pricing decision and the length of the leasing duration changes significantly depending on the duration of the product's lifecycle. If the product lifecycle is long and remanufacturing savings are low, the firm should offer a shorter leasing duration while if the remanufacturing savings are high, the firm should optimally offer a higher leasing duration. On the other hand, if the time duration of the product lifecycle is low and remanufacturing savings are low, the firm prefers to offer a shorter leasing duration, while if the remanufacturing savings are high, the firm should optimally have a longer leasing duration. The paper also shows that if the production capacity is small, the manufacturer increases the leasing duration. If the production capacity is very small, the manufacturer sets the leasing duration to be equal to the product lifecycle and does not use remanufacturing.
KOCABIYIKOGLU Ayse, POPESCU Ioana

We introduce a measure of elasticity of stochastic demand, called the elasticity of the lost-sales rate, which offers a unifying perspective on the well-known newsvendor with pricing problem. This new concept provides a framework to characterize structural results for coordinated and uncoordinated pricing and inventory strategies. Concavity and submodularity of the profit function, as well as sensitivity properties of the optimal inventory and price policies, are characterized by monotonicity conditions, or bounds, on the elasticity of the lost-sales rate. These elasticity conditions are satisfied by most relevant demand models in the marketing and operations literature. Our results unify and complement previous work on price-setting newsvendor models and provide a new tool for researchers modeling stochastic price-sensitive demand in other contexts.

Thursday, May 19, 2011


This study advances understanding of network dynamics by applying matching theory to examine entrepreneurs’ intentions to add new ties to their personal networks. I propose that task complementarity and social similarity are important matching criteria that influence entrepreneurs’ interpersonal tie formation intentions and test whether good matches increase the likelihood of the initiation of economic exchange ties. A novel research design using data from the business cards of new people met by a panel of Indian entrepreneurs reveals effects of matching and suggests that although entrepreneurs intentionally pursue valuable connections, they may be only partially accurate in their assessment of value.

KATONA Zsolt, ZUBCSEK Peter Pal, SARVARY Miklos
Journal of Marketing Research 48, 3 (2011) 425-443


This article discusses the diffusion process in an online social network given the individual connections between members. The authors model the adoption decision of individuals as a binary choice affected by three factors: (1) the local network structure formed by already adopted neighbors, (2) the average characteristics of adopted neighbors (influencers), and (3) the characteristics of the potential adopters. Focusing on the first factor, the authors find two marked effects. First, an individual who is connected to many adopters has a greater adoption probability (degree effect). Second, the density of connections in a group of already adopted consumers has a strong positive effect on the adoption of individuals connected to this group (clustering effect). The article also records significant effects for influencer and adopter characteristics. For adopters, specifically, the authors find that position in the entire network and some demographic variables are good predictors of adoption. Similarly, in the case of already adopted individuals, average demographics and global network position can predict their influential power on their neighbors. An interesting counterintuitive finding is that the average influential power of individuals decreases with the total number of their contacts. These results have practical implications for viral marketing, a context in which a variety of technology platforms are increasingly considering leveraging their consumers’ revealed connection patterns. The model performs particularly well in predicting the next set of adopters.
PUNTONI Stefano, SWELDENS Steven, TAVASSOLI Nader T.
Gender Identity Salience and Perceived Vulnerability to Breast Cancer Journal of Marketing Research 48, 3 (2011) 413-424


Breast cancer communications that make gender identity salient may have unintended deleterious effects by triggering defense mechanisms. We document adverse effects of gender identity salience on perceived vulnerability to breast cancer (Experiments 1A, 3A and 3B); donations to ovarian cancer research (1B); perceived processing difficulty (2A) and memory (2B) of breast cancer advertisements. These results are contrary to the predictions of several theoretical perspectives and a convenience sample of practitioners. We show that defensive denial of vulnerability is eliminated by self-affirmation (Experiment 3A) and fear voicing (3B). The latter studies corroborate the defensive nature of the effects, as well as provide means to minimize defensive reactions.

Wednesday, May 18, 2011

STEPHEN Andrew T., SMALL Deborah A., GALAK Jeff
Micro-Finance Decision Making: A Field Study of Prosocial Lending Journal of Marketing Research48, 2011 Special issue (2011)

Prosocial lending in the form of micro-financing, small uncollateralized loans to entrepreneurs in the developing world, has recently emerged as a leading contender as a cure for world poverty. Our research investigates, in a field setting with real world and consequential data, the characteristics of borrowers that engender lending. We observe that lenders favor individual borrowers over groups or consortia of borrowers, a pattern consistent with the identifiable victim effect. They also favor borrowers that are socially proximate to themselves. Across three dimensions of social distance (gender, occupation, and first name initial) lenders prefer to give to those who are more like themselves. Finally, we discuss policy implications of these findings.
BEARDEN J. Neil, GABA Anil, JAIN Kriti, MUKHERJEE Kanchan
INSEAD Working Paper 2011/61/DS

Subjective probabilistic judgments are inevitable in many real life domains. A common way to obtain such judgments is to assess fractiles or confidence intervals. However, such judgments tend to be systematically overconfident. For example, 90% confidence intervals for future uncertain quantities (e.g., future stock prices) are likely to capture only 50-60% of the actual realizations. Furthermore, it has proved particularly difficult to de-bias forecasts and improve the calibration of expressed subjective uncertainty. This paper proposes a simple process that systematically leads to wider assessed confidence intervals than is normally the case, thus potentially improving calibration and hence reducing overconfidence. Using a series of lab and field experiments with professionals forecasting in their domain of expertise, we show that unpacking the distal future into intermediate more proximal futures has a substantial effect on subjective forecasts. For example, simply making it salient that between now and three months from now there is one month from now and two months from now increases the uncertainty assessors have in their three month forecasts, which helps mitigate the overconfidence in those forecasts. We refer to this phenomenon as the time unpacking effect and find that it is robust to different elicitation formats. We also address the possible reasons for the time unpacking effect and propose future research directions.
SWINNEY Robert, CACHON Gerard P., NETESSINE Serguei

We analyze the competitive capacity investment timing decisions of both established firms and start-ups entering new markets which are characterized by a high degree of demand uncertainty. Firms may invest in capacity early (when the market is highly uncertain) or late (when market uncertainty has been resolved), possibly at different costs. In our model, established firms choose investment timing and capacity level to maximize expected profits. Start-ups are prone to bankruptcy if profit turns out to be too low, and hence choose investment timing and capacity level to maximize the probability of survival. Surprisingly, we find that in monopoly situations, a start-up is more likely to prefer early investment than an established firm, despite the presence of demand uncertainty. In duopoly situations with one start-up and one established firm competing in the same market, we characterize the equilibria of a strategic capacity investment timing game in which firms choose when to build capacity. We find that when demand uncertainty is high and costs do not decline too severely over time, the unique equilibrium of this game is for the start-up to take a leadership role and invest first in capacity while the established firm follows; by contrast, when two established firms compete in an otherwise identical game, high demand uncertainty leads to both firms investing late. Thus, the threat of bankruptcy leads to an increase in sequential investment outcomes in which the start-up leads, a result that we demonstrate persists even if the start-up is concerned with both profit and bankruptcy risk or profit above the bankruptcy threshold. We conclude that the threat of firm failure significantly impacts the dynamics of competition involving start-ups.

Tuesday, May 10, 2011

KIM Ji-Yub (Jay), HALEBLIAN Jerayr (John), FINKELSTEIN Sydney
When Firms are Desperate to Grow via Acquisition: The Effect of Growth Patterns and Acquisition Experience on Acquisition Premiums Administrative Science Quarterly 56, 1 (2011) 26-60

In this paper we draw on work in behavioural learning theory and risk taking to examine whether firms desperate for growth overpay for acquisitions, and we develop a theory of desperation in the context of growth. We suggest two key drivers of such desperation: (1) when a firm’s organic growth is low, paying handsomely for acquisitions may be one of the few options for growth, and (2) when a firm becomes dependent on acquisitions for continuing growth, it is vulnerable to overpaying for acquisitions. Although pressures to grow via acquisition can be intense, we also test whether the benefits of acquisition experience—from both acquirers and their advisors—help to prevent overpayment caused by desperation. We test these ideas in a sample of firms in the banking industry between 1994 and 2005. Consistent with this theory of desperation, our results show that firms desperate for growth are more likely to pay high acquisition premiums. Our findings on the moderating role of acquisition experience show that advisors’ acquisition experience is more helpful than acquirers’ own acquisition experience in preventing desperate acquirers from overpaying for a target. Taken together, this study introduces and tests a new theoretical perspective on firm behaviour in the context of growth and suggests how such a perspective might be applicable in other contexts

Friday, May 6, 2011

SOSA Manuel, MIHM Jürgen, BROWNING Tyson
INSEAD Working Paper 2011/60/TOM revised version of 2010/53/TOM

Defining the appropriate product architecture enables organizations to cope with the managerial challenges of designing high-quality products. This paper integrates two formerly unrelated but complementary views of product architecture to uncover architectural characteristics that harm quality. First, taking a structural view (by which products are networks of interlinked components), we identify the components involved in cyclical dependencies. We show empirically that these components exhibit a higher level of defects than all other components. This challenges the assumption that all connectivity patterns are detrimental to quality. Then, we complement the structural view with a hierarchical view (by which components are organized into hierarchical modules) to examine how the interplay of cycles and modules affects quality. We show empirically: (a) components in cycles are even more defect-prone when cycles span hierarchical modules; (b) there are spill-over effects from components in cycles to certain other components due to associations introduced by hierarchical modules.

Thursday, May 5, 2011

HUNTER Mark Lee, VAN WASSENHOVE Luk , BESIOU Maria, VAN HALDEREN Mignon
INSEAD Working Paper 2011/59/TOM/ISIC revised version of 2009/62/TOM/ISIC

This article considers how “stakeholder media” – media produced and controlled by stakeholders with the purpose of affecting public opinion or attitudes of other actors towards issues or organisations – can exert a powerful influence on firms by setting the public agenda and framing a company’s corporate social responsibility (CSR) initiatives in ways desirable for those stakeholders. We observe that research on agenda-setting, which is largely based on studies of traditional news media, generally ignores the increasingly powerful reach and impact of media controlled by stakeholders. Hence, based on a case study of BP’s CSR campaign “Beyond Petroleum”, we propose a new model that addresses agenda-setting by stakeholder media. The model captures distinct agenda-setting as well as framing techniques used by stakeholder media to put pressure on BP’s “Beyond Petroleum” rebranding campaign. We thus aim to advance extant agenda-setting concepts by demonstrating how stakeholder media ultimately exert different, and in some ways stronger, influences on firms than traditional news media.
AGGARWAL Vikas A.., SIGGELKOW Nicolaj, SINGH Harbir

We examine the performance implications of selecting alternative modes of governance in interorganizational alliance relationships. While managers can choose from a range of modes to govern alliances, prior empirical evidence offers limited guidance on the performance impact of this choice. We use an agent-based simulation of interfirm decision making to complement empirical studies in this area. Our results point to a complex interplay between interdependencies, governance structures, and firms' search capabilities. Different patterns of interdependence create varying needs with respect to coordination and exploration, while at the same time different governance modes, coupled with organizational search capabilities, supply varying degrees of these factors. Firm performance in an alliance relationship improves when the needs and supplies of coordination and exploration are matched. We find that situations in which stronger organizational search capabilities can backfire, leading to lower exploration within the alliance relationship, and hence to lower firm performance. Moreover, we show that for higher levels of interdependence, coordination can become more critical for firm performance than exploration: unless it is tied to coordination, exploration can be ineffective in alliance settings. Copyright © 2010 John Wiley & Sons, Ltd.
WITT Michael A.
China Modernizes: Threat to the West or Model for the Rest? (Review of Randall Peerenboom's book) Asian Business and Management 10,2 (2011) 319-321

Wednesday, May 4, 2011

KIM Sang-Hyun, COHEN Morris A., NETESSINE Serguei
INSEAD Working Paper 2011/58/TOM revised version of 2010/62/TOM

In the defence industry, traditional sourcing arrangements for after-sales support of weapons systems (“products”) have centred around physical assets. Typically, the customer, a military service, would pay the supplier of maintenance services in proportion to the resources used (such as spare parts) to maintain the product. In recent years we have witnessed the emergence of a new service contracting strategy called performance-based logistics. Under a performance-based contract (PBC), the basis of supplier compensation is actually realized during uptime of the product. The goal of this paper is to compare the inefficiencies arising under the traditional resource-based contract (RBC) and PBC. In both cases, the customer sets the contract terms, and as a response the supplier sets the base-stock inventory level of spares and invests in improving product reliability. We find that PBC provides stronger incentives for the supplier to invest in reliability improvement, which in turn leads to savings in acquiring and holding spare product assets. Moreover, the efficiency of PBC improves if the supplier owns a larger portion of the spare assets. Our analysis supports the DoD recommendation for moving towards PBC and transforming suppliers into total service providers.

Tuesday, May 3, 2011

RAMPL Linn Viktoria, PLASSMANN Hilke, KENNING Peter
Consumer Neuroscience and "Neuromarketing" - What you Need to be Aware of (German original title: "Consumer Neuroscience und "Neuromarketing" - Worauf Sie Achten Sollten") Absatzwirtschaft 5 (2011), 22-24

Neuromarketing ist längst nicht mehr ein reiner Wissenschaftsbereich. Consumer Neuroscience ist im Alltag von Unternehmen, Marketing- und Werbeagenturen angekommen. In der Mai-Ausgabe der absatzwirtschaft klären Linn Viktoria Rampl, Professor Hilke Plassmann und Professor Peter Kenning darüber auf, was sich hinter dem Begriff verbirgt, wie es funktioniert und welche Ergebnisse es zu Tage fördert. Hat sich ein Unternehmen für Neuromarketing als Instrument entscheiden, stellt sich die Frage nach dem richtigen Verfahren. Das Angebot auf dem Research-Markt ist groß. Welches Verfahren sich tatsächlich anbietet, hängt nicht nur von der Fragestellung der Untersuchung ab, sondern ebenso von der Methodik des Verfahrens und des Budgets des Unternehmens. Die Anschaffung komplexer Technik ist teuer. Steckbriefe für die neun gebräuchlichsten und relevantesten Verfahren sollen auf den folgenden Seiten einen Überblick geben.

Monday, May 2, 2011

INSEAD Working Paper 2011/56/ST revised version of 2010/100/ST

The literature on top-down strategy implementation has overlooked social-emotional factors. The results of a three-year field study of a large technology firm show how top executives who favor an affect-neutral task approach can inadvertently activate middle managers’ organization-related social identities, such as length of time working for the company (newcomers versus veterans) and language spoken by senior executives (English versus French), generating group-focus emotions. These emotions prompt middle managers—even those elevated to powerful positions by top executives—to support or covertly dismiss a particular strategic initiative even when their immediate personal interests are not directly under threat. This study contributes to the strategy implementation literature by linking senior executives’ actions and middle managers’ social identities, group-focus emotions, and resulting behaviors to strategy implementation outcomes.