CAREER CONCERNS: INCENTIVES AND ENDOGENOUS LEARNING IN LABOUR MARKETS

Abstract. Models of career concerns provide a framework for analysing the actions that may be taken by a manager in an attempt to influence performance signals that the market uses to update its beliefs on her productivity, and the incentive problem that arises if such actions do not coincide with those that maximise the financial return to a firm's owner. This survey provides a formal introduction to the main types of models of career concerns (hidden action and hidden information), and discusses some extensions of these models. Applications of the career concerns framework to explain aspects of managerial behaviour and the form of labour market institutions are emphasised.     

INFORMATION EXTERNALITIES, SHARE-PRICE BASED INCENTIVES AND MANAGERIAL BEHAVIOUR

Abstract. We survey recent theoretical research on the effects of short-term share-price based managerial incentive schemes. Such schemes can induce inefficient managerial behaviour in both hidden action and hidden type contexts. These problems arise from informational asymmetries: managers take actions to manipulate the information flow rather than to maximize firm value. More generally, imperfect transmission of information between managers and shareholders or between managers of different firms can lead to similar distortions even when the parties' interests are aligned.     

Promoting research access and informant rapport in corporate settings: Notes from research on a crisis company

Obtaining evidence on managerial action is inevitably difficult. Although it has been suggested that critical events such as corporate crises provide opportunities for research, there has been a lack of discussion on what aspects of management such conditions help to illuminate and how they could be exploited in obtaining both formal access and rapport with individual informants. Based on fieldwork experience this paper suggests that corporations in crisis should be taken seriously in research on managerial action because they may both facilitate access and liberate and motivate individual managers to reflect on both their own acts and intentions and on those of other individuals.     

Do Managers Matter? Manager Effects on Organization Performance

In this study, we examine how pre‐managerial experience and performance relates to managerial success. Some prior research has documented that managers contribute to organization performance, but the link between specific manager characteristics and performance has been dubious because data about managers' prior work history are typically quite limited. We overcome this limitation by examining our research question in the context of Major League Baseball, where data on pre‐managerial work history are available for a large subset of managers. This allows us to focus on two questions that have not been adequately addressed in prior studies. First, does success prior to becoming a manager translate into success as a manager? Second, what is the relative importance of measurable versus unobservable manager characteristics on performance? Copyright © 2015 John Wiley & Sons, Ltd.     

A heuristic programming approach to the employee scheduling problem and some thoughts on “managerial robots”

We describe a system for the automatic scheduling of employees in the particular setting in which: the number of employees wanted on duty throughout the week fluctuates; the availabilities of the employees varies and changes from week to week; and a new schedule must be produced each week, by virtue of the changing demand for service.The problem which we address appears in a variety of settings, including: airline reservation offices; telephone offices; supermarkets; fast food restaurants; banks and hotels.Previous approaches to the problem have relied chiefly on formal methods, generally involving one or another variation of linear or integer, mathematical programming. We suggest that except in cases involving very small problems (only a handful of employees) that those approaches have not proven promising, especially where union rules and management requirements impose complex constraints on the problem, and that a heuristic approach has proven to be substantially superior.We set forth the general features of our heuristic approach, which we see as an application of artificial intelligence; we show how, in contrast to other approaches, which design shifts as if employees were always available and try to fit those shifts to employees who are not always available, our system design shifts with deference to the employees' limited availabilities; we suggest that, for a given service level, our system produces schedules with a better “fit”—number of employees actually on duty comparing more favorably with the number wanted; and we state that while, for a given service level, a ‘manual scheduler’ may take up to 8 hours each week to prepare a good schedule, our system, on most micro computers, routinely produces better schedules involving up to 100 employees in about 20 minutes.The scheduling of employees is generally considered to be a managerial function, in the setting of the problem we address. When a craft employee is replaced on an assembly line by a machine which performs the same function, we speak of the replacing mechanism as an industrial robot.We suggest that systems like that which we describe deserve a name, to distinguish them from comparable, computer based systems which do not replace, but rather supplement a manager, and we suggest the name ‘managerial robot’ for such systems.We set forth the characteristics which we feel would justify applying the term ‘managerial robot’ to a computer based system, and suggest that classification is basic to understanding and communication and that just as terms such as decision support systems and expert systems prove useful in our increasingly advanced, technological society, so also the term managerial robot has a place in our scheme of things.Decision support systems do not qualify as managerial robots for the reason that managerial robots don't simply support the decision making process, but rather replace the manager in his performance of a function which, when performed by a human being, is considered a managerial function.Nor do we consider managerial robots to qualify as expert systems. While our scheduling system contains an inference mechanism, and could be enhanced to improve the quality of its schedules thru ‘experience’ (and thus to ‘learn’?), that—lacking a knowledge base in the sense of expert systems-and most of all in replacing rather than supporting the decision maker, the managerial robot needs a term of its own.We elaborate, in this paper, a specific application of our system, and show how the design of shifts, and the placement of breaks, serve to yield a fit whose quality no human scheduler can duplicate.     

Responsibility accounting,managerial action and ‘a counter-ability’: Relating the physical and virtual spaces of decision-making

This study examines how the economic structures of responsibility accounting (RA) affect decision-making and managerial action. It analyses how decision rights transform and affect managerial action and argue that functionalist approaches to organising a company through RA principles are inexpedient. The argument is based on two spaces related to decision-making and managerial action – physical space and virtual space – and addresses the managerial effects of RA with respect to these spaces. The RA literature argues that the design of RA should be based on its context and its structure should be stable. However, the study presented here shows how the effects of RA emerge in a process of development and transformation of the organisation. When an organisation and its management control system cannot embrace the dynamism of the physical space, the resulting managerial actions and decision-making are tumultuous; accountability in this context means possessing ‘a counter-ability’, not being ‘accountable’. Accounting forms a virtual organisational space, and the relationships between physical and virtual spaces co-construct the organisational effects of RA.     

ENGINEERS,MANAGEMENT AND WORK ORGANIZATION: A COMPARATIVE ANALYSIS OF ENGINEERS' WORK ROLES IN BRITISH AND JAPANESE ELECTRONICS FIRMS*

Many commentators have attributed the poor performance of British manufacturing to the ‘under-representation’ of engineers in management, and have proposed policies for bringing more engineers into management so as to develop a technologically oriented management culture. This paper argues that the under-representation of engineers in management is a symptom not the root cause of the problem, which lies in the split between technical and managerial expertise at the enterprise level. Based on a comparative analysis of engineers’ work roles and the relationship between technical and managerial functions in British and Japanese electronics firms, the paper argues that the mechanistically structured organization systems in the British firms generate a vertical polarization between technical and managerial roles, inhibit knowledge sharing and lead to the gross under-utilization of engineers in product development. A technologically oriented management cannot simply be achieved by getting more engineers into management. It requires, instead, organizational restructuring and changes in work practices to enable a better integration between technical and managerial expertise.     

In Defense of Bureaucracy

Abstract

Managerial capacity, meant as available potential for managerial resources to be deployed when needed, can be considered ‘slack’ in a public organization during normal times, but recent developments in the research literature of public administration suggest that such capacity can sometimes contribute to public program performance. Does managerial capacity help to dampen or eliminate the effects of sizeable and negative budget shocks on the outcomes of public organizations? This question is investigated in a set of 1,000 organizations over an eight-year period. For the most part, and largely due to managerial adjustments, budgetary shocks of 10 percent or more have only limited or no negative impacts on performance in the short term. They do, however, cause a drop in performance for certain outcome measures, both immediately and in the following year. Sufficient managerial capacity, however, mitigates these negative performance effects. The findings point toward a key question with which public managers must wrestle: how to balance the costs of slack against the benefits that capacity-as-slack can generate when environmental shocks threaten to disrupt the operation of public programs.     

高管持股、会计稳健性与并购绩效——来自沪深A股上市公司的经验证据

选取2007—2010年发生并购交易事件的上市公司为样本,检验了并购方高管持股与并购绩效之间的关系,发现高管持股与短期并购绩效之间没有显著关系,而与长期并购绩效之间呈非线性关系。进一步验证会计稳健性确实能够缓解高管与股东之间的代理冲突。与会计稳健性程度高的并购方相比,会计稳健性程度低的并购方高管持股对并购绩效的影响更大。这些发现意味着,高管持股不会在并购后短期内对绩效有显著影响,而是需要一段时间之后才能得以显现,且其影响程度因公司间会计稳健性不同而存有一定的差异。     

Executive compensation,method of payment and abnormal returns to bidding firms at takeover announcements

This study investigates the association between method of payment, long-term performance plans, managerial stockholdings and abnormal returns to bidding firms at takeover announcements, using a cross-sectional regression methodology. Previous studies have examined each of these factors separately. The results indicate that firms with long-term performance plans and high managerial stockholdings in cash offers experience significantly higher abnormal returns at the announcement of mergers prior to 1980. The study provides additional evidence in explaining the previous conflicting results (Jensen and Ruback, 1985), examining the stock market reaction of bidding firms at merger announcements.     

Hired to be Fired: The Publicity Value of Managers

Sports teams frequently fire and hire managers when they experience losing. However, determining managerial responsibility for player performance is difficult to measure. This study examines how major‐league baseball players perform under different managers and estimates that managers have little effect on performance. The study further investigates whether or not replacing managers serves as a signal to fans that the team is improving, which boosts attendance. The results indicate that new managers were associated with increased attendance in the 2000s; however, such effects were not present in the 1980s and 1990s. Copyright © 2016 John Wiley & Sons, Ltd.     

Informal conflict intervention: Advice and dissent

A disparity appears to exist between how managers are advised to handle conflict and the intervention methods that they utilize in actual practice. Normative advice tends to agree that managers should adopt a facilitative, mediatorlike role (e.g., Walton, 1987; Tjosvold, 1990), while the empirical research suggests that managers are much more controlling, often deciding how to resolve the problem on their own (e.g., Kolb, 1986; Sheppard, 1983). The present study focuses on two potential reasons as to why managers utilize the methods they do: (1) They treat choices instrumentally to achieve key goals and (2) they interpret or frame conflicts in a form that suggests directive action. One hundred and eighty managers were interviewed about a recent effort to intervene in a dispute at work. The results confirm that managers are very controlling when intervening in disputes and relates this to both interpretive frame and, to a lesser extent, managerial goals. A canonical analysis appears to emphasize the pivotal role that frame plays in influencing whether or not managers choose the solution. Implications of these results for managerial action are discussed.     

Corporate Environmental Paradigms in Shift: Learning During the Course of Action at UPM–Kymmene

Contrary to the popular conception in the corporate environmental management literature that corporations must learn new ecocentric paradigms before they can be expected to produce environmentally sound performance, the present results suggest that cognitive–level environmental learning in organizations does not inevitably precede behaviour change. Rather, at least partially, such learning is likely to occur in the course of action. The article also proposes that external pressure can set motion, but it alone does not lead to an environmental paradigm shift. In order to undergo such a shift, organizations will have to learn a meaning of their own to support new, more environmentally sound forms of activity.
The present study examines empirically how two companies have learnt to incorporate environmental considerations into their managerial paradigms. It adopts a perspective according to which learning is portrayed as a process in which changes are brought about in the collective beliefs that the organization members hold about the relationship of their business to the natural environment (i.e. environmental management paradigm). Applying the grounded theory approach, the article identifies phases of environmental learning starting from the recognition or rejection of weak signals in 'pockets' of the organization, continuing through the gaining of new knowledge and experience towards 'competition' between old and new assumptions about the business–environment relationship, and finally proceeding to potential frame–break.     

Does Managerial Ability Really Drive Cost Efficiency? Evidence from Broiler Businesses

This paper ascertains whether managerial ability really drives cost efficiency of broiler businesses. Data was collected from 354 broiler businesses in Ghana and analysed using a modified stochastic Cobb–Douglas cost frontier and inefficiency effect models in a single‐stage maximum likelihood estimation procedure. Results indicate that managerial abilities such as technical advice, age and experience acquired through full‐time farming and increased batches significantly drive cost efficiency. This highlights the need to provide more technical advice and implement periodic capacity building programmes to develop the managerial ability and competences of broiler producers. The youth should also be encouraged and supported through skills development fund to go into full‐time broiler business to produce more batches. Copyright © 2016 John Wiley & Sons, Ltd.     

Characterizing Managerial Skill and Technical Efficiency in a Fishery

Researchers have long recognized that entrepreneurial or managerial skill is a major determinant of productivity or reason why production among firms varies. Yet, except for a few studies, differences in productivity and output levels are usually attributed to plant configuration or scale. More important, there appears to have been few attempts to relate technical efficiency to managerial skill. Utilizing a stochastic production frontier, we examine the relationship between technical efficiency and characteristics of skill such as experience and education in a fishery. Although we can not determine threshold or essential levels of experience and education, substitution possibilities are found to exist between years of experience and education levels. Additional analysis of efficiency for two captains of the same background and experience reveals that additional characteristics need to be considered in the examination of skipper skill or the good-captain hypothesis.     

销售人员学习的前因及其与销售绩效的关系研究

随着环境日益复杂多变,销售人员的学习对于个人的销售绩效的提升乃至组织的成功都起着至关重要的作用。销售人员学习包括学习努力与系统知识两个不同的维度。其前因变量包括个人层面的主动性、经验开放性和学习导向;任务层面的工作自主度和任务难度;组织层面的学习氛围和管理支持。销售人员学习对销售绩效的影响则是通过减少角色模糊、提升自我效能感和工作满意度来实现的。     

Net-zero emission targets and the role of managerial environmental awareness,customer pressure,and regulatory control toward environmental performance

To avoid the worst effects of global warming, countries agreed to limit warming below 2.0°C and ideally to 1.5°C preindustrial level. This requires countries to drop half of their greenhouse gas emission by 2030 and reach net-zero emission by 2050. In this regard, current study explores the role of green production as a mediator in the impact of managerial environmental awareness, customer pressure, and regulatory control on environmental performance. The data collected from 381 managers was analyzed using structural equation modeling (SEM) technique. Results indicate that customer pressure, regulatory control, and managerial environmental awareness play a pivotal role toward green production, whereas only managerial environmental awareness among them directly influences environmental performance. Green production fully mediates the relationship from customer pressure and regulatory control to environmental performance. However, it partially mediates the relation between managerial environmental awareness and environmental performance. Similarly, the importance of green production for environmental performance is highlighted.     

Using learning networks to help improve manufacturing competitiveness

Innovation which requires the acquisition of new or improved technologies involves a technical and managerial learning process and it raises the policy question of how best to encourage and enable relevant learning. The absence or lack of experience in this domain is a particular problem for smaller firms (SMEs) and for enterprises in economies in transition—such as in the countries of the former Soviet Union or in eastern Europe. Successful technology transfer requires considerable management expertise as well as the availability of suitable solutions. This paper reports on one experimental approach used on a pilot basis in Romania to facilitate the absorption of `new' manufacturing practices, which involves the development of `learning networks' as an aid to this process.