Integration of management systems: A methodology for operational excellence and strategic flexibility

Organisations employ various management systems (MSs) to systematically address the needs of their stakeholders. As the number of MSs is mushrooming, the need has arisen to integrate them into one holistic business management system that addresses various stakeholder requirements in an integrated manner. However, the dynamics of the integration process are not yet fully understood and research has yet to establish how the integration of MSs gives rise to various types of organisational improvements. This paper focuses on how the integration process unfolds in practice to give rise to a number of socio-technical changes essential to the integration of MSs. This research is based on four cases; it reveals that integration streamlines operational processes through a number of structural, functional, and operational changes. Integration reforms bureaucratic structures, further giving rise to operational excellence and strategic flexibility. The research also provides the extension of lean production practices bundles, and an operationalisation of Adler’s concept of enabling bureaucracy.     

Individual stock-option prices and credit spreads

This paper introduces measures of volatility and jump risk that are based on individual stock options to explain credit spreads on corporate bonds. Implied volatilities of individual options are shown to contain useful information for credit spreads and improve on historical volatilities when explaining the cross-sectional and time-series variation in a panel of corporate bond spreads. Both the level of individual implied volatilities and (to a lesser extent) the implied-volatility skew matter for credit spreads. Detailed principal component analysis shows that a large part of the time-series variation in credit spreads can be explained in this way.     

On the Information in the Interest Rate Term Structure and Option Prices

We examine whether the information in cap and swaption prices is consistent with realized movements of the interest rate term structure. To extract an option-implied interest rate covariance matrix from cap and swaption prices, we use Libor market models as a modelling framework. We propose a flexible parameterization of the interest rate covariance matrix, which cannot be generated by standard low-factor term structure models. The empirical analysis, based on US data from 1995 to 1999, shows that option prices imply an interest rate covariance matrix that is significantly different from the covariance matrix estimated from interest rate data. If one uses the latter covariance matrix to price caps and swaptions, one significantly underprices these options. We discuss and analyze several explanations for our findings.     

Food choices in Ethiopia: does nutritional information matter?

This article reports results from a framed market experiment conducted to examine whether milk choices are responsive to changes in the nutritional characteristics of milk products. Using a random‐effect Tobit model, we analyzed experimental data collected from 160 participants in urban Ethiopia. It shows that sensory properties play a key role in the acceptance of reduced‐fat milk while the provision of nutrition information has a mixed effect on a price premium. Further, a substantial percentage of participants were found to have a strong preference for whole milk while only 19% of them prefer reduced‐fat milk with 2.8% price premium. The study unveils a heterogeneous preference for the nutritional quality of milk products. Consumers’ health problems and socio‐demographic characteristics influence their preference for the nutritional quality of milk products. The result also shows a nutrition‐taste tradeoff, yet consumers place more value on sensory experience. Contrary to earlier studies, we found that prior belief about milk quality influences how consumers value sensory experience and nutrition information.     

Effects of the redevelopment of an elementary school playground

The effects of the redevelopment of an elementary school playground were evaluated by comparing the situation before and after physical transformation. Observations produced data on the actual use during play time. Interviews were held with all the pupils on their perception and evaluation of the change. A group of adult experts judged the environment before and after the change on aspects like complexity, ‘manipulability’ and ‘affordance’ for different activities. An interview with the designer of the plan gave information about his intentions and expectations, especially regarding behavioural aspects. Data from these different sources are presented and related to each other.     

Stakeholders perception of attitudes towards major landscape changes held by the public: The case of greenhouse clusters in Flanders

The intensification of greenhouse horticulture is a notable trend in many regions around the world. This intensification causes the grouping of large-scale greenhouses on a single site, into so-called ‘greenhouse clusters’. The main incentive for clustering is the reduction of production costs by sharing infrastructure such as energy, water and gas facilities. Despite these advantages, the public remains sceptic towards greenhouse clusters and resistance in Flanders is frequent and often fierce. The objective of this research is to obtain insight into the reasons, underlying motives and processes that steer this resistance as they are perceived by the agricultural sector. A grounded theory approach resulted in a comprehensive scheme that visualizes the public resistance towards greenhouse clusters as perceived by stakeholders in the agricultural sector, and as such the scheme includes factors that are probably also seen as key factors for the resistance among the stakeholders. Our research shows that the protest actions are complex and cannot be attributed to a single concept such as the NIMBY-concept that is still often put forward by politicians, planners and investors.     

New Futures Markets in Agricultural Production Rights: Possibilities and Constraints for the British and Dutch Milk Quota Markets

Farms are increasingly being affected by policies that involve production rights. Because of fluctuations in the prices of these rights in the spot market, farmers face a price risk. Establishing a futures market might enable them to hedge against this price risk. Rights futures have some features that differ from those of traditional commodity futures. This makes them an effective and efficient tool for managing price risk. The implications of these findings will be illustrated for milk quotas in the United Kingdom and The Netherlands. Prior conditions which might make a futures market for milk quotas successful in both countries will be deduced.