Search results

The article looks at how companies pursuing a three‐horizon growth strategy weathered the last economic downturn and what became of their growth initiatives.

The paper examines the financial performance and continued investment of three growing companies from 1996‐2004: Bombardier (Canada), Hutchison Whampoa (Hong Kong/China) and Disney (US).

The Bombardier, Disney and Hutchison Whampoa cases teach a powerful lesson about the importance of using investment in growth to manage uncertainty and limit downside risk.

While the focus of this article is on three companies only, the financial performances of a dozen other growing firms are examined over the same period for purposes of comparison.

Following the last downturn, companies sought to preserve the core and outsource non‐critical functions to reduce the cost of business. Some chose to sideline growth initiatives during this period. This article analyzes the outcomes for three companies that continued to invest in growth during and after this period.

This article addresses a series of questions. Is a three‐horizon growth strategy sustainable in a downturn? Have companies that pursued a three‐horizon strategy actually grown? Do they continue to finance the growth of horizon two and horizon three businesses? Have any viable options matured?

The aim of this paper is to investigate how the efforts of improving transport performance within the scope of one business relationship are embedded in a transport service triad, which, in turn, is embedded in the wider supply network.

The theoretical framing originates from the IMP approach with a specific focus on the concept network horizon, and literature on triads. The study is explorative and applies a qualitative design and a case study approach to illustrate how three actors engage in a change initiative to improve transport performance.

The paper concludes that it is crucial to get counterparts aware of the importance of expanding and defining their network horizons for a certain change initiative. Interaction among actors is important to create awareness and expand its own as well as others’ network horizons for a certain change. Three generic facets are proposed: overlapping network horizons, partly overlapping network horizons and non-overlapping network horizons.

The framework offers a tool to managers in terms of the concept of network horizon that can help to understand the challenges when dealing with change in supply networks and to understand where to deploy resources to cope with change.

This study adds to the literature by explicating facets of the concept of network horizon, especially when firms are faced with a change, how they are affected by this change and how they can cope with the related challenges.

The purpose of this study is to investigate the relationship between gold–platinum price ratio (GP) and stock returns in international stock markets. The study addresses three empirical questions: (1) Does GP have robust predictive power in international stock markets? (2) Does GP outperform other macroeconomic variables in international stock markets? (3) What is the relationship between GP and stock market returns during economic recessions?

The study mainly uses OLS regressions to perform empirical tests for a comprehensive set of 17 advanced international stock markets and overall world market. The monthly data is used for the period January 1978 to July 2019, 499 observations for each market.

The study finds that the first-difference of GP (ΔGP), not the initial-level of GP, has strong predictive power for stock returns, both in short- and long-time horizons. The results remain robust after controlling for a number of macroeconomic predictors. The out-of-sample test results are significant, confirming the robustness of the predictive power of ΔGP.

This study is the first to examine the ability of the ΔGP to predict stock returns, and provide novel evidence on the relationship between ΔGP and international stock markets. The study draws on behavioral finance theory, specifically the myopic loss aversion, the herd effect and the limited attention theory, to explain the predictability of stock returns in international stock markets.

The rapidly changed global context for internationalization (IZN) over the next decade prompted a decision to use a futurist perspective for identifying issues to be considered in the organization’s next strategic plan. This paper aims to report on this project to identify current and strategic issues influencing the future strategy of the higher education (HE) IZN for Thailand on behalf of the Bureau of International Cooperation Strategy and the Office of the Higher Education Commission.

The research approach was a customized version of the University of Houston’s Framework Foresight method. It involved framing the domain with a description and domain map, scanning for signals of change within the domain and emerging issues analysis to produce a set of current and emerging issues. A planning step synthesizes a set of recommended actions.

The key findings reported in this paper are the identification of 14 current and emerging issues influencing the future of the IZN of HE in Thailand. The issues were organized along with the three horizons framework: H1: how are we [currently] doing? H2: what should we do next and H3, where do we want to go? The primary recommendation of this research reported on in this study is to consider the 14 issues for inclusion into the next strategic plan. Seven specific strategic options mapped over three phases were identified as well. The research reported here was carried out for Thailand, but the process could easily be adapted by other countries and other topics.

The modified version of the University of Houston Framework Foresight approach has been applied successfully to many topics. The topic explored here is focused on one nation, Thailand. The authors feel the lessons are, however, broadly applicable.

The ability to use a futurist perspective to identify current and emerging issues is highlighted. The organizing of the issues using the three horizons framework proved to be particularly useful in helping the client to develop a sense of timing regarding the future, that is, when and to what degree to pay attention to the many issues that typically confront any organization.

The use of the three horizons framework in the analysis of the emerging issues provide benefits in two ways in situating the likely timing of signals of change in horizon scanning and “scan hits” both scanning for the identification of issues and organizing the resulting current and emerging issues along the three horizons with H1 current issues: how are we [currently] doing?; H2 emerging issues: what should we do next and H3 emerging issues, where do we want to go? The paper also includes a section exploring the impact of Covid-19 on the likely timing of the issues identified just before the pandemic hit, finding that timing of some issues would speed up, some would stay the same and some would slow down.

This paper aims to propose an innovative approach to risk measurement for the abolition of selection bias arising from the specious selection of different horizons for investment and risk computation of equity-linked-saving schemes (ELSS).

ELSS has a lock-in period of three years, but shorter horizons’ (daily/weekly/monthly) return data are preferred, in practice, for risk computation. This results in horizon mismatch. This paper studies the consequences of this mismatch and provides a noble solution to diminish its effect on investors’ decision-making. To accomplish this objective, the paper uses an innovative methodology, maximal overlap discrete wavelet transformation, to segregate the price movements across different horizons. Risk across all horizons is measured using Cornish-Fisher expected shortfall and Cornish-Fisher value-at-risk methods.

The degree of consistency of risk-based rankings across horizons is examined by means of the Spearman and Kendall’s rank correlation tests. The risk-based ranking of ELSS is found to vary significantly with the change in investor’s horizon. Precisely, the rankings formulated using daily net asset values are significantly different from the rankings developed using fluctuations over longer horizons (two-four and four-eight years).

This finding indicates that the ranking exercise may mislead investors if horizon correction is not done while developing such rankings.

The purpose of this paper is to examine the causal relationships between stock prices and macroeconomic variables in Sri Lanka, in order to examine the validity of the semi‐strong form of the efficient market hypothesis.

The paper adopts unit roots and cointegration, error‐correction modelling, variance decomposition analysis, and impulse responses analysis to examine the causal relationship between six macroeconomic variables.

The results indicate that there are both short and long‐run causal relationships between stock prices and macroeconomic variables. These findings refute the validity of the semi‐strong version of the efficient market hypothesis for the Sri Lankan share market and have implications for investors, both domestic and international.

The paper addresses several methodological weaknesses in relation to unit root and cointegration tests which previous studies in the area of the paper have overlooked. Further, it uses more variables than those used in a previous study using Sri Lankan data.

The purpose of this paper is to investigate whether the factors that summarise the information in the yield curves of Australia and the USA can predict changes in the Australian–USA exchange rate (i.e. the AUD/USD rate) and Australian dollar excess returns.

The paper extracts the three Nelson–Siegel factors (level, slope and curvature) from the relative yield curve of Australia with the USA to predict changes in the bilateral exchange rate and excess returns on the Australian dollar. The full sample regressions allow for a shift in the coefficient on the relative curvature factor which can account for the impact of the Fed’s changed monetary policy to one of quantitative easing.

The paper finds that the relative curvature factor strongly predicts changes in the AUD/USD exchange rate and Australian dollar excess returns out to 12 months ahead in the sample that precedes the Fed’s policy of quantitative easing. The relative curvature factor retains its predictive power in the full sample regressions but anticipates smaller exchange rate changes and excess currency returns in in-sample predictions made from August 2007.

The yield curves of Australia and the USA reliably reflect investor’s expectations about prospective monetary policies in each economy.

The paper investigates the predictive content of the relative Nelson–Siegel factors for changes in the AUD/USD exchange rate and for Australian dollar excess returns over various forecast horizons for a period that covers the Fed’s policy of quantitative easing.

Addresses important logistical considerations in the distribution of a seasonal food product. While continued attempts have been made to maintain high levels of customer service within the food industry, the degree of uncertainty in the distribution channel itself often undermines management’s efforts to procure adequate stock of product during peak demand season. Develops a stochastic dynamic programming formulation which may serve as a decision‐support tool for managers faced with procuring product in a distribution channel in which receipt quantities are probabilistic. Provides numerical results, supporting the intuitive result that expected costs and the length of the required planning horizon are inversely related to the level of uncertainty in the distribution channel.

A major barrier for growth of large multi-business unit firms is the inability to resource the critical initiatives to win—both in terms of dollars and people. The underpinning of the challenge involves the conflict between resourcing current cash-generating legacy businesses vs. new initiatives which may not, in the short term, produce positive financial results. Most companies do not have a formal portfolio process to deal with this fundamental issue. Danaka is a fictional company based on real business experiences. The company has strong growth markets as well as markets that are commoditizing. Unfortunately, the latter represent a sizable portion of the company's business. A framework is given that establishes a matrix to analyze the Danaka businesses using their critical financial criteria—cash generation and top-line growth. Projects are divided into four categories based on how they fit into the matrix, and resource allocations are then analyzed. Students discover that the current allocation does not enable Danaka to meet its aggressive growth goals. The case incorporates an interactive spreadsheet model in which students can dynamically change the various resource allocations and see the impact on future top-line growth. The essence of the case is how to manage the resource allocation for a multi-business unit firm when present allocations will not meet future growth goals.

The key learning of this case is that when business leaders set financial goals, they must understand how they are expending their resources. More often than not, significant changes must occur that could be wrenching to the organization. The key learning objectives are: (1) realize the importance of performing a portfolio analysis; (2) discuss the issues involved in making the changes; and (3) understand how to put the decision process in place.