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- 11 Mar 2015
- Working Paper Summaries
Curbing Adult Student Attrition: Evidence from a Field Experiment
This paper by Michael Luca and colleagues demonstrates how insights from behavioral economics can improve attendance habits among adults in literacy and numeracy programs. In a field experiment consisting of 1,179 adult learners in England, the authors sent behaviorally-informed text messages and organizational reminders to students. The messages led to large increases in attendance rates, and the effects persisted over the three weeks of the campaign. This simple intervention provides a low cost approach for organizations looking to improve attendance and engagement. Closed for comment; 0 Comments.
- 10 Mar 2015
- Research & Ideas
The Surprising Winners and Losers in the Retail Revolution
The growth of ecommerce is creating new leaders in retail while putting many famous brands at risk. Professors Rajiv Lal and José Alvarez pick the winners and losers in part two of our series on their new book, Retail Revolution. PLUS: An excerpt on the future of grocery stores. Open for comment; 0 Comments.
- 02 Mar 2015
- Research & Ideas
‘Retail Revolution’ Excerpt: The Scale of the Ecommerce Threat
With ecommerce becoming a much bigger part of the economy, a tipping point is fast approaching for many retailers. An excerpt from, Retail Revolution: Will Your Brick-and-Mortar Store Survive? on why even big names like Walmart are coming under pressure from the likes of Amazon. Open for comment; 0 Comments.
- 11 Feb 2015
- Research & Ideas
Politicians Benefited From Using Toxic Loans
A new study by Boris Vallée and Christophe Pérignon offers evidence that local politicians in France (and probably elsewhere) used high-risk loans for political gain in the years leading up to the recent financial crisis. The strategy worked: Toxic loans helped mayors get reelected. Open for comment; 0 Comments.
- 29 Jan 2015
- Op-Ed
The Fall of Greece
When the Syriza party emerged victorious in Greece's national election last week, many citizens rejoiced at the promise of an easing of austerity measures. Professor George Serafeim believes having fresh people in government is a positive development, but fears they could point the country backward, away from competition and free-market forces. Open for comment; 0 Comments.
- 01 Dec 2014
- Research & Ideas
The Big Influence of Small Countries in the United Nations Secretariat
Who calls the shots at the United Nations Secretariat? A new study by Eric Werker and Paul Novosad on the nationalities of senior staff draws surprising conclusions about the influence of smaller countries compared with world powers. Open for comment; 0 Comments.
- 15 Sep 2014
- Research & Ideas
Are the Most Talented Employees the Highest Paid? Yes—If They’re Bankers
A recent study by Claire Célérier and Boris Vallée finds that the French finance industry compensates employees largely according to how talented they are. Other high-paying industries? Not so much. Closed for comment; 0 Comments.
- 07 Jul 2014
- Research & Ideas
Banning Big-box Stores Can Hurt Local Retailers
Research by Raffaella Sadun shows how regulations meant to protect independent retailers from big-box stores may actually backfire. Closed for comment; 0 Comments.
- 20 Mar 2014
- Working Paper Summaries
Waste, Recycling and Entrepreneurship in Central and Northern Europe, 1870-1940
The efficient and appropriate collection and disposal of solid waste has been recognized as essential to the hygiene and health of urban societies since the nineteenth century. Over the course of the first half of the twentieth century, sanitary engineers and the broader public also came to understand that the inappropriate treatment of waste could cause major environmental degradation, while recycling could contribute significantly to environmental sustainability. A key question for this industry, therefore, has been whether such social value could be combined with the pursuit of profitable opportunities. In this paper the authors focus on the late nineteenth century through the 1940s, a crucial period for the emergence of firms concerned with waste disposal in industrialized central and northern Europe. The authors show that German, Danish, and other European entrepreneurs built substantial businesses which aimed to achieve "shared value" by making positive social and environmental contributions to their societies. Some of these entrepreneurs had strikingly modern views of environmental challenges and they prefigured many later twentieth-century recycling processes. At the same time, the profit motive encouraged technological innovation, a major ideal of capitalist enterprise, and left a legacy of scientific and engineering knowledge of waste materials and their processing and utilization which benefited later recyclers. Although post-1970 non-profit community recycling centers, municipal collection programs, and recycling divisions of waste management companies provide the terminology and the ideology behind modern recycling, they owe their technological and organizational foundations to an earlier generation of profit-seeking engineers, scientists, and entrepreneurs. Key concepts include: Industrialization and the birth of consumer societies in the nineteenth century encouraged authors the emergence of firms concerned with waste disposal. This paper examines entrepreneurs in this industry in central and northern Europe from the late nineteenth century to the 1940s. These entrepreneurs sometimes had strikingly modern views of environmental challenges and the need to overcome them. They initiated processes for sorting and recycling waste materials that are still employed today. They were driven by a desire to keep city and countryside healthy and unpolluted, and to avoid the gratuitous waste of resources. In an era of municipalization, these entrepreneurs demonstrated the potential for fruitful interactions between business and city government. Their companies show the challenges of achieving profitability in large-scale recycling. The problems of many of these businesses may help to explain why private waste companies have been associated with late and reluctant entry into recycling activities, often trailing municipal governments and non-profit entities in the late twentieth century. Closed for comment; 0 Comments.
- 03 Mar 2014
- HBS Case
Decommoditizing the Canned Tomato
Most commodity producers look to cut costs aggressively. So why is Mutti S.p.a, an Italian producer of tomato products, paying farmers more than competitors? Mary Shelman discusses her case study. Closed for comment; 0 Comments.
- 06 Jan 2014
- Working Paper Summaries
Mechanisms of Technology Re-Emergence and Identity Change in a Mature Field: Swiss Watchmaking, 1970-2008
According to most theories of technological change, old technologies tend to disappear when newer ones arrive. As this paper argues, however, market demand for old technologies may wane only to emerge again at a later point in time, as seems to be the case for products like Swiss watches, fountain pens, streetcars, independent bookstores, and vinyl records, which have all begun to claim significant market interest again. Looking specifically at watchmaking, the author examines dynamics of technology re-emergence and the mechanisms whereby this re-emergence occurs in mature industries and fields. Swiss watchmakers had dominated their industry and the mechanical watch movement for nearly two centuries, but their reign ended abruptly in the mid-1970s at the onset of the "Quartz Revolution" (also known as the "Quartz Crisis"). By 1983, two-thirds of all watch industry jobs in Switzerland were gone. More recently, however, as the field has moved toward a focus on luxury, a "re-coupling" of product, organizational, and community identity has allowed master craftsmen to continue building their works of art. The study makes three main contributions: 1) It highlights the importance of studying technology-in-practice as a lens on viewing organizational and institutional change. 2) It extends the theorization of identity to products, organizations, and communities and embeds these within cycles of technology change. 3) It suggests the importance of understanding field-level change as tentative and time-bound: This perspective may allow deeper insights into the mechanisms that propel emergence, and even re-emergence, of seemingly "dead" technologies and industries. (Read an interview with Ryan Raffaelli about his research.) Key concepts include: The value of some products may go beyond pure functionality to embrace non-functional aspects that can influence consumer buying behaviors. Introducing a new technology is not always the only way to get ahead of the curve when older technologies or industries appear to be reaching the end of their life. Industries that successfully re-emerge are able to redefine their competitive set - the group of organizations upon which they want to compete and the value proposition that they send to the consumer. There is significant interplay among community, organization, and product identities. Swiss watches—as well as fountain pens, streetcars, independent bookstores and vinyl records—are all examples of technologies once considered dead that have rematerialized to claim significant market interest. For Swiss watchmakers, "who we are" (as a community) and "what we do" (as watch producers) were mutually constitutive and may have been a potent force in the processes that sought re-coupling in the face of the de-coupling precipitated by technological change. Although new or discontinuous technologies tend to displace older ones, legacy technologies can re-emerge, coexist with, and even come to dominate newer technologies. Core to this process is the creation—and recreation—of product, organization, and community identities that resonate with the re-emergence of markets for legacy technologies. Substantial economic change may not be contained only within organizational or industry boundaries, but also extend outward to include broader forces related to field-level change. Closed for comment; 0 Comments.
- 20 Sep 2013
- Working Paper Summaries
Historical Origins of Environmental Sustainability in the German Chemical Industry, 1950s-1980s
This paper examines the emergence of environmental strategies in the chemical industry between the 1950s and the 1980s. German chemical firms have been hailed as "eco-pioneers" in this regard, but this study demonstrates that initially the leading chemical companies of both Germany and the United States followed a similar approach to societal concerns about environmental pollution. Both German and American firms suggested that pollution incidents and complaints were a matter for local responses, tailored to specific settings, and should be considered primarily as nuisances rather than as environmental or health hazards. By the 1970s, however, the evolution of environmental strategies in the German chemical industry diverged greatly from that of the United States. This working paper explores how and why by examining the strategies of two prominent German chemical companies, Bayer and Henkel. The German firms diverged from their American counterparts in using public relations strategies not only to contain fallout from criticism of their pollution impact, but also to create opportunities for changes in corporate culture to encourage sustainability. While the US chemical industry remained defensive and focused on legal compliance, there was a greater proactivity among the German firms. The study stresses the importance of the regional embeddedness of Bayer and Henkel in the state of North Rhine-Westphalia, which made their reputations especially vulnerable to criticism. A new generation of corporate leaders also perceived that more reactive strategies were needed to fulfill societal expectations. They were savvy enough to understand that investing in environmental sustainability could provide an opportunity to create value for the firm, and that self-identifying as eco-pioneers had commercial as well as reputational benefits, provided that the image reflected genuine policies and processes. Key concepts include: Leading German chemical companies have been regarded and self-identified as "eco-pioneers," but before the 1970s their environmental strategies were broadly similar to their U.S. counterparts. Subsequently the German firms became more proactive in their environmental strategies. The regional embeddedness of Bayer and Henkel in the state of North Rhine-Westphalia emerges as an important determinant of their emergent green strategies. The firms had deep reputational stakes invested in their region and were highly exposed to criticism of their environmental impact. Corporate leaders of Henkel and Bayer were early movers in understanding that investing in environmental sustainability could provide an opportunity to create value for their firms. Closed for comment; 0 Comments.
- 28 May 2013
- Research & Ideas
Can LEGO Snap Together a Future in Asia?
Using scenario planning, executives at LEGO Group played through a possible strategy shift in Asia. Thanks to a new case study by professor Anette Mikes, students can make their own decisions. Closed for comment; 0 Comments.
- 18 Mar 2013
- HBS Case
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. Closed for comment; 0 Comments.
- 04 Mar 2013
- Working Paper Summaries
The Dirty Laundry of Employee Award Programs: Evidence from the Field
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. Key concepts include: Even simple awards programs can have much broader and complex implications for employee behavior. In the study, two highly valued employee groups - the most productive workers and the most consistently punctual workers - suffered a 6-8% decrease in productivity after the award was instituted. This finding is remarkable because it suggests that awards for one type of behavior have the potential to "crowd out" positive behavior in a completely different realm. This research suggests that non-monetary but extrinsic rewards such as corporate awards act more like monetary rewards than they do intrinsic motivators such as love for the job or empowerment through autonomy. Award programs with a low likelihood of winning may be ineffective because employees do not habituate good behavior, and instead lead to a highly strategic response from employees. Closed for comment; 0 Comments.
- 14 Jan 2013
- Research & Ideas
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. Closed for comment; 0 Comments.
- 12 Dec 2012
- Research & Ideas
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. Closed for comment; 0 Comments.
- 12 Dec 2012
- Research & Ideas
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.
- 10 Dec 2012
- Working Paper Summaries
Vulnerable Banks
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. Key concepts include: This model can simulate the outcome of various policies to reduce fire sale spillovers in the midst of a crisis. Size caps, or forced mergers among the most exposed banks, do not reduce systemic risk very much. However, modest equity injections, if distributed appropriately between the most systemic banks, can cut the vulnerability of the banking sector to deleveraging by more than half. The model can be adapted to monitor vulnerability on a dynamic basis using factor exposures. Closed for comment; 0 Comments.
Tate’s Digital Makeover Transforms the Traditional Museum
What happens when the traditional museum-going experience meets the world of digital marketing? Meet the Magic Tate Ball and other wonders from the online version of the Tate museums. HBS senior lecturer and museum expert Jill Avery guides the tour. Open for comment; 0 Comments.