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Ethical Choices in the Design and Administration of Executive Compensation Programs
Within the past few years, executives have come under increased scrutiny and criticism for the levels of compensation they receive. At the same time, corporate practices surrounding the design and review of executive compensation programs have received increased attention. While some recent executive misconduct has involved violations of the law, many academics and other corporate critics view the issues involving executive compensation more from an ethical than a legal perspective. Several dimensions of the executive compensation decision process offer significant opportunities for ethical choices. Identifies the major components of executive compensation and highlights decision points in the design and administration of each component where ethical issues may arise. Proposals to reduce the potential for ethical misconduct are also offered. -
Why Pass on Viral Messages? Because They Connect Emotionally
Postulates that successful viral marketing campaigns trigger an emotional response in recipients. Working under this premise, examines the effects of viral messages containing the six primary emotions (surprise, joy, sadness, anger, fear, and disgust) on recipients' emotional responses to viral marketing campaigns and subsequent forwarding behavior. According to findings, in order to be effective, viral messages need to contain the element of surprise. By itself, however, surprise is not enough to guarantee message success; therefore, it must be combined with other emotions. The effectiveness of the viral message is also moderated by gender, with disgust-based and fear-based campaigns being more likely to be forwarded by male recipients than female recipients. To ensure forwarding behavior, the message must capture the imagination of the recipient, as well as be clearly targeted. Moreover, achieving fit between a campaign and the featured emotions is important, as this ensures an increased chance of forwarding. In addition to relaying these and other findings, shares and discusses the managerial implications of using different emotions in viral marketing campaigns. Finally, culture is recognized as an influencer. -
Developing Effective e-Recruiting Web sites: Insights for Managers from Marketers
In recent years, the practice of using corporate Web sites to recruit job applicants has increased steadily. Despite this trend, however, studies show that approximately 75% of job seekers find the sites too complicated to use successfully (Brown, 2004) and that more than 20% have rejected job opportunities based on poorly designed Web sites (Pastore, 2000). To address this problem, joins Internet marketing and employee recruitment research to offer six development implications for creating an effective "e-recruitment" source on a corporate Web site. Based on a job marketing approach to the recruitment process and consumer behavior research on persuasive communication and decision making, we present considerations important to creating an online recruiting Web site that effectively influences the search decisions and behaviors of a target market of desired job candidates. -
Back-Propagation of User Innovations: The Open Source Compatibility Edge
Open source software (OSS) is a dramatically disruptive force in the software industry. While businesses see OSS succeeding, many of them have trouble gleaning the lessons that can be learned from the OSS phenomenon, since OSS development appears to be far removed from traditional business practices and principles. A major observation resulting from research on OSS products is that OSS product development is not only enabling innovations by its users, but also providing a structure for them to back-propagate into OSS products, a process that enhances compatibility in OSS products and presents a low-cost solution to the more general problem of servicing highly segmented markets. Argues that this innovative management process carries important insights for both commercial software vendors and companies outside the software industry. -
Creating and Sustaining Trust in Virtual Teams
Conventional wisdom assumes that trust develops from a history of interpersonal interactions and communication, through which people come to 'know and trust' one another. In virtual teams, however, establishing trust can be complicated: members may have no past on which to build, no future to reference, and may never even actually meet face-to-face. Swift but fragile trust can develop early in a team's life cycle. Yet, if swift trust doesn't develop or even dissipates, members need to find ways of building trust in each other. To this end, an understanding of how trust impacts a virtual team's development will help managers and team leaders to facilitate and improve team success. Describes the three components of trust (ability, integrity, and benevolence) and identifies which of these are critical to each life cycle stage (establishing the team, inception, organizing, transition, and accomplishing the task) of the virtual team. Proposed action steps for each stage show managers and team leaders how to help members develop trust and sustain it through the project's successful completion. -
Venture Capital or Private Equity? The Asian Experience
Venture capital in Asia has exhibited remarkable growth over the last two decades. Researchers and practitioners have, however, expressed doubts as to whether what is being reported as venture capital in Asia can really be classified as such. Authors of scholarly studies often avoid this debate and, consequently, fail to caution readers about the applicability of their research findings. Through an exploration of the history, development, and composition of venture capital in Asia, not only confirms significant differences between Asian and traditional venture capital, but also finds that venture capital in Asia differs little from what is commonly called private equity. As such, a need exists within the venture capital literature to recognize this peculiarity of the Asian venture capital market. Moreover, venture capitalists considering expansion into Asia must comprehend the nature of the Asian market in order to avoid disillusionment and frustrations which may result from inadequate understanding. -
Motivating From the Top Down
The CEO and other company leaders are trying to do all the right things to motivate executives. One of those things is to develop the workforce through excellent executive education. On the last day of a week-long off-site program, the head honcho shows up to motivate program participants. With one short "pep talk," he swoops in, sucks all the energy out of the room, and leaves. -
U.S. Retirement Savings Market and the Pension Protection Act of 2006
Provides an overview of the evolution of the private retirement savings market in the U.S. since 1990; the management and administration of defined-contribution (DC) plans; the existing evidence about the investment and savings decisions of participants in DC plans; and the Pension Protection Act of 2006. -
CW: Launching a Television Network
In May 2006, Dawn Ostroff, president of entertainment of the newly formed CW Television Network, was faced with the task of choosing the final set of programs for the 2006 fall schedule, which she would present to advertisers at the annual "upfront" market in New York one week later. Only four months earlier, CBS Corp. and Time Warner Inc. had announced they would close their UPN and The WB networks, and run the CW as a joint venture. This unusual partnership, a first in the history of network television, had created a unique challenge for executives: an unprecedented number of existing shows would have to be cancelled. Ostroff and her colleagues--who had received thousands of letters, petitions, and gifts from desperate fans begging for the renewal of their favorite shows--had filled the empty slots. The final decision was the toughest: although four popular shows were still in contention--Everwood, One Tree Hill, 7th Heaven, and Veronica Mars--there was only room for three. Which show would be the last to be axed? And what would be the best time slots for the three last additions to the line-up? Allows for an in-depth examination of marketing issues in launching and operating a major broadcast television network, in particular making programming and scheduling decisions and managing relationships with audiences and advertisers. Provides unique insights into the launch of a network--a rare enterprise--and the associated marketing and branding campaign. Also contains rich television ratings data that can form the basis for a discussion on product portfolio management, in particular, continuation and pruning decisions (i.e., series renewals and cancellations). Finally, can be used to facilitate an assessment of challenges and opportunities in developing sustainable businesses in a rapidly changing media environment. -
Ericsson: Leading in Times of Change
After its dramatic corporate turnaround, the Swedish telecom infrastructure company Ericsson hires a new CEO to bring the former Swedish flagship company back on track. Puts students in the shoes of Carl-Henric Svanberg, an industry outsider and CEO of locks group Assy Abloy, who does not hesitate a moment when he gets the call in early 2003. Looks back on the reasons for Ericsson's current situation and the recent restructuring programs that cut the company's staff and operating expenses in half. Presents Svanberg's vision for how to re-energize the ailing company and reach profitability once again, and gives students the opportunity to debate these issues. -
Reinventing Ericsson
Carl-Henric Svanberg, CEO of the Swedish telecom infrastructure company Ericsson, has to reorganize the recovering company in late 2003 after a major industry downturn. He is convinced that only a more market-orientated and customer-focused organization will be able to remain competitive in this maturing, high-technology focused industry. Presents his change project, in which the sales and marketing structure play a central role. Will his ideas allow the company to keep its customers and successfully go after new markets? -
Octone Records
In February 2007, Octone Records founders James Diener, Ben Berkman, and David Boxenbaum had been highly successful with the first two bands they had signed, Maroon 5 and Flyleaf. Known for its grassroots marketing campaigns, Octone operated through a unique joint venture model with SonyBMG Music Entertainment's RCA Music Group, which enabled the nimble record label to orchestrate mass marketing campaigns once an artist was ready for "prime time." Octone had been less fortunate, however, with its third act, Michael Tolcher. Despite significant investments, Tolcher's first full album had not sold enough copies to recover its costs and merit RCA's marketing support. Octone's executives faced a decision: whether to continue to support Tolcher's first album, increase the stakes by financing a second album, or cut their losses and instead focus on other artists. At the same time, Octone had to evaluate a proposal from Universal Music Group to buy out SonyBMG's interest in the joint venture. Allows for an in-depth examination of new product development and launch strategies in the context of the music industry. Provides rich insights into how grassroots and mass marketing approaches can facilitate new product/artist development. Octone's "hybrid" marketing structure is described in considerable detail, and supporting economic data is provided. By enabling an analysis of how long and how aggressively an artist should be supported before commercial success is achieved, serves as a vehicle for contrasting different approaches to the new product development process. -
Joel Klein and Leadership in the NYC Public Schools
Reviews the work of the New York City School Chancellor Joel Klein and his attempt to create a Leadership Academy in order to better train principals to lead New York City public schools. Assesses what leadership skills and strategies are necessary for Klein to create a new cohort of effective site-based leaders for New York City Public Schools and further, what methodology Klein and the Leadership Academy establish to accomplish this task. The key question involves Klein's attempt to assess whether an institution dedicated to training better administrators can serve as the key component of a larger effort to improve the performance of the New York City public school system; on a more micro basis is the question of whether the Leadership Academy itself and its program to train principals has been effective in the context of the larger problems the school system faces. If so, will the principals trained be able to be successfully integrated and effectively utilized as organizational elements capable of leading site efforts necessary to improve New York City public school system performance? -
Thomas J. Watson, IBM and Nazi Germany
Considers the strategy of U.S.-owned IBM, then a manufacturer of punch cards, in Nazi Germany before 1937. Opens with IBM CEO Thomas J. Watson meeting Adolf Hitler in his capacity as President of the International Chamber of Commerce. IBM had acquired a German company in 1922 and, like other American companies, found itself operating after 1933 in a country whose government violently suppressed political dissent and engaged in intimidation and discrimination against Jews. Explores the tensions between IBM's German affiliate and its parent and provides an opportunity to explore the options and responsibilities of multinationals with investments in politically reprehensible regimes. -
Royal DSM N.V.: Information Technology Enabling Business Transformation
Describes how Royal DSM NV, an $8 billion dollar global corporation, leveraged information technology to enable a major corporate portfolio transformation between 2000 and 2006. -
Les is More, Times Four
"I've had enough! I've decided that I need to resign," read the email from the founder of Webpoint to the company's board of directors. Les Trachtman, the CEO of Webpoint, has to figure out how to react to the founder's "it's Trachtman or me" ultimatum. Webpoint was Trachtman's fourth job as CEO, and in each case he had been hired as the first non-founding CEO, taking over from the founder-CEO of a tight-knit founding team. Trachtman had first taken over from a mother and son team, then from two brothers, then from a wife and husband team, and now from serial co-founders who were best friends. From these ventures, Trachtman had learned how to manage founders who had strong relationships, but those experiences had not prepared him for the current situation. -
Opening Pandora's Box
Pandora.com provided a highly customizable online radio service tailored to listeners' musical preferences, and had registered explosive growth since its September, 2005 launch. But proposed changes in royalty rates threatened to kill off many Internet radio sites, including Pandora. Explores Pandora's business model, and whether it can evolve to remain viable. -
Intel 2006: Rising to the Graphics Challenge
Examines the evolution of the PC hardware industry over the span of two and a half decades. The open architecture design of the IBM Personal Computer followed by the rapid appearance of clones drove a high level of standardization and modularity in the industry, and value was distributed along the value chain depending on levels of competition and ability to substitute components at each level. On the hardware side two component segments, the microprocessor and the graphics processor unit (GPU), ultimately became the most valuable parts of the chain. The GPU business had settled into a duopoly with Nvidia, Inc. and ATI Technologies (ATI). Intel had dominated the microprocessor segment, but Advanced Micro Devices (AMD) was consistently a thorn in Intel's side. Addresses the prospects of the graphics function becoming integrated with the microprocessor on a single piece of silicon. AMD had just announced the acquisition of ATI and Paul Otellini, Intel's CEO, is faced with the question of what he should do. Should he buy Nvidia, should he continue with his own internal graphics efforts, or should he listen to some of his customers and leave things separate? -
BBC Worldwide: Global Strategy
In January, 2007, John Smith, chief executive officer of BBC Worldwide (BBC WW), the commercial arm of the British Broadcasting Corporation (BBC), was preparing to meet with his senior managers to discuss BBC WW's global strategy options. BBC WW exploited and exported BBC branded content around the globe through all formats, including magazines, television, books, DVDs, audio books, merchandise, mobile phones, downloads, and other emerging digital media (such as Internet Protocol TV). BBC WW delivered its profits back to the BBC. Since 2004, BBC WW profits had more than doubled. -
TA Energy (Turkey): A Bundle of International Partnerships
Stimulates discussion of entrepreneurship in emerging economies, especially for entrepreneurs returning to their home countries to start businesses with global technologies and partners. Focuses on the partnership tensions between global firms and local family-dominated conglomerates. Addresses new venture financing in an asset-intensive business through the assembly of strategic contrasts. More broadly, highlights the opportunities and challenges for returnee entrepreneurs.