The case of the hidden harassment

The past year has seen a growing public awareness of sexual harassment in the workplace. The question of what constitutes sexual harassment and how to recognize it has been debated in the news, the courts, and Congress. This HBR case study is less concerned with defining it than with examining what a manager should do about it. When Filmore Trust manager Jerry Tarkwell found out one of his employees was being sexually harassed on the job, he thought he knew exactly what to do. Following company policy, he immediately notified the bank's equal employment office. Then he called Jill McNair, the employee being harassed. Her response dumbfounded him. "You had no right to call EEO before talking to me," McNair said angrily. Do you have any idea what could happen to me and to my career if people find out about this?" Tarkwell didn't understand; McNair wasn't to blame. He believed the only person who should be worried was the harasser. Tarkwell tried to spell out the procedure for her. "All you have to do is write a letter and ..." McNair cut him off. "If this gets investigated by EEO, everyone in the building could be questioned. I'll probably get transferred, and then I won't have a chance at promotion. And who'd want to work with me? Every man in the company would be afraid I'd report him if he so much as opened a door for me."(ABSTRACT TRUNCATED AT 250 WORDS)     

How to acquire customers on the Web

Most retailers on the Web spend more to acquire customers than they will ever get back in revenue from them. Many think that sky-high spending on marketing is necessary to stake out their share of Internet space. But is it really? How do retailers know how much to pay? Consider CDnow, which has developed a multifaceted customer-acquisition strategy that reflects a clear understanding of the economics of an on-line business. At the heart of its strategy is affiliate marketing, a concept the company pioneered. Under its BuyWeb program, anyone can put a link to CDnow on his or her Web site, and if a customer uses that link to arrive at CDnow and make a purchase, the referring site owner gets a percentage of the sale. CDnow pays no money if no sale is made, which makes the marketing program completely efficient. But CDnow didn't stop there. Being a Web store, it had complete data on the number of visitors to its site and what they bought, which it used to work out the lifetime value of an average customer. CDnow used that figure to determine how much to wager on the expensive and risky world of traditional advertising to reach a wider audience that wasn't already on-line. CDnow's experience, still a work in progress, contradicts John Wanamaker's oft-quoted lament: "I know half the money I spend on advertising is wasted, but I can never find out which half." As the CDnow example demonstrates, there is a way to find out which half really works.     

Right away and all at once: how we saved Continental

In 1993, when Greg Brenneman started working at Continental Airlines, it was the most dysfunctional company he had ever seen. It had been through two bankruptcies and ten presidents in ten years. There was next to no strategy. The company was burning through money. And employee morale couldn't get any worse. Today Continental is flying high. It posted revenues of $7.2 billion and a net income of $385 million in 1997. It regularly ranks as one of the top five U.S. airlines for key performance measures such as dispatch reliability. And employee turnover has been drastically reduced. What happened? In this first-person account, Brenneman, now Continental's president and COO, describes how he and the new team at Continental's helm transformed the company "right away and all at once." More specifically, he describes the five lessons he learned during this dramatic turnaround. At the beginning, there was so much wrong with Continental that he felt as if any one misstep could bring the whole effort down. But in a time of crisis, when time is tight and money is tighter, you can't afford to mull over complex strategy. With Gordon Bethune, Continental's chairman and CEO, Brenneman devised the Go Forward Plan, a straightforward strategy focused on four key elements: understanding the market, increasing revenues, improving the product, and transforming the corporate culture. He admits that the plan wasn't complicated--it was pure common sense. The tough part was getting it done. "Do it now!" became the rallying cry of the movement, and the power of momentum has carried Continental to success.     

Innovation versus complexity: what is too much of a good thing?

What's the number of product or service offerings that would optimize both your revenues and your profits? For most firms, it's considerably lower than the number they offer today. The fact is, companies have strong incentives to be overly innovative in new product development. But continual launches of new products and line extensions add complexity throughout a company's operations, and as the costs of managing that complexity multiply, margins shrink. To maximize profit potential, a company needs to identify its innovation fulcrum, the point at which an additional offering destroys more value than it creates. The usual antidotes to complexity miss their mark because they treat the problem on the factory floor rather than at its source: in the product line. Mark Gottfredson and Keith Aspinall of Bain & Company present an approach that goes beyond the typical Six Sigma or lean-operations program to root out complexity hidden in the value chain. The first step is to ask, What would our company look like if it made and sold only a single product or service? In other words, you identify your company's equivalent of Henry Ford's one-size-fits-all Model T-for Starbucks, it might be a medium-size cup of coffee; for a bank, a simple checking account-and then determine the cost of producing that baseline offering. Next, you add variety back into the business system, product by product, and carefully forecast the resulting impact on sales as well as the cost implications across the value chain. When the analysis shows the costs beginning to overwhelm the added revenues, you've found your innovation fulcrum. By deconstructing their companies to a zero-complexity baseline, managers can break through organizational resistance and deeply entrenched ways of thinking to find the right balance between innovation and complexity.     

When salaries aren't secret

No one seemed to think Treece McDavitt was a malevolent employee. "Just mischievous," one person said. Whatever her motivation, the day before Treece was to leave RightNow!, an off-price women's fashion retailer, the 26-year-old computer wizard accessed HR's files and e-mailed employees' salaries to the entire staff. Now everyone knows what everyone else is making; they are either infuriated that they are making too little or embarrassed that they are making too much. Salary disparities are out there for everyone to see, and CEO Hank Adamson has to do something to smooth things over. Hank's trusted advisers talk extensively with the CEO about his options, ultimately coming down on two sides. Charlie Herald, vice president of human resources, takes a "You get a lemon, you make lemonade" approach: keep making the salaries public to ensure fairness and to push employees to higher performance, he advises. Meanwhile, CFO Harriet Duval sees the need for damage control: apologize, clean up the company's compensation system, and continue to keep--or at least try to keep--salaries private, she says. Should Hank side with Charlie or Harriet? Or perhaps find a compromise between their two views? What should he do about this serious salary debacle? Four commentators offer their advice on the problem presented in this fictional case study.     

When an executive defects

The news that one of the company's senior managers is leaving comes as a complete surprise to Paul Simmonds, CEO of Kinsington Textiles, Inc. Ned Carpenter, KTI's vice president of operations for three years, writes in his resignation letter than he is leaving for a better opportunity. Simmonds soon learns that Carpenter's new job is at Daltex, one of KTI's main rivals in the intensely competitive carpet industry. Hiring Carpenter had helped Simmonds establish his reputation as a topnotch manager. Carpenter came to KTI with lots of ideas and put his enthusiasm to good use. Three years into a five-year change program, Carpenter had turned KTI's operations from one of the worst in the industry to one of the best. He also had helped develop and plan the upcoming launch of a new fiber coating--KTI's first breakthrough in years. In this fictitious case study, Simmonds, along with the company's counsel and vice president of human resources, must figure out how much and what sort of damage control they need. What are they going to tell the company's employees and the media? Should they immediately replace Carpenter with John Brady, the second-in-command of operations? What if Carpenter is taking KTI employees--and strategic information--with him to Daltex? Should Simmonds ask all his managers to sign noncompete agreements-something Carpenter was never asked to do? Should KTI sue Carpenter? Five experts offer advice about communicating with KTI's employees, the media, and Carpenter himself, and about protecting the company's confidential information.     

Courage as a skill

A division vice president blows the whistle on corruption at the highest levels of his company. A young manager refuses to work on her boss's pet project because she fears it will discredit the organization. A CEO urges his board, despite push back from powerful, hostile members, to invest in environmentally sustainable technology. What is behind such high-risk, often courageous acts? Courage in business, the author has found, seldom resembles the heroic impulsiveness that sometimes surfaces in life-or-death situations. Rather, it is a special kind of calculated risk taking, learned and refined over time. Taking an intelligent gamble requires an understanding of what she calls the "courage calculation": six discrete decision-making processes that make success more likely while averting rash or unproductive behavior. These include setting attainable goals, tipping the power balance in your favor, weighing risks against benefits, and developing contingency plans. Goals may be organizational or personal. Tania Modic had both types in mind when, as a young bank manager, she overstepped her role by traveling to NewYork--on vacation time and on her own money--to revitalize some accounts that her senior colleagues had allowed to languish. Her high-risk maneuver benefited the bank and gained her a promotion. Lieutenant General Claudia J. Kennedy weighed the risks and benefits before deciding to report a fellow officer who had plagiarized a research paper at a professional army school. In her difficult courage calculation, loyalty to army standards proved stronger than the potential discomfort and embarrassment of "snitching" on a fellow officer. When the skills behind courageous decision making align with a personal, organizational, or societal philosophy, managers are empowered to make bold moves that lead to success for their companies and their careers.     

Strategy as revolution

How often does the strategic-planning process start with senior executives asking what the rest of the organization can teach them about the future? Not often enough, argues Gary Hamel. In many companies, strategy making is an elitist procedure and ?strategy? consists of nothing more than following the industry's rules. But more and more companies, intent on overturning the industrial order, are rewriting those rules. What can industry incumbents do? Either surrender the future to revolutionary challengers or revolutionize the way their companies create strategy. What is needed is not a tweak to the traditional strategic-planning process, Hamel says, but a new philosophical foundation: strategy is revolution. Hamel offers ten principles to help a company think about the challenge of creating truly revolutionary strategies. Perhaps the most fundamental principle is that so-called strategic planning doesn't produce true strategic innovation. The traditional planning process is little more than a rote procedure in which deeply held assumptions and industry conventions are reinforced rather than challenged. Such a process harnesses only a tiny proportion of an organization's creative potential. If there is to be any hope of industry revolution, senior managers must give up their monopoly on the creation of strategy. They must embrace a truly democratic process that can give voice to the revolutionaries that exist in every company. If senior managers are unwilling to do this, employees must become strategy activists. The opportunities for industry revolution are mostly unexplored. One thing is certain: if you don't let the revolutionaries challenge you from within, they will eventually challenge you from without--in the marketplace.     

Organizing for empowerment: an interview with AES's Roger Sant and Dennis Bakke. Interview by Suzy Wetlaufer.

The topic of empowerment is receiving a lot of attention, but how many employees are truly empowered? At the global electricity giant AES Corporation, the answer is all 40,000 of them. In this interview, chairman Roger Sant and CEO Dennis Bakke reflect on their trials and triumphs in creating an exceptional company and explain how their employee-run company works. When they founded AES in 1981, Sant and Bakke set out to create a company where people could have engaging experiences on a daily basis--a company that embodied the principles of fairness, integrity, social responsibility, and fun. Putting those principles into action has created something unique--an ecosystem of real empowerment. What does that system look like? Rather than having a traditional hierarchical chain of command, AES is organized around small teams that are responsible for operations and maintenance. Moreover, AES has eliminated functional departments; there's no corporate marketing division or human resources department. For the system to work, every person must become a well-rounded generalist--a mini-CEO. That, in turn, redefines the jobs of the people at headquarters. Instead of setting strategy and making the "the big decisions," Sant and Bakke act as advisers, guardians of the principles, accountability officers, and chief encouragers. Can other companies successfully adopt the mechanics of such a system? Not unless they first adopt the shared principles that have guided AES since its inception. "Empowerment without values isn't empowerment," says Sant. "It's just technique," adds Bakke.     

The best of intentions

Cynthia Mitchell has finally gotten a plum management opportunity at AgFunds, a Houston-based company that provides financial services to farmers and farmer-owned cooperatives. Peter Jones, regional vice president, has recruited Cynthia to revive the Arkansas district, which has been losing customers for 15 years. The sales force there isn't bad; it's just been poorly managed by an indifferent boss for too long. Still, Cynthia knows she'll need at least one powerhouse sales rep to get things back on track. She thinks she's found that person in Steve Ripley, this year's top trainee at AgFunds, who is inexplicably available three months after the training period is over. In the interview, he proves to be ambitious, intelligent, and personable. But several of Cynthia's colleagues suggest that Steve might not be the best fit for the job: He's a black man in a company whose customer base is mostly conservative and white. Uncomfortably recalling her own experiences at AgFunds--she'd been rejected for a position in a territory that was deemed too unfriendly to female sales reps--Cynthia addresses the issue with Peter. The mostly white farmers in Cynthia's district just won't trust their books to a black professional, Peter explains. And other minority professionals at AgFunds have derailed their careers trying to make inroads in unfriendly districts. "Steve deserves to start out in a more hospitable district. Once the right opportunity opens up, he'll be hired, and he'll do brilliantly," Peter reassures Cynthia, but she's still uncertain. Should she ignore her customers' biases and hire Steve, possibly setting him up to fail? Or would it be better to let Steve wait for a friendlier opportunity? Four experts comment on this fictional case study.     

Smart customers, dumb companies

Customers today are being bombarded with an overwhelming array of choices. To alleviate customer frustration, say Steven Cristol and Peter Sealey in Simplicity Marketing, companies should stop creating new brands and product extensions. Better to consolidate product and service functions by following a four R approach: replace, repackage, reposition, and replenish. That's an outmoded, dictatorial view of markets, says Christopher Locke. Far from being stymied by choices, customers are rapidly becoming smarter than the companies that pretend to serve them. In this networked economy, people are talking among themselves, and that changes everything. Locke predicts we'll see a growing number of well-defined micromarkets--groups of customers converging in real time around entertaining and knowledgeable voices--such as NPR's car guys and the Motley Fool investment site. "Micromedia" Web sites will replace traditional advertising because they'll provide credible user-supplied news about products and services. Locke contends that an open exchange of information solves the "problem" of choice much better than manipulative strategies like simplicity or even permission marketing. Companies can participate in micromarkets through what Locke dubs "gonzo marketing." If Ford, for example, discovers that a subset of its employees are organic gardeners, it may offer support to a big independent organic-gardening Web site with donations and employee volunteers. This marketing effort would be driven not by advertising managers but by people with genuine interest in each micromarket, so it would have credibility with customers. With gonzo marketing, both companies and their markets will benefit.     

李子彬破解中小企业融资难题

自今年6月份以来,“经营环境恶劣：新一轮中小企业倒闭潮恐将来临”、“珠三角、温州中小企业生存状况堪忧”、“危机似乎比2008年时更为严重”等消息牵动各方人心。而早在4月,中国中小企业协会会长、国家发改委原副主任李子彬就曾上书国务院总理温家宝,表示“如果不采取迅速有力的措施,到今年年底极有可能会出现2007～2008年中小企业资金链普遍断裂的情形”。危机是否真正来临？当前中小企业面临的最大问题是什么？“融资难”到底难在哪里？较为可行的解决之路是什么……．带着这些中小企业极为关心的问题．《国际融资》记者如约来到中国中小企业协会,采访了会长李子彬     

Announcing the announcement

What drives investors’ attention? We study how far in advance earnings calendars are pre-announced and find that investors are more attentive to earnings news when such details are disclosed well ahead of time. This variation in investors' attention affects short-run and long-run stock returns, thereby creating incentives for firms to strategically pre-announce the report date on short notice when the earnings news is bad. Consistent with this idea, firms pre-announce their report dates well ahead of time when earnings are good and do it at the very last moment when earnings are bad. A trading strategy that exploits such variations yields abnormal returns of 1.5% per month.     

Effective marketing for professional services

In many professions, the idea of marketing has traditionally been not only foreign but distasteful. After all, what doctor, lawyer, architect, or consultant worth his or her salt would even need to go out hustling business? While this view still holds considerable weight in many people's minds, it is gradually receding before the forces of economic reality. As more professions become overcrowded, competition for customers is sharpening. How should professionals go about drawing favorable attention to themselves? By first recognizing the special problems they face in marketing their services, argues the author. Among the obstacles he identifies are buyer uncertainty about obtaining professional services, the difficulties of distinguishing among firms, and the immeasurable benefits of advertising. Among his suggestions are that providers of these services concentrate on educating prospective customers about the opportunities and limitations of the services, team up with others who have desirable experience, and do marketing research to identify and then cater to customer desires.     

The moonlighter

Jeremy Hicks, Zagante Systems' lead programmer, walks into the office at eight o'clock on a Sunday night and does a double take when he spots his boss, Melanie. She's equally surprised to find she isn't alone. Before leaving for the evening, Melanie pays Jeremy a visit, only to discover that he isn't hard at work on Zagante's new product--he's programming a game for another company. The next day over lunch, Melanie confronts Jeremy and lets him know that he needs to stay focused on Zagante's new software. Jeremy insists that he's fully engaged in it. So Melanie agrees to keep the moonlighting under wraps so long as it doesn't interfere with Jeremy's job. That night, Melanie sits down at her laptop and opens up a Google window. "Moonlighting," she types. Dismayed at the number of hits, she changes her search to "Fired for moonlighting." This search leads her to case after case, but none helps her with Jeremy. She tries one more time. "Promoted for moonlighting," she types. No surprise. Zero hits. Frustrated with Jeremy, yet anxious to keep such a talented employee, Melanie turns to Jill Darby, Zagante's HR director, for guidance. Jill has both good and bad news. The bad news is that the company has no moonlighting policy. The good news is that Jill can arrange for Jeremy to receive a low-interest loan. But when Melanie tells Jeremy about the loan, he doesn't go for it. He's not just freelancing for the money, it turns out; he's downright enjoying the work and doesn't appreciate his boss butting in to his private business. How should Melanie handle this moonlighting issue? Commentators Bill Jensen, author of Work 2.0: Rewriting the Contract; attorney Barry LePatner; economics professors Jean Kimmel and Karen Conway; and HR director Sandra Davis offer advice in this fictional case study.     

The curse of the superstar CEO

When struggling companies look for a new chief executive today, the one quality they prize above all others is charisma. But once they've recruited a larger-than-life leader, they often find that their troubles only get worse. Indeed, as the author's new research painfully reveals, the widespread belief in the powers of charismatic CEOs can be problematic. Why? First, Khurana says, there's no conclusive evidence that charismatic leadership affects an organization's performance. And yet--as Kodak's story over the past decade reveals--when a company is faltering, boards feel compelled to oust the incumbent chief executive and bring in a corporate savior. Second, the insistence on finding a charismatic leader, combined with the undefinable nature of charisma, results in selection processes that are overly conservative and even irrational. Boards end up considering only candidates who have already achieved the rank of CEO or president at a high-performing, high-profile company, even if they are not right for the job. Third, charismatic leaders deliberately destabilize organizations. This can result in a more vibrant company, as it did at General Electric during Jack Welch's tenure, but it can also leave a troubled legacy for the organization to overcome, as GE, Ford, and Enron have all found. Faith in a company, a product, or an idea can unleash tremendous innovation and productivity. But the extravagant hopes invested in charismatic CEOs resemble not mature faith but a belief in magic. If we are willing to reconsider our notion of leadership, this age of faith can be followed by an era of faith and reason.     

基于新闻文本共现性的银企关系分析——以房地产上市公司为例

本文首次提出基于新闻文本共现性衡量银企关系强度的指标。相比多数传统方法,该指标能够更为全面地反映银行和企业间的业务和非业务联系,并在数据可获得性上也具备优势。据此,本文对2009年至2014年间我国238家房地产上市公司与19家主要内资银行之间的银企关系强度进行了定量度量,并利用该指标对银企关系影响企业信贷融资能力的规律进行了实证分析。结果显示,良好的银企关系确实能显著提高企业的信贷可得性,但整体上对企业信贷融资成本的影响有限。同时,上述影响规律存在显著的企业间差异,对于规模小或盈利能力弱的企业,银企关系尤其能够帮助其提高信贷可得性或降低信贷融资成本。     

Case study. Does this company need a union?

No doubt about it, the top managers in this fictitious case study agree, Wellington Associates is a great place to work. Analysts at the high-tech consulting firm enjoy some of the best pay in the industry. And their benefits are extensive: flextime, liberal educational opportunities, comprehensive medical and dental coverage, generous vacation leave, and even on-site day care. So it came as something of a shock to CEO Jane Wellington and her top executives when HR chief Elvin Cusack started out the weekly senior-management meeting by declaring that the United Office Workers Union had begun organizing the support staff. Turns out, Cusack explained, that the company looks very different from the support staff's point of view. Although their starting salaries are indeed competitive, raises average a mere 2% to 3%, and promotions to professional ranks are rare. Medical and dental coverage take a greater chunk out of clerical pay than out of the larger professional salaries, and the cost of the day care center is pretty much out of reach for the support staff. Flextime is impractical for workers who need to be in the office to answer phones and to file papers. Worse, the support staff is expected to accommodate the analysts' flexible schedules; if an analyst decides to work late to finish a project, the secretary has to stay as well. What to do? Suggestions ranged from "fire 'em" to "say nothing before calling in legal counsel." Five commentators examine Wellington's options and its legal obligations.     

The perfect message at the perfect moment

Marketers planning promotional campaigns ask questions to boost the odds that the messages will be accepted: Who should receive each message? What should be its content? How should we deliver it? The one question they rarely ask is, when should we deliver it? That's too bad, because in marketing, timing is arguably the most important variable of all. Indeed, there are moments in a customer's relationship with a business when she wants to communicate with that business because something has changed. If the company contacts her with the right message in the right format at the right time, there's a good chance of a warm reception. The question of "when" can be answered by a new computer-based model called "dialogue marketing," which is, to date, the highest rung on an evolutionary ladder that ascends from database marketing to relationship marketing to one-to-one marketing. Its principle advantages over older approaches are that it is completely interactive, exploits many communication channels, and is "relationship aware": that is, it continuously tracks every nuance of the customer's interaction with the business. Thus, dialogue marketing responds to each transition in that relationship at the moment the customer requires attention. Turning a traditional marketing strategy into a dialogue-marketing program is a straightforward matter. Begin by identifying the batch communications you make with customers, then ask yourself what events could trigger those communications to make them more timely. Add a question or call to action to each message and prepare a different treatment or response for each possible answer. Finally, create a series of increasingly urgent calls to action that kick in if the question or call to action goes unanswered by the customer. As dialogue marketing proliferates, it may provide the solid new footing that Madison Avenue seeks.