Reaffirming the CEO effect is significant and much larger than chance: A comment on Fitza (2014)

A recent study by Fitza argued that the prior estimates of the Chief Executive Officer (CEO) effect are conflated with events outside the CEO's control, are largely the result of random chance, and that the true CEO effect is smaller than has been previously estimated. We suggest that the empirical methodology employed by Fitza to support these claims substantially overstates the “random chance” element of the CEO effect. We replicate Fitza's findings, highlight methodological issues, offer alternative conclusions, and using multilevel modeling (MLM), suggest that his analyses mischaracterize the CEO effect. Copyright © 2016 John Wiley & Sons, Ltd.     

A method for reducing information asymmetry in destination–airline relationships

We propose a measure of business risk in air travel demand at the route level that can reduce information asymmetry during route development negotiations between tourism destinations and airlines. Aviation-exposed risk (AER) conveys information about the level of uncertainty with regard to air travel demand from an airline’s perspective. Using AER, tourism destinations and air service development teams can evaluate their risks from the perspective of the airline and its network. From there, an assessment can be made as to the value of air services in certain circumstances, including whether a direct underwrite or risk share between airlines and destinations is viable and necessary. By applying a portfolio analysis to an airline’s network, we find evidence that AER does indeed mimic the actual capacity distribution of the network. This provides support for AER as a useful risk measure to be used in practice.     

On commodification: volunteer experiences in festivals†

This paper is about the creation of non-commodified volunteer experiences, for tourists and local volunteers participating in festivals. How is the tourist experience created when most of the traditional tourism demands are not fulfilled? And what are the experiences and how do they relate to different ‘regimes of value’? The experience context includes tourists who work together with locals voluntarily in a festival, where the volunteers pay for their own travel, food, overnight stay, and work for free. To gain more knowledge on the volunteers is important because local cultural life becomes more festivalized, most festivals are reliant on the involvement of volunteers, and the festivals gain an important role in an economy where even small places are engaged in branding [Löfgren, O. 2003. The new economy: A cultural history. Global Networks, 3, 239–254]. This paper uses a qualitative approach. Interviews were conducted (n?=?23) and participants were observed during four festivals in Finnmark, Norway. Nothing in the experiences was facilitated, and the experience creation occurred in the work tasks together with volunteer colleagues. It was like a holiday experience, without a stream of commodified moments. It was a value creation that could be seen as authentic and real, created in the interaction between the local and visiting volunteers.     

The impact of technical consultants on the quality of their clients' products: Evidence from the Bordeaux wine industry

Research summary : Recent research rooted in the resource‐based view of the firm suggests that resources are more likely to create value if they are effectively managed. An underlying assumption of the literature is that firms manage their resources on their own. However, many firms hire consultants to help them do so. In this study, I develop and test hypotheses regarding the impact of technical consultants on the quality of their clients' products. Using data from the Bordeaux wine industry, I find evidence that the use of technical consultants has a positive impact on relative product quality and a negative impact on the extremeness of relative product quality. Moreover, the positive impact of technical consultants on relative product quality is stronger at lower levels of relative resource quality. Managerial summary : Findings from a study in the Bordeaux wine industry indicate that the decision to hire consultants should depend on a firm's strategy. If a firm wants to improve its performance, it should hire consultants. Indeed, the “best practices” of technical consultants are generally more valuable than internally generated knowledge. If a firm wants to achieve outstanding performance, hiring consultants may not be the right decision. Because the “best practices” of technical consultants have more certain performance implications than internally generated knowledge, they decrease the likelihood of extremely low performance. However, their lack of uniqueness also decreases the likelihood of extremely high performance. Finally, the decision to hire consultants should depend on the quality of a firm's resources. Firms with low‐quality resources tend to benefit more from the “best practices” of technical consultants. Copyright © 2016 John Wiley & Sons, Ltd.     

Reconfiguration,restructuring and firm performance: Dynamic capabilities and environmental dynamism

Research summary: Reorganization has been proposed as a key dynamic capability. This study compares the performance outcomes of two forms of reorganization, differing in their pervasiveness: organizational restructuring and organizational reconfiguration. Our dynamic panel data analysis of large U.S. corporations between 1985 and 2004 finds contrasting performance outcomes for these two forms of reorganization: in general, the more pervasive restructuring is associated with positive performance outcomes, while the more limited reconfiguration is associated with negative performance outcomes. However, outcomes vary by environment. Consistent with dynamic capabilities theory, we find evidence that in dynamic environments reconfiguration outcomes turn positive, while restructuring outcomes turn negative. We discuss implications for dynamic capabilities theory and managerial policy. Managerial summary: Firms need to reorganize in order to adapt to change. This study compares the financial performance consequences of two forms of reorganization: organizational restructurings and organizational reconfigurations. Restructurings involve fundamental change in organizational principles and are typically irregular; reconfigurations involve incremental change and are frequent. Examining a set of large U.S. corporations, we find these two forms of reorganization have contrasting financial consequences, depending on context. In the general case, fundamental restructurings have positive consequences, while incremental reconfigurations have negative consequences. However, this general result reverses in specifically dynamic environments, where reconfigurations are positive financially, while restructurings are negative. We conclude that the relative frequency of reconfigurations helps adaptation in dynamic environments. Managers should choose forms of reorganization according to the rate of environmental change. Copyright © 2016 John Wiley & Sons, Ltd.     

Do Liquidated Damages Clauses Affect Strategic Mortgage Default Morality? A Test of the Disjunctive Thesis

We test the disjunctive thesis as it relates to mortgage contracts and find that a liquidated damages clause shifts ones view of a mortgage from a promise to perform to either a promise to perform or pay compensatory damages. However, when a strategic mortgage default is responsible for the breach, the perceived immorality of this action overwhelms the liquidated damages clause effect in support of the disjunctive thesis. We also find that people's conscious “experimentally stated preference” moral stance on installment loan (mortgages, auto loans, credit card debt and even cell phone contracts) default significantly differs from their subconscious “experimentally revealed preference” moral stance indicating a difference between what people say they believe and what they actually believe.     

Residents’ attitudes toward future tourism development in terms of community well-being and attachment

This study explores residents’ attitudes toward future tourism development based on their community well-being (CWB) and community attachment. Focusing on the case of Gamcheon Culture Village in Busan, South Korea, which was developed during an urban regeneration project in 2009, an exploratory factor analysis was conducted. The main findings of this study are: (1) CWB is supported by five variables including income effects, social participation, safety service, infrastructure service, and environmental effect; (2) not only does CWB influence community attachment but attachment also effects residents’ attitudes; and (3) the most effective variable of CWB is income effect, and safety service for community attachment. These results can help to provide effective strategies to encourage residents to have positive attitudes about further tourism development in a community-based tourism destination.     

Employee satisfaction and turnover intention: A comparative analysis between front-of-house and back-of-house employees in casino-entertainment venues

ABSTRACT

This study investigates job location and its relationship with employee turnover intention within the casino-entertainment industry. The researchers analyzed turnover intention at the supervisor and company level from the perspective of employees who hold front-of-house or back-of-house jobs in three Nevada casinos and their corporate office. The results of this research fill existing gaps in the academic literature related to turnover intention and provide beneficial implications for industry and academic practitioners. Organizations within the casino-entertainment industry may develop strategies related to the management of human capital that could provide fiscal and operational benefits.     

B2B relationship calculus: quantifying resource effects in service-dominant logic

Increasingly, knowledgeable business-to-business (B2B) customers and evolving customer needs are leading to seismic shifts in vendor–client interactions. Across industries, sellers are changing their business models from a simple goods orientation to a hybrid goods–services model, placing greater emphasis on delivering complete customer solutions. In such an environment, companies must find ways to prioritize investments in resource development. The service-dominant (S-D) logic framework offers significant insights into this challenge; however, these effects have not been tested quantitatively. This study addresses that gap, examining the influence of various seller resources on buyer satisfaction. An empirical analysis of buying organizations that purchased and implemented business intelligence systems finds that “augmented” operant resources that the buyers ascribe to the software’s sellers—resources that go above and beyond expectations—are the most significant predictors of both successful technology assimilation and overall customer relationship quality. In particular, an augmented operant resource reflecting a seller’s ability to see value creation opportunities from the buyer’s perspective (value mindset) has up to three times the effect on relationship satisfaction as “core” operant resources such as product-specific expertise or basic interpersonal service skills. These results can help sellers prioritize resource investments.