Stages of Organizational Transformation in Transition Economies: A Dynamic Capabilities Approach

How do organizations previously dominated by the state develop dynamic capabilities that would support their growth in a competitive market economy? We develop a theoretical framework of organizational transformation that explains the processes by which organizations learn and develop dynamic capabilities in transition economies. Specifically, the framework theorizes about the importance of, and inter‐relationships between, leadership, organizational learning, dynamic capabilities, and performance over three stages of transformation. Propositions derived from this framework explain the pre‐conditions enabling organizational learning, the linkages between types of learning and functions of dynamic capabilities, and the feedback from dynamic capabilities to organizational learning that allows firms in transition economies to regain their footing and build long‐term competitive advantage. We focus on transition contexts, where these processes have been magnified and thus offer new insights into strategizing in radically altered environments.     

Psychology and the development problem in Southern Africa

Although psychology is mainly concerned with the study of the individual, it can also make a valuable contribution to the economic development of communities, as the same complex factors are involved. Several relevant viewpoints of contemporary psychologists are discussed and their implications for development research are indicated. The conclusion is reached that psychologists can make a major contribution by studying personal factors that play a role in development, by therapeutic interventions and as advisory members of research teams.     

National Economic Policy Simulations with Global Interdependencies: A Sensitivity Analysis for Germany

Policy simulations for national economies with econometric models, in general, are done using a standalone national model with exogenous export values and import prices. In a globalised world, such an exercise is critical, since the policy in question may change the export prices and the import volumes of the particular country and induce via international trade a change of the economic activities of the global economy and a feedback to the export values and import prices of the particular country. This paper presents a sensitivity analysis for Germany comparing the impacts of a shock on investment in a standalone simulation using the multisector model INFORGE with the results, which occur, if the same model is linked to the global multicountry/multisector model GINFORS endogenising Germany`s export values and import prices. The results are striking: the effect on real GDP is 50% higher in the global simulation than in the standalone case. Because of the specialisation in trade the differences on the sector level are even stronger.     

Management of technology in traditional industries: a pilot study in ten Belgian companies

Empirical Research about management of innovation has mainly been limited to the Anglo-Saxon world. In this paper the author reports on a pilot study, which is part of a larger project, in ten small and medium-sized Belgian companies, all of them active in rather mature industries. The study concerned aspects of idea generation, problem-solving, project selection, and some organizational aspects of the innovation process. An interesting hypothesis resulting from this study is that innovation is mainly an incremental process along a natural trajectory characteristic for the subindustry to which the company belongs, and that the selection process is for the majority of these companies only a minor problem.     

The Asymmetric Commodity Inventory Effect on the Optimal Hedge Ratio

Hedging strategies for commodity prices largely rely on dynamic models to compute optimal hedge ratios. This study illustrates the importance of considering the commodity inventory effect (effect by which the commodity price volatility increases more after a positive shock than after a negative shock of the same magnitude) in modeling the variance–covariance dynamics. We show by in‐sample and out‐of‐sample forecasts that a commodity price index portfolio optimized by an asymmetric BEKK–GARCH model outperforms the symmetric BEKK, static (OLS), or naïve models. Robustness checks on a set of commodities and by an alternative mean‐variance optimization framework confirm the relevance of taking into account the inventory effect in commodity hedging strategies.     

Flexibility: The next competitive battle the manufacturing futures survey

Over the past 4 years research teams from INSEAD (Fontainebleau), Boston University and Waseda University (Tokyo) have administered a yearly survey on the manufacturing strategy of the large manufacturers of the three industrialized regions of the world. In this paper the results for the 1986 survey are compared. One of the most striking results of that year's survey is the emphasis some of the more advanced manufacturers put on their efforts to overcome the trade-off between flexibility and cost efficiency. In particular for the Japanese respondents these attempts become clear. Europeans and North Americans are not yet seizing the opportunity to cut costs through rapid production and design changes, and are focusing more on traditional cost reduction programmes and the improvement of quality. This might mean that they are preparing the basis on which they can built to obtain added value from flexible automation. If this is the case then the Japanese are clearly ahead.