ESMT Berlin publishes in international academic journals, which are first-class in their respective fields. Research also provides cutting-edge and profound insights for the business community as well as the classroom through managerial publications and case studies. This rare integration of research and practice makes ESMT Berlin an outstanding location for generating relevant and ground-breaking knowledge.
Appearing self-confident and getting credit for it: Why it may be easier for men than women to gain influence at work
Appearing self-confident is instrumental for progressing at work. However, little is known about what makes individuals appear self-confident at work. We draw on attribution and social perceptions literatures to theorize about both antecedents and consequences of appearing self-confident for men and women in male-dominated professions. We suggest that performance is one determinant of whether individuals are seen as confident at work, and that this effect is moderated by gender. We further propose that self-confidence appearance increases the extent to which individuals exert influence in their organizations. However, for women, appearing self-confident is not enough to gain influence. In contrast to men, women in addition are “required” to be prosocially oriented. Multisource, time-lag data from a technological company showed that performance had a positive effect on self-confidence appearance for both men and women. However, the effect of self-confidence appearance on organizational influence was moderated by gender and prosocial orientation, as predicted. Our results show that through self-confidence appearance, job performance directly enables men to exert influence in their organizations. In contrast, high performing women gain influence only when self-confidence appearance is coupled with prosocial orientation. We discuss the implications of our results for gender equality, leadership, and social perceptions.
We study the effects of competition on loan rates and portfolio-at-risk in microcredit markets using a new database from rating agencies, covering 379 microbanks located in 67 countries between 2002 and 2008. Our study reveals different competitive effects in nonprofit and for-profit microbanks. We find that for-profit microbanks charge significantly lower rates and exhibit improved portfolio-at-risk in less concentrated markets. In particular, the effect of concentration on loan rates is nearly three times the one reported in previous studies in banking. In contrast, nonprofit microbanks are relatively insensitive to changes in concentration. We control for interest rate ceilings, which very significantly reduce rates in for-profit microbanks. However, our study also uncovers a competitive interplay between for-profit and nonprofit microbanks. In particular, the PAR of nonprofit microbanks deteriorates when the proportion of profit-oriented microbanks increases. Finally, we find evidence consistent with dispersion of borrower-specific information among competing microbanks in the for-profit sector, even after controlling for the presence of credit registries.
Maintenance service plans (MSPs) are contracts for the provision of maintenance by a service provider to an equipment operator. These plans can have different payment structures and risk allocations, which induce various types of incentives for agents in the service chain. How do such structures affect service performance and service chain value? We provide an empirical answer to this question by using a unique panel data covering the sales and service records of more than 700 diagnostic body scanners. We exploit the presence of a standard warranty period and employ a matching approach to isolate the incentive effects of MSPs from the confounding effects of endogenous contract selection. We find that moving the equipment operator from a basic, pay-per-service plan to a fixed-fee, full-protection plan not only reduces reliability but also increases equipment service costs. Furthermore, that increase is driven by both the operator and the service provider. Our results indicate that incentive effects arising from MSPs leads to losses in service chain value, and we provide the first evidence that a basic pay-per-service plan—under which risk of equipment failure is borne by the operator—can improve performance and reduce costs.
© 2017, INFORMS
This paper presents an analytical framework of the product take back legislation in the context of product reuse. We characterize existing and proposed forms of E-waste legislation and compare their environmental and economic performance. Using stylized models, we analyze an OEM’s decision about new and remanufactured product quantity in response to the legislative mechanism. We focus on the 2012 waste electrical and electronic equipment directive in Europe, where the policy-makers intended to create additional incentives for the product reuse. Through a comparison to the original 2002 version of the directive, we find that these incentives translate into improved environmental outcomes only for a limited set of products. We also study a proposed policy that advocates a separate target for the product reuse. Our analysis reveals that from an environmental standpoint, the recast version is always dominated either by the original policy or by the one that advocates a separate target for the product reuse. We show that the benefits of a separate reuse target scheme can be fully replicated with the aid of fiscal levers. Our main message is that there can not be a single best environmental policy that is suitable for all products. Therefore, the consideration of product attributes is essential in identification of the most appropriate policy tool. This can be done either by the implementation of different policies on each product category or by implementation of product based target levels.
This article is protected by copyright. All rights reserved.
We study the impact of exogenous funding shocks to German savings banks during the U.S. subprime mortgage crisis on the labor decisions of 30,000+ private and public firms in Germany. We find that firms with credit relationships with affected banks experience a significant decline in labor demand relative to firms with credit relationships with healthy banks, manifested in a simultaneous reduction in firm‐level employment and average wages. The employment effect is more pronounced in larger firms, while the wage effect is stronger in smaller firms. Both employment and wages go back to pre‐shock levels three years after the shock.
(Abstract from author's website.)
We examine whether start-ups attract employees with different pecuniary and non-pecuniary motives than small or large established firms. We then explore whether such differences in employee motives may lead to differences in innovative performance across firm types. Using data on more than 10,000 U.S. R&D employees, we find that start-up employees (“joiners”) place lower importance on job security and salary but greater importance on independence and responsibility. Start-up employees have higher patent output than employees in small and large established firms, and this difference is partly mediated by employee motives - especially joiners’ greater willingness to bear risk. We discuss implications for research as well as for managers and policy makers concerned with the supply of human capital to entrepreneurship and innovation.
Copyright © 2017 Strategic Management Society
Research has shown that hiring R&D scientists from competitors fosters organizational learning. We examine whether hiring scientists who have many collaborative ties with the hiring firm prior to the mobility event produces different learning outcomes than hiring scientists who have few or no such ties. We theorize that prior ties reduce explorative learning and increase exploitative learning. From our arguments we also derive other testable implications. Namely, we posit that prior ties lead the hiring firm to focus on that part of a new hire’s knowledge with which they are already familiar and that they help appropriate the new hire’s newly generated knowledge. At the same time, prior ties induce new hires to search locally within the hiring firm’s knowledge base and also to produce more incremental, lower-impact innovations. Using data on R&D scientists’ mobility in the Electronics and Electrical Goods industry, we find broad support for our hypotheses. Our results extend our theoretical understanding of learning-by-hiring processes and bear practical managerial implications.
With permission of SAGE Publishing
When organizations crowdsource ideas, they ultimately select only a small share of the submitted ideas for implementation. Organizations generally provide no feedback on ideas they do not select. Contributors whose ideas are not selected for implementation tend to forego submitting ideas in the future. We suggest that organizations can increase contributors’ willingness to submit ideas in the future by giving a thus far understudied form of feedback: rejections. Drawing on social network theory, we develop the overarching argument that rejections lead contributors to bond with the organization, increasing their willingness to continue to interact with the organization. While it may be counterintuitive to associate rejections with bonding, we hypothesize that rejections indicate to contributors that the organization is interested both in receiving their ideas and in developing a relationship with them. This effect, we argue, is particularly pronounced when rejections provide newcomers with explanations that suggest to them that they and the organization are a good match. To test our theory, we examine the crowdsourcing efforts of 70, 159 organizations that receive ideas from 1,336,154 contributors. Using large-scale content analysis, we examine differences in how rejections are written in order to disentangle the mechanisms through which rejections affect contributors’ willingness to continue to interact with an organization. We find that getting a rejection has a positive effect on a newcomer’s willingness to submit idea in the future. The effect is stronger if the rejection includes an explanation, and is particularly pronounced if the explanation accompanying the rejection matches the original idea in terms of linguistic style.
With permission of the Academy of Management
We link the hiring of R&D scientists from industry competitors to the subsequent formation of collaborative agreements, namely technology-oriented alliances. By transferring technological knowledge as well as cognitive elements to the hiring firm, mobile inventors foster the alignment of decision frames applied by potential alliance partners in the process of alliance formation thereby making collaboration more likely. Using data on inventor mobility and alliance formation amongst 42 global pharmaceutical firms over 16 years, we show that inventor mobility is positively associated with the likelihood of alliance formation in periods following inventor movements. This relationship becomes more pronounced if these employees bring additional knowledge about their prior firm’s technological capabilities and for alliances aimed at technology development rather than for agreements related to technology transfer. It is weakened, however, if the focal firm is already familiar with the competitor’s technological capabilities. By revealing these relationships, our study contributes to research on alliance formation, employee mobility, and organizational frames.
With permission of the Academy of Management
Do conceptualizations of the IS organization reflect findings from research studying requirements for successfully harnessing information, systems and technology to achieve operational and strategic objectives? This paper addresses this question, reporting on an analysis of articles published in leading academic journals. It describes how the IS organization is portrayed in these studies and examines the results of this analysis through a sensitizing lens constructed from research that has examined how organizations generate business value from IS. The lens depicts this objective as a quest to harness knowledge that is distributed enterprise wide. The analysis suggests that conceptualizations of the IS organization used by researchers do not reflect the requirements for generating business value from IT that have been identified in the literature. While highlighting that definitions are vague or indeed absent, it challenges the dominant orthodoxy of the IS organization as a separate organizational unit suggesting that it is a more pervasive construct. The implications of this conclusion for practice, research and teaching are considered.
© 2016 John Wiley & Sons Ltd
In this paper, we study how the coexistence of access regulations for legacy (copper) and fiber networks shapes the incentives to invest in fiber-based network infrastructures.
To this end, we first develop a theoretical model that extends the existing literature by, among other things, considering alternative firms with proprietary legacy network (e.g., cable operators) and the presence of asymmetric mandated
access to networks. In the empirical part, we test the theoretical predictions using a novel panel data from 27 EU member states pertaining to the last decade. Our main
finding is that, in line with the theoretical results, stricter access regulations (i.e., a decrease in access price to legacy network and the adoption of fiber regulation) decrease the incumbent operators’ fiber investments. The estimated magnitude of these effects is economically significant. On the other hand, cable operators, who are responsible for the largest share of investments in fiber, are not affected by
access regulation. Our paper thus provides policy insights for the on-going revision of the EU regulation framework for the electronic communications industry.
With permission of Elsevier
The Matthew effect as an unjust competitive advantage: Implications for competition near status boundaries
Merton often envisioned status growth as a process of stepping across a boundary between one status grade and another more elite status grade. Such boundaries include the border between graduate school and a top academic department that young researchers try to traverse, or the frontier between scientists outside the French Academy and scientists inside the French Academy. As it is now common to measure status continuously using network data, the behavioral ramifications of status boundaries have been understudied in recent research. In this essay, we focus on competitive behaviors that emerge near a status boundary because of the desirability - as well as the “double injustice” - of the Matthew effect. Offering insights for future research, we discuss how these competitive behaviors are likely to delay, or even derail, status growth for those who are near a status boundary.
With permission of SAGE Publishing
|ISSN||15526542 (Online) 10564926 (Print)|
The risky side of inspirational appeals in personal selling: When do customers infer ulterior salesperson motives?
In personal selling, the inspirational appeal (IA) is a widely promoted tactic that aims at stimulating customers’ values and ideals, thereby evoking emotions and arousing their enthusiasm for a product. However, whether IAs in fact improve or undermine salespeople’s success in sales talks remains controversial. Therefore, the present study examines consequences and key contingencies of IAs in customer–salesperson interactions in a retailing context, using multi-source data from several retailing industries for three quantitative studies, comprising a total sample of 590 customer and 174 salesperson responses. Drawing on the Multiple Inferences Model (MIM), the authors show that an IA is likely to drive the customer’s inference that the salesperson holds ulterior motives. IAs seem to be particularly detrimental for salespeople with a lack of customer orientation. Beyond expanding research on influence tactics and the ambivalent role of IAs in retailing interactions, these findings can guide practitioners about when to refrain from using an IA.
|ISSN||1557–7813 (Online) 0885–3134 (Print)|
Too precise to pursue: How precise first offers create barriers-to-entry in negotiations and markets
Precise first offers strongly anchor negotiation outcomes. This precision advantage has been previously documented only when the parties were already engaged in a negotiation. We introduce the concept of negotiation entry, i.e., the decision to enter a negotiation with a particular party. We predict that precise prices create barriers-to-entry, reducing a counterpart’s likelihood of entering a negotiation. Six studies (N=1,580) and one archival analysis of real estate sector data (N=11,214) support our barrier-to-entry prediction: Potential negotiators were less likely to enter a negotiation with precise versus round first offers. Using both statistical mediation and experimental-causal-chain analyses, we establish that perceptions of offer maker inflexibility underlie the precision barrier. Furthermore, we demonstrate that this inflexibility mechanism of precision is distinct from the mechanism (being offended) that creates barriers-to-entry for extreme first offers. The discussion theoretically integrates research on first-offer precision and extremity by offering the Precision-Extremity Model of First Offers.
With permission of Elsevier
In recent years, the German banking sector has overcome major challenges such as the global financial crisis and the European debt crisis. This paper analyses a recent development as a particular determinant of the future outlook for the German banking sector. Interest rates are at historically low levels and may remain at these levels for a considerable period of time. Such levels pose a specific challenge to banks which are heavily dependent on interest income, as is the case for most German banks. We consider different interest rate scenarios and analyse the extent to which they cause a further narrowing of the interest rate margin. Our
results indicate that a projected decline in this margin will result in no more than 20% of German banks earning a cost of capital of 8% by the end of this decade. This decline is somewhat alleviated by the fact that German banks can apply a special feature of German accounting standards by using hidden and open reserves.
© 2017 John Wiley & Sons, Ltd.
|ISSN||1465-7287 (Online) 1074-3529 (Print)|