Business Administration, Management, and Operations Commons^™

Stakeholder Orientation, Managerial Discretion And Nexus Rents, Robert A. Phillips, Shawn L. Berman, Heather Elms, Mechael E. Johnson-Cramer

Management Faculty Publications

A firm's orientation toward its stakeholders determines how it will use the discretion accorded to it by external and internal circumstances. The interaction between these two factors affects a firm's ability to create value in the short term and influences the level of discretion available to the firm in the long term. We argue that the interplay of discretion and orientation create a vicious (or virtuous) cycle, in which the firm either creates or destroys goodwill with stakeholders, thereby making it more or less likely that stakeholders will grant discretion in the future. This argument suggests an account of stakeholder …

When A Promotion Is Denied: The Effects Of Decision Stage On Perceptions Of Promotion And Price Fairness, Monika Kukar-Kinney, Lan Xia, Kent B. Monroe

Marketing Faculty Publications

Marketers frequently use promotions to enhance sales and increase consumers' perceptions of value. However, most promotions usually come with restrictions, such as time expiration, quantity or product model restriction, etc. In the present research, the effect of the stage in the purchase process when the consumer finds out about the restriction is investigated. The findings indicate that the later in the purchase process the consumer discovers the restriction, the greater is the perception that the effort invested into the purchase is wasted, consequently resulting in lower promotion and price fairness. This effect is mediated through the feeling of entitlement to …

[Introduction To] Service Parts Management: Demand Forecasting And Inventory Control, Nezih Altay, Lewis A. Litteral

Bookshelf

Service Parts Management provides the reader with an overview and a detailed treatment of the current state of the research available on the forecasting and inventory management of items with intermittent demand. It is a comprehensive review of service parts management and provides a starting point for researchers, postgraduate students, and anyone interested in forecasting or managing inventory.

The Effect Of Institutional And Cultural Factors On The Perceptions Of Earnings Management, Marshall A. Geiger, Joyce Van Der Van Der Laan Smith

Accounting Faculty Publications

In this study we examine the effect of stakeholder orientation versus shareholder orientation, and the level of cultural secrecy on individuals’ perceptions of earnings management practices. Examining perceptions from 1,260 participants from 13 countries indicates that individuals from stakeholder-oriented institutional back- grounds were less accepting of earnings management, including both accounting earn- ings management and operating earnings management activities, than participants from shareholder-oriented institutional backgrounds, and that individuals from secretive cultures were more accepting of both types of earnings management activities. Our findings provide evidence of the anticipated perceptual differences across countries with respect to earnings management and suggest the …

Maintaining A Flexible Payout Policy In A Mature Industry: The Case Of Crown Cork And Seal In The Connelly Era, James Ang, Tom Arnold, C. Mitchell Conover, Carol Lancaster

Finance Faculty Publications

As related in these pages, the history of Crown Cork and Seal (hereafter known as “Crown”) provides us with a case of a company that stopped paying dividends but establish a disciplined share repurchase policy and did so for all the right reasons. Under family ownership in the 1950s, Crown lost market share and was on the brink of bankruptcy when its largest shareholder, John Connelly, was elected chairman of the board in 1957. Under John Connelly’s leadership, the firm restructured its operations and began a payout policy based solely on stock repurchases. During the Connelly era, the firm did …

Stakeholder Theory: The State Of The Art, Bidhan L. Parmar, R. Edward Freeman, Jeffrey S. Harrison, Et Al.

Management Faculty Publications

A variety of forces are changing the way managers and executives make sense of their responsibilities. Globalization has brought a larger variety of participants into contemporary businesses, technological innovation has increased the pace of change, and managers are discovering that their actions have the potential to affect a broader range of people all over the globe (Clement, 2005). Additionally, the pursuit of corporate objectives can be easily disrupted by the actions of unexpected groups. These challenges, driven by change and interconnectedness, reveal a need for managers and academics to re-think the traditional ways of conceptualizing the responsibilities of the firm. …

Managing For Stakeholders, Stakeholder Utility Functions, And Competitive Advantage, Jeffrey S. Harrison, Douglas A. Bosse, Robert A. Phillips

Management Faculty Publications

A firm that manages for stakeholders allocates more resources to satisfying the needs and demands of its legitimate stakeholders than what is necessary to simply retain their willful participation in the productive activities of the firm. Firms that exhibit this sort of behavior develop trusting relationships with stakeholders based on principles of distributional, procedural and interactional justice. Under these conditions, stakeholders are more likely to share nuanced information regarding their utility functions, which increases the ability of the firm to allocate its resources to areas that will best satisfy them (thus increasing demand for business transactions with the firm). In …

The Shifting Geography Of Competitive Advantage: Clusters, Networks And Firms, Mark Jenkins, Stephen Tallman

Management Faculty Publications

We consider the dynamics of knowledge-based sources of advantage as they move between geographical locations and multinational and other firm level networks using the specialist context of Formula 1 motor over a fifty nine year period. We suggest that shifts in competitive advantage are underpinned by the movement of both architectural and component knowledge at both the firm and cluster level, and in particular we suggest that isolated firms can both benefit from and add to cluster level knowledge. We conclude by suggesting ways in which MNEs can adapt their approach to both location and knowledge development in order to …

[Introduction To] Stakeholders, Robert A. Phillips, R. Edward Freeman

Bookshelf

This landmark book takes a retrospective look at the most important and influential works in the study of stakeholders since Freeman’s 1984 publication, Strategic Management: A Stakeholder Approach. 2009 marked the 25th anniversary of this watershed in organizational scholarship, so now is an excellent time for Phillips and Freeman to revisit this topical and exciting subject.

From the tremendous upsurge in the literature, the editors have carefully selected ground-breaking works on topics including corporate governance, stakeholder-agency theory, management models, ethical theory and stakeholder orientation. This invaluable volume will shape the thinking of scholars and academics for the next 25 years.

Paul M. Klekner (B), Roger R. Schnorbus

Robins School of Business White Paper Series, 1980-2022

This is a fictitious case study, including the name of the restaurant and the people involved.

Paul Klekner graduated first in his class from the Culinary Institute of America (CIA) in 1998; his fellow students named him the chef most likely to succeed in the future. After graduation, he and his wife, Sarah, moved back to his home in Richmond, Virginia where he was employed as a chef at several restaurants including Bottega and Old Original Bookbinders. In 2003, he decided to open his own restaurant, Rogerios, in the Tobacco Row section of Richmond. With an inheritance of $300,000 he …

Duration Measures For Corporate Project Valuation, Tom Arnold, David S. North

Finance Faculty Publications

Sensitivity analysis is a very common exercise performed with the forecasting of project cash flows. In this paper, a duration-type measure is generated that provides a single number for the assessment of project cash flows relative to changes in the discount rate (or adjusted for changes in a particular cash flow model parameter). The calculation is no more difficult than the duration measures that already exist for bonds. Yet, the calculation provides valuable insight that many times is lost when performing sensitivity analysis. Further, at a minimum, the measure provides a gauge for the consequences of mis-specifiying the discount rate …

An Alternative Strategy For Building Sales Of Computers: Generic Advertising, Min Lu, Steven M. Thompson, Yanbin Tu

Management Faculty Publications

Frequent upgrading and aggressive price-cutting have become standard practice in the computer sector. While necessitated in part by declining production costs and a highly competitive market, these strategies have also served to make computers more affordable, growing the size of the overall market. Recently downturns in the sales of computers motivate us to examine the impact of these strategies on overall sales growth. We find evidence to suggest that excessive upgrading and overly aggressive price-cutting can be detrimental to overall sales growth. We also find that the computer sector exhibits characteristics that suggest that generic advertising would be an effective …

A Field Study Of Rfid Deployment And Return Expectations, Jonathan W. Whitaker, Sunil Mithas, M. S. Krishnan

Management Faculty Publications

Radio Frequency Identification (RFID) technology promises to transform supply chain management. Building on previous research in information systems and supply chain management, this paper proposes a theoretical framework for RFID adoption and benefits, and tests the framework using data on U.S. firms. Our analysis suggests that there is a positive association between information technology (IT) application deployment and RFID adoption. We find that RFID implementation spending and partner mandate are associated with an expectation of early return on RFID investment, and a perceived lack of industry-wide standards is associated with an expectation of delayed return on RFID investment. These results …

Brink's Entry Into China 2007, Roger R. Schnorbus, Littleton M. Maxwell

Robins School of Business White Paper Series, 1980-2022

This case was prepared from various referenced sources and was developed solely for classroom discussion; the case is not intended to serve as an endorsement, source of primary data or an illustration of either effective or ineffective handling of a business situation.

Ron Rokosz, the President of Brink's International was both pleased and distressed as he reviewed the financial results of International operations for fiscal 2006. Revenue had increased by 14% to $1,568.6M, driven by strong gains in both EMEA (Europe, Middle East, Africa) and LA (Latin America). In addition, operating profit in International was up by 68%. (Exhibit 1) …

Leveraging Knowledge Across Geographic Boundaries, Stephen Tallman, Anupama Phene

Management Faculty Publications

This paper examines knowledge flows within and across geographic boundaries of clusters and nations in the biotechnology industry. We hypothesize that these flows are characterized by various factors relating to the knowledge itself and by firm innovativeness and the presence of prior knowledge flows at the firm level. Surprisingly, our findings suggest that geographic proximity does not matter in some instances, while in others it has a decidedly nonlinear effect opposite to that hypothesized. The pattern of findings points to the greatest contrast in the comparison of between-cluster and between-country flows and presents an opportunity to reevaluate the role of …

Releasing Individually Identifiable Microdata With Privacy Protection Against Stochastic Threat: An Application To Health Information, Robert Garfinkel, Ram Gopal, Steven M. Thompson

Management Faculty Publications

The ability to collect and disseminate individually identifiable microdata is becoming increasingly important in a number of arenas. This is especially true in health care and national security, where this data is considered vital for a number of public health and safety initiatives. In some cases legislation has been used to establish some standards for limiting the collection of and access to such data. However, all such legislative efforts contain many provisions that allow for access to individually identifiable microdata without the consent of the data subject. Furthermore, although legislation is useful in that penalties are levied for violating the …

What Stakeholder Theory Is Not, Robert A. Phillips, R. Edward Freeman, Andrew C. Wicks

Management Faculty Publications

The term "stakeholder" is a powerful one. this is due, to a significant degree, to its conceptual breadth. The term means many different things to many different people and hence evokes praise or scorn for a wide variety of scholars and practitioners of myriad academic disciplines and backgrounds. Such breadth of interpretation, though one of stakeholder theory's greatest strengths, is also one of its most prominent theoretical liabilities as a topic of reasoned discourse. Much of the power of stakeholder theory is a direct result of the fact that, when used unreflectively, its managerial prescriptions and implications are nearly limitless. …

The Sox-Rfid Connection, Porcher L. Taylor Iii, Nezih Altay

School of Professional and Continuing Studies Faculty Publications

Companies expect to gain many benefits from implementing Radio Frequency Identification (RFID) technology. Perhaps the one cited most often is lower supply chain costs, which result from the improved inventory visibility that the technology affords. But there's another often overlooked advantage that supply chain managers should know about: RFlD technology can help them fulfill the requirements of the Sarbanes-Oxley Act (SOX) if implemented and integrated properly. Conversely, RFID can complicate the already complex and costly internal mandates of SOX if the implementation is not approached the right way.

The Effectiveness Of Insider Trading Regulation: International Evidence, Art Durnev, Amrita S. Nain

Finance Faculty Publications

There is a long standing debate in the finance and law literatures about the need for insider trading regulation. Some scholars and practitioners argue that insider trading restrictions should be revoked because insider trading allows private information to be quickly incorporated into stock prices, thereby leading to more informationally efficient stock prices (Carlton and Fischel (1983); Dye (1984)). For example, Milton Friedman, laureate of the Nobel Memorial Prize in Economics, said: “You want more insider trading, not less. You want to give the people most likely to have knowledge about deficiencies of the company an incentive to make the public …

Information Technology, Production Process Outsourcing, And Manufacturing Plant Performance, Indranil Bardhan, Jonathan W. Whitaker, Sunil Mithas

Management Faculty Publications

What is the role of information technology (IT) in enabling the outsourcing of manufacturing plant production processes? Do plant strategies influence production outsourcing? Does production process outsourcing influence plant performance? This research addresses these questions by investigating the role of IT and plant strategies as antecedents of production outsourcing, and evaluating the impact of production outsourcing and IT investments on plant cost and quality. We develop a theoretical framework for the antecedents and performance outcomes of production outsourcing at the plant level. We validate this theoretical framework using cross-sectional survey data from U.S. manufacturing plants. Our analysis suggests that plants …

With A Little Help From My Friends (And Substitutes): Social Referents And Influence In Psychological Contract Fulfillment, Violet Ho

Management Faculty Publications

This study investigated employees’ choice of social referents and the impact of social influence on their beliefs of psychological contract fulfillment. Using data from a field study conducted with 99 employees in a research organization, we found that one’s referent choice varied with the domain of promise evaluated. When evaluating the organization’s fulfillment of organization-wide promises, employees’ referents were primarily coworkers with whom they had close direct ties, namely, friends and advice givers. On the other hand, when evaluating the fulfillment of job-related promises, employees’ referents were mainly fellow workers who could substitute for them and people with whom they …

Agglomeration Effects And Strategic Orientations: Evidence From The U.S. Lodging Industry, Linda Canina, Cathy A. Enz, Jeffrey S. Harrison

Management Faculty Publications

This study provides evidence regarding the strategic dynamics of competitive clusters. Firms that agglomerate (co-locate) may benefit from the differentiation of competitors without making similar differentiating investments themselves. Alternatively, co-locating with a high percentage of firms with low-cost strategic orientations reduces performance for firms pursuing high levels of differentiation. Further, the lowest-cost providers with the greatest strategic distance from the norm of the competitive cluster reap the greatest benefit from co-location with differentiated firms. We find empirical support for these ideas using a sample of 14,995 U.S. lodging establishments, and controlling for a number of key demand-shaping factors.

An Hr Planning Model For Outsourcing, Shilpa Khanna, J. Randolph New

Management Faculty Publications

To assist leaders and planners, the researchers provide a new human resource planning model and suggest best practices for planning and implementing an outsourcing engagement. Based on dynamic HR planning theory, and research into current outsourcing cases and approaches, the researchers provide a roadmap to confront the challenges of outsourcing. The researchers also suggest directions for further research on the contemporary outsourcing issues. First and foremost, HR planning should not be outsourced during the outsourcing process. Companies rushing into outsourcing sometimes depend so much on consultants and potential vendors for advice that the critical job of determining the new organization …

Some Key Questions About Stakeholder Theory, Robert A. Phillips

Management Faculty Publications

As businesses emerge as some of the most powerful institutions in the world, business ethics have never been more important, and given very recent history, more open to question. Corporations are relative newcomers to power, and for evidence of this we can look to Europe, where the oldest, largest, most elaborate buildings are the churches and cathedrals. For thousands of years, the church and its leaders were arguably the most powerful institution, but as the liberal notions of the Enlightenment supplanted church orthodoxy, the state supplanted religion as the more powerful institution. But at the dawn of the third millennium, …

Is Organizational Democracy Worth The Effort?, Jeffrey S. Harrison, R. Edward Freeman

Management Faculty Publications

Organizational democracy is frequently associated with increased employee involvement and satisfaction, higher levels of innovation, increased stakeholder commitment, and, ultimately, enhanced organizational performance. However, democratic processes can also absorb significant time and other organizational resources and bog down decisions, which may lead to reduced efficiency. This article summarizes the pros and cons of organizational democracy. It also introduces and integrates ideas from the three other articles in this special forum. In the end, we conclude that although the economic arguments for organizational democracy may be mixed, increased stakeholder participation in value creation and organizational governance can benefit both society and …

Campbell Soup Company In 2004 (A), Roger R. Schnorbus

Robins School of Business White Paper Series, 1980-2022

As fiscal 2004[1] began, Doug Conant, the President and CEO of the Campbell Soup Company could take pride in the results of his 3-year transformation plan instituted in fiscal 2001 to revitalize the company. The key initiatives of the plan were to restore revenue and profitability growth and stimulate shareholder wealth.

Conant, who became President and CEO in January of 2001, called the plan, “the single most comprehensive commitment to revitalization ever undertaken in the 132-year history of Campbell Soup Company.”

The financial results achieved in fiscal 2002, the first year of the plan, were a mixed bag. Although net …

Management Textbooks As Propaganda, Kim S. Cameron, R. Duane Ireland, Robert N. Lussier, J. Randolph New, Stephen P. Robbins

Management Faculty Publications

Are management textbooks propaganda? Do textbook authors write to advance the interests of a particular group or groups (such as employees, organizations, and/or society)? Do they write to present the theory and research of the academic discipline? Do they write primarily to produce a product that consumers (faculty and students) will buy in sufficient numbers and at a price that will yield financial profit? This article explores these and related questions by asking four well-established management textbook authors - Kim Cameron, Duane Ireland, Bob Lussier, and Steve Rabbins - to react to the metaphor of "management textbooks as propaganda or …

Replies To Commentaries On "Management Textbooks As Propaganda, Kim S. Cameron, R. Duane Ireland, Robert N. Lussier, J. Randolph New, Stephen P. Robbins

Management Faculty Publications

In commenting on our article, "Management Textbooks as Propaganda," Professors Gilbert and Mir provide stimulating observations regarding the purpose of textbooks, the role of management in the world of organizations, and the fundamental purposes of education. In our first article, we attempted to make explicit the ideologies furthered by our textbooks and pointed out that faculty members-as ultimate gatekeepers of the academic management knowledge that students receive-should be aware of their individual ideologies and choose and use textbooks (and other course materials) accordingly. Textbooks serve an appropriate function in helping to identify and articulate the content of ideologies, valid and …

Visualizing The Stochastic Calculus Of Option Pricing With Excel And Vba, Tom Arnold, Stephen C. Henry

Finance Faculty Publications

Stochastic calculus, part calculus and part statistics, is an integral part of option pricing that can be intimidating. By developing the statistical nature of stochastic processes and introducing Monte Carlo simulation using Microsoft Excel, this paper develops a visualization of how stochastic processes are evaluated using Ito's lemma and integral calculus. Ultimately, the Black-Scholes (1973) option pricing equation is the natural result.

Internationalization, Globalization, And Capability-Based Strategy, Stephen Tallman, Karin Fladmoe-Lindquist

Management Faculty Publications

Current trends appear to suggest that globally integrated strategies are the wave of the future for many industries, but no theoretically sound, firm-level model explains this situation. International business models explain industry trends from economic perspectives, and organizational theory is beginning to examine the organizing principles of multinational firms, but a gap exists in explaining the strategic motivations of multinational firms as they expand and integrate worldwide. This article develops a capability-driven, as opposed to market-driven, framework of multinational strategy. This contingent framework explains the organizational consequences of international expansion and global integration depending on the capability types, capability strategies, …