A pernicious panacea—a critical evaluation of business re-engineering

This article investigates the practicalities of implementing business process re-engineering (BPR) through two case studies, DefCo and ServiCo in the public sector. It demonstrates the destructive and insidious nature of BPR, and deconstructs the myth that BPR represents a discontinuity in management thinking.     

Limited attention and the optimal incompleteness of contracts

A decision-maker's limited attention is allocated between writingnew contracts and directing current contracts. More time spentwriting a new contract makes the contract more complete. A morecomplete contract performs better and generates higher returns.The optimal allocation of attention implies two types of contracts,relational and market. A relational contract, which is directedperiodically, is optimally less complete than a market contract,which is not directed. The completeness of relational contractsdecreases with the ability to direct contracts, since changingcircumstances can be dealt with later. In addition, the completenessof relational contracts increases with the ability to writenew contracts, since more complete relational contracts aredirected less frequently and leave more time for writing newcontracts. The optimal allocation of attention to relationalcontracts is socially efficient even though it does not maximizethe discounted expected returns of the firm.     

Workplace Transformation and Worker Upskilling: The Perspective of Individual Workers

How common is workplace transformation in the American economy? What are its implications for work force skill requirements and training investments? The existing literature addressing these questions is based on firm-reported survey data. Using new data available in the 1993 wave of the National Longitudinal Survey of Youth (NLSY), this article examines the same questions from the perspective of individual workers. Our empirical results suggest that workplace transformation is commonplace. Fully 40 percent of private-sector workers surveyed report that in the space of just one year, a change occurred at work that required them to learn new job skills. About 23 percent of all respondents reported experiencing a workplace change we term anorganizational transformation. Incidence of formal training is positively related to indicators of organizational transformation, but the effect of these indicators is found to be sensitive to the inclusion of other important workplace change variables (namely, new products, new equipment, and new government regulations). While we expected to find strong positive relationships with product development and physical capital investment, government regulation has a surprisingly large impact on formal training.     

Being and Time: On the Nature and the Evolution of Institutions

The process that drove the early evolution of hominid culture was an arms race that led to selection for 'big brains,' higher consciousness, and language. Culture was a constraining force on this arms race. 'Big brains,' higher consciousness and language paved the way for the evolution of theory of mind and lower rates of time preference, two keys to the development of complex culture. Culture is a shared mental construct, a form of shared social intentionality with a deeply abstract and symbolic nature. Our symbolic ability enabled the development of this public good, which included such mental constructs as promises, obligations, contracts, marriages, property, money, agency, and government. Cultural institutions change the way we think because they both reduce the cost of cognition and become a substitute for cognition by forming a framework for social habits and routines and that allows for specialization in cognition over space and time; in a fundamental and often unrecognized way, they reduce transactions costs. Perception—including social perception—is an ill-posed problem. Culture provides background assumptions and constraints which allow us to solve this problem and thereby reduce transactions costs.     

The Efficiencies Defense in the 2010 Horizontal Merger Guidelines

We analyze the efficiencies defense that is contained in the 2010 Merger Guidelines, which provides the most current statement of the Agencies?? enforcement philosophy and procedure. Most of our attention centers on efficiencies in production, but we also address merger-specific efficiencies that may lead to improved product quality, enhanced services, or even to the introduction of entirely new products. We begin with the analytically clean case of merger-specific efficiencies that are accompanied by monopoly power. From the perspective of either consumer welfare or social welfare, this presents the welfare analysis that should guide merger policy. We, then, examine the errors that may arise due to the restricted role that efficiencies play in Section 7 enforcement. Finally, we close with some policy recommendations.     

Building a structure to support optimal revenue integrity

Intermountain Healthcare has effectively executed a strategy to improve revenue integrity comprising five parts: Building a multidisciplinary team to support revenue integrity. Developing department-specific charge capture teams. Providing ongoing education and training on best practices for charge capture and coding. Leveraging new technology and business support services. Establishing a proactive approach to managing audits and compliance.     

Influencing consumer purchase likelihood of organic food

Organic food is a fast‐growing niche market in the US. Information in the marketplace tends to promote organic by describing either the potential benefits from organic methods (positive framing) or the potential negative consequences of conventional agriculture (negative framing). For this research, a survey was designed to test the effect of positive and negative framing on the self‐reported change in purchase likelihood of organic food. Respondents were asked to directly evaluate whether the information in the survey made them more or less likely to purchase organic food, or if there was no change. Over 40% of the respondents reported greater likelihood of purchasing organic as a result of the survey information, and less than 4% said they would be less likely to buy it. Tobit regression results revealed that positive framing and perceived risk from conventional agricultural methods increased the influence of the survey. African‐Americans and those with more prior knowledge of organic methods reported less influence from the survey. Overall, information and knowledge variables had more effect on the impact of the survey than demographic variables.     

Relational Investing And Firm Performance

A substantial academic and popular literature argues that the performance of American corporations might improve if American corporations had long‐term outside investors (relational investors) who would hold large stakes, actively monitor management performance, and engage with management in setting corporate policy. Institutional investors can perhaps play this role. We provide the first large‐scale test of the hypothesis that relational investing can affect corporate performance. We consider ownership and performance data for more than 1,500 large U.S. companies over a thirteen‐year period (1983–1995). Our results provide a mixed answer to the question of whether relational investing affects corporate performance. Our data suggest that there was a period in the late 1980s—a period with a uniquely high level of hostile takeover activity—when the presence of a relational investor was associated with higher stock market returns. This cohort of relational investors may have been able to induce corporate restructuring, whose principal effect was to reduce growth rates while improving profitability. But this pattern was not found in the early 1980s or repeated in the early 1990s.     

Is Disinflation Good for the Stock Market?

The stock market appreciates by an average of 24 percent in real dollar terms when countries attempt to stabilize annual inflation rates that are greater than 40 percent. In contrast, the average market response is 0 when the pre–stabilization rate of inflation is less than 40 percent. These results suggest that the potential long–run benefits of stabilization may dominate short–run costs at high levels of inflation, but at low to moderate levels of inflation, benefits may be offset by costs in a present value sense. Stock market responses also help predict the change in inflation and output in the year following all 81 stabilization efforts.