Tuesday, February 1, 2011

Strategic Management

When Is Bad Publicity Good?

In a new study from Stanford Graduate School of Business, researchers say in some cases negative publicity can increase sales when a product or company is relatively unknown, simply because it stimulates product awareness.

Would Boycotting BP Do Any Good?

Consumer and environmental groups, angry over the spreading oil disaster in the Gulf of Mexico, are calling for a boycott of BP, the oil giant that owns the well gushing oil onto beaches and marshes. According to research by Phillip Leslie and Larry Chavis, boycotts do in fact work and they're something businesses should be concerned about.

Outsourcing May Be Slowing Down Apparel Firms

Designing fashion products quickly to capture the latest consumer trends, and then spending extra money to get them to market quickly, can be well worth the extra expense and can increase profits exponentially, says Stanford Graduate School of Business Professor Robert Swinney, coauthor of a recent study.

Posting Calorie Counts in Restaurants Lowers Customers’ Calorie Counts Per Visit

Starbucks’ customers purchased 6% fewer calories per visit at chain outlets that posted calorie counts without substantially affecting revenue say Stanford Graduate School of Business researchers Bryan Bollinger, Phillip Leslie, and Alan Sorensen.  

Social Pressures Affect Corporate Strategy and Performance

Social pressure plays a major role in determining corporate strategy and performance according to an award-winning paper coauthored by Professor David Baron. The researchers find that social pressure and social performance reinforce each other, greater social pressure is associated with lower financial performance, and financial and social performance are largely unrelated.

Services Market Is Key to Open Source Software

Open source software has become a major and fast-growing presence in the computer industry in recent years. Professor Tunay Tunca of Stanford Graduate School of Business and his co-authors argue that the key factor in whether to create open source software is the strength of the market for support, integration, and related services for such programs.

Customers Can't Buy It If They Don't Know It Exists

Rock groups can lose as much as 40% of their potential sales because consumers don’t know enough about them, says the Stanford Business School’s Alan Sorensen. There are lots of crowded markets out there where lack of information skews sales.

Businesses Can Win the Competition Against Open-Source Technology

Commercial vendors can compete successfully against open-source products says Professor Haim Mendelson. To do so they must be first to market, judiciously improve product features, keep the product closed so the open source competitors cannot tap into the commercial network, and segment the market.

Firms Survive by Recognizing Fundamental Industry Changes

Enduring companies survive because employees throughout the firm, not just those in the executive suite, learn to keep an eye on how related industries are evolving, say Robert Burgelman and Andrew Grove. Strong firms don't just match the competition, they also recognize fundamental changes in their industries and stay strategically ahead.

Netflix Broke the Rules and Won

The video rental service broke new ground with a patented consumer model that had no deadlines or penalties and charged a set monthly fee. “Netflix got it right,” said Professor Sunil Kumar.

Compaq and HP: Ultimately, the Urge to Merge Was Right The controversial merger of Hewlett-Packard and Compaq ultimately was a good idea, but failure to focus on long-term corporate strategy actions meant it wasn’t smooth sailing to the finish line. (June 2007)

Specializing Can Mean Bigger Sales Customers like to feel they’re buying goods and services from businesses that are leaders in a specific category or two. Being a jack of all trades in too many categories may reduce profits say researchers. The research is co-authored by Business School Professor Michael Hannan.

Why Your Appendectomy Costs More than Mine The ability to move insurance subscribers to another hospital, not the sheer number of subscribers a company controls, may be the key bargaining chip as insurance firms negotiate rates with hospitals says Alan Sorensen.

Startups Need a Special Learning Curve for Sales Before a young company can sell its product successfully, the entire organization needs to learn how customers will acquire and use the product. This requires a special learning curve for sales and marketing before the product is ready for a major push, say researchers Charles Holloway and Mark Leslie. (September 2006)


Consumers Feast on Restaurant Ratings When Los Angeles started rating restaurant hygiene a few years ago, the information was snapped up by consumers and by the restaurants themselves, who worked to improve quality. Prof. Phillip Leslie says a rating system wouldn't work in all industries, but when consumers and merchants agree on quality standards, it can produce impressive results. (October 2005)

Strategies for Getting Users to Adopt Computer Software Security Patches Malicious hackers have cost businesses millions of dollars, yet many users continue to take chances by not downloading programs to stave off intruders. The best way to get consumers on board in the war against computer viruses is for software producers to create reliable, easy-to-use programs and make them easily accessible to users. (September 2005)

Co-Financing Doesn’t Make Movies More Profitable Co-financing major motion picture production is supposed to benefit movie studios by lowering the risk on films that aren’t guaranteed blockbusters, but research by Phillip Leslie of the Stanford Business School shows no difference in return on investment. (September 2005)

Valuing Bestselling Books Making the New York Times Bestsellers list is an honor, but it really doesn't boost sales substantially for most of the big name authors who make the list, according to research by Prof. Alan Sorensen. (July 2004)

When is it Smart to Sell the Factory and Outsource? Should your company keep control of its supply chain and manufacturing facilities when it needs to expand — and risk getting stuck with expensive capacity it can't use? Or should it outsource — and if so, to whom and for how much? Researchers take on the build vs. buy dilemma. (June 2003)

A Strategic Look at Business Change: Andy Grove, who led Intel through one of the biggest strategic decisions in the technology industry, outlines what can happen to a business when it faces a major transformation point altering its environment and possibly the business itself. Grove outlines the concepts he and Robert Burgelman have developed during a decade of teaching Strategy and Action in the Information Processing Industry. (April 2003) Strategy is Destiny: How Strategy-Making Shapes a Company's Future Robert Burgelman and Andrew Grove, Free Press, 2002 Intel CEO Craig Barrett's frustration with some of the spoils of success is told by Robert Burgelman, the Edmund W. Littlefield Professor of Management at the Stanford Graduate School of Business, in a new book about how Intel has built business strategies, sometimes from the bottom up, sometimes from the top down, or from all parts of the hierarchy simultaneously. (July 2002)

Intel Inside Strategic dissonance is common in the fast paced technology industry. Business School faculty Robert Burgelman and Andrew Grove use the term to describe what happens when a firm's stated strategy differs dramatically from what it actually does, such as the 1994 situation when a flaw was discovered in Intel's Pentium processor. (June 1996)