Strategic stakeholder orientations and performance consequences—a case of private nonprofit performing arts in the US

• This paper borrows a market orientation perspective in considering how organizations behave toward stakeholders and the implications on performance in the institutional performing arts environment. To investigate the relationship between stakeholder orientations and organizational performance, both interviews and a survey instrument were used. Using nonprofit performing arts organizations in three metropolitan areas of Northwestern US as a sample frame, primary data was collected from leading directors of these organizations. The results generally indicate a positive relationship between stakeholder orientation and organizational performance. Complex relationships between dimensions of stakeholder orientation and performance consequences were also observed.

Copyright © 2009 John Wiley & Sons, Ltd.     

A multidimensional perspective of SME internationalization speed: The influence of entrepreneurial characteristics

This paper contributes to a multidimensional perspective on the speed of SME internationalization. It examines the influence of entrepreneurial characteristics – experience, rationales and innovation strategies – on multiple dimensions of internationalization speed. Findings from a sample of 180 SMEs show that earliness, speed of deepening, and speed of geographic diversification can be viewed as three different strategic alternatives and that each dimension is predicted by a different set of entrepreneurial antecedents. Earliness of internationalization is associated with entrepreneurs’ international business experience and their perception of opportunities abroad as well as preference for an innovation strategy characterized by ambidextrous innovation. Speed of deepening is related to entrepreneurs’ international business experience, their orientation towards differentiation vis-à-vis competitors, and commitment to innovation and a strategy focusing on exploration. These results indicate the importance of distinguishing between different forms of innovation. Speed of geographic diversification is predicted only by entrepreneurs’ orientation towards differentiation vis-à-vis competitors.     

Classification of Service Businesses from a Utility Creation Perspective

The concept of time and space utility creation involving the relationship between service businesses and their recipients has not been adequately explored by scholars. This study provides a conceptual framework for classifying service businesses on the basis of utility creation, and proposes that the value of a service business rests on its ability to create utility. The insights of the framework are also discussed.     

Analyst Report Readability and Stock Returns

This study investigates the market's response to analyst report readability. We posit that readable reports decrease uncertainty of earnings expectations and by extension increase stock prices. Our results show that the equity market reacts more positively to readable reports and that this positive reaction is attributable to a reduction in uncertainty of future performance. Moreover, we find that the effect of readability on stock prices is significantly positive only for firms with greater R&D spending, higher bid‐ask spreads, a greater proportion of uninformed investors, and more experienced analysts, which suggests that readability matters only when information asymmetry in the equity market is high.     

Assessing and ranking the innovation ability and business performance of global companies in the aerospace and defense industry

This study examined the innovation ability and business performance of global companies in the aerospace and defense (A&D) industry by using dynamic data envelopment analysis and ranking methods with the DuPont model. Results indicated that compared with business performance, A&D companies exhibit lower scores and higher standard deviations in the innovation ability, which signified that they should first work on reducing the gap in the level of innovation ability. DuPont analysis indicated that typical A&D companies exhibit the highest ROE. Finally, this study offers managers and policymakers detailed insights into potential areas of improvements in innovations, business performance, and profitability.     

The risk in hedge fund strategies: Theory and evidence from long/short equity hedge funds

Theory suggests that long/short equity hedge funds' returns come from directional as well as spread bets on the stock market. Empirical analysis finds persistent net exposures to the spread between small vs large cap stocks in addition to the overall market. Together, these factors account for more than 80% of return variation. Additional factors are price momentum and market activity. Combining two major branches of hedge fund research, our model is the first that explicitly incorporates the effect of funding (stock loan) on alpha. Using a comprehensive dataset compiled from three major database sources, we find that among the three thousand plus hedge funds with similar style classification, less than 20% of long/short equity hedge funds delivered significant, persistent, stable positive non-factor related returns. Consistent with the predictions of the Berk and Green (2004) model we find alpha producing funds decays to “beta-only” over time. However, we do not find evidence of a negative effect of fund size on managers' ability to deliver alpha. Finally, we show that non-factor related returns, or alpha, are positively correlated to market activity and negatively correlated to aggregate short interest. In contrast, equity mutual funds and long-bias equity hedge funds have no significant, persistent, non-factor related return. Expressed differently, L/S equity hedge funds, as the name suggests, do benefit from shorting. Besides differences in risk taking behavior, this is a key feature distinguishing L/S funds from long-bias funds.     

The impact of OBRA on shareholder wealth

Market-return data and a multivariate regression model are used to investigate the impact of the Omnibus Budget Reconciliation Act of 1987 (OBRA) on the wealth of shareholders of firms sponsoring overfunded and underfunded pension plans during the period surrounding the passage of OBRA. Assuming semistrong market efficiency, a reduction in the pension insurance effect associated with the passage of OBRA was hypothesized to have a negative impact on the security prices of all plan sponsors. In general, the market reacted unfavorably to sponsors of both overfunded and underfunded defined-benefit pension plans when OBRA was introduced. However, the market reaction varied as a function of the funding-level change during the period preceding passage of the Act. Firm-specific financial variables were also used in a stepwise regression analysis to investigate whether selected financial variables could explain negative abnormal returns observed during the legislative period. We found that earnings per share and the short-term debt-coverage ratio explained up to 19.4% of the negative abnormal returns for the underfunded sample. However, no significant explanatory variables were identified for the overfunded sample.     

The Fisher Equation: A Nonlinear Panel Data Approach

This article reinvestigates the Fisher equation. Using the panel smooth transition regression (PSTR) model, it was found that there is a significant regime-switching effect concerning the impact of inflation on interest rates. Specifically, inflation is found to raise the interest rates and the effect becomes stronger in magnitude with inflation. However, the data do not provide evidence in support of the one-for-one Fisher effect. The evidence is robust to interest rates with different maturities and subsamples.     

Supervisors as good coaches: influences of coaching on employees’ in-role behaviors and proactive career behaviors

Coaching as an effective leadership initiative in organizations has gained increasing attention from scholars. This study investigates the effects of coaching on employees’ in-role behaviors (IRBs) and proactive career behaviors (PCBs), while also exploring the mediating role of psychological empowerment. Data were collected from a sample of 324 employee–supervisor pairs from 11 service companies in Taiwan. The results show that coaching was positively related to both IRBs and PCBs. Moreover, psychological empowerment fully mediated the coaching–IRB relationship and partially mediated the coaching–PCB relationship. Implications for managerial practices and future research are derived from these findings.