- 09 Dec 2008
- First Look
- 08 Dec 2008
- Research & Ideas
Thinking Twice About Supply-Chain Layoffs
Cutting the wrong employees can be counterproductive for retailers, according to research from Zeynep Ton. One suggestion: Pay special attention to staff who handle mundane tasks such as stocking and labeling. Your customers do. Closed for comment; 0 Comments.
- 04 Dec 2008
- Working Paper Summaries
Local Industrial Conditions and Entrepreneurship: How Much of the Spatial Distribution Can We Explain?
Some places, like Silicon Valley, seem almost magically entrepreneurial with a new start-up on every street corner. Other areas, like declining cities of the Rust Belt, appear equally starved of whatever local attributes make entrepreneurship more likely. Many academics, policymakers, and business leaders stress the importance of local conditions for explaining spatial differences in entrepreneurship and economic development. This paper uses data from the U.S. Census Bureau to characterize these entry relationships more precisely within the manufacturing sector. Key concepts include: Local costs and relevant natural advantages (e.g., coastal access, energy prices) are very important for new manufacturing start-ups. Manufacturing start-ups are particularly drawn to cities with suitable labor forces in terms of occupational distributions. This labor dependency holds across all sizes of start-ups. New start-ups are drawn to areas with smaller, more entrepreneurial suppliers. Local customers are less important for manufacturing startups. Measures of general entrepreneurial culture did not predict manufacturing entry well. Closed for comment; 0 Comments.
- 03 Dec 2008
- What Do You Think?
Can Housing and Credit be “Nudged” Back to Health?
Did human frailty cause this crisis? Several thinkers have come forward with a suggestion for improvements to fiscal policy that are based on fostering better decisions while preserving consumer choice, says HBS professor Jim Heskett. What should be done? What do you think? (Online forum now closed. Next forum begins January 7.) Closed for comment; 0 Comments.
- 03 Dec 2008
- Working Paper Summaries
Performance Persistence in Entrepreneurship
All else equal, a venture-capital-backed entrepreneur who starts a company that goes public has a 30 percent chance of succeeding in his or her next venture. First-time entrepreneurs, on the other hand, have only an 18 percent chance of succeeding, and entrepreneurs who previously failed have a 20 percent chance of succeeding. But why do these contrasts exist? Such performance persistence, as in the first example, is usually taken as evidence of skill. However, in the context of entrepreneurship, the belief that successful entrepreneurs are more skilled than unsuccessful ones can induce real performance persistence. In this way, success breeds success even if successful entrepreneurs were just lucky. Success breeds even more success if entrepreneurs have some skill. Key concepts include: There is evidence for the role of skill as well as the perception of skill in inducing performance persistence. Closed for comment; 0 Comments.
- 01 Dec 2008
- Lessons from the Classroom
How Many U.S. Jobs Are ‘Offshorable’?
Some 900 Harvard Business School students were asked to recreate a study assessing the potential "offshorability" of more than 800 occupations in the United States. Their findings: It might be a larger number than we thought. Key concepts include: Management students are likely tomorrow to face an unprecedented array of options concerning what they can do where. Increasingly, jobs are being viewed as groups of tasks that can be bundled, unbundled, and sent to different places. Offshoring could come to an end just as quickly as it began. Closed for comment; 0 Comments.
- 26 Nov 2008
- Working Paper Summaries
The Sciences of Design: Observations on an Emerging Field
This paper examines the sciences of design as an emerging field of study that cuts across disciplinary boundaries. The paper summarizes and synthesizes the positions, reflections, opportunities, and challenges expressed at the first doctoral consortium to explore the topic, held in 2008. It thus provides a useful agenda for clarifying and articulating important strands of this nascent field. Key concepts include: Design sciences is a movement that affects not only the information systems discipline but also several allied disciplines, which must also contribute to its definition and participation. When a common language exists across disciplines, it enables an ongoing, productive pursuit of scientific knowledge. But common languages only come about through intense, repeated conversations between individuals with disparate views and open minds. Closed for comment; 0 Comments.
- 26 Nov 2008
- Working Paper Summaries
Spanning the Institutional Abyss: The Intergovernmental Network and the Governance of Foreign Direct Investment
Economic globalization presents severe governance challenges. The insufficiency of states as a source of surety for transactions that transcend national borders creates an opportunity for an increased role for organizations in the global institutional framework. The authors of this paper applied a network methodology to show how one type of organization, the intergovernmental organization (IGO), facilitates the cross-border investments of another type, the multinational corporation (MNC). They further document the interdependence between domestic institutions, and international institutions represented by IGOs. The results help to understand and explain which countries attract FDI, and from which senders. Results also point to an emerging rivalry between states and organizations as sources of governance in the global economy. Key concepts include: The connections between states through both economic and social/cultural IGOs are positive and important influences on which states receive FDI from which other states. The network forged by international organizations is massively and increasingly influential in domestic and international governance. The interrelationship between domestic and international governance is more complex than previous accounts have recognized. Closed for comment; 0 Comments.
- 25 Nov 2008
- First Look
- 24 Nov 2008
- Research & Ideas
Harvard Business School Discusses Future of the MBA
The MBA industry is in turmoil. Many business schools are revisiting their offerings to see if they still have relevance in the 21st century. And HBS is using its centennial year to convene worldwide experts on business education and plot its directions for the next 100 years. From HBS Alumni Bulletin. Key concepts include: Critics claim MBA programs put too much emphasis on theory and not enough on leadership in a global environment. A number of top MBA programs have retooled their offerings. HBS is looking at several change proposals, including the development in students of "soft skills." Whatever curriculum changes HBS ultimately adopts, the School will remain committed to the case method. Closed for comment; 0 Comments.
- 21 Nov 2008
- Working Paper Summaries
Applicant and Examiner Citations in U.S. Patents: An Overview and Analysis
The ready availability of patent citation data has been a tremendous boon to applied research on knowledge and innovation. The role of examiners in the generation of patent citations has been thought to potentially complicate these analyses, but has been difficult to study. Taking advantage of a change in the way patent citation data has been reported starting in 2001, this paper summarizes basic facts on examiner citations, and provides a descriptive analysis of factors associated with citations in a patent. Key concepts include: Patent citations reflect the complicated interaction of applicant and examiner strategies, capabilities, and incentives. Examiner shares are highest in fields where intellectual property tends to be fragmented (computers and communications, for example), and lowest in fields where patents have been shown to be more important in appropriating returns to research and development (such as biomedical and chemical patents). The most prolific patentees tend to have very high shares of examiner citations. Examiner citation shares are especially high for foreign firms. Closed for comment; 0 Comments.
- 20 Nov 2008
- Working Paper Summaries
Was the Wealth of Nations Determined in 1000 B.C.?
To the extent that history is discussed at all in economic development, it is usually either the divergence associated with the Industrial Revolution or the effects of colonial regimes. Is it possible that precolonial, preindustrial history also matters significantly for today's national economic development? The authors find that technology adoption circa 1500 A.D., prior to the era of colonization and extensive European contacts, predicts approximately 50 percent of cross-country differences in both current per capita income and technology in a large cross-section of countries. When exploring the causes of this extreme persistence in technology, they find evidence in favor of the importance of the effect of current adoption on subsequent adoption as the main driver. This leaves a limited role to country-specific factors such as institutions, geography, or genes to explain the persistence of technology. Key concepts include: Precolonial, preindustrial differences have striking predictive power for the pattern of both per capita incomes and technology adoption across nations that can be observed today. Technology is very persistent both within countries and sectors. Adoption dynamics vis-à-vis country-specific factors such as institutions, geography, or genes appear to be the mechanism behind such persistence. Closed for comment; 0 Comments.
- 18 Nov 2008
- First Look
- 17 Nov 2008
- Research & Ideas
Decoding the Artful Sidestep
Do you notice when someone changes the subject after you ask them a question? If you don't always notice or even mind such conversational transformations, you're not alone. New research by Todd Rogers and Harvard Business School professor Michael I. Norton explores the common occurrence of "conversational blindness." Q&A with Rogers. Key concepts include: In the study, speakers who dodged a question suffered no ill will from their listeners and paid no price. People prefer, trust, and like a question-dodger who is smooth and sounds confident over a question-answerer who is unsmooth and stammers. If you're a listener who wants to avoid conversational blindness on important matters, here's a tip: Remember your question. Closed for comment; 0 Comments.
- 14 Nov 2008
- Working Paper Summaries
Parallel Search, Incentives and Problem Type: Revisiting the Competition and Innovation Link
The innovation process is fraught with uncertainty. Managers often do not know ahead of time the ideal mix of individuals and skills needed to solve innovation-related problems. One way around this uncertainty is to have multiple paths, approaches, or designs explored at once. The "parallel search" principle can be used inside the firm just as it may be used more generally by pursuing "open innovation". However, having too many searchers attempting to solve the same problem can undercut the benefits if it leads to less effort and investment. The authors study the outcomes of 645 software development contests, conducted by a software outsourcing vendor, involving over 9,000 coders, to understand the relationship between parallel search and increasing competition and innovation. Key concepts include: The key factor favoring parallel search, i.e. increasing the number of independent solvers, is the complexity of the problem at hand. The benefits of increased searchers were curtailed when the problems were simple, indicating that the negative consequences of competition matter most for simpler problems. Closed for comment; 0 Comments.
- 13 Nov 2008
- Working Paper Summaries
The Effect of Labor on Profitability: The Role of Quality
Determining staffing levels is an important decision in retail operations. In 2006, retailers spent $393 billion on employee wages, more than 10 percent of their revenue that year and more than their inventory holding costs. Hence, staffing levels have a major impact on retailers' costs. But at the same time, staffing levels affect conformance quality—how well employees execute prescribed processes—and service quality—the extent to which customers have a positive service experience at the stores. While there is overwhelming evidence that conformance quality and service quality improve sales, both generally and in retail settings, their effect on profitability is not clear. To examine how the amount of labor at a store affects profitability through its impact on conformance quality and service quality, Zeynep Ton analyzed extensive data from stores of a large retailer. Key concepts include: How well employees execute prescribed processes is an important driver of financial performance. It is important to design processes that are simple and easy to follow, especially when there is high employee turnover, as in the retail industry and when offering a self-service environment. Good process design needs to be backed up with an organizational culture that emphasizes conformance to these processes. Too much corporate emphasis on payroll management may motivate managers to operate their stores with insufficient labor capacity that, in turn, degrades financial performance. Emphasis on payroll management can also degrade employee morale. Closed for comment; 0 Comments.
- 12 Nov 2008
- Research & Ideas
The Marketing of a President
Barack Obama's run for the White House was a model of marketing excellence, argues Professor John Quelch. Here's why it worked so well. Closed for comment; 0 Comments.
- 12 Nov 2008
- First Look
- 10 Nov 2008
- Research Event
Social Media Leads the Future of Technology
From Facebook to smartphones, advances in technology are changing the way we work and communicate. Professor David Yoffie led three experts in a recent panel discussion on "The Technology Revolution and its Implications for the Future" at the HBS Centennial Business Summit. Key concepts include: A lot of growth potential remains worldwide. The sticking point for business is spanning the gap between the physical and digital worlds. For example, it remains difficult to figure out consumers' specific intent on the Web. What people want most of all is technology that is simple to use, said one panelist. Closed for comment; 0 Comments.
Market Reaction to the Adoption of IFRS in Europe
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. Key concepts include: Overall, investors reacted positively to the increased likelihood of IFRS adoption. Investors expected net benefits associated with increases in information quality, decreases in information asymmetry, more rigorous enforcement of the standards, and convergence. The reaction for firms domiciled in code law countries is less positive, consistent with investors' concerns over enforcement of IFRS in those countries. Closed for comment; 0 Comments.