Search results

Innovations in takeover financing, less restrictive regulatory requirements, and a general desire to enhance market position have led to a substantial increase in corporate takeover and restructuring activity. In response target firm managers have become increasingly active in devising defensive strategies and tactics designed to ward off hostile bidders. It is well‐ documented, however, that large wealth gains accrue to target firm shareholders in mergers and acquisitions. Thus the emergence of such terms as “shark repellents”, “poison pills”, and “greenmail”, raises the question of whose best interests are really being served by antitakeover measures.

The purpose of this paper is to integrate aspects of the literature on strategic and performance groups and explicitly derive strategic/performance groups which exhibit differences with respect to both strategy and performance, as well as display associations and potential interrelationships between the two sets of variables.

A two‐way clusterwise bilinear spatial model was formulated (e.g. a scalar products or vector multidimensional scaling model (MDS)) for the analysis of two‐way strategic and performance data which simultaneously performs MDS and cluster analysis. An efficient alternating least‐squares procedure was devised that estimates conditionally globally optimum estimates of the model parameters within each iterate in analytic, closed‐form expressions.

This bilinear MDS methodology was deployed in the context of strategic/performance group estimation using archival data for public banks in the NY‐NJ‐PA tri‐state area. For this illustration, four strategic/performance groups and two underlying dimensions were found.

Consideration of both strategy and performance data should be employed in describing the heterogeneity amongst firms competing in the same industry.

The paper provides a new spatial methodology to derive strategic/performance groups in any given industry to more completely summarize intra‐industry heterogeneity.

The purpose of this paper is to investigate the strategy-performance relationship in a multi-industry setting for joint stock firms operating in Pakistan using Miles and Snow typology. The impact of firm size and industry on performance along with strategy is also investigated. The empirical research evidence on strategy-performance relationship for Miles and Snow typology is updated as well.

Scoring methodology is applied for identification of strategic types, including the reactor strategy. The consistency of the firms over time is also checked. Seven year archived financial data of 320 Pakistani joint stock firms from 12 industries are used for analysis. Descriptive statistics and analysis of variance is used for analysis.

Hybrid strategies are practiced by firms rather than pure strategies. The distribution of strategic types is uneven. There are mixed results for performance difference among strategic types for different industries and firm size. Defending and analyzing strategies are better than the prospecting strategies. Reactors performed better in some industries as well.

Proposed scoring methodology can be applied to identify all strategic types including reactors in the longitudinal studies. This can be replicated for other typologies or strategic group classifications. The process for identification of reactor strategy through a consistency check is a unique contribution to the literature, especially when archived financial data are used.

Strategic typologies are applied to investigate strategy–performance relationship. The typology of Miles and Snow (1978) is one of them, but the methodology applied for identification of strategic types for archival financial data is questionable on three grounds: no standard procedure for categorization of strategic types; identification of reactor strategy is always ignored; and the behavior of firms’ strategic orientation over time is under-researched. Besides, the assumptions that viable strategies are expected to perform equally well, outperform reactors and distributed evenly are not overwhelmingly supported. The purpose of this paper is to address these issues.

A refined scoring methodology is developed and used for identification of all strategic types, including reactors, by investigating the consistency of the firms over time. Empirical analysis using seven years of data of 121 joint stock firms of the textile sector in Pakistan is performed to test the assumptions regarding presence, distribution and performance of strategic types.

There is significant difference in the distribution of the strategic types. Pure defenders and pure prospectors are non-existing, whereas a reasonable number of reactors are present. Overall difference in performance among strategies is generally insignificant and viable strategies outperformed reactors. The effect of size on performance is also insignificant. However, there is variation in performance of strategies with variation in size. Strategy is the better predictor of performance than size.

The transition of strategic stance of the firms over time and the identification of reactor strategy from archived financial data are the important outcomes of the proposed methodology. The proposed methodology can be used for any longitudinal study for identification of all possible strategic types and can also be used for any other typological research.

The purpose of this paper is to investigate the influence of capital structure changes by target firms on the outcome and ex post performance of firms targeted by proxy contests.

The influence is examined by using predictions of control‐driven model developed by Harris and Raviv and signaling theory of debt in capital structure.

The results are consistent with the predictions of both control‐driven model and signaling theory. Significant differences are found between two groups of target firms – management victory targets and dissident victory targets. Specifically: management victory targets feature proxy contests that are accompanied by leverage increasing changes in target firms' capital structure; the same group also realizes better long‐run stock performance compared to dissident victory targets; and the long‐run abnormal stock performance of management victory targets is significantly positively related to the increases in leverage in the capital structure during proxy contest period.

This paper is the first to directly address the relationship between leverage change and the outcome and long‐run performance of proxy contest targets, thus confirming both the defensive and the signaling role of debt on firm's capital structure decision.

Does Fortune magazine’s list of the 100 Fastest-Growing Companies have information content; that is, is the list a source for market-beating performance? The paper aims to discuss this issue.

Using data for 26 annual periods, 1991–2016, the paper examines the top 5, 10, 25, 50 and all 100 stocks on a return-risk basis, including an application of Modern Portfolio Theory. To generate portfolio performance metrics, the study uses conventional mean-variance analysis, which includes the estimation of returns and risks, where risk will be measured by standard deviation and β. To arrive at the performance metrics and to determine whether information content is embedded in the list, the study reviews a series of tests. Because Fortune ranks the companies from 1 to 100, the data can be used to test if information content is displayed in sub-groups, such as in the first five to ten companies, even if it does not exist in the 100-stock portfolios.

The study finds that the returns are not high enough nor are the risks low enough statistically to conclude the existence of significant information content.

As part of the authors’ efforts to move to the population of 2,600 firms as closely as possible, the authors use “delisting” returns from CRSP on 120 firms to account for missing observations, with a final sample size of 2,594 firms.

The evidence indicates that investors drawn to Fortune’s “100 Fastest-Growing Companies” should view them skeptically as a source for an effective stock selection strategy.

On the basis of the results of this study, readers will conclude that subscribers drawn to Fortune’s “100 Fastest-Growing Companies” should view them skeptically for investment recommendations. From a portfolio perspective, the study is unable to uncover information content that could lead to a market-beating performance, suggesting that the published criteria Fortune uses to select the Fastest-Growing Companies is embedded in the prices of the stocks even before Fortune publishes its list. The study notes that the selection criteria used by Fortune do involve some judgments on the part of the editorial staff (e.g. whether an announced restatement of previously reported financial data appears to have a significant impact), which means that someone who wished to anticipate the publication of the next list of the “Fastest-Growing Companies” would not only have to gather information but would also have to correctly anticipate these judgment calls.

The purpose of this paper is to argue that diversity management (DM) interventions, underpinned by principles of justice and fairness, create a powerful force that drives sustainable outcomes. Further, the authors argue that justice and fairness should be embedded at the core of DM.

A qualitative case study methodology was used to ascertain how four organizations approached critical issues regarding diversity. Justice and fairness principles were used as a framework to evaluate each organization’s DM interventions. Different approaches adopted by the case study organizations were compared using a cross-case analysis.

Justice and fairness principles provide a useful framework to evaluate DM interventions. The findings show that justice and fairness principles have an effect across the continuum of DM, including identifying dimensions of diversity, executing DM programs and realizing outcomes of DM.

The current study is limited to four case studies using qualitative methods.

The findings demonstrate the importance of integrating justice and fairness benchmarks when implementing DM programs.

The findings shed light on the link between DM and justice and fairness, an area lacking empirical studies. It also presents a new area for empirical enquiry—the application of social justice principles in evaluating organizational interventions in DM.

The purpose of this paper is to contribute to the elaboration of a comprehensive moral framework for designing and implementing diversity practices. In so doing, it employs distinct ethical theories that not only elevate respect for differences to an end, but also provide a set of principles, virtues or values conducive to the formation of an inclusive work environment.

A literature review, in particular contributions critical to current implementations of diversity management, may provide the basis of a non-instrumental approach to diversity issues, allowing for an inclusive and participative workplace. The paper suggests that such an endeavor can be founded on the concepts of organizational virtue, care or human dignity alternatively. In this respect, a theoretical context demonstrating the very way these concepts influence and inform diversity issues, is elaborated, analyzed and properly discussed.

Three distinct theoretical frameworks capturing the importance of major ethical traditions based on dignity, organizational virtue and care, for reconceptualizing diversity issues, are introduced. It is proposed that non-utilitarian philosophical ethics (and more specifically, Kantian deontology, Aristotelian virtue ethics or ethics of care) is in a position to provide a rationale for diversity policies that affirm the diverse other as a valued end.

The authors argue that a corporation is in a position to develop ethically-informed diversity initiatives that may effectively combine performance with an affirmation of the value of the diverse other.

The authors argue that a corporation is in a position to develop ethically-informed diversity initiatives that may effectively combine performance with an affirmation of the value of the diverse other.

The paper offers certain insights into the particular conditions that may help organizations design and implement a diversity strategy facilitating thriving and fulfillment of diverse others, grounded on the priority of dignity, virtue or care respectively. Such a perspective, permeating vision, culture and leadership, is invested with a potential that overcomes the managerial instrumentality, so strongly denounced by the majority of critical diversity scholars.

To increase the share of women in the top management of companies, legal gender quotas are increasingly being introduced worldwide. Their effect, however, especially on perceived diversity and employer attractiveness, remains unknown. The purpose of this study is to investigate how a gender quota for a company’s executive board affects potential employees’ evaluation of that company as an employer. Drawing on signaling theory and the rationale of diversity attraction, the authors assumed that both the gender composition of a company’s board and the presence of a quota send signals regarding specific factors associated with diversity (i.e. perceived diversity climate, perceived internal motive for gender diversification and perceived competencies of board members). The authors postulated that these signals are perceived by job applicants and used to evaluate the attractiveness of the company as an employer.

In a scenario study, the authors manipulated the composition of the management board. That is, participants were presented an executive board that was either homogeneously male (Group 1) or had a female representation of 30% (Groups 2 and 3) or 50% (Group 4). The executive board in Groups 3 and 4 was subject to a statutory gender quota of 30%.

The results showed that a company with a gender-diverse board was perceived as more attractive by potential applicants than an all-male board. Also, a gender quota did not reduce a company’s employer attractiveness. The results suggest that potential applicants attach importance to board diversity but place less value on the causes that led to it.

Against the backdrop of the war for talent, this study contributes to a better understanding of the impact of gender quotas and factors influencing employer attractiveness. The study showed that when a gender quota is in place, applicants assume to a lesser extent that a company staffs its gender-diverse board of directors out of an inner conviction. Nonetheless, the presence of a gender quota does not significantly reduce the perceived diversity climate, nor does a quota have a negative impact on the employer attractiveness. Thus, using a quota as a means to increase gender diversity does not harm the ends.

The study aims to explore major internationally operating hotel groups and their corporate diversity statements. An understanding of these statements is critical for the analysis of workforce diversity actions, as they shape the policy framework and basis for any diversity management (DM) program or initiative.

The study applied a qualitative content analysis of corporate web sites. The analysis and evaluation of the data was not treated in statistical terms or in any quantifiable measures due to the study's rather exploratory and inductive nature. Moving away from traditional forms of validity and reliability, this study applied Denzin and Lincoln's authenticity criteria.

Most of the selected hotel companies with diversity management strategies and policies need to communicate their diversity management activities and actions more extensively and clearly via their corporate web sites to help support employee recruitment efforts, attraction of talents with different educational and cultural backgrounds, development of multiple (minority) supplier relations and corporate social responsibility (CSR) image, and accessibility into new markets.

This study should be seen as a starting point with some of the arguments and conclusions to be reconfirmed with more case‐study based explorations of corporate DM policies and their translation into operational actions and programs.

Communicating in a more effective and structured way, corporate or operational diversity strategies and activities via corporate web sites will provide hotel organizations with a key sustainable competitive advantage in talent recruitment, CSR and market accessibility.

This study provides a starting point for better understanding corporate diversity management in the global hotel industry.