Showing papers by "European Business School London published in 2007"

Credit Risk Assessment and Relationship Lending: An Empirical Analysis of German Small and Medium-Sized Enterprises*

Abstract: We estimate a logit scoring model for the prediction of the probability of default by German small and medium-sized enterprises (SMEs) using a unique data set on SME loans in Germany. Our scoring model helps SMEs to gain knowledge about their default risk, which can be used to approximate their risk adequate cost of debt. This knowledge is likely to lead to a detection of hold-up problems that German SMEs might be confronted with in their bank relationships. Furthermore, it allows them to monitor their bank’s pricing behavior and it reduces information asymmetries between lenders and borrowers. Finally, it can influence their future financing decisions toward capital market-based financing.

Effects of top management team characteristics on strategic decision making: Shifting attention to team member personalities and mediating processes.

Abstract: Purpose – The purpose of this research is to explore the effects of the diversity of experience and different personalities of top management team members on mediating processes such as agenda‐setting, the generating of strategic alternatives, and the speed of strategic decision making Previous research has studied the effects of top management team characteristics on strategic decision‐making and performance by analyzing team demographics such as age and tenure – with ambiguous resultsDesign/methodology/approach – In a multi‐case study approach, 46 members of eight top management teams were interviewed and surveyedFindings – The study suggests that the ambiguity of research results can be decreased by: introducing more deep‐level measures; and further differentiating the mediating processes The results indicate that diversity of experience affects agenda‐setting and the generating of alternatives but – unexpectedly – does not appear to affect the speed of decision making Personality factors such as

The adjustment of credit ratings in advance of defaults.

Abstract: This paper assesses biases in credit ratings and lead–lag relationships for near-to-default issuers with multiple ratings by Moody’s and S&P. Based on defaults from 1997 to 2004, we find evidence that Moody’s seems to adjust its ratings to increasing default risk in a timelier manner than S&P. Second, credit ratings by the two US-based agencies are not subject to any home preference. Third, given a downgrade (upgrade) by the first rating agency, subsequent downgrades (upgrades) by the second rating agency are of greater magnitude in the short term. Fourth, harsher rating changes by one agency are followed by harsher rating changes in the same direction by the second agency. Fifth, rating changes by the second rating agency are significantly more likely after downgrades than after upgrades by the first rating agency. Additionally, we find evidence for serial correlation in rating changes up to 90 days subsequent to the rating change of interest after controlling for rating changes by the second rating agency.

Towards Defining Knowledge Management Success

Abstract: Discussions at previous HICSS conferences have shown that there is no general agreement on definitions of knowledge management (KM) and knowledge management systems (KMS) success. A deep understanding of these concepts would help to design and implement efficient KM initiatives and systems. We present an exploratory research study to begin and facilitate a debate that will hopefully lead to a consensus definition of KM and KMS success. We chose an expert panel approach followed by two exploratory surveys to approach the KM and KMS success definition. The research shows only a few points of consensus. We present areas of agreement as well as of disagreement, which serve as a good starting point for further discussions on KM and KMS success

Application portfolio management: a decision-oriented view of enterprise architecture

Abstract: Today large companies operate 100s of computer-based information systems (IS), also called applications, to support their businesses. Enterprise Architecture (EA) is regarded as a promising concept to cope with the complexity caused by large application portfolios (AP). This article focuses on senior IT managers’ decision-making with regard to their AP, and EA’s role therein. Through multiple case studies in large companies, we found that these managers consider and balance a set of aspects, each of which is supported by partial EA models maintained by specific groups within their IT departments. These models are, however, not sufficiently integrated. Based on the empirical findings, we propose indicators for each of the partial EA models to aggregate the AP-relevant characteristics per application, which are then integrated into an AP dashboard to support senior IT managers’ holistic AP management. Consequently, a decision-oriented view is created of the overall EA, which the managers of the case studies companies deemed to be very helpful for steering their AP.

ERP Usage in Banking: An Exploratory Survey of the World's Largest Banks

Abstract: As banking is currently considered a non-typical area for ERP usage, the authors conducted a survey on anticipated benefits, potential disadvantages and implementation success associated with ERP adoption in banking. The results indicate that, despite a predominant usage of ERP systems in back-office areas, banks see ERP systems as a long-term strategic investment to support organizational effectiveness.

Assessing User Acceptance of a Knowledge Management System in a Global Bank: Process Analysis and Concept Development

Abstract: Many organizations pursue knowledge management (KM) initiatives, with different degrees of success. One key aspect of KM often neglected in practice is that it not only concerns technology. Technology merely provides the tools with which employees can leverage their knowledge in the context of their work. Thus, how employees perceive the technology and interact with it is assumed to play a major role in KM initiatives' success. This paper analyses patterns of user behavior and acceptance of knowledge management systems (KMS) to identify their relevance for a KM initiative's overall success. Using a combined single case study and literature review approach, we develop a model of user behavior and acceptance of KMS. By combining the user acceptance model with a model of context-specific influencing factors and the integrated KMS architecture by Riempp, we also present an integrated framework for approaching KM initiatives

Patterns in task-based modeling of user interfaces

Abstract: The development of user interfaces is influenced by various challenges in recent years. These are foremost caused by increasing complexity of the underlying applications and the use of these applications on different devices, by different user types and in changing environments. Model-based user interface development approaches have been shown to be suitable to face these challenges. However, creating, transforming and linking the various included models are complex tasks. Employing patterns can avoid these disadvantages and provide an advanced concept of reuse. In this paper a general framework is introduced that describes how model-based approaches can be extended with patterns. The implementation of the framework is exemplarily shown in order to derive a concrete pattern-driven model-based approach for user interface development. A case study is used to illustrate the derived approach.

Young technology ventures in Europe: aspects of market orientation and entrepreneurial orientation

Abstract: The constructs of market orientation and entrepreneurial orientation have been researched over the last decade. Critics increasingly demand the simultaneous testing of several orientations. An online single-industry study investigated the constructs on a factor, dimensional and full measurement level as well as clarified the interconstruct relation. Using reviewed measures from the works of Kohli et al. (1993), as well as Covin and Slevin (1986; 1991) and Lumpkin and Dess (1996), a total of 282 wireless application developers in Europe and Israel were surveyed. It can be concluded that entrepreneurial orientation is a multidimensional construct comprising four distinct constructs: Proactiveness, Risk Taking, Competitive Aggressiveness, and Innovativeness of the Company. Market orientation was found to be a unidimensional construct comprising five distinct dimensions: Intelligence Generation on Macro Environment, Intelligence Generation on Micro Environment, Intelligence Generation on Customers, Intelligence Dissemination and Responsiveness.

Coaching als Instrument der Personalentwicklung

Abstract: Coaching ist ein schillernder Begriff, der auf dem besten Wege ist, zu einem jener Modeworte zu werden, unter denen jeder etwas anderes versteht oder noch schlimmer, sie nur deshalb verwendet, weil sie im Trend sind. Nicht selten wird sogar versucht, alles Bisherige in diesen neuen Terminus zu verpacken. Damit wurde die Metapher vom „alten Wein in neuen Schlauchen“ wieder einmal voll zutreffen!

Capturing Fat Tail Risk in Exchange Rate Returns using SU-curves: A Comparison with the Normal Mixture and Skewed Student Distributions

Abstract: Evidence that the distribution of daily changes of exchange rates has fatter tails than the normal has led researchers to consider different alternative distributions to estimate quantile-based risk measures. In this paper we investigate the ability of SU-curves to capture fat tail risk of exchange rate returns, comparing them against the mixture of normals and skewed Student models. The results indicate that, although the skewed Student provides the best overall fit, in terms of VaR performance the SU-curves can yield better or at least similar results than any of the models considered. This, together with their flexibility in modeling different degrees of non-normality, suggests the SU system can be a useful alternative for risk management.

Eine Analyse des moderierenden Einflusses der Faktoren Wettbewerbsintensität, Marktdynamik und dezentrale Autonomie auf die erfolgreiche Gestaltung der Budgetierung

Abstract: Trotz der hohen Bedeutung der Budgetierung fur die Unternehmenspraxis ist unser Wissen uber die optimale Gestaltung dieses Prozesses beschrankt. Insbesondere liegen kaum empirische Befunde uber kontextspezifische Unterschiede in den gestaltungsrelevanten Ursache-Wirkungs-Beziehungen vor. Vor diesem Hintergrund wird im vorliegenden Beitrag zunachst ein integratives Modell der Zusammenhange zwischen ausgewahlten Gestaltungsfaktoren, Budgetierungs- und Geschaftsbereichserfolg abgeleitet und empirisch uberpruft. Im zweiten Schritt wird mit Hilfe eines kausalen Mehrgruppenvergleichs explorativ untersucht, ob sich die Zusammenhange in Abhangigkeit von den Faktoren Wettbewerbsintensitat, Marktdynamik und dezentrale Autonomie unterscheiden. Es zeigt sich, dass signifikante moderierende Effekte vorliegen und somit undifferenzierten Gestaltungsempfehlungen in der Literatur und der jungeren Praxisdiskussion nicht gefolgt werden kann.

Beyond the Big‐Bang Enlargement: Citizens' Preferences and the Problem of EU Decision Making

Abstract: Given the increasing heterogeneity regarding economic structures, political interests, social preferences and financial constraints, governance problems in the EU will increase significantly Based on a theoretical model of fiscal federalism, the question on which governance level political competencies should be located is addressed for the case of a heterogeneous union The model suggests a distinct allocation of competencies in different policy fields depending upon the degree of country heterogeneity and the size of spillover effects of government services Additionally, citizens' preferences regarding centralization and decentralization of policy prerogatives are analysed empirically It is investigated whether the preferences are consistent with the theoretical implications, to what extent there are controversies within the groups of old and new EU members, and whether the scope for controversies changes within an enlarged union Moreover, the preference distribution is used to simulate vot

Globales Netzwerkmanagement — Königsweg oder Irrglaube?

Abstract: Die Bildung von Netzwerken ist ein andauernder Trend. Bereits in den 90er Jahren wurde das Thema in der betriebswirtschaftlichen Literatur vermehrt aufgegriffen [Jarillo 1988, Miles/Snow 1992, Sydow 1992]. Ausloser waren die japanischen Keiretsu und regionale Agglomerationen wie beispielsweise im Falle der Automobilhersteller, die dazu ubergingen, langfristige Partnerschaften mit wenigen ausgewahlten Lieferanten einzugehen [Helper et al. 2005]. In jungerer Zeit stehen internationale bzw. globale Netzwerke zunehmend im Fokus des Interesses, da diese als ein Konigsweg zum Erfolg angesehen werden.

Performance financière : vers une relecture critique du résultat comptable

Abstract: La mesure de la performance revet une dimension essentielle au sein de toute organisation dont l'existence depend de l'efficience. Le concept est cependant loin d'etre unidimensionnel ; il existe, pourrait-on dire, autant d'approches de la performance que de parties prenantes : performances economique, technique, humaine, environnementale, citoyenne, ethique... Chacun la construit en fonction des objectifs qu'il assigne a l'organisation. Pour notre part, nous avons choisi de consacrer cet article a sa dimension financiere. La comptabilite en tant que systeme de mesure nous en fournit plusieurs indicateurs dont le plus connu et le plus expose du fait de sa position centrale est le resultat net comptable. Compte tenu des enjeux manageriaux qu'il implique, ce solde final fait l'objet de toutes les attentions lors des assemblees generales mais aussi des publications financieres. Son influence est telle que nombre de decisions majeures dependent de son montant constate ou attendu : embauches ou licenciements, investissement ou abandon d'activite, restructuration, acquisition, fusion ... Empruntant au courant conventionnaliste ses methodes et son axiomatique, cette etude tente alors de projeter sur le resultat comptable un eclairage renouvele ; l'indicateur se devoile alors pour apparaitre non plus comme un solde fiable et objectif mais comme un reliquat dont la determination est modelee par des mecanismes sociaux qui echappent a l'interpretation contractualiste largement predominante. L'analyse par les conventions nous invite ainsi a decouvrir les dispositifs cognitifs qui guident le praticien dans la resolution de problemes lies a la representation comptable. Si elles le soustraient a l'incertitude de la modelisation, les conventions ne peuvent toutefois pretendre a la neutralite des solutions proposees. Resultat de tensions diverses, d'influences culturelles, ideologiques et politiques, elles orientent inevitablement l'utilisateur dans un schema de pensee tres oriente. Le benefice net apparait alors moins comme la performance degagee par les activites marchandes de la firme que la variation de la richesse de ses proprietaires, destinataires implicites du modele. Animes par le seul interet scientifique, ces travaux ont cherche a montrer que tout dispositif de mesure est indissociable de son contexte social. A cet egard, la propriete privee, meta convention qui regente le rapport que l'etre entretient avec les objets conditionne inevitablement la facon dont la performance est evaluee. En accordant la legitimite souveraine (que cet article ne conteste pas) aux detenteurs des droits de propriete, nous acceptons leur creance residuelle comme mesure finale du profit de la firme et partant comme indicateur privilegie de son efficacite. Il semble pourtant que cette acceptation s'est dissipee dans l'esprit des convenants pour se transformer peu a peu en une verite qu'on ne songe meme pas a discuter. Au demeurant, c'est bien la le propre d'une convention que de guider l'individu dans la resolution d'un probleme jusqu'a faire disparaitre le probleme lui-meme, de sorte qu'aucune question ne se pose et que la voie a suivre s'ordonne comme une evidence.

La norme IFRS 2 : un éclairage critique par la théorie comptable

Abstract: La nouvelle norme IFRS 2 relative au paiement sous forme d'actions oblige desormais les groupes a comptabiliser le cout lie a l'exercice futur des options. Une relecture critique de la regle nous entraine alors a redecouvrir les fondements theoriques et conventionnels du modele comptable. Celui-ci se revele moins comme un systeme d'information destine a mesurer la performance financiere de l'entreprise en tant qu'entite qu'un outil au service de ses proprietaires. L'IFRS 2 en est une illustration eclairante.

A Theory-Based Framework for Integrated Supply Performance Measurement

Abstract: Due to the reduction of the degree of value added within many companies, purchasing and supply management has been acknowledged as an important lever for corporate performance enhancement. Recent research has shown that the installation of performance measurement systems in purchasing and supply management is a decisive management tool for purchasing and supply management. Based on the old saying “you can’t manage what you can’t measure” companies must have decisive metrics that translate supply strategy into action and drive company performance. The paper applies selected management theories to the research field and suggests a framework for the design, implementation and enablement of performance measurement in purchasing and supply management.

Does Priming Improve Performance?—An Evaluation Based on a Simulation Game

Abstract: This study focuses on the priming effect on performance in a simulation game It took place during the regular course programme at the European Business School (Germany) Two groups of students were chosen randomly to play a business game (Szyperski & Klandt, 1988) that simulated the start-up and early development phase of a software company including a large variety of decisionsBy means of the study design the amount of cognitive involvement before the game was varied Thus, one of the groups received a strategy questionnaire while the other did not It contained questions about production, supply, personnel, advertising, etc The intention was to prime the students towards the use of strategies According to former experiments by Higgins, Rholes and Jones (1977) priming influences cognition and memory and leads to a faster retrieval of information This should be transferred to the performance in a simulation game

Knowledge Management/Organizational Memory Success and Performance Measurements

Abstract: This mini-track focuses on performance and success measurements for Knowledge Management and Organizational Memory. Key aspects examined in mini-track papers include measuring the success and effectiveness of systems that manage knowledge initiatives and organizational memories. Metrics and performance measures were a particularly strong area for submissions. Examining the impact of knowledge management systems on organizational performance was also a popular area for submissions. Twenty papers were reviewed for this mini-track. Ten papers accepted for presentation at the conference. Two papers from other KMS mini-tracks will also be presented in this mini-track. We are especially grateful to the many colleagues who helped in the review process.

Is Hostility in the Merger and Acquisition Market Wasteful? Empirical Evidence of the Economic Costs of Hostility

Abstract: The question as to whether hostility is economically wasteful has been subject to intense debate for decades in the literature of law, economics, and finance. Typically the debate is focused in the issue of managerial entrenchment. Commentators frequently adopt an unstated presumption that hostility is wasteful per se. We argue that it is important to examine empirical data before accepting this premise. We investigate long-term, post-acquisition measures of corporate operating performance of hostile acquisitions relative to non-hostile acquisitions. Our results suggest that hostility does not affect operating performance, and from this we infer that there are no economic costs associated with hostility. The findings are robust with respect to a variety of methodologies and control variables.

Retained Inside Ownership, Signaling, and the Valuation of Initial Public Offerings - Evidence from Germany

Abstract: This paper investigates the relation between inside ownership and valuation of German initial public offerings from 1997 to 2002. In order to rationalize the under diversification of insiders in the presence of an informational advantage toward investors, the paper tests and confirms the Leland and Pyle (1977) signaling hypothesis of retained inside ownership. The ownership change at the IPO (divestment) is found to have a negative impact on Tobin's Q, while the absolute level of retained inside ownership has a nonlinear impact in an OLS estimation. This impact turns into a linear positive impact in a simultaneous estimation of IPO valuation and the divestment of insiders. Simultaneous estimation is necessary due to a reverse wealth effect proposed by Ritter (1984). Consistent with the wealth effect, IPO valuation is uniquely found to have a negative reverse impact on insider divestment. This is interesting because, except for the work of Ritter (1984), no previous study has accounted for simultaneity in an IPO context. Moreover, other signaling mechanisms proposed in the IPO context are not found to be relevant. They neither act as substitutes nor as complements for the retained inside ownership signal. All findings are robust to a treatment of simultaneity in the general relation of valuation and ownership. This paper contributes to the scarce empirical ownership and valuation research using German data and indicates that this relationship is highly sensitive to the current life cycle circumstances of the firm.

Rules of Proof, Courts, and Incentives

Abstract: We analyze the design of legal principles and procedures for court decision-making in civil litigation. The objective is the provision of appropriate incentives for potential tort-feasors to exert care, when evidence about care is imperfect and may be distorted by the parties. Efficiency is shown to be consistent with courts adjudicating on the basis of the preponderance of evidence standard of proof together with common law exclusionary rules. Inefficient equilibria may nevertheless also arise under these rules. Directing courts as to the assignment of the burden of proof is then useful as a coordination device. Alternatively, burden of proof guidelines are unnecessary if courts are allowed a more active or inquisitorial role, by contrast with that of passive adjudicator.

Adverse Selection Costs, Sequential Learning, and the Within-Wave Timing of Initial Public Offerings - Evidence from Germany

Abstract: This paper investigates whether IPO firms' characteristics associated with adverse selection costs, which are in particular proxies for asymmetric information and signaling, differ across the recent German IPO wave from 1996 to 2002. Theoretical research on sequential learning within an IPO wave suggests that issues undertaken late in a wave exhibit larger proxies for information asymmetries and apply less signaling (learning hypothesis). This issue is interesting since previous empirical research focused on explanations of whole IPO waves and "hot issue" markets, while dynamics within waves were neglected. In a logistic regression with early and late wave IPOs (within-wave timing) as the dependent variable, the hypothesis is clearly confirmed for asymmetric information and weakly confirmed for signaling mechanisms. The findings in the sample of 315 IPOs are not driven by the occurrence of "hot issue" markets, and are robust to a special consideration of industry waves and several versions of the timing variable. Although these results imply a learning process, more research is needed to generalize the findings for more IPO waves and countries.

RefModPM: Reference Information Model for Enterprise-Wide Project Planning, Controlling and Coordination in Matrix Project Organizations

Abstract: Project information systems can be regarded as a sub-system of project management systems. Their aim is to supply all relevant stakeholders with the information necessary to plan, control and coordinate projects. The objective of the research presented in this paper is the development of a semi-formal, conceptual reference information model for the enterprise-wide planning, controlling and coordination of projects in matrix project organizations, which can serve as a basis for information system development (RefModPM). The reference model construction is based on 13 in-depth interviews with domain experts from large German and Swiss enterprises and the analysis of 28 commercial software products for the problem domain. The paper reflects the corresponding research process and shows the reference model’s architecture. Parts of the reference model are discussed to give an impression of the outcome of the research.

Rigorosität in der Fallstudien-Methodologie — eine kritische Analyse der Dokumentation in der Logistikforschung

Abstract: Der Fokus dieses Beitrages liegt auf der Analyse der Dokumentation von Fallstudien in der Logistikforschung. Die Analyse von Publikationen mit dieser Forschungsmethode entzieht sich der leicht zuganglichen Bewertung durch Sichtung von standardisierten Guteparametern. Dies und der zunehmende Einsatz von Fallstudien als Methode fuhren zu einem Bedeutungszuwachs des Themas Rigorositat im Sinne der wissenschaftlichen Qualitat in der Forschung.1