Exploring Strategy Implementation Consistency Over Time: The Moderating Effects of Industry Velocity and Firm Performance

In this paper we empirically investigate the temporal development of a firm’s strategy implementation consistency (SIC), i.e. the alignment between firms’ resource allocation decisions (RAD) and their articulated corporate concept (Noda and Bower, 1996; Burgelman and Grove, 1996; Love et al., 2002; Mintzberg, 1978). Doing so, we test whether (1) SIC is more likely to increase or decline over time, (2) whether firms competing in (low) high-velocity environments in fact show different temporal patterns in SIC, and (3) whether overperforming firms succeed in conserving their level of SIC. For our analysis we draw on 6238 RAD of 20 publicly listed firms with European origin over a period of 4–6 years. Applying maximum likelihood ordered logit estimation, our results indicate that the likelihood of an alignment of RAD and a firm’s corporate concept decreases over time. In line with scholars’ perception of high-velocity environments, we find that the firms in our sample competing under such conditions show no clear trend in SIC. These firms tend to “zig-zag” over time – swaying off and pulling back to their strategic course independent of the timing of the announcement of a corporate concept. We also find that overperforming firms are unsuccessful in preserving their SIC at the same level over time. Based on the empirical findings the paper discusses implications for theory and derives suggestions for corporate level managers on how to balance SIC and strategic flexibility.     

A Note On Impossibility Theorems and Seniority Rules

We characterize seniority rules, also known as lexical dictatorships, under weak consistency constraints on the groups choice function. These constraints are base triple-acyclicity in the case of binary choices and rationalizability (although not rationality) in the case of choices between an arbitrary number of alternatives. Existing results on these weakened constraints remain silent on the treatment of the groups most junior individuals and therefore do not yield a complete characterization of seniority rules. We also impose a universal domain, binary strict Pareto optimality, binary Pareto indifference, binary independence of irrelevant alternatives, and the newly introduced condition of conflict resolution. The latter condition requires a social choice rules not to remain indecisive between alternatives for which individuals have conflicting preferences.JEL CLASSIFICATIONS: D63, D71This revised version was published online in May 2005 with a corrected article title.     

Fiscal equalisation: Principles and an application to the European Union

The paper derives a normative model for partial fiscal equalisation based on a number of axioms and makes special allowance for the existence of a specific fiscal need in the jurisdictions. A simple version of this idealised equalisation scheme relates net contributions to the equalisation funds to deviations of a jurisdictions gross income from average gross income and a jurisdictions specific needs from average specific needs. The theoretical model is then empirically tested for the case of the European Union using data from 1986–97. It is found that most restrictions of the model appear to hold, in particular, relatively richer countries contribute more and those with greater fiscal needs, approximated by the importance of the agricultural sector, pay less. However, in the EU, an adjustment of net payments to changes in the actual importance of the specific fiscal need for a country is lacking.The paper was presented at the CESifo Area Conference on Public Sector Economics 2001 in Munich and at a research seminar in Berlin. Thanks to the participants, Matthias Brückner, Johann Brunner, Jeremy Edwards, Friedrich Heinemann, Eckhard Janeba, Roland Strausz, and Alfons Weichenreider for helpful comments. Special thanks to an anonymous referee for many detailed suggestions. All remaining errors are our own.     

Qualitätsmanagement in Netzwerken der Integrierten Gesundheitsversorgung

Quality management in networks of the Integrated health care. Theory and practiceSelf evaluation is one of the most important sources for the quality management in ambulatory care of integrated health care systems. The quality testing of the survey instrument itself is of outstanding importance, since only a high quality instrument is able to supply high quality data, which can serve as a reliable base for improvement strategies. The paper shows the aspects of a quality management in organizational networks for integrated health care delivery systems. The technique allows the management and the single practioner on the one hand to identify the critical areas at a glance and on the other hand to focus — where necessary — on the single aspects in order to define detailed improvement actions.     

National Income and Income Inequality,Family Affluence and Life Satisfaction Among 13 year Old Boys and Girls: A Multilevel Study in 35 Countries

Adolescence is a critical period where many patterns of health and health behaviour are formed. The objective of this study was to investigate cross-national variation in the relationship between family affluence and adolescent life satisfaction, and the impact of national income and income inequality on this relationship. Data from the 2006 Health Behaviour in School-aged Children: WHO collaborative Study (N = 58,352 across 35 countries) were analysed using multilevel linear and logistic regression analyses for outcome measures life satisfaction score and binary high/low life satisfaction. National income and income inequality were associated with aggregated life satisfaction score and prevalence of high life satisfaction. Within-country socioeconomic inequalities in life satisfaction existed even after adjustment for family structure. This relationship was curvilinear and varied cross-nationally. Socioeconomic inequalities were greatest in poor countries and in countries with unequal income distribution. GDP (PPP US$) and Gini did not explain between country variance in socioeconomic inequalities in life satisfaction. The existence of, and variation in, within-country socioeconomic inequalities in adolescent life satisfaction highlights the importance of identifying and addressing mediating factors during this life stage.     

Maximum expected entropy transformed Latin hypercube designs

Existing projection designs (e.g. maximum projection designs) attempt to achieve good space-filling properties in all projections. However, when using a Gaussian process (GP), model-based design criteria such as the entropy criterion is more appropriate. We employ the entropy criterion averaged over a set of projections, called expected entropy criterion (EEC), to generate projection designs. We show that maximum EEC designs are invariant to monotonic transformations of the response, i.e. they are optimal for a wide class of stochastic process models. We also demonstrate that transformation of each column of a Latin hypercube design (LHD) based on a monotonic function can substantially improve the EEC. Two types of input transformations are considered: a quantile function of a symmetric Beta distribution chosen to optimize the EEC, and a nonparametric transformation corresponding to the quantile function of a symmetric density chosen to optimize the EEC. Numerical studies show that the proposed transformations of the LHD are efficient and effective for building robust maximum EEC designs. These designs give projections with markedly higher entropies and lower maximum prediction variances (MPV''s) at the cost of small increases in average prediction variances (APV''s) compared to state-of-the-art space-filling designs over wide ranges of covariance parameter values.     

Globale organisation — globale manager — globale Klasse?

The globalization of business corporations led to the thesis that a so-called global management class would emerge, both integrating transnational companies and facilitating a global business culture which is able to turn cultural diversity into a competitive advantage. Two questions stem from this thesis: First, how do talents and high potentials in transnational companies become global managers? Second, is global management to be understood as an integrating culture or as a selective one in the context of transnational corporations? The article explores these questions by contrasting the theory of global management with empirical findings from research concerning the strategies of international management assignment and the forming of expatriates’ “mental memberships“. It is shown that global management rests on a ‘thin’ Ethos of economic rationalities which give way to an exclusive “business monoculture” challenging cultural diversity taking place in everyday-life of transnational organizations.     

Bonuszahlungen an Geschäftsführungen: Wodurch werden Gerechtigkeitsurteile von Erwerbstätigen beeinflusst?

Managerial compensation in large companies is subject to many critical concerns; this holds particularly for bonus payments. Empirical evidence shows that nearly three quarter of the German population perceive managers’ incomes as unfairly high. Based on an own survey, we examine what drives fairness perceptions of bonus payments for managers: When do employees assess bonus payments for managers within their own company as unfairly high? Under which conditions do they accept high bonus payments? The analyses show that acceptance decreases with the estimated amount of bonus paid. It increases, however, if aspects of procedural and distributive justice are taken into account.     

Examination and visualisation of the simplifying assumption for vine copulas in three dimensions

Vine copulas are a highly flexible class of dependence models, which are based on the decomposition of the density into bivariate building blocks. For applications one usually makes the simplifying assumption that copulas of conditional distributions are independent of the variables on which they are conditioned. However this assumption has been criticised for being too restrictive. We examine both simplified and non‐simplified vine copulas in three dimensions and investigate conceptual differences. We show and compare contour surfaces of three‐dimensional vine copula models, which prove to be much more informative than the contour lines of the bivariate marginals. Our investigation shows that non‐simplified vine copulas can exhibit arbitrarily irregular shapes, whereas simplified vine copulas appear to be smooth extrapolations of their bivariate margins to three dimensions. In addition to a variety of constructed examples, we also investigate a three‐dimensional subset of the well‐known uranium data set and visually detect the fact that a non‐simplified vine copula is necessary to capture its complex dependence structure.