- 07 Jan 2013
- Lessons from the Classroom
Culture Changers: Managing High-Impact Entrepreneurs
In her new Harvard Business School course, Creative High-Impact Ventures: Entrepreneurs Who Changed the World, professor Mukti Khaire looks at ways managers can team with creative talent in six "culture industries": publishing, fashion, art-design, film, music, and food. Closed for comment; 0 Comments.
- 03 Dec 2012
- HBS Case
HBS Cases: Against the Grain
Dealing with pervasive, institutionalized corruption is tough but not impossible. A new case study on Tanzania joins a series of cases in professor Karthik Ramanna's research that explore the deep-seated problems of corruption as well as multiple entrepreneurial paths to combat it. Closed for comment; 0 Comments.
- 13 Sep 2012
- Working Paper Summaries
Entrepreneurship in the Natural Food and Beauty Categories Before 2000: Global Visions and Local Expressions
How do entrepreneurs create a market? Geoffrey Jones takes a historical approach and focuses on influential figures who created new categories of natural and organic food, agriculture, and beauty products over the course of the twentieth century. At first these pioneering entrepreneurs, often motivated by ideological or religious convictions, faced little consumer demand for "green" products and little consumer knowledge of what they entailed. The creation of new categories thus involved a lengthy process with three overlapping waves of entrepreneurship. First, the diffusion of ideas through publishing, and promotion of research and education, engaged many entrepreneurs. They were, in effect, making the ideological case for natural products, and providing the basis for them to be made available. Second, entrepreneurs engaged in the creation of industry associations which could advocate, as well as give the nascent industry credibility and create standards. Finally, entrepreneurial ventures established retail stores, supply and distribution networks, and created brands. Key concepts include: Entrepreneurial cognition and motivation frequently lay in individual, and very local, experiences, combined with strong global visions about the need for environmental sustainability. There was a notable international transfer of ideas and concepts. Exposure to Asia, or an imagined Asia, was a significant influence on many pioneering entrepreneurs. Many individual entrepreneurs suffered from personal illnesses which appeared to have motivated their subsequent careers. A significant sub-set of the influential historical figures were articulate in expressing strong religious convictions. These entrepreneurs believed that business could and should be used as a vehicle to preserve and protect the natural environment. By the 1990s, entrepreneurs encouraged a much wider range of businesses to enter the natural categories, some genuinely, but others seeking to green wash conventional businesses. This created confusion and skepticism in consumer minds. There were also legitimacy issues caused by growing scale. Closed for comment; 0 Comments.
- 09 Apr 2012
- Research & Ideas
Who Sways the USDA on GMO Approvals?
Government agencies can be "captured" by the very companies or industries they regulate. Looking at how genetically altered food products are approved, Assistant Professor Shon R. Hiatt finds unexpected influencers on the US Department of Agriculture. Key concepts include: "Regulatory capture" describes the phenomenon whereby regulatory agencies tasked with serving the public instead end up advancing the interests of the companies they regulate. Traditional theories of capture such as lobbying and campaign contributions had little effect on whether the US Department of Agriculture approved any particular genetically altered agriculture product. What did seem to affect the approval process was the influence of third-party groups such as associations and even related regulatory agencies. Open for comment; 0 Comments.
- 24 Oct 2011
- Research & Ideas
The Yelp Factor: Are Consumer Reviews Good for Business?
Michael Luca shows just how much restaurant reviews on Yelp affect companies' bottom lines. The more difficult question: Are these ratings reliable as a measure of product quality? Closed for comment; 0 Comments.
- 04 Oct 2011
- Working Paper Summaries
Reviews, Reputation, and Revenue: The Case of Yelp.com
In just six years, Yelp.com has managed to crowdsource 20 million reviews of restaurants and other services by creating and leveraging an impressive social network of people who enjoy writing reviews. But can a bunch of amateur opinionators working for free really transform the restaurant industry, where heavily marketed chains and highly regarded professional critics have long had a stronghold? To answer this question, HBS professor Michael Luca combined Yelp reviews with revenues for every restaurant that operated in Seattle, WA at any point between 2003 and 2009. Applying a new method to tease out the causal effect of reviews (separate from the effect of underlying quality), the study shows that a one-star increase on Yelp leads to a 5 to 9 percent increase in revenue. Yet Yelp doesn't work for all restaurants. Chain restaurants —which already spend heavily on branding —are unaffected by changes in their Yelp ratings. This suggests that consumer reviews present a new way of learning in the Internet age, and are fast becoming a substitute for traditional forms of reputation. Key concepts include: Online consumer review websites provide more information to consumers than was previously thought to be cost-effective. By relying on user-generated content, Yelp is able to review more products than traditional media such as newspaper reviews. More than 70 percent of Seattle restaurants are on Yelp. The impact of consumer reviews depends on the existing reputation of a company or product. Consumer reviews are effective overall, but ineffective when a product has a firmly established reputation (such as a chain restaurant). Consumer reviews provide a substitute for more traditional forms of marketing. Other forms of reputation such as chain affiliation may become less influential as websites like Yelp continue to gain traction. Evidence suggests that this pattern is already emerging. Consumers rely on simple metrics such as the average rating and the number of reviews, and are more trusting of reviews that are written by "elite" reviewers (as identified by Yelp). Closed for comment; 0 Comments.
- 17 Jun 2011
- HBS Case
KFC’s Explosive Growth in China
In China, Yum! Brands is opening a KFC store every day. But this is not the KFC you know in America. A recent case study written by professor David Bell and Agribusiness Program director Mary Shelman reveals how the chicken giant adapted its famous fast-food formula for the local market. Closed for comment; 0 Comments.
- 14 Feb 2011
- Research & Ideas
Clay Christensen’s Milkshake Marketing
Many new products fail because their creators use an ineffective market segmentation mechanism, according to HBS professor Clayton Christensen. It's time for companies to look at products the way customers do: as a way to get a job done. Closed for comment; 0 Comments.
- 19 Jul 2010
- Research & Ideas
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. Key concepts include: The last 10 yards of the supply chain lies between the store's loading dock and the customer's hands. Poor operational decisions create unnecessary complications that lead to quality problems and lower labor productivity and, in general, make life hard for retail employees. Adopting Mercadona's approach requires a long-term view and a leader with a strong backbone. Closed for comment; 0 Comments.
- 18 Nov 2009
- HBS Case
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. Closed for comment; 0 Comments.
- 15 Dec 2008
- Research & Ideas
The Surprisingly Successful Marriages of Multinationals and Social Brands
What happens when small iconic brands associated with social values—think Ben & Jerry's—are acquired by large concerns—think Unilever? Can the marriage of a virtuous mouse and a wealthy elephant work to the benefit of both? Professors James E. Austin and Herman B. "Dutch" Leonard discuss their research. Closed for comment; 0 Comments.
- 22 May 2008
- Working Paper Summaries
Testing Strategy with Multiple Performance Measures Evidence from a Balanced Scorecard at Store24
To what extent do balanced scorecards provide useful information for testing and validating an organization's strategy? Numerous case studies of balanced scorecard implementations document their use in translating organizational strategies to objectives and measures, communicating strategic objectives to employees, evaluating the performance of business units, and aligning the incentives of employees across business units and functions. There has been comparatively little research, however, on the potential learning and feedback role of balanced scorecards. Analyzing balanced scorecard data from Store24—a privately held convenience store retailer in New England—during the implementation of an innovative but ultimately unsuccessful strategy, this study investigates whether, when, and how information about problems with the firm's strategy was captured in the multiple performance measures of its balanced scorecard. Key concepts include: Store24's balanced scorecard contained useful and timely information for detecting problems in its strategy. The results also suggest that Store24 executives eventually learned about problems with the strategy despite a lack of reliance on such formal analysis. Analysis of the balanced scorecard could have yielded more timely information as well as more detail on why the strategy was not working as planned. Multiple measures in a balanced scorecard might systematically be used to test how well different drivers of performance are working to achieve strategic objectives and superior financial performance. Closed for comment; 0 Comments.
- 08 May 2008
- Working Paper Summaries
Organizational Design and Control across Multiple Markets: The Case of Franchising in the Convenience Store Industry
Chain organizations operate units that are typically dispersed across different types of markets, and thus serve significantly different customer bases. Such "market-type dispersion" is likely to compromise the headquarters' ability to control its stores for two reasons: Relative differences in local conditions make it difficult to monitor a store manager's behavior, and a chain with wide-ranging customer bases will have a harder time serving its customers and will need to rely more heavily on store managers' ability to adapt to local needs. This study identifies market-type dispersion as a factor that is systematically related to firms' organizational design choices. The results may help managers and consultants who deal with control challenges related to a chain's geographic expansion into different markets. Key concepts include: Chains experiencing higher levels of variation in customer demands across different locations are more likely to increase delegation and the provision of incentives through the organizational design choice of franchising. Stores are more likely to be franchised when their location characteristics are more divergent from the most prevalent location characteristics of the chain as a whole. Non-franchisor chains with higher levels of such market-type dispersion tend to decentralize operations to a greater extent. It is also possible that they provide higher variable pay. Closed for comment; 0 Comments.
- 11 Mar 2008
- Working Paper Summaries
Finding Missing Markets (and a disturbing epilogue): Evidence from an Export Crop Adoption and Marketing Intervention in Kenya
Why do farmers continue to grow crops for local markets when crops for export markets are thought to be much more profitable? Answers may include missing information about the profitability of these crops, lack of access to the necessary capital to make the switch possible, lack of infrastructure necessary to bring the crops to export outlets, high risk of the export markets, lack of human capital necessary to adopt successfully a new agricultural technology, and misperception by researchers and policymakers about the true profit opportunities and risk of crops grown for export markets. Ashraf and colleagues conducted an experimental trial with DrumNet, a social enterprise of Pride Africa, a nongovernmental organization, to evaluate whether a package of services can help farmers adopt, finance, and market export crops, and thus earn more income. This experiment was motivated by a recent push in development to build sustainable interventions that help complete missing markets. Key concepts include: Researchers found positive but not overwhelming one-year impacts from DrumNet. DrumNet leads to more farmers growing export crops, increasing their production and lowering their marketing costs. While there was no statistically significant impact on income for the full sample of farmers, first-time growers of export-oriented crops experienced a statistically and economically significant increase in income. The epilogue to this project is more dismal. Due to DrumNet's lack of compliance with European export requirements, farmers were forced to undersell and thus default on their loans. The implication is that farmers may not be adopting export crops because of the risk of the export market. Closed for comment; 0 Comments.
- 24 Sep 2007
- Research & Ideas
The FDA: What Will the Next 100 Years Bring?
With the possible exception of the Internal Revenue Service, no other governmental agency touches the lives of more Americans than the U.S. Food and Drug Administration, which ensures the safety of $1.5 trillion worth of consumer goods and medicines. Harvard Business School professor Arthur A. Daemmrich discusses the impact and challenges of the agency and his new book, Perspectives on Risk and Regulation: The FDA at 100. Closed for comment; 0 Comments.
- 15 May 2007
- Working Paper Summaries
I’ll Have the Ice Cream Soon and the Vegetables Later: Decreasing Impatience over Time in Online Grocery Orders
How do people’s preferences differ when they make choices for the near term versus the more distant future? Providing evidence from a field study of an online grocer, this research shows that people act as if they will be increasingly virtuous the further into the future they project. Researchers examined how the length of delay between when an online grocery order is completed and when it is delivered affects what consumers order. They find that consumers purchase more "should" (healthy) groceries such as vegetables and less "want" (unhealthy) groceries such as ice cream the greater the delay between order completion and order delivery. The results have implications for public policy, supply chain managers, and models of time discounting. Key concepts include: Consumers spend less and order a higher percentage of "should" items and a lower percentage of "want" items the further in advance of delivery they place a grocery order. Encouraging people to order their groceries up to 5 days in advance of consumption could influence the healthfulness of the foods that people consume. Similarly, asking students in schools to select their lunches up to a week in advance could considerably increase the healthfulness of the foods they elect to eat. Online and catalog retailers that offer a range of goods as well as different delivery options might be able to improve their demand forecasting by understanding these findings. Closed for comment; 0 Comments.
- 16 Feb 2004
- Research & Ideas
Marketing Wine to the World
From consolidation to the growing clout of mass retailers, structural changes have hit the wine industry. Professor Michael Roberto discusses the move from elitism to mainstream appeal. Closed for comment; 0 Comments.
- 09 Dec 2002
- Research & Ideas
UnileverA Case Study
As one of the oldest and largest foreign multinationals doing business in the U.S., the history of Unilever's investment in the United States offers a unique opportunity to understand the significant problems encountered by foreign firms. Harvard Business School professor Geoffrey Jones has done extensive research on Unilever, based on full access to restricted corporate records. This recent article from Business History Review is the first publication resulting from that research. Closed for comment; 0 Comments.
- 04 Feb 2002
- Research & Ideas
How a Juicy Brand Came Back to Life
"Some brands just want to have fun, and from birth Snapple was one of them," says HBS professor John Deighton. As he explains in this excerpt from Harvard Business Review, the odyssey of the fun-loving beverage contains smart lessons for managers on branding and company culture. Closed for comment; 0 Comments.
Helping Yelp Create More Accurate Reviews
Over time, Yelp's reader rating system of restaurants can make or break an operation, but professor Michael Luca shows the program has flaws. Can a more accurate, fairer system be created? Closed for comment; 0 Comments.