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Article
Publication date: 3 May 2022

Mark Klassen, Grant Alexander Wilson and C. Brooke Dobni

The purpose of the paper is to emphasize the performance benefits of a long-term innovation and value creation perspective. This paper responds to the recent concept of the…

Abstract

Purpose

The purpose of the paper is to emphasize the performance benefits of a long-term innovation and value creation perspective. This paper responds to the recent concept of the imagination premium method for valuing companies. It offers four key takeaways to create a long-term innovation-focused orientation for future value creation.

Design/methodology/approach

The research is based on both consulting experience and insight from several studies of executives that were supported by the U.S. Conference Board.

Findings

The research differentiates how high versus low innovators create long-term perspectives and value. High innovators have explicit processes that support innovation, leadership that focuses on long-term performance, resources committed to long-term projects and innovation and knowledge management systems that transfer knowledge throughout the organization.

Research limitations/implications

The research offers strategic directives aimed at creating long-term value but acknowledges that there are other means to accomplish such objectives.

Practical implications

This paper offers strategies for executives to create an innovation-focused organizational culture that drives lasting long-term value.

Social implications

Focusing on long-term innovation prioritizes larger social, environmental and business objectives over superficial short-term stock price changes, leading to greater value-creation.

Originality/value

This paper advocates that leadership play the long game and adopt a longer-term view of innovation due to its long-term competitive, employee engagement, sustainability and performance benefits.

Details

Journal of Business Strategy, vol. 44 no. 4
Type: Research Article
ISSN: 0275-6668

Keywords

Book part
Publication date: 23 August 2012

Denisa Maria Sologon and Cathal O’Donoghue

The economic reality of the 1990s in Europe forced the labor markets to become more flexible. Using a consistent comparative dataset for 14 countries, the European Community…

Abstract

The economic reality of the 1990s in Europe forced the labor markets to become more flexible. Using a consistent comparative dataset for 14 countries, the European Community Household Panel (ECHP), we explore the degree of earnings mobility and inequality across Europe, and the role of labor market institutions in understanding the cross-national differences in earnings mobility. We study the degree of rank mobility and the degree of mobility as equalizer of long-term earnings. The country ranking in long-term earnings inequality is similar with the country ranking in annual inequality, which is a sign of limited long-term equalizing mobility within countries with higher levels of annual inequality. In long-term earnings inequality, Denmark renders the most mobile earnings distribution with the second highest equalizing effect. The only disequalizing mobility in a lifetime perspective is found in Portugal. With respect to the relationship between earnings mobility and earnings inequality, we find a significant negative association both in the short and the long run. Based on the rankings in long-term Fields mobility and long-term inequality, Denmark is expected to have the lowest lifetime earnings inequality in Europe, followed by Finland, Austria, and Belgium. The Mediterranean countries (Spain and Portugal) are expected to have the highest long-term inequality. With respect to the institutional factors that may be related to earnings mobility, we bring evidence that the deregulation in the labor and product markets, the degree of unionization, the degree of corporatism and the spending on ALMPs are positively associated with earnings mobility.

Details

Inequality, Mobility and Segregation: Essays in Honor of Jacques Silber
Type: Book
ISBN: 978-1-78190-171-7

Keywords

Book part
Publication date: 24 August 2011

Zhihong Wang and James E. Hunton

The purpose of the current study is to examine how employees from different cultures respond to participative budgeting when the budget planning horizon is congruent or…

Abstract

The purpose of the current study is to examine how employees from different cultures respond to participative budgeting when the budget planning horizon is congruent or incongruent with their cultural time orientation. We conducted a 2×2 quasi-experiment in which cultural time orientation (short term or long term) was measured and budget planning horizon (short term or long term) was manipulated. A total of 164 employees participated in the experiment – 87 from China and 77 from the United States, representing long-term and short-term cultural time orientations, respectively. The results indicate that satisfaction with participative budgeting was greater when cultural time orientation and budget planning horizon were congruent, relative to incongruent. Also, the differential reaction between congruence and incongruence was less extreme for the Chinese participants than the U.S. participants, which is consistent with Confucian thought of “The Doctrine of the Mean.” The results of this study contribute to participative budgeting literature and suggest that managers who operate in different countries should be cognizant of cultural differences when employing participative budgeting processes.

Details

Advances in Accounting Behavioral Research
Type: Book
ISBN: 978-1-78052-086-5

Book part
Publication date: 8 April 2010

Terhi Chakhovich, Seppo Ikäheimo and Tomi Seppälä

Purpose – This research presents empirical evidence on which performance measures are perceived as short-term oriented and long-term oriented by company executives, and on whether…

Abstract

Purpose – This research presents empirical evidence on which performance measures are perceived as short-term oriented and long-term oriented by company executives, and on whether any perceived performance measure-related time orientation affects the time orientation of these executives. In addition, the study explores which measures impact executive time orientation, regardless of how these measures are perceived.

Methodology/approach – A survey was used to collect the perceptions of chief financial officers (CFOs) in 109 companies listed in the Nasdaq OMX, the Nordic Stock Exchange. Performance measures include: stock price, earnings, returns, cash flow, success of development programs, EVA™, sales, and balanced scorecard, and the method employed was multiple regression.

Findings – First, the CFOs perceived returns, sales, EPS, and stock price to have long time orientation. Second, the use of returns, stock price, and success of development programs as major performance measures encourage the CFOs toward long-term behavior, whereas the use of cash flow encourages short-term behavior. Third, stock price, earnings, and EPS are measures whose perceived time orientation affects the time orientation of executives. It is most likely due to this influence, that they have received major attention in public debates on the short time orientation of executives at the expense of other, more “silent” measures that also impact executive time orientation. Contextual factors strongly affect the results.

Practical implications – The study assists in designing executive performance measurement systems that encourage desired time orientation.

Originality/value – This study contributes to the fields of performance measurement and time orientation by recognizing the multidimensionality of the construct of time orientation and by showing how performance measures and their perceived time orientation influence executive time orientation.

Details

Performance Measurement and Management Control: Innovative Concepts and Practices
Type: Book
ISBN: 978-1-84950-725-7

Open Access
Article
Publication date: 21 August 2023

Anna Mårtensson, Kristen Snyder, Pernilla Ingelsson and Ingela Bäckström

The purpose of this study is to explore the concept of long-term thinking in a non-business context to gain deeper insights into bridging the gap between the theory of long-term

Abstract

Purpose

The purpose of this study is to explore the concept of long-term thinking in a non-business context to gain deeper insights into bridging the gap between the theory of long-term thinking and its application as a management strategy.

Design/methodology/approach

To explore the concept of long-thinking further in a non-business setting, a grounded theory study was conducted with preschool leaders in a municipality in Sweden to examine how the leaders describe, define and apply the concept of long-term thinking in their schools. Interviews with school leaders, both written and oral, were used for data collection.

Findings

This study illustrates that the concept of long-term thinking can be twofold. First, the description can be as an anchor that reflects a mission. Second, the description can be a steering mechanism that guides decision-making. The findings also reinforce the importance of organisations developing an organisational culture that connect their vision and goals with the values and needs of their customers.

Research limitations/implications

This study was carried out in a single organisation and shows a snapshot of the organisation's status at the time the data were collected. Therefore, the findings are not generalisable to all organisational settings; rather the findings may be transferable to other settings.

Practical implications

The results can be used to help identify areas where preschools in a municipal context can engage with sustainable quality development in order to build systems that support work with quality in a more structured way.

Originality/value

Long-term thinking is seen, within both theory and organisations, as necessary to achieve success in terms of sustainable development and quality, and this study contributes with knowledge about the current gap between theories of long-term thinking and practice in organisations.

Details

The TQM Journal, vol. 35 no. 9
Type: Research Article
ISSN: 1754-2731

Keywords

Article
Publication date: 6 December 2022

Jake David Hoskins and Abbie Griffin

This research paper aims to investigate detailed relationships between market selection and product positioning decisions and their associated short- and long-term product…

Abstract

Purpose

This research paper aims to investigate detailed relationships between market selection and product positioning decisions and their associated short- and long-term product performance outcomes in the context of the music category: a cultural goods industry with high amounts of product introductions. Market selection decisions are defined by the size, competitiveness and age of market subcategories within an overall product category. Positioning decisions include where a product’s attributes are located spatially in the category (periphery versus the market center), whether a product resides within a single subcategory or spans multiple ones and what brand strategy (single versus co-branding) is used.

Design/methodology/approach

Data are from multiple sources for the US music industry (aka product category) from 1958 to 2019 to empirically test the hypotheses: genres (rock, blues, etc.) correspond to subcategories; artists to brands; and songs to products. Regression analyses are used.

Findings

A complex set of nuanced results are generated and reported, finding that key marketing decisions drive short-term new product success differently and frequently in opposing ways than long-term success. Launching into very new, well-established or very competitive markets leads to the strongest long-term success, despite less attractive short-run prospects. Positioning a product away from the market center and spanning subcategories similarly poses short-run challenges, but long-run returns. Brand collaborations have reverse effects. Short-run product success is found, overall, to be difficult to predict even with strong data inputs, which has substantial implications for how firms should manage portfolios of products in cultural goods industries. Long-run product success is considerably more predictable after short-run success is observed and accounted for.

Originality/value

While managers and firms in cultural goods industries have long relied on intuition to manage market selection and product positioning decisions, this research tests the hypothesis that objective data inputs and empirical modeling can better predict short- and long-run success of launched products. Specific insights on which song characteristics may be associated with success are found – as are more generalizable, industry-level results. In addition, by distinguishing between short- and long-run success, a more complete picture on how key decisions holistically affect product performance emerges. Many market selection and product positioning decisions have differential impacts across these two frames of reference.

Details

Journal of Product & Brand Management, vol. 32 no. 4
Type: Research Article
ISSN: 1061-0421

Keywords

Article
Publication date: 9 November 2022

David E. Cavazos, Matthew Rutherford and Triss Ashton

This study aims to examine the implications of short-term and long-term reputation change because of government agency responses to firm product defects.

Abstract

Purpose

This study aims to examine the implications of short-term and long-term reputation change because of government agency responses to firm product defects.

Design/methodology/approach

This study’s findings have important implications for both scholars and practitioners. From a scholarly perspective, the authors create a more fine-grained examination of reputation that may be used to assess various performance dimensions. From a practice perspective, managers must realize that reputation can be one of an organization’s most important resources as it meets each of the valuable, rare, inimitable and nonsubstitutable criteria associated with those resources capable of providing sustainable competitive advantage.

Findings

Analysis of 17,879 product recalls from 15 automobile manufacturers in the US suggests that firms with higher long-term reputations are more likely to face regulator sanctions when a reputation-damaging event happens. On the other hand, firms with higher short-term reputations are less likely to face sanctions in such circumstances. Finally, firms whose short-term reputation exceeds their long-term reputation are less likely to be sanctioned by regulators when reputation-damaging events occur.

Research limitations/implications

There are several limitations that should be addressed. First, as our reputation measure is based on government investigations of potential defects, vehicles that have never been inspected are not included in the sample. Although this number is likely extremely low, omitting vehicles that have never been inspected leaves out some high-reputation firms from the sample. In addition, the study relies on a single-firm stakeholder that is capable of punitive actions.

Practical implications

From a practical perspective, this study’s findings encourage managers to think about the temporal aspects associated with firm reputation, and to realize that stakeholders may react differently when their expectations are not met depending on an organization’s relative long- and short-term reputations. From a theoretic perspective, the primary contribution of this study is to illustrate how long-term and short-term changes in reputation can provide mixed signals to firm stakeholders regarding future performance.

Originality/value

This study explores the temporal aspects of firm reputation by examining how government sanctions vary depending on firms’ long-term (10 years) and short-term (1 year) reputation. The findings of this study contribute to current reputation research by illustrating the variation in government responses to product defects as a function of short-term and long-term reputation. In doing so, the important role of the timing of firm performance is considered.

Details

International Journal of Organizational Analysis, vol. 31 no. 7
Type: Research Article
ISSN: 1934-8835

Keywords

Article
Publication date: 4 October 2022

Samra Chaudary, Sohail Zafar and Thomas Li-Ping Tang

Following behavioral finance and monetary wisdom, the authors theorize: Decision-makers (investors) adopt deep-rooted personal values (the love-of-money attitudes/avaricious…

366

Abstract

Purpose

Following behavioral finance and monetary wisdom, the authors theorize: Decision-makers (investors) adopt deep-rooted personal values (the love-of-money attitudes/avaricious financial aspirations) as a lens to frame critical concerns (short-term and long-term investment decisions) in the immediate-proximal (current income) and distal-omnibus (future inheritance) contexts to maximize expected utility and ultimate serenity across context, people and time.

Design/methodology/approach

The authors collected data from 277 active equity traders (professional money managers and individual investors) in Pakistan’s two most robust investment hubs—Karachi and Lahore. The authors measured their love-of-money attitude (avaricious monetary aspirations), short-term and long-term investment decisions and demographic variables and collected data during Pakistan's bear markets (Pakistan Stock Exchange, PSX-100).

Findings

Investors’ love of money relates to short-term and long-term decisions. However, these relationships are significant for money managers but non-significant for individual investors. Further, investors’ current income moderates this relationship for short-term investment decisions but not long-term decisions. The intensity of the aspirations-to-short-term investment relationship is much higher for investors with low-income levels than those with average and high-income levels. Future inheritance moderates the relationships between aspirations and short-term and long-term decisions. Regardless of their love-of-money orientations, investors with future inheritance have higher magnitudes of short-term and long-term investments than those without future inheritance. The intensity of the aspirations-to-investments relationship is more potent for investors without future inheritance than those with inheritance. Investors with low avaricious monetary aspirations and without inheritance expectations show the lowest short-term and long-term investment decisions. Investors' current income and future inheritance moderate the relationships between their love of money attitude and short-term and long-term decisions differently in Pakistan's bear markets.

Practical implications

The authors help investors make financial decisions and help financial institutions, asset management companies, brokerage houses and investment banks identify marketing strategies and investor segmentation and provide individualized services.

Originality/value

Professional money managers have a stronger short-term orientation than individual investors. Lack of wealth (current income and future inheritance) motivates greedy investors to take more risks and become more vulnerable than non-greedy ones—investors’ financial resources and wealth matter. The Matthew Effect in investment decisions exists in Pakistan’s emerging economy.

Article
Publication date: 1 September 2004

Kevin J. Laverty

For more than two decades both the business press and research in several academic disciplines have seen an extended debate over what has been called “myopia” or “short‐termism”…

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Abstract

For more than two decades both the business press and research in several academic disciplines have seen an extended debate over what has been called “myopia” or “short‐termism”. These terms have been used to describe decisions in which firms pursue short‐term gains ( for example, seeking to maximize quarterly profits) at the expense of long term strategies ( for example, investing in basic research or laying the groundwork for new core competencies). Despite the attention to this subject, there remain conflicting positions in the business press and inconclusive evidence from research regarding causes and proposed solutions. This paper proposes that progress may be possible by looking inside firms – addressing how managerial systems and decision‐making processes affect the development of long term strategies. Survey results suggest that systemic elements – organizational culture, processes, and routines – have promised in understanding why firms may undervalue the long term and pay too much attention to the short‐term. This study finds that firms are less likely to undervalue the long term when they are able to manage tradeoffs between short‐term and long term results, and create a climate of trust that allows individuals to weather the short‐term setbacks necessary to achieve long term results.

Details

Management Decision, vol. 42 no. 8
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 1 March 2017

John Topinka

The purpose of this research is to examine fiscal health of a specific local enterprise operation: seaports. Seaports provide unique local services while spending and borrowing…

Abstract

The purpose of this research is to examine fiscal health of a specific local enterprise operation: seaports. Seaports provide unique local services while spending and borrowing billions of dollars. Decision makers should be aware of the fiscal health of these enterprises in part to assess the potential risks to the fiscal health of the government at large or public authority. Using eight stock and flow fiscal indicators appropriate for enterprise activities, this research examines eight seaports to compare fiscal health by geographic location and governing structure as well as the connection between long-term and short-term fiscal measures. Descriptive measures suggest that western and public authority ports exhibit better fiscal health than southern and departmental ports with some evidence showing a modest link between long-term and short-term fiscal health.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 29 no. 1
Type: Research Article
ISSN: 1096-3367

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