Articles tagged with Financial Management
A new study suggests that the G20 Toronto summit may not lead to significant reforms in financial regulations. The study highlights the challenges of coordinating policies among countries with diverse financial structures, making harmonization a difficult task.
A new Rotman paper finds that physically enclosing relevant materials from unpleasant memories improves psychological closure, creating a sense of well-being. The study's findings have implications for products and services that relieve stress and anxiety related to past events or tasks.
A new INFORMS study proposes incentivizing shippers to take on more port security responsibilities, reducing the burden on the federal government. This shift could lead to cost savings and improved security measures in the supply chain.
A new study found that CEO charismatic visions can lead to poor decisions by financial analysts and investors. Analysts who follow firms with high CEO charisma are more likely to make forecasting errors, which can impact stock prices and investor outcomes.
Research by Stylianos Kavadias and Svenja C. Sommer suggests that brainstorming techniques are more effective when participants from different specialties collaborate to develop simpler products. The study found that in highly technical products, specialists work individually before collaborating through 'nominal' groups.
A new study found that toy recalls in 2007 had a ripple effect on the industry, with even non-recalled companies experiencing a 25% decline in Christmas season sales. Sales of toys from manufacturers named in the recalls dropped by 30%, while those from unaffected companies remained unaffected.
A study published in Management Science found that presenting small gains alongside large losses can improve decision-making by reducing mental pain. The 'Silver Lining Effect' suggests that people prefer separating positive and negative information to mitigate the impact of loss, with more pronounced effects for larger losses.
A recent study published in Financial Management argues that Chapter 11 reorganizations fail to offer a clean slate for firms to establish new capital structures. Despite substantial reductions in debt burden, firms still end up with higher debt ratios than industry norms.
Research published in Strategic Organization highlights micro-level underpinnings of macroeconomic events, arguing that traditional theories are inadequate. The authors propose a new approach based on heterogeneous resources and capabilities, which can help resolve the current crisis.
The study found that internet retailers can successfully compete with brick-and-mortar stores by focusing on niche products. The researchers recommend that online retailers vary their product offerings based on geographic locations and promotional strategies to target specific consumer groups.
Researchers found that managers tend to downplay the significance of their past forecasting mistakes when predicting future earnings. This underestimation can influence how investors respond to new forecast announcements, contributing to persistent price drift after an earnings announcement. Further study is needed to determine if this...
A new study from UAB researchers suggests that individuals with mild cognitive impairment (MCI) who struggle with financial management skills may be at risk for developing Alzheimer's disease. The study found that MCI patients who declined in financial capacity over a year were more likely to progress to Alzheimer's.
A new study by Management Insights suggests that Iraq veterans may be experiencing a PTSD rate of up to 35%, doubling the expected rate due to delayed onset and subsequent deployments. The Institute for Operations Research and the Management Sciences calls for increased mental health resources to care for returning troops.
A new study by Oregon State University professor JunJie Wu found that senior management's environmental values are a leading factor in firms' decisions to over-comply with environmental regulations. Facilities making products sold directly to consumers or offering services are less likely to violate regulations.
A study from North Carolina State University found that companies can identify winning products by critically evaluating new ideas early on, eliminating bad ideas and advancing good ones. The research provides a benchmarking template for developing customized review criteria to improve product development practices.
Andrew W. Lo's lecture at SIAM Annual Meeting explores the evidence for and against blaming quantitative analysis for the financial crisis. He suggests a broader perspective reveals bubbles, crashes, and market dislocation are unavoidable consequences of human behavior and free enterprise.
A study of online DVD rentals found that customers tend to hold highbrow films longer than lowbrow films, with a 1.3% increase in reversal probability if the first film is more attractive. As customers gain experience, they tend to favor want over should characteristics.
Research in Management Science reveals that recommender systems can create self-reinforcing cycles favoring popular items, reducing diversity and serving consumers and producers poorly. To mitigate this issue, designers must consider modifications to limit popularity effects and promote exploration in their recommender systems.
A new study suggests that charging consumers a fee at the time of sale can significantly reduce electronic waste (e-waste) in the US. The approach is found to be more effective than fees upon disposal, increasing manufacturer profits while decreasing e-waste quantities.
Researchers found that wishful bettors can contaminate beliefs throughout markets, causing investors with accurate beliefs to become overly optimistic about stock values. This contagion problem could contribute to market bubbles and other anomalies.
Research by Christophe Boone and Walter Hendriks found that IT firms with diverse expertise and work experience tend to be more effective in managing organizations. In contrast, personality diversity hinders firm performance. The study suggests using carefully designed personnel selection techniques to screen for knowledge and experience.
The 2008 financial crisis has radically transformed the business information landscape, with senior information managers seeking to add value and manage costs. The survey found that companies are pushing for more strategic management of their information services, with a focus on appraising how to add value and managing vendors.
A Rensselaer Polytechnic Institute student project has created an open-source app called Vault that tracks and manages personal spending on the iPhone, while protecting users' identities. The app offers features like automatic expense categorization and GPS-located bank branches.
A new INFORMS management insights feature warns that relying on arithmetic means can lead to flawed plans. Non-averaging metrics, such as the artist's maximum sales, are often more accurate and should be used instead.
A new INFORMS study suggests automakers must balance short-term price savings with long-term product life cycle implications when considering outsourcing production. The study finds that in-house development allows for higher performance improvement over the entire product life cycle.
Liverpool Associates in Tropical Health (LATH) has been awarded a £10 million contract to strengthen Malawi's health research capacity. The initiative aims to enhance institutional capacity for high-quality multi-disciplinary health research and improve the use of research in national policy and implementation.
A recent study published in Management Science found that social preferences, such as status and reciprocity, play a significant role in shaping the behavior of supply chain partners. When these preferences are taken into account, partnerships can become more collaborative and mutually beneficial, leading to improved overall performance.
The University of Minnesota study reveals that corporate culture is the most important factor in driving radical innovation across nations. Firms with a supportive internal structure, product champions, and incentives are more innovative than those with other characteristics.
Research suggests that joint bidding on packages can increase consumer surplus and improve profits for both consumers and retailers. In a study, authors found that consumers tend to bid more for individual items when asked to place a joint bid, increasing the probability of a transaction going through.
A University of Illinois expert argues that traditional corporate governing systems failed to prevent risky business deals, contributing to the financial meltdown. In contrast, partnership-based firms have better weathered crises through controls like tying managers' compensation to company fortunes.
The article proposes new best practices for corporate portfolio management, including revamping organizational structure and compensation systems to prioritize investor thinking. An independent group within companies can function like a SWAT team to support objective portfolio management.
A new study found that firms with high analyst coverage engage in excessive external financing and capital spending, resulting in lower future returns. Firms with high analyst coverage tend to have higher levels of investment compared to those with low analyst coverage.
A recent INFORMS study suggests that hiring top talent from competitors may not lead to improved performance. Instead, the performance of stars depends on firm-specific human capital and colleague relationships. The study's findings warn managers against expecting significant gains from hiring stars.
The NIST model assigns a probable risk of attack to guide IT managers in securing their networks by analyzing all possible paths that system attackers could penetrate through. This allows decision makers to make wise decisions and investments to protect their network from data breaches.
A new issue brief examines the current financial status of state retiree health plans, finding that not all states face a fiscal crisis and retirement benefits are not protected by law. States with low unfunded liabilities include North Dakota, Wyoming, Iowa, and Oregon.
Firms in rural areas are less likely to issue equity than urban firms, with rural firms using lower-quality underwriters. This is due to the marginal investor being located far away, creating an information disadvantage for insiders.
A study by Matthew T. Billett and Yiming Qian found that CEOs who exhibit self-attribution bias tend to overcredit their role in successful deals and underestimate the impact of luck, leading to more value-destructive acquisitions. The authors advise CEOs to be cautious and boards to ensure proposed deals are judged on their own merits.
A study by Vanessa Gail Perry found that those who overestimated their credit ratings had lower incomes, less formal education, and were less likely to own their homes. People more likely to overestimate their credit quality tend to be minority consumers with less financial experience.
A study published in Strategic Management Journal reveals that financial markets reward green firms due to their perceived lower risk, resulting in reduced total cost of capital. Additionally, individual investors favor greener firms, leading to increased ownership and lower equity capital costs.
A new Management Insights study by Enno Siemsen reveals that software designers intentionally create complex products to advance their careers. Companies are struggling to cope with increasing design complexity, and the study suggests moving compensation agreements towards short-term project success.
A Management Insights study finds that physicians consider patients' inputs when making prescriptions, improving forecasting performance. However, patient influence diminishes for specialist doctors and those treating severe symptoms. The study has significant implications for pharmaceutical executives and marketing strategies.
A recent study by Management Insights found that IT professionals with MBAs earn 46% more than those without. In contrast, IT professionals with master's degrees other than an MBA earn 37% less. The study analyzed data on over 50,000 IT professionals in the US and found that firms value IT experience more than non-IT experience.
A recent study by Sanjeev Dewan, Charles Shi, and Vijay Gurbaxani found that information technology (IT) investments are substantially riskier than ordinary capital investments. This increased risk is associated with a substantial risk premium, driven in part by the lost option value of making irreversible capital investment decisions.
A new study by Sudip Bhattacharjee and Ram D. Gopal reveals that file sharing has a devastating impact on lower ranked Billboard albums, reducing their survival time on the chart by 42%. Top debuting albums, however, remain relatively unaffected.
A new study published in Management Insights reveals that online auctions where all bids are disclosed after the bidding round benefit buyers. The research finds that buyers pay higher prices when only winning bids are disclosed, leading to better outcomes for consumers.
A study by Melissa A. Schilling and Corey C. Phelps found that large-scale alliance networks with high clustering and reach enhance firm innovation. The research analyzed 1,106 firms in 11 industry-level alliance networks over a six-year period.
A new INFORMS-published study reveals that executive stock options significantly increase the likelihood of financial misrepresentation. Approximately 1 in 10 corporate financial restatements are linked to fraud and illegal practices, with a 9% chance of misrepresentation over five years.
A study by Juan Alcacer and Wilbur Chung found that more advanced technology companies locate near universities to partner in research. These firms are attracted to regions rich with academic activity, rather than competitor-rich areas.
A new study in April Management Insights highlights the risks of pursuing aggressive market share expansion and rapid growth. Firms that adopt such strategies often face losses due to overcapacity when the market saturates, ultimately undermining their competitive advantages.
The study found that firms with managers having more social relationships with peers at other software start-ups have a better chance of surviving external shocks. Managers who prefer to talk to larger firms, not among themselves, are also more likely to survive.
Research by Pino G. Audia and Jack A. Goncalo suggests that successful inventors' creative output decreases over time, while collaboration and exploration goals can help manage this phenomenon. The study's findings have implications for R&D managers seeking to boost their departments' productivity.
A study published in Management Science finds that system quality and perceived usefulness are key determinants of information systems (IS) success. The research suggests that developers and managers should focus on improving system quality rather than increasing user satisfaction, as this will lead to greater system use.
A new study recommends that brick-and-mortar retailers avoid opening online portals when facing e-tailer threats. The authors suggest that staying true to the original business model is the most effective response in markets where price consistency is crucial.
A new study examines the implications of internet forum manipulation on policy decisions, R&D investments, and consumer trust. Strategic manipulation of online forums can have significant effects on both consumers and firms, highlighting the need for investments in technologies that discourage online manipulation.
Management Science has introduced a monthly feature called Management Insights, which provides a digest of important research in business and management. The September issue features studies on airline safety, entrepreneurial risk, and market valuation, offering practical insights for practicing managers.
A new method by University at Buffalo engineers calculates the expected cost of managerial neglect in processes with variability, such as supply chains. The model can help managers justify investments for improvement and save up to 50% in costs over three years.
Patients who received a disclosure were more likely to correctly identify their physician's payment model and report enough knowledge to judge its influence on health care. Loyalty to the physician group was higher among those receiving a disclosure, with no significant decrease in trust.
A study of US government financial managers found that timely feedback from supervisors can mitigate stress and encourage ethical action. The majority of respondents reported feeling less stressed when they received regular, constructive feedback on their performance.
A new three-step process developed by NIST's Office of Applied Economics evaluates the vulnerability of facilities to terrorist threats, considering engineering, management, and financial strategies. The tool assesses the most cost-effective combination of risk reduction strategies to protect facilities from damages.
The UN University has authorized a diploma for graduates of its 10-course, 250-hour online training program in Integrated Water Resources Management. The program aims to upgrade knowledge of modern water management concepts and principles among practicing professionals.