Strategy as Simulacra? A Radical Reflexive Look at the Discipline and Practice of Strategy*

ABSTRACT Over the past three decades strategic management has become a crucial aspect of business education and practice. At the core of strategic management – linking technique to worldview – is modelling (e.g. value chain, SWOT analysis) whereby the complex elements of strategic thinking are simplified. This accounts in large part for the apparent popularity of strategic management as complex interrelationships are pursued through relatively simple models. Yet has the field of strategic management realized the third order of simulacra? Is strategic management a model of simulation whereby reality has been replaced by hyperreality? A review of the extant literature on strategy explores the study and practice of strategy as a discourse, engulfed by its own truth effects. An examination of the concepts of reflexivity demonstrates the value of a postmodern radical reflexive account through the application of Baudrillard's (1983 , 1988 , 1991 , 1994 ) simulation and simulacra. It is through the development of a radical reflexive discourse of strategy as simulacra, this paper critically examines the study and practice of strategy and the lessons we can take from this perspective.     

A First Assessment of Some Measures of Core Inflation for the Euro Area

Abstract. Core inflation plays an important role in the deliberations of monetary policy-makers. In this paper we evaluate a number of measures of core inflation constructed using euro-area data. In addition to the traditional exclusion-type core measures, we examine two newer ones, documenting their properties and evaluating their performance in terms of their ability to track underlying or trend inflation in real time. We focus on core measures derived from the Harmonized Index of Consumer Prices (HICP) as the European Central Bank has chosen to define its mandate for price stability in terms of this index, and because this is the only index of consumer prices that is compiled in a comparable manner across all members of the European Union. We document significant excess kurtosis in the cross-section distribution of price changes in the euro area, and show that several categories of prices are more volatile than those typically excluded from traditional measures of core inflation. Contrary to what one might expect, traditional measures of core inflation are not significantly less volatile than headline measures. We document the superior performance of alternative measures of core inflation in tracking trend inflation on average, but show that none of the various measures of core gave significant advance warning of the pickup in trend inflation at the beginning of 1999.     

The Role of Future‐Market Focus in the Early Stages of NPD across Varying Levels of Innovativeness

The concept of future‐market focus (FMF) arose out of the debate about firm size and incumbency in the face of radical or disruptive innovations, and has been demonstrated to have a positive correlation with radical innovation (RI) success. This study examines the relationship between FMF and the processes used in the early stages of NPD for four types of innovation projects: incremental innovations, technological breakthroughs, market breakthroughs, and radical innovations. We found that the future‐market focus of a project team can influence the early stage processes used in a new product innovation project, and does so differentially across levels of innovativeness. In particular, the concept generation process, understanding of market needs, and screening decision criteria are different for low‐ versus high‐FMF projects and there are differences based on the level of innovation. In addition, we found that radical innovation projects rated low in FMF are markedly different than the radical innovation projects described in prior studies.     

An Empirical Comparison Between the Synthetic Control Method and HSIAO et al.'s Panel Data Approach to Program Evaluation

We compare two program evaluation methodologies: the synthetic control method and the panel data approach. We apply both methods to estimate the effect of the political and economic integration of Hong Kong. The results obtained differ depending on the methodology used. We then conduct a simulation that shows that the synthetic control method results in a post‐treatment mean squared error, mean absolute percentage error, and mean error with a smaller interquartile range, whenever there is a good enough match. Copyright © 2016 John Wiley & Sons, Ltd.     

When Research Meets Development: Antecedents and Implications of Transfer Speed

This paper focuses on the organization of new product development in large, R&D‐intensive firms. In these firms, research and development activities are often separated. Research is conducted in dedicated research projects at specialized research labs. Once research results are achieved by research projects, they are transferred to business units for further development and commercialization. We investigate the speed whereby research projects transfer their first research results to business units (hereafter: transfer speed). In particular, we analyze the antecedents and performance implications of transfer speed. Based on data of 503 research projects from a European R&D intensive manufacturing firm, our results suggest that a fast transfer speed (as measured by the time it takes for a research project to develop and transfer its first research result to business units) is associated with a better research performance (as measured by the total number of transfers the research project generates). Moreover, we find that different types of external R&D partners—science‐based and market‐based partners—play distinct roles in speeding up project first research transfers. While market‐based partnerships (i.e., customers and suppliers) generally contribute to a faster transfer of first research results, science‐based partnerships (i.e., universities and research institutions) only speed up first research transfers of technologically very complex projects. Our results also show that early patent filings by research projects accelerate first research transfers.     

Exploring the customer's intention to switch firms: The role of customer‐related antecedents

This study examined the customer‐related antecedents of the customer's intention to switch firms. Customer citizenship behavior was a key element in this study. Scholars have extensively studied the antecedents of customer citizenship behavior. However, the way that customer citizenship behavior relates to other attitudinal variables and the intention to switch has scarcely been analyzed. The proposed hypotheses were verified using partial least squares variance‐based structural equation modeling applied to 947 users of beauty care service firms in five countries. The results suggest that customer citizenship behavior is an antecedent of satisfaction, trust, and attitudinal loyalty. Two of these variables influence customers’ intentions to abandon relationships with the service provider. The implications of these findings enhance managers’ and scholars’ understanding of the determinants of customers’ intentions to switch firms.     

Beyond invention: the additive impact of incubation capabilities to firm value

Incubation is a process whereby the firm nurtures breakthrough discoveries and inventions to test their potential as new business platforms. The recent emergence of organizational roles associated with innovation incubation shows that internal incubation is becoming recognized as an important organizational capability. This development also suggests that firms that invest in discovery for competitive advantage recognize a need to leverage that investment more fully. While case studies describe incubation activities and note their importance, empirical research linking this capability to firm performance is limited. The current study represents an initial attempt at exploring the relationship empirically. Our main finding is that financial markets have difficulty valuing a firm's exploratory discovery investments and that the presence of an incubation capability positively moderates the impact of such investments on firm market valuation. The implication of this result is that investments in certain types of R&D may be suboptimized if there is not a parallel investment in a capability to incubate the opportunities that arise from potentially breakthrough inventions.     

Managing radical innovation: an overview of emergent strategy issues

Despite differences in definitions, researchers understand that radical innovation within an organization is very different from incremental innovation , and and that it is critical to the long-term success of firms. Unfortunately, research has also shown that it is often difficult to get support for radical projects in large firms [14], where internal cultures and pressures often push efforts toward more low risk, immediate reward, incremental projects. Interestingly, we know considerably less about the effective management of the product development process in the radical than in an incremental context. The purpose of this study is to explore the process of radical new product development from a strategic perspective, and to outline key observations and challenges that managers face as they move these projects to market. The findings presented here represent the results of a longitudinal (since 1995), multidisciplinary study of radical innovation projects. A multiple case study design was used to explore the similarities and differences in management practices applied to twelve radical innovation projects in ten large, established North American firms. The findings are grouped into three high-level strategic themes. The first theme, market scope, discusses the challenges associated with the pursuit of familiar versus unfamiliar markets for radical innovation. The second theme of competency management identifies and discusses strategic challenges that emerge as firms stretch themselves into new and unfamiliar territory. The final theme relates to the people issues that emerge as both individuals and the project teams themselves try to move radical projects forward in organizations that are not necessarily designed to support such uncertainty.A breadth of subtopics emerge within and across this framework relating to such ideas as risk management, product cannibalization, team composition, and the search for a divisional home. Taken together, our observations reinforce the emerging literature that shows that project teams engaging in radical innovation encounter a much different set of challenges than those typically faced by NPD teams engaged in incremental innovation.     

Do individual investors learn from their trading experience?

After analyzing retail investors’ stock trades for potential learning behavior, we present evidence that individual investors learn from their trading experience. Initially, we question whether investors’ previous forecasting ability (inferred from prior purchases’ subsequent risk-adjusted performance) affects their future trade profitability and activity. Indeed, as an investor's inferred ability increases, so does her ensuing trade profitability and intensity. Further, because additional investment experience allows more accurate ability inference, we posit that trading experience should help investors obtain better investment performance. Consistent with this hypothesis, not only do excess portfolio returns improve with account tenure, but we also find that trade quality (i.e., average raw and excess buy-minus-sell returns) significantly increases with experience (i.e., calendar time and account tenure). In sum, individual stock investors do learn, and they consequently adjust their behavior and thus effectively improve their investment performance.