- 02 May 2008
- What Do You Think?
What is the Future of State Capitalism?
In state capitalism, is the operative word "capitalism"? State capitalism is neither to be applauded nor feared, judging from the tone of responses to May's column. Jim Heskett sums up. Online forum now closed. Closed for comment; 0 Comments.
- 01 May 2008
- Research & Ideas
The Marketing Challenges of the China Olympics
The Olympic Games are normally a marketer's dream. Not so much this year, given widespread protests against the Chinese government. Professor John Quelch outlines the branding challenges posed by this year's Games in Beijing. Key concepts include: Political pressure directed at the Chinese government will also pose challenges for Olympic Games sponsors, who don't want to be associated with the controversy. Given the prominence of China as a supplier and customer, it is unlikely that we will witness grandstanding boycotts of the Games by any company. Some marketers are employing a dual marketing approach, with China-specific campaigns inside the country but less Beijing-centric messaging outside. Marketers are not over-committing funds to Olympics-related brand advertising and promotions. The normal Olympics year advertising boost may be less than expected. Closed for comment; 0 Comments.
- 30 Apr 2008
- Sharpening Your Skills
Sharpening Your Skills: Brand Management
Should I trust my brand to a sports endorser? Does B2B branding work? What does mystery writer James Patterson know about branding that I don't? Here are some recent Working Knowledge articles on issues that keep brand managers up at night. Closed for comment; 0 Comments.
- 29 Apr 2008
- Research Event
Venture Capital
Professor Josh Lerner provides a summary report on the recently held HBS Centennial colloquium on venture capital. Closed for comment; 0 Comments.
- 29 Apr 2008
- First Look
- 28 Apr 2008
- HBS Case
Negotiating with Wal-Mart
What happens when you encounter a company with a great deal of power, like Wal-Mart, that is also the ultimate non-negotiable partner? A series of Harvard Business School cases by James Sebenius and Ellen Knebel explore successful deal-making strategies. From the HBS Alumni Bulletin. Closed for comment; 0 Comments.
- 24 Apr 2008
- Working Paper Summaries
Bank Accounting Standards in Mexico: A Layman’s Guide to Changes 10 Years after the 1995 Bank Crisis
Mexico was the first emerging market compelled to reformulate the financial reporting of its banks as a result of a financial crisis. In the last decade, Mexico has undergone a process of internationalization of its banking industry. Today, more than 80 percent of the equity of Mexican banks belongs to internationally active bank corporations. This internationalization demands more transparent regulation, including standardized accounting rules and better disclosure of information. The case of Mexico can therefore serve as an example of the relevance of these changes, as well as of their scope and limitations. This paper attempts to clarify the nature and structure of the new accounting standards, and explains how they have affected financial statements and their interpretation. Key concepts include: Mexican bank accounting standards enjoyed special treatment during most of the 20th century because banking was an industry protected from foreign competition in a relatively closed economy. More transparent bank accounts and stricter accounting processes in Mexico are especially crucial today, in light of the predominantly foreign ownership of the Mexican banking system. The classification of financial operations still varies from country to country. National differences emerge despite the fact that financial instruments, products, and transactions are either very similar or the same worldwide. Legal and regulatory stipulations, accounting history, tax structure, and local business practices create differences in the way financial transactions are recorded in the financial statements. Closed for comment; 0 Comments.
- 23 Apr 2008
- Op-Ed
The Gap in the U.S. Treasury Recommendations
U.S. Treasury recommendations for strengthening the regulation of the financial system are a good start but fall short, says Harvard Business School professor emeritus Dwight B. Crane. Here's his suggestion for bringing regulation into the 21st century. Key concepts include: The Treasury proposal recognizes that fundamental change in the regulatory structure is required for managing risk in the financial system. The difficulty with the approach is that the risk in the financial system will not disappear—it will simply move to the non-prudentially regulated firms. The United States should include all financial service firms under the regulatory authority of the new prudential regulator. Closed for comment; 0 Comments.
- 22 Apr 2008
- Working Paper Summaries
An Exploration of Technology Diffusion
How long are technology adoption lags? Can cross-country differences in technology adoption lags account for a significant fraction of cross-country GDP disparities? Diego Comin of Harvard Business School and Bart Hobijn of the Federal Reserve Bank of New York develop a new benchmark to understand the diffusion process of individual technologies and the consequences that this has for aggregate growth. This benchmark provides a rationale for the evolution of diffusion measures that include how many units of technology each adopter has adopted in addition to the traditional extensive margin. The model is estimated to obtain measures of adoption lags for 15 technologies in 166 countries. Key concepts include: Adoption lags are large. On average, countries have adopted technologies 47 years after their invention. There is substantial variation across technologies and countries. Over the past two centuries, newer technologies have been adopted faster than old ones. The remarkable development records of Japan between 1870 and 1970 and of the so-called East Asian Tigers in the second half of the 20th century all coincided with a catch-up in the range of technologies used with respect to industrialized countries. Adoption lags account for at least 25 percent of cross-country per capita income differences. Closed for comment; 0 Comments.
- 22 Apr 2008
- First Look
- 21 Apr 2008
- Research & Ideas
The New Math of Customer Relationships
Harvard Business School professor emeritus James L. Heskett has spent much of his career exploring how satisfied employees and customers can drive lifelong profit. Heskett and his colleagues will soon introduce a new concept into the business management literature: customer and employee "owners." Key concepts include: Service profit chain concepts are global, subject only to local cultural practices. Businesses are experimenting with the idea of creating "owners" out of both customers and employees, who create the highest lifetime value to the organization. During times of economic stress, relationships between customer and employee satisfaction, loyalty, and productivity become more critical. Closed for comment; 0 Comments.
- 17 Apr 2008
- Working Paper Summaries
Diffusing Management Practices within the Firm: The Role of Information Provision
Managers face a range of options to diffuse innovative practices within their organizations. This paper focuses on one such technique: providing practice-specific information through mechanisms such as internal seminars, demonstrations, knowledge management systems, and promotional brochures. In contrast to corporate mandates, this "information provision" approach empowers facility managers to decide which practices to actually implement. The authors examine how corporate managers diffused advanced environmental management practices within technology manufacturing firms in the United States. The study identifies several factors that encourage corporate managers to employ information provision, including subsidiaries' related expertise, the extent to which the subsidiaries were diversified or concentrated in similar businesses, and the geographic dispersion of their employees. Key concepts include: This research can help managers better understand when to employ an "information provision" approach to facilitate knowledge transfer within their organizations. Corporate managers in the information and communication technology sector were more likely to use information provision to diffuse advanced environmental management practices when their subsidiaries on average possessed modest levels of related expertise, and when the levels of expertise varied greatly between subsidiaries. An information provision diffusion strategy was used more heavily by corporate managers of firms that were more diversified and where employees dispersed across more facilities. Closed for comment; 0 Comments.
- 16 Apr 2008
- Lessons from the Classroom
Chris Christensen: Legend of the Classroom
Professor C. Roland ("Chris") Christensen was the maestro of Harvard Business School's case method of teaching. Over a career spanning half a century, Christensen made his colleagues better teachers, and his students better leaders. From the HBS Alumni Bulletin. Closed for comment; 0 Comments.
- 15 Apr 2008
- First Look
- 14 Apr 2008
- Research & Ideas
The Surprising Right Fit for Software Testing
Software analysts and programmers live to innovate—but hate to run tests. Yet top-notch testing saves many a company money when bugs are caught early. A case study describes the secret behind a Danish consultancy's success: The majority of its testers have Asperger syndrome or a form of autism spectrum disorder. Open for comment; 0 Comments.
- 10 Apr 2008
- Working Paper Summaries
Where Does it Go? Spending by the Financially Constrained
Despite widespread interest by academics, businesspeople, and policymakers, much is unknown about the financial behavior of low-income individuals, particularly those who rarely or ever use banks. Do credit constrained consumers spend money more quickly than less constrained consumers? Do they spend the money in different manners (card-based merchant transactions versus cash ATM withdrawals)? Do credit constrained consumers have different spending patterns than the less constrained—do they buy different goods and services? This working paper provides preliminary data on spending patterns by over 1.5 million refund recipients, all of whom used either a loan or a settlement product to receive refund money faster than the IRS processes would have otherwise allowed. The results should inform the view of policymakers, financial service professionals, scholars, and consumer advocates. Key concepts include: The conclusion that a material fraction of funds was used to pay for necessities suggests that the federal Earned Income Tax Credit program is central to the lives of the poor. Loans tended to be used to obtain necessities, especially funds spent in the first few days of the loans. Consumer advocates who seek to ban settlement products should consider how a ban would affect households' ability to smooth consumption. Similarly, businesses that are pricing and marketing these products should be mindful that the products are not a luxury for the users. These findings document the fairly rapid speed of spending of refunds, which may help policymakers think about the economic stimulus impact of tax refunds and rebates. Closed for comment; 0 Comments.
- 09 Apr 2008
- Research & Ideas
The Matchmaker of the Modern Economy
In the wake of World War II, Georges Doriot helped found the world's first public venture capital firm, American Research and Development. Doriot (1899–1987) was also a professor at Harvard Business School for 40 years. Our book excerpt from Creative Capital: Georges Doriot and the Birth of Venture Capital (HBS Press) describes how ARD first came to "marry" investors and innovators. Key concepts include: A decorated brigadier general, favorite professor, and quirky personality, Georges Doriot shepherded many companies to life before launching American Research and Development (ARD) in 1946. The idea of venture capital was still so new in 1946 that ARD's founders were forced to reengineer aspects of various financial regulatory structures in order to make it viable. World War II was a watershed for entrepreneurialism. Closed for comment; 0 Comments.
- 08 Apr 2008
- First Look
- 07 Apr 2008
- Research & Ideas
The Debate over Taxing Foreign Profits
Corporate tax policy has suddenly become a hot topic in the U.S., including the issue of whether current tax laws encourage American firms to outsource jobs to other countries. Harvard Business School professor Mihir Desai makes a case for exempting foreign profit from taxes if proper safeguards are put in place. Key concepts include: The United States is increasingly an outlier in its taxation of corporate income earned on foreign soil. Critics argue the ability to defer U.S. taxation until profits are repatriated provides an incentive to ship jobs overseas. On the other hand, the current worldwide system is often derided as making American firms uncompetitive relative to their foreign competition. An alternative may be to exempt foreign income from taxes paired with safeguards against an overly aggressive use of tax havens. Closed for comment; 0 Comments.
Connecting with Consumers Using Deep Metaphors
Consumer needs and desires are not entirely mysterious. In fact, marketers of successful brands regularly draw on a rich assortment of insights excavated from research into basic frames or orientations we have toward the world around us, according to HBS professor emeritus Gerald Zaltman and Lindsay Zaltman, authors of Marketing Metaphoria. Here's a Q&A and book excerpt. Key concepts include: Deep metaphors are powerful predictors of what customers think and how they react to new or existing goods and services. The seven deep metaphors discussed in Marketing Metaphoria appear across a variety of products. Recent advances in various disciplines are providing concepts and techniques enabling marketers to dig into what consumers don't know they know. Closed for comment; 0 Comments.