Promise-based management: the essence of execution

Critical initiatives stall for a variety of reasons--employee disengagement, a lack of coordination between functions, complex organizational structures that obscure accountability, and so on. To overcome such obstacles, managers must fundamentally rethink how work gets done. Most of the challenges stem from broken or poorly crafted commitments. That's because every company is, at its heart, a dynamic network of promises made between employees and colleagues, customers, outsourcing partners, or other stakeholders. Executives can overcome many problems in the short-term and foster productive, reliable workforces for the long-term by practicing what the authors call "promise-based management," which involves cultivating and coordinating commitments in a systematic way. Good promises share five qualities: They are public, active, voluntary, explicit, and mission based. To develop and execute an effective promise, the "provider" and the "customer" in the deal should go through three phases of conversation. The first, achieving a meeting of minds, entails exploring the fundamental questions of coordinated effort: What do you mean? Do you understand what I mean? What should I do? What will you do? Who else should we talk to? In the next phase, making it happen, the provider executes on the promise. In the final phase, closing the loop, the customer publicly declares that the provider has either delivered the goods or failed to do so. Leaders must weave and manage their webs of promises with great care-encouraging iterative conversation and making sure commitments are fulfilled reliably. If they do, they can enhance coordination and cooperation among colleagues, build the organizational agility required to seize new business opportunities, and tap employees' entrepreneurial energies.     

Project selection and execution in teams

We use a mechanism‐design approach to study a team whose members select a joint project and exert individual efforts to execute it. Members have private information about the qualities of alternative projects. Information sharing is obstructed by a trade‐off between adaptation and motivation. We determine the conditions under which first‐best project and effort choices are implementable and show that these conditions can become relaxed as the team grows in size. We also characterize the second‐best mechanism and find that it may include a “motivational bias,” that is, a bias in favor of the team's initially preferred project, and higher‐than‐optimal effort by uninformed team members.     

Strategic execution in the presence of an uninformed arbitrageur

We consider a trader who aims to liquidate a large position in the presence of an arbitrageur who hopes to profit from the trader's activity. The arbitrageur is uncertain about the trader's position and learns from observed price fluctuations. This is a dynamic game with asymmetric information. We present an algorithm for computing perfect Bayesian equilibrium behavior and conduct numerical experiments. Our results demonstrate that the trader's strategy differs significantly from one that would be optimal in the absence of the arbitrageur. In particular, the trader must balance the conflicting desires of minimizing price impact and minimizing information that is signaled through trading. Accounting for information signaling and the presence of strategic adversaries can greatly reduce execution costs.     

保险企业如何实施CRM

在保险行业,随着保险主体的增加,竞争更加激烈。中国保监会对产品、价格等增加了监管力度,使得行业竞争向提高服务水平方面转化。各家公司都开始     

Components of execution costs: evidence of asymmetric information at the Mexican Stock Exchange

Immediate execution costs for stocks trading at the auction market of the Mexican Stock Exchange (MSE) are five times higher than those for similar NYSE stocks. The source of the trading cost differential is asymmetric information. Mexican stocks are associated with a substantially larger asymmetric information component of the spread (2.76 cents per dollar) than their matched NYSE counterparts (0.28 cents). Results indicate that differences in asymmetric information are not related to stock characteristics, number and sophistication of security analysts, listing and disclosure requirements, ownership restrictions, and voting rights.     

NYSE execution costs: A case study of a leading bank

Using trade data obtained from a major bank and a measure of indirect execution costs based on the stock price when orders are placed, we investigate indirect costs and their relation to brokerage commissions. For all trades the mean brokerage commission is 6.5 cents per share, and the mean indirect execution cost is about 3.6 cents per share, or 0.1084% of the transactions amount. Contrary to the prediction of the price pressure hypothesis, indirect execution costs are lower for larger size trades. Further, higher indirect execution costs are not associated with lower brokerage commission.