Europe

80 Results

 

HBS Cases: LEGO

LEGO toys have captivated children and their parents for 80 years. But managing the enterprise has not always been fun and games. Professor Stefan H. Thomke explains the lessons behind a new case on the company. Open for comment; 14 Comments posted.

The Dirty Laundry of Employee Award Programs: Evidence from the Field

Timothy Gubler, Ian Larkin, and Lamar Pierce

Many scholars and practitioners in human resource management have recently argued that awards and other forms of on-the-job recognition provide a "free" way to motivate employees. But are there unintended, negative effects of such awards? In this paper, the authors simultaneously examine the costs and benefits of an attendance award program that was implemented in an industrial laundry plant. The award used in the study was effective in that it reduced the average rate of tardiness among employees. However, it also led to a host of potential spillover effects that the plant manager readily admits were not considered when designing the program, and that reduced overall plant productivity. Overall, findings demonstrate that an award program that appears to be effective may also induce unintended consequences severely reducing the net value of the program. These results highlight the impact such a program can have on the overall performance of the firm and suggest caution when designing and implementing such programs. Read More

Few Women on Boards: Is There a Fix?

Women hold only 14 percent of the board seats at S&P 1500 companies. Why is that, and what—if anything—should business leaders and policymakers do about the gender disparity? Research by Professor Boris Groysberg and colleagues shows that male and female board members have very different takes on the issue. Open for comment; 17 Comments posted.

Power to the People: The Unexpected Influence of Small Coalitions

J. Gunnar Trumbull discusses his new book, Strength in Numbers, in which he argues that diffuse groups—environmentalists, consumer activists, farmers—wield great influence in areas of regulation including trade to product safety and labor policy. Open for comment; 1 Comment posted.

Book Excerpt: Strength in Numbers

In his new book, Strength in Numbers: The Political Power of Weak Interests, Gunnar Trumbull shows how consumer groups can effect change by forming interest-driven alliances among activists, regulators, and corporations. Open for comment; 0 Comments posted.

Vulnerable Banks

Robin Greenwood, Augustin Landier, and David Thesmar

Since the beginning of the US financial crisis in 2007, regulators in the United States and Europe have been frustrated by the difficulty in identifying the risk exposures at the largest and most levered financial institutions. Yet, at the time, it was unclear how such data might have been used to make the financial system safer. This paper is an attempt to show simple ways in which this information can be used to understand how deleveraging scenarios could play out. To do so the authors develop and test a model to analyze financial sector stability under different configurations of leverage and risk exposure across banks. They then apply the model to the largest financial institutions in Europe, focusing on banks' exposure to sovereign bonds and using the model to evaluate a number of policy proposals to reduce systemic risk. When analyzing the European banks in 2011, they show how a policy of targeted equity injections, if distributed appropriately across the most systemic banks, can significantly reduce systemic risk. The approach in this paper fits into, and contributes to, a growing literature on systemic risk. Read More

HBS Cases: Sir Alex Ferguson--Managing Manchester United

For almost three decades, Sir Alex Ferguson has developed the Manchester United soccer club into one of the most recognized sports brands in the world. Professor Anita Elberse discusses the keys to Sir Alex's long-time success. Open for comment; 22 Comments posted.

Is Support for Small Business Misplaced?

Summing Up Is small business overhyped as a panacea for our economic troubles? Jim Heskett's readers don't think so. Closed for comment; 35 Comments posted.

Greater Fiscal Integration Best Solution for Euro Crisis

Ministers and central bankers are working to solve the debt crisis that threatens the European integration project. Is there hope? There is reason to be optimistic, according to Harvard Business School's Dante Roscini, a former investment banker. Open for comment; 1 Comment posted.

The Forgotten Book that Helped Shape the Modern Economy

A British merchant's long-forgotten work, An Essay on the State of England, could lead to a rethinking of how modern economies developed in Europe and America, and add historical perspective on the proper relationship between government and business. An interview with business historian Sophus A. Reinert. Open for comment; 11 Comments posted.

Historical Trajectories and Corporate Competences in Wind Energy

Geoffrey Jones and Loubna Bouamane

Analyzing developments in the wind turbine business over more than a century, Geoffrey Jones and Loubna Bouamane argue that public policy has been a key variable in the spread of wind energy since the 1980s, but that public policy was more of a problem than a facilitator in the earlier history of the industry. Geography has mattered to some extent, also: Both in the United States and Denmark, the existence of rural areas not supplied by electricity provided the initial stimulus to entrepreneurs and innovators. Building firm-level capabilities has been essential in an industry which has been both technically difficult and vulnerable to policy shifts. Read More

Managing Political Risk in Global Business: Beiersdorf 1914-1990

Geoffrey Jones and Christina Lubinski

After the outbreak of World War 1, management of political risk became a central concern for firms, especially those operating internationally. These risks were on many levels, from expropriation to exchange controls and other economic policies. German firms, which had flourished during the second industrial revolution of the late nineteenth century, and enthusiastically expanded internationally, found themselves especially exposed to such risks. Focusing on one such firm, Beiersdorf, a German-based pharmaceutical and skin care company (and, during the Nazi years, a so-called Jewish business), the authors examine corporate strategies of political risk management during the twentieth century, especially the volatile years of Nazi Germany. The history of Beiersdorf highlights areas of managerial discretion. Faced by the worst of all worlds, the firm survived and was able, albeit at great cost, to rebuild its business. Read More

Rupert Murdoch and the Seeds of Moral Hazard

Harvard Business School faculty Michel Anteby, Rosabeth Moss Kanter, and Robert Steven Kaplan explore the moral, ethical, and leadership issues behind Rupert Murdoch's News of the World fiasco. Open for comment; 12 Comments posted.

Poultry in Motion: A Study of International Trade Finance Practices

Pol Antras and C. Fritz Foley

When engaging in international trade, exporters must decide which financing terms to use in their transactions. Should they ask the importers to pay for goods before they are loaded for shipment, ask them to pay after the goods have arrived at their destination, or should they use some form of bank intermediation like a letter of credit? In this paper, Pol Antràs and C. Fritz Foley investigate this question by analyzing detailed data on the activities of a single US-based firm that exports frozen and refrigerated food products, primarily poultry. The data cover roughly $7 billion in sales to more than 140 countries over the 1996-2009 period and contain comprehensive information on the financing terms used in each transaction. Read More

An Empirical Decomposition of Risk and Liquidity in Nominal and Inflation-Indexed Government Bonds

Carolin E. Pflueger and Luis M. Viceira

The yields on US Treasury Inflation Protected Securities (TIPS) have declined dramatically since they were first issued in 1997. This paper asks to what extent the returns on nominal and inflation-indexed bonds in both the US and the UK can be attributed to differential liquidity and market segmentation or to real interest rate risk and inflation risk. Read More

Mandatory IFRS Adoption and Financial Statement Comparability

Francois Brochet, Alan Jagolinzer, and and Edward J. Riedl

In the past decade, many countries have adopted International Financial Reporting Standards (IFRS) developed by the International Accounting Standards Board, which has impelled economists to examine the benefits of the standards. This paper discusses how IFRS adoption affects financial reporting comparability—that is, the properties of financial statements that allow users to identify similarities or differences between the economics of different reporting entities over any given period of time. Research was conducted by Francois Brochet and Edward J. Riedl of Harvard Business School, and Alan Jagolinzer of the University of Colorado at Boulder. Read More

Moving From Bean Counter to Game Changer

New research by HBS professor Anette Mikes and colleagues looks into how accountants, finance professionals, internal auditors, and risk managers gain influence in their organizations to become strategic decision makers. Open for comment; 12 Comments posted.

How Do Risk Managers Become Influential? A Field Study of Toolmaking and Expertise in Two Financial Institutions

Matthew Hall, Anette Mikes, and Yuval Millo

Most organizations have technical experts on staff—accountants, finance professionals, internal auditors, risk managers-but not all experts are listened to at higher levels. To understand how expert influence on strategic thinking can be increased, Matthew Hall, Anette Mikes, and Yuval Millo followed the organizational transformation of risk experts in two large UK banks. One transformation was successful, the other not. Are your experts merely "box-tickers," or are they influential "frame-makers"? Read More

What CEOs Do, and How They Can Do it Better

A CEO's schedule is especially important to a firm's financial success, which raises a few questions: What do they do all day? Can they be more efficient time managers? HBS professor Raffaella Sadun and colleagues set out to find some answers. Open for comment; 66 Comments posted.

What Do CEOs Do?

Oriana Bandiera, Luigi Guiso, Andrea Prat, and Raffaella Sadun

If time is money, as the old adage goes, then a CEO's schedule is especially important to a firm's financial success. This raises a fair question: What do CEOs do all day? To that end, researchers followed the activities of 94 CEOs in Italy over the course of a pre-specified week, enlisting the CEOs' personal assistants to track their bosses' activities with time-use diaries. Research was conducted by Raffaella Sadun of Harvard Business School, Luigi Guiso of the European University Institute, and Oriana Bandiera and Andrea Prat of the London School of Economics. Read More

Do US Market Interactions Affect CEO Pay? Evidence from UK Companies

Joseph J. Gerakos, Joseph D. Piotroski, and Suraj Srinivasan

CEOs of UK firms receive higher total compensation if their companies have interactions with US product, capital, and labor markets. Moreover, the compensation package is often adopted from American-style arrangements, such as the use of incentive-based pay. Researchers Joseph J. Gerakos (University of Chicago), Joseph D. Piotroski (Stanford), and Suraj Srinivasan (Harvard Business School) analyzed data on the compensation practices of 416 publicly traded UK firms over the period 2002 to 2007. Read More

Regulating for Legitimacy: Consumer Credit Access in France and America

Gunnar Trumbull

Why have American households consistently borrowed so heavily? And why have their counterparts in France borrowed so little? This comparative historical analysis by HBS professor Gunnar Trumbull traces the roots of these different attitudes. In the United States, early welfare reformers embraced credit "on a business-like basis" as an alternative to expansive welfare states of the sort that were emerging in Europe. In France, early social planners saw consumer credit as a drain on savings that threatened to crowd out industrial investment. Regulatory regimes that emerged in the postwar period in the two countries reflected these different interpretations of the economic and social role of credit in society. Read More

Tesco’s Stumble into the US Market

UK retailer Tesco was very successful penetrating foreign markets—until it set its sights on the United States. Its series of mistakes and some bad luck are captured in a new case by Harvard Business School marketing professor John A. Quelch. Read More

The Impact of Supply Learning on Customer Demand: Model and Estimation Methodology

Nathan Craig, Nicole DeHoratius, and Ananth Raman

"Supply learning" is the process by which customers predict a company's ability to fulfill product orders in the future using information about how well the company fulfilled orders in the past. A new paper investigates how and whether a customer's assumptions about future supplier performance will affect the likelihood that the customer will order from that supplier in the future. Research, based on data from apparel manufacturer Hugo Boss, was conducted by Nathan Craig and Ananth Raman of Harvard Business School, and Nicole DeHoratius of the University of Portland. Read More

Will Transparency in CEO Compensation Have Unintended Consequences?

Summing Up: The Dodd-Frank legislation requiring companies to compare CEO compensation with rank-and-file pay will have little or no impact on executive compensation levels, say Jim Heskett's readers. (Online forum has closed; next forum opens November 4.) Closed for comment; 55 Comments posted.

How Mercadona Fixes Retail’s ’Last 10 Yards’ Problem

Spanish supermarket chain Mercadona offers aggressive pricing, yet high-touch customer service and above-average employee wages. What's its secret? The operations between loading dock and the customer's hands, says HBS professor Zeynep Ton. Read More

From Russia with Love: The Impact of Relocated Firms on Incumbent Survival

Oliver Falck, Christina Guenther, Stephan Heblich, and William R. Kerr

The relocation of the machine tool industry from the Soviet-occupied zone of postwar Germany to western regions is a unique laboratory for studying the impact of industrial structures on incumbent survival. Typically, geographic agglomerations of similar firms offer benefits to each member firm by reducing the transportation costs for material goods, specialized workers, and industry knowledge among the firms. Of course, tight geographic concentration comes with countervailing costs as firms compete for local inputs. In this paper, HBS professor William R. Kerr and coauthors study the impact of increased local concentration on incumbent firms by considering postwar Germany, when the fear of expropriation (or worse) in the wake of World War II prompted many machine tool firm owners to flee to western Germany, where they reestablished their firms. Read More

Corporate Governance and Internal Capital Markets

Zacharias Sautner and Belén Villalonga

What is the impact of corporate ownership on corporate diversification and on the efficiency of firms' internal capital markets? Corporate governance and internal capital markets are two topics closely intertwined in theoretical research; for example, agency problems—which corporate governance mechanisms seek to mitigate in a variety of ways—are at the heart of every theory of inefficient internal capital markets. Yet surprisingly few empirical studies have looked into the actual link between corporate governance and internal capital markets. This paper by University of Amsterdam professor Zacharias Sautner and HBS professor Belén Villalonga seeks to fill the gap by taking advantage of a natural experiment provided by a tax change in Germany in 2002. The researchers provide direct evidence of the effect of governance structures on how markets work, as well as new evidence about the benefits and costs of ownership concentration. Read More

Environmental Federalism in the European Union and the United States

David Vogel, Michael Toffel, Diahanna Post, and Nazli Z. Uludere Aragon

Under what circumstances will individual states take the lead in passing the most stringent environmental regulations, and when will the federal government take the lead? When a state takes a leadership role, will other states follow? HBS professor Michael Toffel and coauthors describe the development of environmental regulations in the U.S. and EU that address automobile emissions, packaging waste, and global climate change. They use these three topics to illustrate different patterns of environmental policymaking, describe the changing dynamics between state and centralized regulation in the United States and the EU. Read More

The History of Beauty

Geoffrey G. Jones

Fragrance, eyeliner, toothpaste—the beauty business has permeated our lives like few other industries. But surprisingly little is known about its history, which over time has been shrouded in competitive secrecy. HBS history professor Geoffrey Jones offers one of the first authoritative accounts in Beauty Imagined: A History of the Global Beauty Industry. Read More

The Economic Crisis and Medical Care Usage

Annamaria Lusardi, Daniel Schneider, and Peter Tufano

The global economic crisis has taken a historic toll on national economies and household finances around the world. What is the impact of such large shocks on individuals and their behavior, especially on their willingness to seek routine medical care? In this research, Annamaria Lusardi of Dartmouth College, Daniel Schneider of Princeton University, and Peter Tufano of Harvard Business School find strong evidence that the economic crisis—manifested in job and wealth losses—has led to large reductions in the use of routine medical care. Specifically, more than a quarter of Americans reported reducing their use of such care, as did between 5 and 12 percent of Canadian, French, German, and British respondents. Read More

Labor Regulations and European Private Equity

Ant Bozkaya and William R. Kerr

Recent theoretical models predict that countries with stricter labor policies will specialize in less innovative activities due to the higher worker turnover frequently associated with rapidly changing sectors. HBS visiting scholar Ant Bozkaya and HBS professor William R. Kerr examine how differences in labor regulations across European countries influence the development of private equity markets, comprised of venture capital and buy-out investors. In so doing, the researchers provide the first empirical evidence for this theoretical prediction at the industry level in the entrepreneurial finance literature. They also make a methodological contribution by demonstrating how jointly modeling the different policies for providing worker insurance delivers more consistent results than their individual relationships would indicate by themselves. Read More

Private Equity and Industry Performance

Shai Bernstein, Josh Lerner, Morten Sørensen, and Per Strömberg

In response to the global financial crisis that began in 2007, governments worldwide are rethinking their approach to regulating financial institutions. Among the financial institutions that have fallen under the gaze of regulators have been private equity (PE) funds. There are many open questions regarding the economic impact of PE funds, many of which cannot be definitively answered until the aftermath of the buyout boom of the mid-2000s can be fully assessed. HBS professor Josh Lerner and coauthors address one of these open questions, by examining the impact of PE investments across 20 industries in 26 major nations between 1991 and 2007. In particular, they look at the relationship between the presence of PE investments and the growth rates of productivity, employment, and capital formation. Read More

International Differences in the Size and Roles of Corporate Headquarters: An Empirical Examination

David Collis, David Young, and Michael Goold

Are small headquarters more nimble and efficient than large ones? Not necessarily, according to HBS adjunct professor David Collis and coauthors David Young and Michael Goold. Even within a single industry in one country, the variance can be enormous: In Germany in the late 1990s, for instance, Hoechst, the chemical and pharmaceutical manufacturer, had only 180 people in the headquarters function at the same time that Bayer had several thousand. This paper seeks to fill gaps in the research by using a unique database of over 600 companies in seven countries to determine whether systematic differences in the size and roles of corporate headquarters between countries actually exist, and if so, how they differ. In particular, the authors examine whether there is a systematic difference between market- and bank-centered economies, and between developed and developing countries. Read More

Customer Feedback Not on elBulli’s Menu

The world is beating a path to Chef Ferran Adrià's door at elBulli, but why? In professor Michael Norton's course, students learn about marketing from a business owner who says he doesn't care whether or not customers like his product. Read More

Where is the Pharmacy to the World? International Regulatory Variation and Pharmaceutical Industry Location

Arthur Daemmrich

The era of paternalistic medicine has passed, but the notion that patients can act as consumers and make appropriate decisions concerning medical treatment poses countervailing risks of its own. A better accommodation among key players needs to be struck to foster the safe use of pharmaceuticals, according to HBS professor Arthur Daemmrich. The "pharmacy to the world," once located at the intersection of Germany, Switzerland, and France, today is found in the United States. Studies of the industry have attributed this sustained competitive advantage to a variety of factors, including U.S. intellectual property policies, funding for biomedical research through the National Institutes of Health, the absence of government controls on drug prices, and the availability of venture capital and other factors that fostered the growth of the biotechnology industry. The data and analysis presented in this working paper, however speculative, are an initial step toward deepening the understanding of interrelationships between government regulation, patients' mobilization both as regulators and as consumers, and the functioning of the pharmaceutical industry. Read More

The Energy Politics of Russia vs. Ukraine

A recent Harvard Business School case looks at Russia's decision in 2006 to cut off supply of natural gas to Ukraine's energy company—a move repeated this year. Is Russia just an energy bully? Students of professor Rawi Abdelal learn there is nothing black and white when it comes to Russia's energy politics. From HBS Alumni Bulletin. Read More

Market Reaction to the Adoption of IFRS in Europe

Christopher S. Armstrong, Mary E. Barth, Alan D. Jagolinzer, and Edward J. Riedl

How do investors in European firms react to a change in financial reporting? Prior to 2005, most European firms applied domestic accounting standards. The adoption of International Financial Reporting Standards (IFRS) would result in the application of a common set of financial reporting standards within Europe, and between Europe and the many other countries that require or permit application of IFRS. However, modification of IFRS by European regulators would result in European standards differing from those used in other countries, thereby eliminating some potential convergence benefits. This study investigates the equity market reaction to 16 events associated with the adoption of IFRS in Europe. Overall, the researchers' findings are consistent with investors expecting the benefits associated with IFRS adoption in Europe to exceed the expected costs. Read More

Extending Producer Responsibility: An Evaluation Framework for Product Take-Back Policies

Michael W. Toffel, Antoinette Stein, and Katharine L. Lee

Managing products at the end of life (EOL) is of growing concern for durable goods manufacturers. While some manufacturers engage in voluntary "take back" of EOL products for a variety of competitive reasons, the past 10 years have seen the rapid proliferation of government regulations and policies requiring manufacturers to collect and recycle their products, or pay others to do so on their behalf. Toffel, Stein, and Lee develop a framework for evaluating the extent to which these product take-back regulations offer the potential to reduce the environmental impacts of these products in an effective and cost-efficient manner, while also providing adequate occupational health and safety protection. The evaluation framework is illustrated with examples drawn from take-back regulations in Europe, Japan, and the United States. Read More

Economic Impacts of Immigration: A Survey

Sari Pekkala Kerr and William R. Kerr

International migration is a mighty force globally. According to United Nations statistics, over 175 million people, accounting for 3 percent of the world's population, live permanently outside their countries of birth. This paper surveys the economic impacts of immigration for host countries, mostly emphasizing the recent experiences of Northern Europe and Scandinavia. The paper documents how migrant flows to some countries within this region are now of similar magnitude to the United States. The authors discuss the impact of immigration on national labor markets in terms of both immigrant assimilation and possible native displacement. Their survey concludes with the impact of immigration on the public finances of host countries, which is of particular policy importance within Europe today given ageing populations and fiscal imbalances. Read More

Consequences of Voluntary and Mandatory Fair Value Accounting: Evidence Surrounding IFRS Adoption in the EU Real Estate Industry

Karl A. Muller, III, Edward J. Riedl, and Thorsten Sellhorn

The required adoption of International Financial Reporting Standards (IFRS) in the European Union, effective January 1, 2005, resulted in a number of significant changes in how firms report their financial results. Mandatory IFRS adoption has been criticized for both the flexibility afforded under the standards and the encroachment of the fair value paradigm. Specifically, common accounting standards alone may not be sufficient to provide the benefits of common accounting practices. This paper examines the causes and consequences of different forms of fair value disclosures for tangible long-lived assets. Insights may assist standard setters and users in understanding the factors influencing firms' current and future accounting choices, and may also interest U.S. standard setters and managers of the almost 250 publicly traded U.S. real estate firms. Read More

The Lessons of Business History: A Handbook

Geoffrey G. Jones

Compiling a handbook on the current thinking in any area of study seems daunting enough, but the just-published Oxford Handbook of Business History carries an even larger mission: bring the lessons of business history to current research in other disciplines and to the practice of business management itself. A Q&A with coeditor Geoffrey Jones. Read More

Radical Design, Radical Results

Consumers appear increasingly willing to make purchase decisions based upon their emotions about a product—how it looks, or sounds, or makes them feel using it. But the traditional design process based on user experience goes only so far in creating radical innovation. Harvard Business School visiting scholar Roberto Verganti is exploring the new world of "design-driven innovation." Read More

Climate Change Puts Heat on GMs

Ready or not, companies are being swept up in the increasing public debate over global climate change. How should firms respond? A case study exploring how financial service giant UBS thinks through the issues has students coming down on different sides. Read More

Sharpening Your Skills: Managing Innovation

Can creativity be managed? Where do creative ideas come from? These questions and others are explored in this latest collection from the HBS Working Knowledge archives. Read More

High Note: Managing the Medici String Quartet

Robert D. Austin

As one of the top ensembles in classical music, the Medici String Quartet has enjoyed a long and creative collaboration. But it hasn't always been harmonious. HBS professor Robert Austin explains what innovative businesses can learn about managing creative people. Read More

HBS Cases: Using Investor Relations Proactively

Gregory S. Miller, Vincent Dessain, and Daniela Beyersdorfer

Investor relations has a delicate balancing act. It communicates with stakeholders, of course, but can also help employees take a step back and analyze their firm as outsiders do. Harvard Business School's Gregory S. Miller, Vincent Dessain, and Daniela Beyersdorfer explain where IR is going, with energy giants BP and Total leading the way. Read More

All Eyes on Slovakia’s Flat Tax

Laura Alfaro, Vincent Dessain, and Ane Damgaard Jensen

The flat tax is an idea that's burst to life in post-communist Eastern and Central Europe, especially in Slovakia. But is the rest of the world ready? A new Harvard Business School case on Slovakia's complex experience highlights many hurdles elsewhere, as HBS professor Laura Alfaro, Europe Research Center Director Vincent Dessain, and Research Assistant Ane Damgaard Jensen explain in this Q&A. Read More

Learning from Failed Political Leadership

D. Quinn Mills

Strategic independence and better leadership assessment—these are the critical issues for both business and government in the future, says Professor D. Quinn Mills. In this Q&A he describes key lessons from his new book, Masters of Illusion, coauthored with Steven Rosefielde. A book excerpt follows. Read More

Handicapping the Best Countries for Business

Richard H.K. Vietor

India? South Africa? Russia? Which are the best countries for a firm to invest in? In a new book, Professor Richard Vietor looks at the economic, political, and structural strengths and weaknesses of ten countries and tells readers how to analyze the development of these areas in the future. Read our Q&A and book excerpt. Read More

Capital Rules: The Tensions of Global Finance

With the start of the new decade, most global financial powers are rethinking a previously powerful trend toward liberalizing global finance. In his new book Capital Rules, Professor Rawi Abdelal charts the intellectual, legal, and political history of financial globalization, and the tensions facing today's world economy. Read an excerpt. Read More

“Don’ts" and "Do’s”: Insights from Experience in Mitigating Risks of Western Investors in Post-Communist Countries

Charalambos A. Vlachoutsicos and Paul R. Lawrence

Cultural and other misunderstandings between westerners and locals in post-communist countries are very costly, and western investors grossly underestimate how damaging ineffective interaction really is. This article shows that such interaction constitutes a major stumbling block to effective risk management and stands in the way of the enterprise fully taking advantage of opportunities for profit in these product-hungry, fast-expanding, and dynamic economies. Ultimately, effective communication between westerners and locals is the necessary condition for the success of western investments in transition countries. Read More

U.S. Tops Business Competitiveness Index 2006

The United States and Germany continue to top an annual review of the business competitiveness of 121 countries, which is compiled by Professor Michael Porter's Institute for Strategy and Competitiveness at Harvard Business School. While India climbed in the rankings, China fell. Read More

HBS Cases: Porsche’s Risky Roll on an SUV

Why would any company in the world want to locate in a high-cost, high-wage economy like Germany? Porsche's unusual answer in a globalizing auto industry has framed two case studies by HBS professor Jeffrey Fear and colleague Carin-Isabel Knoop. Read More

How Europe Wrote the Rules of Global Finance

Rawi E. Abdelal

Following decades of liberalization, controls on cross-border capital movements are again being discussed by financial institutions, governments, and policymakers around the globe. Professor Rawi Abdelal discusses implications and the historical roles of Europe and the United States in promoting the flow of capital across national borders. Read More

Whatever Happened to Caveat Emptor?

J. Gunnar Trumbull

In many world nations, consumers enjoy vast protections that are relatively new on the scene. Why the rapid rise in consumer protectionism? Why do these efforts vary from country to country? A discussion with professor Gunnar Trumbull on his new book, Consumer Capitalism. Read More

Investor Protection: The Czech Experience

Mihir A. Desai

When TV Nova launched as the first private television channel in post-communist Czechoslovakia, few anticipated the business drama behind the scenes. HBS professor Mihir Desai explains what managers can learn from one unlucky investor's experience. Read More

When Rights of First Refusal Are a Bad Deal

Alvin E. Roth

Contracts that include a right of first refusal usually benefit the holder of that right. But not always. New research by professor Alvin E. Roth and colleague Brit Grosskopf explains when it's wise to say no. Read More

Unilever: Transformation and Tradition

In a new book, professor Geoffrey Jones looks at Unilever's decades-old transformation from fragmented underperformer to focused consumer products giant. This epilogue summarizes the years 1960 to 1990. Read More

Homers: Secrets on the Factory Floor

Michel J. Anteby

Homers are things you make for personal use while on company time. Professor Michel Anteby says that although the practice might be illegal, some companies secretly endorse it. Here's why. Read More

What’s the Future of Globally Organized Labor?

There’s an ongoing story of fragmentation in the union movement in North America. Will the concept of cooperation and individual sacrifice for the common good work in a global labor market populated by large multinational employers? Closed for comment; 11 Comments posted.

How Organizations Create Social Value

A study of smart practices by social and business organizations in Iberoamerica. Research by HBS professor James Austin, HBS senior researcher Ezequiel A. Reficco, and UNIANDES professor Roberto Gutiérrez. Read More

Restoring a Global Economy, 1950–1980

In his recent book Multinationals and Global Capitalism, professor Geoffrey Jones dissects the influence of multinationals on the world economy. This excerpt recalls the rebuilding of the global economy following World War II. Read More

Why IT Matters in Midsized Firms

Marco Iansiti, George Favaloro, James Utzschneider, and Greg Richards

What does IT actually contribute to a business? Is IT a commodity like electricity or is it a crucial element of competitive advantage? In a study of over 600 medium-sized global firms to analyze the business benefits that IT can enable, the authors found that IT capability was key to profitable business growth. This was true in both the U.S. product and services sectors as well as in Germany and Brazil. Read More

Germany’s Pioneering Corporate Managers

Professor Jeffrey Fear's new book Organizing Control takes a fresh look at corporate management innovations created by German companies and managers over the last two centuries. A Q&A with the author. Read More

HBS Center Focuses on Europe

Vincent Dessain and Anders Sjöman

The Euro is changing the face of business in Europe, and Harvard Business School’s Europe Research Center is right in the middle of it all. Read More

European Private Equity—Still a Teenager?

If the private equity industry has a life cycle, these are the teenage years for Europe, according to panelists at the conference session on European private equity. Read More

Why Europe Lags in Pharmaceuticals and Biotech

Governmental, cultural and academic differences are hurting Europe’s chances of gaining on the U.S. Can anything be done? Read More

Peeling Back the Global Brand

The global brand is a hard nut to crack. In a session devoted to these seemingly all-powerful brands, professors and practitioners exposed the fault lines. Read More

Foreign Multinationals in the U.S.: A Rocky Road

Geoffrey G. Jones

Why do many of the world’s leading multinationals experience managerial and performance problems in the United States? The answers, as offered by Harvard Business School professor Geoffrey G. Jones, provide lessons for all companies operating on foreign soil. Read More

Are We Entering an Era of European Management Leadership?

Closed for comment; 11 Comments posted.

Countries on the Cusp: The Power of Nationalism

Rawi E. Abdelal

What’s nationalism got to do with it? If you’re talking about the world economy, then the answer is quite a lot, says HBS professor Rawi Abdelal. In a conversation about his new book, Abdelal describes the power nationalism has over new countries—and its very far-reaching effects. Read More

Alfred Chandler on the Electronic Century

Pulitzer Prize-winning historian Alfred D. Chandler Jr. examines the development of two pivotal industries in post-World War II America—the consumer electronics and computer industries. Read More

Merchants to Multinationals: British Trading Companies in the Nineteenth and Twentieth Centuries

It was a business world defined by globalization and growing interdependency. But it's not international trade circa 2000. As HBS professor Geoffrey Jones points out, the "global economy" first emerged in the 1870s. Read More

Something Ventured, Something Gained: A European View of Venture Capital

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Privatization and the New European Economy

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Entrepreneurship in Europe

Can the entrepreneurial spirit that's thrived in the U.S. and flourished amid the bloom of the dot.com economy make it in Europe and, if so, what will it take? Read More

The State of the Markets

Technology is bringing about vast changes in worldwide financial markets, generating improvements in efficiency, speed and economies of scale. But as technological change continues to occur, attention must also be paid to changes in the role that regulation plays, said industry leaders in a panel on "Technology and the Future of the Financial Markets." Read More

Three Countries, Three Choices in Post-Soviet Eurasia

The experience of three states of the former Soviet Union in the shadow of post-Soviet Russia, says HBS Professor Rawi Abdelal, shows that nationalism plays a far greater role in economic policy than has generally been recognized. Read More

Companies, Cultures and the Transformation to the Transnational

Often overlooked in the move into the international arena, a comapny's heritage can have a major impact on how it adapts to the new environment. In this excerpt from the second edition of their pioneering book Managing Across Borders: The Transnational Solution, HBS Professor Christopher A. Bartlett and Sumantra Ghoshal examine one aspect of that heritage: the influence on a company of its nation's history, infrastructure and culture. Read More