By astripp

Should CEO Compensation Be Tied to Employee Satisfaction?

October 21st, 2011 in Dean Freeman, Faculty, School

CEO Compensation

In Harvard Business Review’s online series “The CEO’s Role in Fixing the System,” Kenneth Freeman, Allen Questrom Professor and Dean at Boston University School of Management, draws on his experience as chairman and CEO of Quest Diagnostics, where he led a significant and lasting turnaround.

He writes,

When I first became head of MetPath in 1995, a troubled Corning subsidiary that eventually became Quest Diagnostics, I dropped in on what was one of the largest clinical testing laboratories in the U.S. As I walked the halls, I found that almost no one would look me in the eye. Something was clearly wrong. When I tried to get to the bottom of it, HR not only couldn’t tell me the voluntary attrition rate, they couldn’t even give me an employee headcount.

The attrition rate turned out to be 45%….

As Raymond Gilmartin writes, people work not just for money but also for meaning in their lives. And, as many writers in this series argue, one of the chief means of fixing the system lies in focusing on the creation of long-term value. There is a simple but significant way to help achieve that goal: Evaluate and compensate CEOs, at least partly, on their ability to create a culture of aligned, engaged employees.

Read more and join the conversation at Harvard Business Review.

Why Is the U.S. Losing the Green Race?

October 21st, 2011 in Digital Technology Sector, Energy & Environment Sector, Faculty, News, Sectors, Social Impact

greenbu

Nalin Kulatilaka, finance professor and co-director of the Clean Energy Initiative at Boston University, joins the discussion in the New York Times Room for Debate series.

According to Professor Nalin Kulatilaka, a smart grid is crucial.

“Americans pride themselves on being global leaders in innovation. So why is the nation lagging behind China and Germany on renewable energy?

The failure of clean energy efforts in the U.S. comes not from a lack of technology innovations, but from the lack of their widespread adoption. Rather than singling out specific companies or industries, our clean energy efforts should focus on building a smarter electricity system, one in which consumers and producers base their decisions on timely information that reflect true costs. Such a system will accelerate the adoption of clean energy by bridging information gaps that are dissuading investments and inhibiting energy-saving behavior.

“Once businesses and individuals can see what drives up their electric bills, a wide range of new energy business models will emerge.”

Once businesses and individuals can see what drives up their electric bills, a wide range of new energy business models will emerge.

The sources of generating electricity, hence the environmental impact and costs, change often and unpredictably. In the current system this is opaque to retail users. By making prices readily visible, smart electricity systems will reduce energy use. In fact, some European countries already have appliances that receive pricing information from the grid and are programmed to run during cheaper times. Having a smart grid is also essential in integrating renewable sources of energy like solar and wind by better managing their intermittent availability. Such a system is also imperative for the electrification of the transportation sector that needs to coordinate charging batteries with availability of cheap and clean sources of power. Because electricity and the transportation sector currently consume two-thirds of our fossil fuel use, these changes would have an enormous impact.

With the smart electricity infrastructure in place, a wide range of new energy business models will emerge. For example, the new information will enable cheaper and better audits of buildings’ energy use, which would help to tailor efficiency improvements.

As with the highway system, by investing public resources on a smart electricity infrastructure, we can create a truly transformative environment in complementary sectors and can take the U.S. to a leadership position in clean energy.”

Once businesses and individuals can see what drives up their electric bills, a wide range of new energy business models will emerge.

Karen Golden-Biddle Honored with 2011 Distinguished Mentor Award

October 21st, 2011 in Organizational Behavior

Karen Golden-Biddle

Professor Karen Golden-Biddle

Karen Golden-Biddle, Everett W. Lord Distinguished Faculty Scholar in Organizational Behavior, has been honored with Boston University School of Management’s 2011 Distinguished Mentor Award. This accolade, given by the PhD School of Management Association, recognizes a faculty member who has supported the School’s doctoral programs and students by providing outstanding mentorship, guidance, and engagement.

Previous honorees are Krish Mennon, Professor and Dean’s Research Fellow, Accounting (2010); and Janelle Heineke, Professor, Dean’s Research Fellow, and Chair, Operations and Technology Management (2009).

Professor Golden-Biddle has also recently been named Senior Associate Dean. In this new role, she oversees faculty development and lead the expansion of research initiatives across the School. She also leads efforts to transform and reposition the undergraduate and graduate curriculums  consistent with the School of Management’s evolving strategy.

See more faculty honors news at the School of Management.

Donald Smith’s New Book, Bond Math: The Theory Behind the Formulas

October 21st, 2011 in Faculty, Finance

Bond Math: The Theory Behind the Formulas

Bond Math: The Theory Behind the Formulas

Of his new book, Boston University Associate Professor of Finance Donald J. Smith writes, “My objective in Bond Math is to explain the theory and assumptions that lie behind the commonly used statistics regarding the risk and return on bonds.”

The book breaks down the calculations necessary for working in the field of fixed income. But it then goes beyond these calculations putting them in practical perspective, explaining how to think about bond math in the context of investment strategy and revealing which numbers prove most useful when dealing with bonds. For instance, it illuminates how bond math functions in both aggressive and passive investment strategies and analyzes the circumstances when statistics reported for individual securities can be used to calculate summary statistics for a portfolio of bonds. It also explains and critiques The Bloomberg Yield Analysis(YA) page, detailing which numbers provide data that are reliable, meaningless, or even misleading for investors.

A book that goes beyond calculation, explaining how to think about bond math.

Chapters progress from money market rates to coupon bonds and yield curves, duration and convexity to floaters and linkers, and interest rate swaps to bond portfolios and strategies. Throughout, Smith taps lessons drawn from his 25 years of experience teaching these topics, and making them more accessible, to both graduate students and finance professionals.

See more about Bond Math: The Theory Behind the Formulas, or get the related resource for professors, A Teaching Note on Pricing and Valuing Interest Rate Swaps with LIBOR and OIS Discounting-2.

Iain Cockburn Is Named Richard C. Shipley Professor of Management

October 21st, 2011 in School, Strategy & Innovation

Iain M. Cockburn

Iain M. Cockburn

Boston University School of Management is delighted to announce that Iain M. Cockburn, Professor of Strategy & Innovation, has been named the Richard C. Shipley Professor of Management.

The chair’s donor, Richard C. Shipley (BSBA ’68, MBA ’72) is the retired CEO of Shipley Company in Westborough, Massachusetts, and serves on the Boston University Board of Trustees.

Professor Cockburn joined the School of Management in September 1999.  He received his Ph.D. and A.M. in Economics from Harvard University and B.Sc. in Economics from Queen Mary College of the University of London.  Professor Cockburn is a major contributor to the School’s research, teaching and programmatic efforts.  He is the author of more than fifty book chapters and articles in prestigious management journals, including the American Economic Review and Management Science.   In addition, he has delivered more than two hundred scholarly presentations of his research.  Professor Cockburn serves as Research Director for the School’s Institute for Technology Entrepreneurship and Commercialization. He was previously  a member of the School of Management’s APT Committee and a representative to the Boston University Faculty Council from 2007 to 2009.

Professor Cockburn’s scholarship has garnered him such recognition as the Everett W. Lord Distinguished Faculty Scholar Award (2004 – 2011) and an appointment as Research Associate at the National Bureau of Economic Research.  He has received more than twenty research grants, including three National Science Foundation grants.  His honors also encompass the Dan and Mary Lou Schendel Best Paper Prize 2010 from the Strategic Management Journal, the University of British Columbia Faculty of Commerce Research Excellence Award, the Alfred P. Sloan Doctoral Dissertation Fellowship, and the School of Management’s MBA Second Year – Teacher of the Year award.

See more faculty honors news at the School of Management

Michael Salinger Is Named First Designee of Bahr Professorship

October 21st, 2011 in Markets, Public Policy & Law, School

Michael A. Salinger, Professor of Markets, Public Policy & Law

Michael A. Salinger, Professor of Markets, Public Policy & Law

Boston University School of Management is delighted to announce that Michael A. Salinger, Professor of Markets, Public Policy & Law, has been named the initial designee of the Jacqueline J. and Arthur S. Bahr Professorship of Management.

The chair’s generous donor, alumnus Arthur S. Bahr (BSBA ‘54), is the retired executive vice president for equity investments of General Electric Investment Company in Fairfield, Connecticut.

Professor Salinger  joined the School of Management in September 1990. He received his Ph.D. in Economics from the Massachusetts Institute of Technology and B.A. from Yale University.

Professor Salinger has been a strong contributor to the School’s research, teaching and programmatic efforts, while also making significant impact outside of academia, including serving for two years as Director of the United States Federal Trade Commission’s Bureau of Economics. He is also the author of more than thirty-five book chapters and articles in prestigious management journals such as the Journal of Economic Perspectives and has sat on the editorial boards of both the Journal of Industrial Economics and the Review of Industrial Organizations.

Professor Salinger’s scholarship has garnered him recognitions such as the Everett W. Lord Distinguished Faculty Scholar Award (2007 - 2011).  In addition, he has held several important leadership roles at Boston University School of Management, including Faculty Director of the Undergraduate Program and Chair of the Finance and Economics Department.

See more faculty honors news at the School of Management

Does Knowledge Diversity Drive Success?

October 21st, 2011 in Strategy & Innovation

Stine Grodal, Assistant Professor, Strategy & Innovation

Stine Grodal, Assistant Professor, Strategy & Innovation

Even in the relatively abstract worlds of science and technology, people assume that diversity drives success.  But does the mixing of diverse ideas actually guarantee an innovative outcome? And how do ideas drawn from diverse fields spread beyond the place of invention to create value in the marketplace?

New research-in-process by Stine Grodal and co-author Grid Thoma, Cross-Pollination in Science and Technology: Concept Mobility in the Nanobiotechnology Field,” searches beyond mere assumptions about the value of knowledge diversity (or “cross-pollination”) aiming to measure its ultimate commercial potential.

“By measuring ideas directly, we get one step closer to unpacking the challenge of how to provide advice to firms looking to become more innovative.”

–Assistant Professor Stine Grodal

Exploring the juncture between the biotechnology and nanotechnology fields, Grodal (Assistant Professor in Strategy and Innovation, Boston University School of Management) and Thomac(Assistant Professor of Economics and Management, University of Camerino), write that many existing studies on innovation have “investigated cross-pollination at the team or individual level…while [only] assuming that cross-pollination occurred between concepts.”

Grodal and Thoma’s goal is to look deeper, focusing at the level of the concept. For instance, just because ideas coming from different communities are recombined, does that mean the resulting theory or model is as multifaceted as the backgrounds of its creators?  And if it is, how does this resulting cross-pollination influence the concept’s mobility from science to the marketplace?

Findings

Drawing on data from 1991 to 2005 tracking the movement of 133,128 concepts from science to technology and commercialization, the authors find the following:

  • Cross-pollination does ultimately facilitate concept mobility.
  • For cross-pollinated ideas to impact technology and economic growth, they must move from their locus of first use to other institutional arenas; Otherwise the cross-pollinated concepts might be innovative, but they fail to gain widespread acceptance.
  • If a patent contains cross-pollinated concepts, it is more valuable.
  • Scientists who reside in commercial firms generally assist the mobility of concepts, but;
  • Scientists who reside in commercial firms also generally hinder the mobility of cross-pollinated concepts.

Explains Grodal, “We were able to directly capture and quantify how ideas move between different institutional contexts.  And by measuring ideas directly, we get one step closer to unpacking the challenge of how to provide advice to firms looking to become more innovative.”

What’s Next: Applying Findings to Firm Performance

Grodal and Thoma are working to link their current findings on cross-pollination and concept mobility to firm performance outcomes.  “Can we show that possessing cross-pollinated patents create value for the firm?,” Grodal explains.  They are also exploring whether cross-pollination is more fruitful at different points during the industry life cycle.

Read more about the paper “Cross-Pollination in Science and Technology: Concept Mobility in the Nanobiotechnology Field.”

Colin Fisher Named a Peter Paul Career Development Professor

October 21st, 2011 in Faculty, Organizational Behavior

FisherColin

Colin Fisher, Assistant Professor of Organizational Behavior, has been named a Peter Paul Career Development Professor for the Academic Year 2011-2012.

This highly competitive one-year award honors promising faculty with no more than two years in residence at Boston University.  The professorships were founded in 2006 by Peter Paul (GSM ’71), the president of mortgage banking company Paul Financial and member of the Boston University Board of Trustees.

Assistant Professor Fisher joined the School of Management in July 2010 from Harvard University, where he earned his PhD and MA.  His research examines the role of improvisation on the development of teams in the areas of leadership, creativity and group decision-making.

See more faculty honors news at the School of Management

Kathy Kram Honored by Academy of Management

October 21st, 2011 in Faculty, Organizational Behavior

Kathy Kram

Professor of Organizational Behavior Kathy E. Kram, Shipley Professor of Management, has been honored with the 2011 Everett Cherrington Hughes Award from the Academy of Management.

It is the Academy’s premier award in the Careers Division and recognizes scholarship which has made a significant contribution to the task of linking careers theory with the broader field of organization studies. The Hughes citation notes that “it is a way of honoring those who have worked to build bridges between careers and other areas of organizational enquiry. The aim of this award is to acknowledge the work of scholars who have forged, rather than severed, connections between careers and other fields of social inquiry.”

Professor of Organizational Behavior Douglas “Tim” Hall, Morton H. and Charlotte Friedman Professor in Management, is a former recipient of the Hughes Award.

See more faculty honors news at the School of Management

Boston University MBA Team Wins NAAMBA Global Case Competition

October 21st, 2011 in Graduate Students, News, Students

Roman Sverdlov (MBA '12), Sabrina Grijalva Wells (MBA '12), and Sidharth Ramsinghaney (MBA '12)

Roman Sverdlov (MBA '12), Sabrina Grijalva Wells (MBA '12), and Sidharth Ramsinghaney (MBA '12)

A team of Boston University School of Management MBA students swept the finals in the National Association of Asian MBAs (NAAMBA) Global Case Competition on September 9, 2011, in New York.

Congratulations to team leader Roman Sverdlov (MBA ’12) and his colleagues Sabrina Grijalva Wells (MBA ’12), and Sidharth Ramsinghaney (MBA ’12), who competed against finalists from Purdue, Syracuse University, and the University of Southern California. Each group presented a marketing plan to position Singapore as an ideal career destination to young Asian professionals in the US.

The winning Boston University team will receive a trip to Singapore to examine the dynamics of doing business in Asia through networking opportunities with senior management at multinational companies.

NAAMBA is a leading non-profit professional organization dedicated to cultivating global Asian leaders.  According to Jino Ahn, founder and president of NAAMBA, “The Global MBA Case Competition is an opportunity for NAAMBA members to exhibit and refine their business skills under pressure, which will help them tremendously as they pursue career opportunities.”

Tze Min Lim, Area Director at the competition’s sponsor, Contact Singapore, added, “Asia has become a hub for business and finance, and Singapore is at the epicenter with more than 7,000 multinational companies. As businesses continue to expand into Asia, experience and knowledge of this region is invaluable. The Global MBA Case Competition gives students the chance to examine how they can best position themselves to seize career and business opportunities in Asia.”