The Business Review, Cambridge

Vol. 7 * Number 1 * Summer. 2007

The Library of Congress, Washington, DC   *   ISSN 1553 - 5827 

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Antecedences and Consequences of Customer Orientation: Do Individual Factors Affect Customer Orientation?

Dr. Ceyhan Kilic, New York Institute of Technology, New York, NY

Dr. Turkan Dursun, West Texas A&M University, Canyon, TX



Customer orientation has been acknowledged by both practitioners and scholars as a critical element for the success of almost every business. If an organization aims to establish and/or maintain a competitive position in the marketplace and to develop long-term satisfactory relationships with its customers, it should emphasize on understanding the factors that influence the customer orientation of its employees. The primary objective of this research study is to respond to the previous research calls by investigating the antecedents and consequences of customer orientation at the individual level through a structural model. The suggested model was tested over a random sample of 2000 marketers from a broad range of businesses. The final sample consisted of 189 usable responses resulting in a response rate of 9.45%. A Structural Equation Modeling (SEM) analysis via LISREL 8.5 was used for the model specification and hypothesis testing. The study reveals that younger marketers (less than 45 years old) place more value on customers than older marketers (45 years and older). Inexperienced marketers (less than 10 years of experience on the job) care more about their customers than experienced ones (at least 10 years of experience on the job). Educated marketers (having attended graduate school or higher) have more customer orientation than less educated marketers. The study results suggest that higher levels of customer orientation result in higher levels of relationship development and performance. Managerial implications were also provided.  Employees of a market-oriented firm are ideally expected to be also market- or customer-oriented. Market orientation motivates employees to become more customer-oriented, more committed to their company and their job, and more satisfied with their job (Kohli and Jaworski 1990; Siguaw, Brown, and Widing 1994). Siguaw, Brown, and Widing (1994) found a positive and significant relationship between organizational-level market orientation and individual-level customer orientation. Having a workforce with a strong market/customer orientation is especially important for a firm in the selling context. If a firm is market-oriented, it is more likely to take a planned action to train its sales employees to make them more market/customer-oriented. Better customer-oriented selling is achieved by customer-oriented marketers. Especially, customer-oriented sales people or sales force can create a high level of customer satisfaction and thus, develop a strong customer base for the company. Several researchers have pointed out that there is a lack of understanding of customer-oriented selling or customer orientation at the individual salesperson level (e.g., O’Hare, Boles and Johnston 1991; Saxe and Weitz 1982). Also, the number of studies on this issue is small (e.g., Brown, Mowen, Donavan, and Licita 2002; O’Hare, Boles and Johnston 1991). For example, Saxe and Weitz (1982) stated that “little empirical work has examined the effectiveness of customer oriented selling and the factors influencing the extent to which salespeople engage in it” (p.344). O’Hare, Boles, and Johnston (1991) urged that “Although customer oriented selling is an acknowledged practice, a complete understanding of is lacking” (p.61).  This study aims to fill this gap in the literature and to facilitate a better understading of the antecedents and consequences of customer orientation at the individual level. The purposes of this study are two-fold: (1) to examine the effects of individual factors on individual customer orientation, and (2) to investigate the effect of individual customer orientation on performance outcomes.  Whether the degree of the employees’ customer orientation is contingent upon the gender of the employee has been an interesting research topic. But, until now, only few studies have addressed this issue (e.g., Siguaw and Honeycutt 1995; Dwyer, Richard, and 1998, Busch and Bush 1978, etc.). Most studies have investigated the gender factor as a minor part of their suggested model or framework. O’Hare, Boles, and Johnston (1991) pointed out the lack of the research studies that focus on the factors which may differentiate between male and female counterparts in the work environment. Babin and Boles (1998) reported that gender-related differences were observed in some organizational constructs. There are few studies that investigated the possible effects of gender differences on the degree of the salesperson’s customer orientation (e.g., O’Hare, Boles, and Johnston 1991; Siguaw and Honeycutt 1995).  More alarmingly, Siguaw and Honeycutt (1995) urged that “No substantive research on gender differences concerning market orientation, customer orientation, or adaptive selling perceptions has been reported” (p.47). Nowadays, women constitute to “a large and important segment of the sales force” in organizations (Schul and Wren 1992, p.39). Therefore, the question of whether there are significant differences between male and female salespeople in their levels of customer orientation is a crucial research issue that should be examined closely.


Changes in Income Inequality: Gini Coefficient Versus the Theil Index in Estimating Potential Effects of the Proposed Fair Pay Act

Dr. Pearl Steinbuch, Mount Ida College, Newton, MA



Although at present two major laws address employment discrimination, the Equal Pay Act of 1963 and the Civil Rights Act of 1964, neither law explicitly addresses the question of salary differentials between unrelated sex-segregated jobs.  An October 2003 GAO report, Women’s Earnings, found that, despite progress toward pay equality between men and women, the gender-based pay gap has remained consistent between 1983-2000.  The report concluded, ”(T) he pay gap is . . . not just a women's issue -- it's a family issue”. (1) By referring to the impact on family there is an assumption that there will be positive income distribution effects.  Empirical research, however, on changes in income equality resulting from proposed wage changes has been lacking.  This paper examines changes in income inequality in order to support the current thought that the gender-based wage gap is indeed a family issue.  By examining the distributional impacts resulting from its proposed implementation, policy makers, including critics and proponents of   Pay Equity, will be better equipped to assess the equity consequences.  The empirical analysis will present the Gini Coefficient estimates, the most common measure of changes income distribution, along with the Theil Index estimates.  Results of both measures will be compared and contrasted.  Specifically, the author finds that the Theil Index is a superior measure of the total effects, when disaggregating by race and within group changes.  Although at present two major laws address employment discrimination, the Equal Pay Act of 1963 and the Civil Rights Act of 1964, neither law explicitly addresses the question of salary differentials between unrelated segregated jobs.  Currently there are two bills in Congress aimed at curbing wage discrimination.  The Fair Pay Act (S.840/H.R.1697) was introduced by Senator Tom Harkin (D-IA) and Delegate Eleanor Holmes Norton (D-DC) on Equal Pay Day 2005.  It seeks to end wage discrimination against those who work in female-dominated or minority-dominated jobs by establishing equal pay for equivalent work. The Paycheck Fairness Act (S.841/H.R.1687), introduced on Equal Pay Day 2005 by Senator Hillary Clinton (D-NY) and Congresswoman Rosa DeLauro (D-CT), seeks to strengthen the Equal Pay Act of 1963.  The bill expands damages under the Equal Pay Act and amends its very broad fourth affirmative defense.  In addition, the Paycheck Fairness Act call for a study of data collected by the EEOC and proposes voluntary guidelines to show employers how to evaluate jobs with the goal of eliminating unfair disparities. (2)  The Equal Pay Act guarantees that when men and women perform tasks that require equal skill, effort, and responsibility under similar working conditions, they will receive equal remuneration.  For example, job pairs such as janitor and cleaning woman, are considered sufficiently similar as to be considered equal, and as such must be paid the same wage by a company.  (Remick, 1980:405).  No violation of the Equal Pay Act will exist, however, if wage differentiation stems from "seniority, merit, the quantity or quality of production or some other basis not related to sex”, as these are considered affirmative defenses against sex discrimination as set forth in the Act. The courts have interpreted the Equal Pay Act as not only prohibiting unequal pay between men and women working in the same jobs, but also in jobs that are substantially the same.  That is, employers can not attempt to evade the Act by specifying overly technical distinctions between jobs, assigning different job titles to essentially the same jobs, or allocating extra, but inconsequential, duties to men in order to justify a higher wage than for women performing the same work.  Only factors other than sex can be used by the employer to justify pay differences between men and women performing substantially similar work.   Title VII of the 1964 Civil Rights Act, as amended, prohibits discrimination in all employment practices, including compensation, because of race, color, sex, or national origin.  As originally drafted Title VII made no mention of sex discrimination.  As the prohibition of sex discrimination was incorporated into Title VII, the Senate feared a conflict between the two statutes: EPA and Title VII.  Specifically, the concern was that Title VII may override the affirmative defenses written into the Equal Pay Act.  To avoid any conflict the Equal Pay Act was partially incorporated into Title VII via the Bennett Amendment, which states: "It shall not be unlawful employment practice under this title for any employer to differentiate upon the basis of sex in determining the amount of wages or compensation paid or to be paid to employees...if such differentiation is authorized by the provisions of the Equal Pay Act." (3)


A Study of Leadership Prototypes in Colombia

Dr. Sergio Matviuk, Regent University, Virginia Beach, VA



This article reports the results of an exploratory study of leadership prototypes in Colombia. Based on the concept of cognitive leadership categorization, prototypical leadership behavior expectations were assessed by using the Leadership Practices Inventory (LPI) adapted to describe an ideal leader. Results indicated that a prototypical Colombian leader should exhibit delegation and empowerment behaviors, serve as a role model for followers and collaborators, be proactive in encouraging people by recognizing team accomplishments and being conservative in terms of fostering changes and innovation. Additional analysis also indicated that neither gender nor age have an impact on leadership prototypes. Also, further data analysis suggested that education has an impact on leadership prototypes; particularly on the extent people expect their leaders to recognize individual and team accomplishments. Latin American countries have notably increased their participation in the context of the global market (Recht & Wilderom, 1998; Hanes, 2000). As a part of this trend, several Latin American countries have signed or are negotiating trade agreements with other countries, particularly with the United States. Examples of these commercial agreements are the North American Free Trade Agreement (NAFTA), signed by Canada, Mexico and the United States; the Colombia-United States Free-Trade Agreement (FTA); the United States-Peru Trade Promotion Agreement (PTPA), and the Dominican Republic-Central America Free Trade Agreement, (DR-CAFTA). Besides the growing trade exchange between Latin American countries and the United States, also the commercial and business relation between China and Latin America has grown exponentially. Kerry Dumbaugh and Mark P. Sullivan (2005) reported that China’s imports from Latin America grew from almost $3 billion in 1999 to $21.7 billion in 2004 and China’s exports to Latin America also grew from $5.3 billion in 1999 to $18.3 billion in 2004.  These removals of trade barriers and the growth of global markets has given rise to an increased association between employees and managers of different cultures creating several new issues in cross-border businesses, as Adler (1983) and Doney, Cannon, and Mullen (1998) have posited. This cross-cultural association exposes managers and leaders to cultures other than their own making cross-cultural teams more commonplace and important (Brodbeck et al., 2000). During intercultural exchanges, barriers to communication and other factors facilitating misunderstandings are more likely to arise as a result of cross-cultural interactions (Graham, 1985; Varner & Beamer, 1995).  One of the ways of reducing potential sources of conflicts and misunderstandings in the context of a global economy characterized by cross-cultural interactions is identifying the expectations the parties have regarding how business should be conducted and how the counterpart should behave. Leadership research may contribute to increase the knowledge on behavior expectations in the global context by studying leadership prototypes. This study precisely contributes to increase the knowledge on Latin American leadership behavior expectations by exploring leadership prototypes in Colombia. Due the lack of research on the topic of leadership prototypes in Latin America in general and in Colombia in Particular, the research reported in this article was exploratory in nature, aiming to establish an empirical and theoretical background for future research in other Latin American countries.  A review of the literature on Latin American leadership indicates that leadership researchers “do not know very much about the unique aspects of Latin American leadership” (Romero, 2004, p. 25). The few available leadership studies in Latin America indicate that research efforts have been focused on identifying a dominant leadership styles and corresponding leadership traits. Research on dominant leadership style in Latin America concluded that in general leadership in the region tend to be autocratic and paternalistic (Recht & Wilderom, 1998). Studies conducted Argentina (Majul, 1992), Bolivia (Camacho-Garcia, 1996), Chile, (Rodriguez, Majluf, Abarca & Bassa, 1999) and Mexico (Stephens & Greer, 1995; Dorfman & Howell, 1997) confirmed that tendency. A more recent study conducted by Romero (2004) in Argentina, Chile, Dominican Republic, Mexico, Peru, Puerto Rico and Venezuela indicated that the traditional autocratic leadership model is still more dominant in those countries than a more participative model. In order to go beyond general descriptions of dominant leadership models and expand our understanding on Latin American leadership it is necessary to explore fundamental expectations regarding leadership behavior. In order to do so, this study was aimed to determine leadership prototypes in Colombia by assessing leadership behavior expectations attempting to contribute a empirical research model towards a general theory of leadership for Latin America.


Trends in Database Tools and Technologies

Shamsul Chowdhury, Ph.D., Roosevelt University, Schaumburg, IL



The study presents the uses of new and emerging technologies, like data warehousing (active or virtual), data mining and Case-based Reasoning (CBR) and their integration for application development, which can help to provide competitive advantages for organizations. The purpose of a database/data warehouse could be to derive or infer facts about a discipline in general and thereby improve the quality of decision-making processes. The quality of the decision could further be enhanced by having access to a large pool of related data in a data warehouse about the discipline. A data warehouse or a data mart, which is a subset of a data warehouse; captures data from different operational sources and accumulate them for analyses and presentations. Traditional statistical methods as well as AI-based knowledge-based methods could be employed for performing data analyses – generally known as data mining.  Data mining is a subset of knowledge discovery in databases/data warehouses/data marts. Knowledge discovery in databases (KDD) is the overall process for: - preparing data, - selecting data mining  (also known as Knowledge extraction) methods, - extracting patterns (models), - evaluating the extracted decision knowledge. Data mining tools are also integrated with rather easy to use presentation tools/techniques. OLAP (On-Line Analytical Processing) is a good example of a widely used data presentation tools. The paper presents briefly the emerging technologies, for example; active data warehousing, virtual data warehousing and their uses in application development. The paper also discusses the importance of data quality for quality decision and a  studies a methodology for data quality assurance in databases and data warehouses. The paper further explores the possibilities of combining data mining and CBR techniques to retain and reuse the knowledge/information that has been mined from data warehouse/data mart. In CBR, previous knowledge/skills are taken into consideration to solve a new problem. CBR may also be viewed as a general knowledge management and problem-solving tool. Finally, we intend to propose an architecture for integration of the emerging technologies for use in informed decision-making. The  results obtained and experiences with data mining on data warehouse are satisfactory when it concerns knowledge extraction, case representation and  reuse in CBR. These new technologies (data warehousing, data mining and CBR) could be combined together for implementing information systems to gain and retain competitive advantages. Data, which is an asset; captured in different operational databases (for example: business and clinical databases, demographic databases, etc.) over time could be extracted and integrated together in a data warehouses/data marts for building decision support facilities/systems. The pool of data in a data warehouse could further be explored by data mining tools to extract relevant information/knowledge that other wise may be hidden and could never be taken into account in decision making processes. Data warehouse (DW) is a subject-oriented, integrated, non-volatile and time-variant collection of data from many different sources for use in many applications and by many users in an enterprise in support of management’s decisions (Sperley, 1999). One main purpose for a DW creation is the possibility of having integrated data in one place (DW). It solves the problems with non-integrated data. But it does not really solve the problems with bad or incorrect data in the operational (source) systems. We may still suffer from the syndrome “Garbage in- Garbage out”. Data quality is a key issue when an organization implements an enterprise wide data warehouse, for example for customer relationship management (CRM) or other purposes.  Utilizing CRM requires that customer information be of high quality, in order to identify, validate and consolidate customers within an organization.  Quality of the data will determine the quality of the data warehouse as well as the quality of the decision.  In other words data quality is an investment in profitability (Sperley, 1999). Data warehouses allow firms to learn more about their customers so that they can develop strategies to maximize profits and minimize cost.   Some of the characteristics of Data Warehousing Data are that  (Sperley, 1999):


Knowledge to Game the Day-Ahead Electricity Market

Dr. Eric Woychik, Strategy Integration, LLC, Oakland, California

Dr. Bo Carlsson and Dr. Argun Saatcioglu, Case Western Reserve University, Cleveland, Ohio



This paper explains how Enron et al. used knowledge to game the day-ahead electricity market in Western North America.  Based on previously unavailable data, we examine the knowledge-based behavior of electricity traders.  The results explain how electricity prices changed in response to institutional knowledge, common knowledge, market monitoring and modeling, explicit cooperation and emergency conditions.  These results extend previous research based on bid-price mark-up studies by further explaining how knowledge leverages trader opportunities to profit from gaming, as predicted by Aumann. Market power was evident in 1999 in the Western United States (CAISO 1999), and in May of 2000, the cost curve changed dramatically (McCullough 2001).  By that summer, prices were almost 500% higher (Joskow and Kahn 2002), though underlying electricity costs rose much less.  The literature does not explain this large gap between prices and benchmark costs (Hildebrandt 2002, Joskow and Kahn 2002), though some market gaming is expected (Tirole 1988).  Likewise, game theory does not explain electricity trading in practice.  These gaps and the repeating markets problem that predicts cooperation (Aumann 2000, Rothkopf 1999) motivate this analysis.  This paper explores knowledge-based game theory elements of trader behavior, focusing on the extent to which trader knowledge contributed to electricity price increases in 2000.  The paper proceeds as follows.  It starts with an overview of electricity trading.  Second is a literature review of trade behavior and related game theory.  Third is a summary of common trader knowledge in theory and in practice.  Fourth is a description of the variables and the hypotheses.  Fifth are the model and the analysis strategy.  Sixth, the results are discussed.  The conclusion is that specific knowledge elements contributed directly to the exercise of market power in the day-ahead market.  General market games have been described in some reports (California 2005, FERC 2003, Hildebrandt 2002).  The literature points to the need to use long-term contracts (Bushnell 2004).  There is agreement that customer demand-response is needed to temper gaming (Bushnell 2004, Wilson 2002), but literature about gaming in practice or knowledge-based trader behavior is absent.  Workable competition is viewed as requiring conditions where traders face fixed prices set by an anonymous and exogenously-specified market (Samuelson 2004, p. 386).  The problem of the California market rules that compelled trader gaming is acknowledged.  With the repeated market, trader proximity, and a rich information environment (Gulati 1995, Skrzpacz and Hopenhayn 2004) as givens, it is unlikely that an anonymous and exogenously-specified market would exist.  Some still believe that competition merely requires a sufficient number of sellers, (1) yet dialog or research on the knowledge base of traders is absent.  Game theory has been used to analyze electricity prices (Hogendorn 2003, Macatangay 2002, Spear 2003), but major gaps exist in translating game theory and its use in empirical analysis of the knowledge constructs that influence gaming.  It appears that high levels of market knowledge undermine anonymous bidding and eliminate exogenously-defined market prices, resulting in reduced competitive dominance and triggered forbearance from competing.  These results, discussed in game theory (Aumann 2000), in essence show that workable competition requires some level of incomplete information (knowledge).  Some argued that electricity supplies in California were inadequate in 2000, causing the crisis (Sweeney 2002).  Others believe tacit collusion is likely in electricity markets facilitated through both frequent interaction and intimate understanding of rival cost structures (Macatangay 2001 p. 338).  In theory, competition prompts traders to bid their short-run marginal costs (Wolfram 1999). Deviations from this reflect games that result in trader price-markup (Joskow and Kahn 2002).  Most competitive electricity markets use bid-based markets (Woo, Lloyd, and Tishler 2003).  Negotiated bilateral contracts are also usually used.  Both allow for trader opportunism when competition is relaxed.  Traders acquire knowledge to predict the market and conduct trades consistent with bid strategies to increase market prices (Green and Porter 1984).  Both tacit (Skrzpacz and Hopenhayn 2004) and express cooperation may occur (Chakraborty and Yilmaz 2004, Dutta, Nouweland, and Tifs 1998).  Most analysis of electricity prices uses some form of an oligopoly model (Borenstein and Bushnell 1999, Fabra and Toro 2005) or a supply equilibrium model (Green and Newbery 1992).  Others model price-markup (Wolfram 1999), transmission constraints (Hogendorn 2003, Joskow and Tirole 2005, Younes and Ilic 1999), or tacit collusion (Bunn and Oliviera 2003, Macatangay 2002, 2001, Spear 2003).  A body of theory on repeating games has emerged (Kungl 2005).  Aumann explains how familiarity evolves to the exchange of common prior experiences and to common knowledge of rationality (Aumann 1998, 2000, Samuelson 2004).  The folk theorem shows that tacit cooperation is expected in repeating markets (Abru, Dutta, and Smith 1994, Fudenberg, Levine, and Maskin 1994).  “The folk theorem shows that repetition enables cooperation,” but even more importantly, this implies that “repetition necessarily leads to cooperation, which is quite a different matter.”  (Aumann 2000 p. 318) 


  Gendered Opportunities to Enhance Direct-to-Consumer Advertising of Gender-Neutral Pharmaceutical Brands: Factors Arising from Information Processing, Message Content and Demographic Change

Dr. Amy Handlin



 This paper argues that direct-to-consumer advertising for gender-neutral prescription drug brands should make more frequent use of female-centered visual images. By synthesizing findings from three streams of research – in the areas of information processing, message content and demographic change – the author identifies likely opportunities for advertisers to enhance attention, comprehension and recall, while taking advantage of women’s increasing longevity and continuing role as health-care gatekeeper for the family.  Many of the most heavily advertised prescription drugs are gender-neutral products – in other words, they are intended to treat illnesses or conditions that afflict both women and men. For instance, the 50 pharmaceutical brands that accounted for the bulk of mass media spending in 2000 or later included five asthma medications, three arthritis remedies, three diabetes medications, two antidepressants and two sedatives.  According to the author’s review of 40 recent print advertisements for gender-neutral prescription drugs, female images were used as the primary visuals in approximately 40% of these ads.


The Role of Organizational Culture in Customer Service

A. Jane Dunnett



 This paper examines the concept of organizational culture in the retailing context, particularly as it is cultivated and utilized within big box retailers to encourage and maintain a certain level of customer service among its employees. Several research issues are raised and it proposes the modeling of the relationship between organizational culture and customer service.  Retail employees are frequently expected to put aside personal feelings in order to better serve their organization’s customers.  Yet training alone cannot account for this behavior. People who work together necessarily spend a considerable amount of time together, often sharing significant events in their lives as well as their careers.  The idea of a common system of values or beliefs may apply to any group of individuals who are bound together in some way, linked by mutual experience or circumstances, including the experience of serving customers in a retail setting. 


A Global Perspective and an Integrative Case Study: The Corporate Card Services Group at American Express

Dr. Larry Taube and Dr. Vidyaranya Gargeya



 This Case Study examines American Express and their Corporate Card Services Group (CCSG). The Group helps companies and institutions manage their corporate expenses. It also provides investment management services, and administers various pension and employee benefit plans. American Express’ vision is to become the world’s Number One most respected service brand.  To achieve that, American Express has created technology platforms to deliver products and services in new ways that customers prefer.  The CCSG business unit must address how their operations strategy will achieve the above focus, and how specific ideas will be implemented.  They also need to address their present situation, noting strengths and weaknesses in the present competitive business environment.  American Express Company is a global travel, financial and network services provider. Founded in 1850, the Company provides individuals with charge and credit cards, travelers cheques and other stored value products. It also offers financial planning, brokerage services, mutual funds, insurance and other investment products.


Managing Networked Business Models in the Software Industry

Mika Westerlund, M.Sc. and Risto Rajala, M. Sc., and Dr. Senja Svahn



 This study focuses on the context of management in the business networks of small and medium-sized software companies. Our objective is to explore the challenges that action through networks set for the management in different types of business models. Drawing on prior literature, we identify four basic types of business models on the basis of their offering and customer relationship constructs. Furthermore, we distinguish four simultaneous modes of management, and propose that each mode contributes differently to the management in networks. The identified modes of management are: influencing the other actors, controlling and monitoring the actors and their activities, coordinating the network structure and processes, and integrating the activities and knowledge. Finally, we summarize the findings from our empirical research and discuss how these distinct modes of management are manifested in the networks of different types of business models.   The cooperation of organizational actors includes different forms of collaboration such as alliances, dyadic partnerships, supply chains, marketing or distribution networks, product-development networks, different competitive coalitions and strategic or value nets (Jarillo, 1993; Parolini, 1999; Gulati et al., 2000; Ford et al., 2002).


Developing Industrial Services: An Empirical Study

Dr. Katri Ojasalo



 The integration of manufactured products and services is becoming a trend, and the industrial service business is a fast growing business area in the manufacturing industry. Many companies have tried to develop industrial services to create new business with customers but many of them have failed. In many cases, customers have not valued the proposed service models because of the lack of added value to the current co-operation between supplier and customer. The purpose of this empirical study is to gain an understanding as to what are the most important challenges when an equipment manufacturing company begins to develop service offerings to its customers.  With products becoming more and more a commodity, many manufacturing companies face the question: how do we enhance our profit margin? One of the answers is 'going downstream': bundling the product offer with services to an 'integrated solution'. In other words, the pressure on product margins, increased competition, and changing customer demands, among other factors, have contributed to the rise of industrial services. This means that many industrial companies are bundling the product offering with services to create an integrated solution to customers’ problems. Customers in industrial markets increasingly demand turnkey solutions to problems instead of products that partially solve their problems.


Forecasting New Taiwan Dollar/United States Dollar Exchange Rate Using Neural Network

Dr. Wei-Pang Wu and Dr. Hui-Ling Yang,



 This study investigates the relationship between exchange rate fluctuation and other economic indicators by applying the neural network to predict the yearly exchange rate of the NT currency. The empirical experiment shows that the performance of neural networks is better than the other models discussed. The result demonstrates the predictive strength of the neural network and its potential for solving financial forecasting problems.  Exchange rate forecasting is an important and challenging task for both academic researchers and business practitioners. Various theoretical models, such as the econometric and time series approaches have been suggested to model and forecast exchange rates. Unfortunately, empirical results often fail to meet theoretical expectations. It is natural to conjecture that exchange rate data contain nonlinear that may not be accounted for or approximated well by linear. In fact, the linear unpredictability of exchange rates has been confirmed by many studies. Much research efforts have been devoted to explore the nonlinear factors in the exchange rate data and to develop specific nonlinear models to improve exchange rate forecasting.


Problem and Risks of Slovene Business Management in Light of Globalization Processes and Historical Heritage

Boštjan Kuralt, M.Sc.



 This article examines the problems of modern Slovene management in the context of the history of management in Europe and presents ways of finding the right track for the further development of business in Slovenia. Doing so, it warns that the new management of Slovenian enterprise has to be based on the existing, internationally acclaimed theories and achievements of various sciences. But should not in the process neglect its own national identity provided to every society, including ours, by historical heritage. The specific development of individual societies also dictates the development of individuals within the society.  Marked by its own culture and multilateral support to the national economy, which will, in the existing organizational models build its own individual note and give support to manager teams, who will not merely bring certain organizational models to their own country and expect reasonable success. For it would surely lead to subordination of the national economy to other economies of more powerful and successful countries.


Challenges to Building a Sustainable US Seafood Export Industry and Possible Solutions

Dr. Goitom T. Tsegay, Eastern Washington University, Bellevue, WA



 The US seafood export industry has been structured to provide semi-processed seafood as raw material for further processing in foreign countries. Such practice is motivated, among other things, by the lack of modern technology, lack of knowledge on foreign markets, availability of abundant seafood in the US waters, at least for the short term, and relatively cheaper reprocessing cost in foreign countries. However, export of large volume of semi- processed seafood means less rewarding to US exporters,   high fishing in US waters and ultimately an obstacle to building a profitable and sustainable seafood export industry. Hence to build sustainable seafood industry and earn more revenue to US exporters US seafood production needs to transform itself from raw material export to export of value added products.  International seafood trade has expanded substantially since the early 1980s. The United States is one of the world’s largest exporters of seafood. The United States exports seafood to developed countries and developing countries. While Canada, Japan, France and South Korea are major developed countries that import US seafood, China and Mexico are major developing countries that import US seafood (US seafood analyst, 2005).


An Experimental Study on Fairness Perceptions: Evidence from Singapore and Two Cities in China

Dr. Zhiyong Dong and Dr. Qingyang GU



In this study, we present three experiments that were conducted in Singapore and two cities in China to analyze the impact of age, gender, culture, occupation and educational qualifications on the fairness perceptions of people from various regions. Our main findings are: first, the more economically developed a region is, the more competitive is the society, and the higher the educational standards and the stronger the ability to tolerate social unfairness. Second, if men become more highly educated and earns more, the women have more opportunities to engage in economic activities in the society. Third, regardless of how economically developed a society is, there will always be a discrepancy in expectations between the employers and employees.  Fourth, to maximize profits, the employer will always offer as little wages as he can, in return for the maximum level of effort rendered by the employee. Fifth, in relatively less developed regions/cities, employees are more mentally receptive to shouldering more work burden, and thus their fairness perception is relatively weaker.  Over the last decade, behavioral economists have strongly argued for the importance of fairness in motivating behavior, based on substantial experimental evidence. The popular research game is called the Ultimatum Game which has its origins in 1982 where Guth, Schmittberger and Schwarze discussed in their paper a type of “acceptance or rejection” game.


The Impact of Relative Share of Unit Labor Costs and Technology Variables on Firm’s Export Behavior

Alfredo M. Bobillo, Ph.D., Juan A. Rodriguez Sanz, Ph.D. and Fernando Tejerina Gaite, Ph.D.



 Using panel data on 20 industries in Spain, this paper aims to contrast the sensitivity of relative export shares to changes in the relative share of unit labor costs (RULCs), factors that condition the degree of sensitivity, and whether that sensitivity has the same importance in small and medium-sized firms (< 200 workers) as in large firms (> 200 workers) over the period 1990-2001. The paper also confirms a decrease in the importance of the relative share of unit labor costs in relation with the technology variables. The introduction of these variables (R&D, patents, capital intensity) confirms the importance of R&D expenditure and capital intensity as indicators of technological change on the relative export shares in the sub-sample of small and medium-sized firms. Similarly, the evolution of concentration is also significant for the variations in relative share of exports in those firms, while not being particularly relevant for large firms.  


Two Sectors Economy and the Effects of Pollution on Economic Growth

Dr. Ben-David Nissim



 An economy with two production sectors and four types of agents is presented. The production process of the first sector pollutes the environment, and the second produces without pollution. When a critical perceived level of pollution is approached, the competitive economy converges into a steady state with a low level of capital.  Many ecologists and economists alike fear that without the guiding hand of a wise government a competitive economy will drive itself all the way to doomsday. This fear is rooted in the premise that in a competitive economy where consumers are too small to fight the polluting production processes, firms are able to follow their profit maximization incentives without any possibility of a counteraction by the victims of the deterioration of environmental quality. Many people worry that environmental protection comes at the expense of economic growth. This thinking is based on the premise that the earth's resources and its ability to absorb pollution and regenerate are finite and that continued growth will inevitably reach these constraints. Meadows et al (1972) argued that the collapse of the world’s ecological and economic systems was imminent and that to avoid disaster we must move to a zero growth world.


Driving Innovation and Improving Employee Capability: The Effects of Customer Knowledge Sharing on CRM

Jia Shi and Leslie Yip, Hong Kong Polytechnic University, KLN, HK



 In this paper, we propose a conceptual framework of customer knowledge sharing, which is a critical process for achieving effective customer relationship management (CRM). An organization’s customer knowledge, innovation ability, and employee capability are regarded as a firm’s crucial resources by using the resource-based view (RBV). Customer knowledge sharing gives direct support for an organization’s innovation and human resource functions, and hence, results in products /services improvement and marketing employees’ capability enhancement. However, in the existing relationship marketing literature, the internal organization processes have not received adequate attention. Our emphasis on internal organizational process is potentially helpful to add new dimensions to CRM and relationship marketing literature. In order to verify the effectiveness of the framework, we also include several propositions, where the testing data will be collected from the industries in China. This differs greatly from many of the previous efforts where the targets are on the western firms. The results of our paper are potentially crucial for Chinese managers to broaden their knowledge in CRM implementation.


 The Effect of Syntactic Complexity, Social Comparison, and Relationship Theory on Advertising Slogans

Julie M. Stewart and Marilyn K. Clark



 This study examines the impact of syntactic complexity, social comparison, and relationship theory on the effectiveness of advertising slogans by comparing participants’ response to Xavier University’s current simple slogan, “The Power of X,” and an alternative complex slogan, “Musketeer Loyalty, Jesuit Thinking.”  Companies use slogans to introduce themselves, their products or their services to the public through advertisements and special promotions.  In order for a slogan to be successful in representing a company or institution, it must connect with the public in two important areas:  it must be understood by the consumer and be readily associated with the particular brand it represents.  Three important concepts associated with slogans are syntactic complexity (Lowry, 1998) (Bradley & Meeds, 2002), social comparison and advertising (Lin & Tsai, 2006), and relationship theories of advertising (Fournier, 1998).  Syntactic complexity refers to the way language is used by a writer and processed by a reader.  Social comparisons involve advertising and the way consumers relate to that advertising.  Relationship theory looks at brand loyalty and extending that which is already known about an organization or company into the advertising so that consumers associate a product with something about which they already have a positive idea.


Analysis of the Generation Investment Strategy of Spanish Electricity Enterprises

Dr. María Teresa García-Álvarez, Dr. Rafael M. García-Rodríguez and Dr. Rosa María Mariz-Pérez



 Liberalization of electricity industry has as its basic objective an increasing of efficiency by means of the decentralization of decision-making. As such, the investment decision in new generation capacity is especially relevant because the electricity supply is indispensable, in the modern societies, due to its utilization in the majority of the productive processes. The objective of this paper is to provide a comprehension of the specific dynamics of the generation investment in the new liberalized electricity markets. So, electricity enterprises have autonomy to make such a decision and, therefore, the price established in the electricity wholesaler market is set as a basic sign in the investment.  In this context, we develop a simulation model of the Spanish electricity market which shows the presence of boom and bust cycles in investment as a consequence of the electricity companies have autonomy to make these investments.  Liberalization assumes that electricity generation can be a “normal” competitive activity if the network activities -transport and distribution- are regulated whenever this regulation allows for non-discriminatory access to existing network for new agents (De Vries, 2005). Therefore, it is expected that the wholesaler electricity market allows the production of the electricity output in an efficient way and an optimum investment which secures the stability of the offer of such a product.


Individual Spirituality at Work and Its Relationship With Job Satisfaction and Burnout: An Exploratory Study Among Healthcare Professionals

K. Komala and Prof. L. S. Ganesh, IIT Madras



 Spirituality is now a topic of interest in management research.  Though spirituality can be practiced in the context of any work, healthcare has an advantage over other sectors.  This is because of the historic association of spirituality with health and the nature of the profession itself.  The present study explores the relationship between Individual Spirituality at Work and healthcare professionals’ job satisfaction and burnout.  This work focuses on healthcare professionals - doctors and nurses who are full time employees in hospitals located in India.  A cross sectional descriptive research design is adopted and data is collected through a survey method.  Correlation analysis revealed a significant positive relationship between Individual Spirituality at Work and job satisfaction and a significant negative relationship with burnout.  This will enable a better understanding of Individual Spirituality at Work and bring to light its relevance in hospital settings.  Healthcare administrators can also utilize this valuable information and thereby improve the functioning of hospitals and healthcare delivery.


Organization as a Source of Competitive Advantage: Case of Croatia

Lovorka Galetic, Ph.D., Jasna Prester, Ph.D., and Ivana Nacinovic, B.Sc.



 In today’s turbulent environment one of the main interests of any enterprise is to achieve competitive advantage and to outperform others due to its ability to create more value from resource used. Organization design as an organization archetype has been recognized as a possible source of competitive advantage by academics and practitioners. Thus organizations strive to adapt their organization design to external environment in order to benefit from organization design as a source of competitive advantage. This paper is based on the exploration of possibilities for organization structure to be a source of competitive advantage in Croatian enterprises. The survey was performed in Croatia by the end of 2004 and in the first three months of 2005. The sample includes 350 Croatian enterprises whose top managers received the questionnaires. Questionnaire return rate was 18% and included different branches of economy. Extensive research has showed the following: organization is recognized as a source of competitive advantage by Croatian enterprises, although statistical evidence that organization design and competitive advantage are interdependent was not found. Even though the relationship among strategy and structure is important, the compatibility among organizational structure and strategy is not statistically related with competitive advantage in Croatian enterprises.


Re-examining the Relationship between Stock Prices and Dividends: Evidence Based on Taiwan Panel Data Investigation

Dr. Chi-Wei Su, Hsuling Chang, Dr. Tsangyao Chang, and Dr. Chien-Chun Wei



 In this study, we employ the newly developed panel unit root test and cointegration technique to determine the long-run relation between stock prices and dividends in Taiwan’s stock market during June 1991 to February 2005.  Panel methods amplify the power and precision of the estimation procedures, allowing to concentrating on both the short- and long-run relations.  The results indicate that there exists a significant cointegration relationship between stock prices and dividends.  These findings further support the existence of stock price increases relative to fundamentals.  Different from previous studies, our results reveal that stock prices adhere to dividends and rational bubbles were nonexistent in the Taiwan’s stock market.  This study investigates whether rational bubbles were present in Taiwan stock market during June 1991 to February 2005 time period.  Financial theory points out that in a well-functioning capital market the prices and dividends should be related (Brealey and Myers, 1986); the present value of the share should be equal to the dividend stream discounted by the return earned on securities of a comparable risk. 


Interdependence between Organisational Culture and Leadership Styles: The Croatian Case

Marin Buble, Ph.D. and Ivana Pavic



 Organizational culture is the set of values, norms, standards of behavior, and common expectations that control the ways in which individuals and groups in an organization interact with each other and work to achieve organizational goals (Jones et al, 2000, p. 332). It is twined into all organisations' activities and it represents its personality. The significance of organisational culture brought many experts to the conclusion that the organisational culture is the condition for the success and development of modern organisations. The essential factor for organisation's success and development is the functionality of the organisational culture. In this context the essential is a role of the management. This leads to the leadership style that is a process of influencing people to direct their efforts toward the achievement of some particular goals (Hodgetts and Luthans, 2000, p. 400). An important source of insight into organizational performance can be provided by theory and research on organizational culture connected with leadership styles, because, undoubtedly, the interdependence between these two variables has a powerful effect on knowledge about long-term effectiveness of organization. The purpose of this paper is to determine the interdependence between organizational culture and leadership styles in Croatian companies; to establish its existence, to realize its importance and intensity, and to clarify implications of its existence or non-existence. In accordance to mentioned research objectives, this survey was conducted during the second half of the year 2006 at the sample of 118 Croatian companies, in which 389 individuals (managers) were interviewed, and a number of conclusions were reached.


Cultural Differences: Results from Empirical Research Conducted in Croatia, Slovenia, Bosnia and Herzegovina and Hungary

Darko Tipuric, Ph.D., Najla Podrug, MSc, and Domagoj Hruska, MSc



 The paper presents results from the empirical research conducted during year 2005 in Croatia, Slovenia, Bosnia and Herzegovina, Hungary and Finland. The instrument used in the research was Value Survey Module 1994, a modified version of the original Hofstede’s questionnaire that was defined by the Institute for Research on Intercultural Cooperation (IRIC) for the purpose of recurrence of the original research on national culture’s dimensions and for comparison with original research. Estimated positions on the dimensions of national cultures (power distance, uncertainty avoidance, individualism/collectivism, masculinity/femininity and long versus short-term orientation) were done by using a narrow-sample strategy. The narrow-samples were postgraduate and doctoral students in the field of business and economics. Results from Finland were used for standardization purposes.


Accounting Based Valuation Models and Security Prices in India -An Empirical Assessment

Dr. Ramesh Gupta, IIM Ahmedabad, India



 There is a large literature examining how accounting values, including earnings, relate to contemporaneous equity values. Ohlson ( 1995,1999) and Feltham and Ohlson (1995,1996) develop valuation models that link accounting amounts and equity values by assuming a link between equity values and the linear information structure of the accounting amounts. Although such models have been the subject of empirical testing, few studies tests whether they aid in predicting equity values. We use Residual Earnings (RE) Valuation and Abnormal Earnings Growth (AEG) model to predict equity values of the 50 largest firms in India comprising the NSE S&P Nifty Index. The valuation approach consists of reformulating and forecasting financial statements, estimating residual earnings and determining firm value. An integrated matrix framework using price-to-book and price-to-earnings ratios is used to classify firms to be used as a comparative filter for identifying mispriced stocks. Finally, an investment recommendation is developed for each of the 50 firms based on differences between market price and intrinsic value.


Videoconferencing in Virtual Teams

Zlatko Nedelko



 Over the past two decades, several innovative ways of working have emerged—among them, virtual teams. In today’s world, virtual teams have become almost a prerequisite to succeeding in the global economy. Technology is a crucial element of any virtual team, and a broad range of groupware exists that supports virtual teams’ work. However, team members still have unique obstacles to overcome. Frequent complaints from virtual team members relate to the lack of face-to-face contact and the inability to share non-verbal communication. Using a videoconferencing system in performing the virtual team’s work can help eliminate such problems as videoconferencing simulates very closely face-to-face communication. The paper presents an overview of videoconference typology and assesses which types of videoconferencing systems are most suitable for performing the different tasks associated with virtual teams.  Recent improvements in information and communication technology have resulted in many new ways to work. One of these innovative ways is the virtual team (Stough et al., 2000).


Reporting of Beef Purchaser Demographics: A Descriptive Analysis of Major Southern U.S. Markets

Roger Hanagriff, Ph.D., Michael Lau, Ph.D., and Stanley Kelley, Ph.D.



 This paper investigates the purchasing demographics of beef consumers in major U.S. markets.  The data represents the purchasing habits of 174,745 beef transactions, creating a large sample size to establish base-line demographics for interested stakeholders.  In general, beef consumers are males over 55 years of age, married, college graduates, with professional occupations and average household income exceeding $50,000 annually.  These characteristics describe an aging consumer and a product that does not seem to appeal to the younger aged consumer.  This information is valuable to stakeholders for developing key marketing strategies.  In the past 20 years, the beef industry has experienced significant changes of beef at the retail counter.  With health and convenience being the initial driving factors however, more recent changes have occurred due to palatability preferences and safety concerns of the consumer. 


Exploring the Effectiveness of a Destination’s Tourism-marketing Expenditures: Conversion Rate and Return on Investment Analysis

Dr. Mark M. Gultek, Dr. Tufan Tiglioglu and John C. Parmelee



 This research examines the effectiveness of tourism marketing expenditures by analyzing the conversion rate and return on investment ratios for a tourism destination.  Determining return on investment and conversion rate for marketing expenditures is a difficult endeavor in any industry, and it is particularly a challenge for the tourism industry. Regional tourism officials strive to correlate marketing expenditures with the sales resulting from those expenditures, and the number of actual visitors to a region as a direct result of the region’s marketing efforts. The marketing expenditures expended in the Lake Placid/Essex County regions of New York by the County Visitors Bureau was the primary focus of the study to determine the effectiveness of the public marketing dollars. In addition, the study analyzed other key visitor profile information.  County convention and visitors bureaus that are responsible for marketing a county’s tourism assets struggle to determine the value of their marketing dollars. A direct measure of their marketing efforts’ effectiveness may not always be clear.


Momentum Returns in US Corporate Bond Pricing: Evidence from Daily Price Data 2002-2006

Kevin R. Foster and Carlos Galindo



 This paper shows that US corporate bonds traded over-the-counter exhibit short-horizon reversals very similar to that documented for stock returns by DeBondt and Thaler (1985, 1987) and Lehmann (1990) rather than momentum as documented by Jegadeesh and Titman (1993).  The contribution of this research paper lies in the use of daily information from 2002 to 2006 from the NASD's Trade Reporting and Compliance Engine (TRACE) database, so not only is the frequency comparable to stock market studies but the time period is much more current than any previous bond contrarian/momentum studies.  Rapid advances in information technology have driven substantial changes in financial markets.  Trading in the US corporate bond market has become much more transparent as the National Association of Securities Dealers (NASD) since 2002 has introduced real-time quotes of over-the-counter (OTC) bond trades.  This paper examines this market to distinguish empirical regularities in the bond market that parallel such patterns that have been found in many stock markets.  Since this bond reporting is still nascent, the research in this paper must be provisional, establishing a benchmark from which to measure future developments in pricing efficiency.


Virtual Teams: Just a Theoretical Concept or a Widely Used Practice?

Gerda Mihhailova, University of Tartu, Pärnu College, Estonia



 Virtual teams and management processes in them have been researched mainly theoretically.  Most of these papers concentrate on presenting the definition and/or on outlining the advantages/disadvantages of virtual teams. Use of virtual teamwork is still relatively new field for academic research and even when researched empirically usually case study, interviewing or some other small sample approach is used. Current paper tries to test on a bigger sample of data, based on a questionnaire type of research, is the use of virtual teams really growing as usually stated in theoretical papers on this subject. As use of ICT is one of the main characteristics of virtual teams the study concentrates on issues related to ICT-mediated communication for co-operation purposes. The empirical results presented in the article are based on a sample of 226 Estonian service sector organizations.  The organizations have started to use teamwork for solving the problems and tasks mainly during the past 15 to 20 years. A team is a group of individuals who work interdependently for solving the problems and accomplishing tasks (Kirkman, Mathiew 2004). Relatively recent developments in the field of information- and communication technology (ICT) have enabled the organizations to start using also the so called virtual teams.


Influence of Engineering and Technology on Banking and Capital Markets in Developing Countries

Dr. Celestine Chukumba, Samuel A Oyewole and Manu Parbhakar



Developing countries are now getting access to modern banking services; however a huge market still remains unserviced. High oil, natural gas and commodity prices, growth in the knowledge industry (Drezner, 2004) and migration of manufacturing jobs from developed countries are further fueling the demand for improved banking services. Besides in the past few years the financial markets here have been marked by high returns and lower structural risk. This lower risk can be attributed to better regulation, migration to e-trading and corporatization of stock exchanges. These measures have attracted growing number of foreign investors. Information technology (IT), a burgeoning communication infrastructure and an expanding engineering manpower are the other big enablers in this financial transformation. Technology is providing cost effective means of rendering banking services at ever decreasing costs. This makes it possible for more people to invest their wealth productively in capital markets and banks. In this paper we propose that as more engineering practices are introduced in the banking and financial sector in developing countries, it will lead to higher productivity and greater access to improved quality banking services at cheaper cost.


Cross Country Comparison of Religious Values and Income: Implications for Managers

Dr. Constance S. Bates



 Fundamental differences exist between high and low income countries.  Among these are cultural values.  The World Values Survey and the European Values Survey show an important difference in the view toward religion.  Generally, low income countries value religion more than high income countries.  This article reviews survey results to show specific differences regarding view toward religion.  The resulting implications for managers are discussed, focusing on high income managers going to low income countries and vice versa.  As international business activities expand around the globe, managers are faced with the challenge of adapting to new environments.  One of the more subtle but challenging situations is how to manage in a country with a very different view toward religion.  This article uses the World Values Survey and the European Values Survey to show how high and low income countries differ regarding view towards religion.  Six questions from the surveys are explored to further understand the view towards religion of these two groups. 


Corporate Governance and Ownership Concentration in Croatia

Darko Tipuric, Ph.D., Domagoj Hruska, M.Sc., and Ana Aleksic, B.Sc., University of Zagreb, Croatia



 The developments in the Croatian corporate sector in last fifteen years showed that the institutional framework during the 1990s was very poor and in combination with unorthodox method of privatization resulted in the emergence of severe social and economical problems. However, certain improvements in the area of corporate governance have taken place in recent years.  Ownership concentration has crucial policy implication with respect to corporate governance. It defines distribution of control between managers and shareholders. Large number of small shareholders increases separation of ownership and control. While in American business practice ownership structure is extremely dispersed, in rest of the world ownership is concentrated within large shareholders. Concentration of ownership in the hands of few or even one big shareholder ensures level of control that allows direct control of management actions, however it brings forth another agency problem – one between dominant and minority shareholders.


The Rise of Workplace Incivilities:  Has It Happened to You?

Diane Bandow, Ph.D. and Debra Hunter DBA,



 Incivility in the workplace has become a growing concern. Aggression, including harassment and bullying in the workplace has become a growing concern in the United States because aggression often leads to violence.  Although different forms of incivility including aggression and bullies have historically existed for centuries, this behavior in the workplace which often has tacit acceptance diminishes organizational performance.  Workdays can be lost because of abuse which can lead to errors, increased sick leave and lost productivity.  Moreover, incivilities existing between supervisors and subordinates may not only stiffen interpersonal relationships but also obstruct productivity and demean an individual’s self-worth.  The purpose of this paper is to identify workplace incivilities based on existing research and to propose a research agenda that will address the knowledge and frequency of experience individuals have relative to this abuse, (including instigators)  and its effect on job satisfaction in the workplace.


The Growing Popularity of Internet Banking Among UAE Consumers

Dr. Muhannad Radi Khanfar



 This study focuses on the growing popularity of Internet banking among consumers in the UAE. Despite such growth, occasional phishing scams, and other factors may affect this popularity negatively. The sample for this survey was drawn from the banks providing Internet banking services in the UAE. In addition to the fears of Internet misuse by hackers and other security concerns, ignorance of Internet banking and its advantages are the main obstacles to increasing its popularity among consumers. To overcome such obstacles, this study suggests some possible solutions.  Moreover, this study suggests that delivery of banking services through the Internet should be integrated into overall customer service and service marketing strategies. Such measures could help in creating a mass migration of customers to Internet banking, leading to considerable savings and tremendous  reduction  in operating expenses for banks and financial firms.


Economic Reforms and the Attenuation of African Collectivism: Implications for Human Capital Management in Africa

Constantine Imafidon Tongo



 Historically, resolving economic problems confronted by industrial societies has been found to be closely associated with the evolution of management thought. The economic reforms (privatization, deregulation, etc) currently pursued by African governments and enterprises to resolve their economic problems should be no exception. However, in the quest for evolving an indigenous management system suitable for African employees; management scholars in Africa have been oblivious to the impact of these economic reforms on future management thinking in Africa. Primarily, they seek to evolve an African management system that aligns with the values and traditions of African collectivism. But it is not possible to extricate African collectivism from the mechanisms of her previously planned central economy. Presently, the African State is placing an overarching emphasis on market mechanisms, which rely on impersonal network of forces and decisions in allocating resources. Consequently, it is doubtful whether African collectivism would stand the test of time given this context. In brief, the attenuation of African collectivism by these market forces and the envisaged birthing of African individualism would generate a paradigm shift in the ways African managers coordinate their human capital in attaining stated objectives. This study seeks to investigate the consequences of this paradigm shift in human capital management in Africa.


Peer Reviews: Are Web-Based Ratings More Accurate Than Paper-and-Pen Ratings?

Dr. L. Kim Troboy, Dr. David W. Roach, and Dr. Loretta F. Cochran



 This paper examines advantages and disadvantages of using computers and networks to implement student peer evaluation of written work. Because data entry is accomplished electronically, web-based rating systems are less expensive and require less effort to administer than paper-based rating approaches for large groups. Thus, when adequate computers and internet access are available, web-based rating systems are an attractive alternative to traditional pencil-and-paper systems. Despite these advantages, questions remain. Will students engage in this process? Will students provide accurate ratings? What factors influence student performance in a peer review? In this paper, we compare the accuracy of ratings provided by students evaluating peers using a web-based system with those using a traditional pencil-and-paper system. We also examine the effect of contextual factors (anonymity, rater familiarity with computers and length/complexity of rating item questions).


The Analyses of Competitiveness-Associated Research and its Connection with Government Industry Policies:  An Empirical Study of Taiwan

Liang-Hsuan Chen, Ph.D. and Huey-Der Hsiao, Ph.D. Candidate



 In the increasingly challenging world economy, competitiveness is an important concern for government, industries, and academic researchers. This paper investigates the contents of competitiveness-associated theses in the business administration-related institutes of Taiwan from 1985 to 2004. First, Content-analysis is used to classify and examine 439 theses, then five hypotheses are tested, and finally some conclusions are made: when research on competitiveness and related topics was being conducted, different research methods and tools were used, certain target industries were preferred. In addition, an association analysis between research objectives and government industry policies is also made in this paper, and it finds that, after 1990, research on competitiveness had a higher association with government industry policies with regard to technology and the economy.  In the global competitive environment, competition between nations and/or business enterprises is becoming extremely intense, thus competitiveness is a central management issue for policy makers and industries. In general, a great amount of effort from government and industries is made to reinforce national and/or business competitiveness.


Study on the Co-Opetition of Industrial Chain by Ecological Methods

Dr. Chen-kuo Lee



 This study attempts to implement a unitary industrial chain development model based upon the high level of similarity between industrial chain and ecological groups via the logistic growth model outlined in the population ecological theory so as to analyze the factors that affect the scale and growth of industrial chains and, meanwhile, to analyze the trend of changes for a number of industrial chains based upon the three industrial chain relationships (competition, mutual benefit, and loot) via the self-organization stationary theory. This study concludes that the competitive industrial chain’s development trend is determined by two industrial chains’ competition for resources; cooperative industrial chain’s relative position determines the level of strengths that support each other; and the looting industrial chain upgrades its resource integration efficiency and maintains an optimal looting percentage at the same time.


Identifying Stakeholders’ Positions through Value Creation System

Chia-Hui Ho, Ph.D.



 Partner relationship is one of competitive strategies for firms in the future business environment. Partnership can be widely recognized as relationships with customers, suppliers, local community, or even with competitors. These partners are mostly external stakeholders to firms. However, partner relationship is so complicated and interrelated, thus, traditional management concept cannot deal those issues. Stakeholder analysis is applied to identify various partners and extended as a mechanism for firms to manage those partners. This paper intends to explore the relationships between firms and those stakeholders; meanwhile, it identifies multi-layers of net that constitutes the partnership network (Value Creation System, VCS).  The VCS includes four layers of net: technology support net, value adding net, social connection net, power relationship net. These four nets are integrated and constituted as network for firms and their stakeholders. Hopefully, through stakeholder identification and evaluation of firms’ external relationships can give guidelines for firms to manage their relationships.


Performance Following Asset-Backed Securitization

Li-Ching Chiu and Dr. Yi-Ta Hsieh



 We examine the long-run stock price and operating performance of 447 open-market asset-backed-security (ABS) issues. Our results show no evidence of a market underreaction phenomenon; however, under the buy-and-hold abnormal return method, we do observe some positive abnormal returns in the three-month to three-year period subsequent to the issue announcement. Our results also show that securitizers experience no improvement in operation performance following ABS offerings, but do perform significantly better than their industry and matching non-securitizing firms in some of the pre- and post-periods. The empirical evidence suggests that managers and investors are likely to be overoptimistic about the prospects of firms that securitize assets. Overall, our results confirm that with a weaker signaling power, open-market ABS programs have indeed been market efficient.   Corporations, especially financial firms, have long been interested in the relative merits of conducting asset-backed securitization. A good deal of the prior research effort has focused on excess returns in the short window surrounding the announcement or issue date of the ABS offering. For example, when studying a sample of 294 ABS issues, Lockwood et al. (1996) documented that shareholders experience a wealth loss one day before the announcement date and a wealth gain on the actual announcement date.


Knowledge Transfer: Past Research and Future Directions

Tsai–Lung Liu



 Studies on knowledge transfer are rarely based on a longitudinal perspective, which explores relevant research over time. The purpose of this research is to explore the research trend of knowledge transfer from 1980 to 2004, and to suggest some potential areas for future research. Content analysis is proposed to analyze the literature on the related areas, such as the application field, methodology, data, level of analysis, focus of study, related constructs, and variables. Through the content analysis of 135 articles, the results not only show the development of research on knowledge transfer over the past 24 years, but also unveil the five most frequently studied constructs and the related variables. This research provides some suggestions from internal and external organizational perspectives for future research on knowledge transfer. In addition, this research provides a comprehensive understanding of the relevant specific research on knowledge transfer over time, which may shed some light for future researchers to enrich the fields of research.  For the next 25 years, the dominant competitive advantages are education and skill of the workforce (Drucker, 1998).


Philosophy of the Chinese Legalist School: Study of the Case of Taiwan

Dr. Chiou-Hua Lin and Yuan-Kai Chi



 China has been standing firmly for more than 5000 years.  Though through turmoil, the rebellions have been successfully settled to create peace and good reign, mainly relying on the continued contribution of intelligence and effort of our great ancestors, creating the best management philosophy. Management science is a kind of complicated dynamic development process.  It has such characteristics as target, methodology, input, time/space and development, etc.  On the other hand, the management thoughts of the Chinese Legalist School have influence on the development of Chinese culture and society progress for several thousand years that have been integrated into the management process and significance.  The management science of Chinese Legalist School it develops from an age of getting rid of the feudalistic ideas about “protocol reign”, but as a management philosophy developed on the foundation of a community in a new age. It to study, construct the jurisdiction management technology from the concepts of a leader and manager.  Except for extremely high concern of “laws, regulations”, “power and authority”, the “credibility in merit and punishment” is also implemented, to manage people.


A Link Between Strategic Goals and Financial Performance: Goodrich Aerospace Corporation - A Case Study

Dr. Hailu Regassa and Dr. Ahmad Ahmadian



 Goodrich Aerospace Corporation is a leading global defense industry. In its quest to attain a steady and sustained growth, the company has identified three key strategic goals: balanced growth, leveraging the enterprise, and operational excellence that it considers are mission critical to its success in creating long-term value to its shareholders. This case addresses various questions in examining the financial performance of this company in light of its strategic objectives. An attempt is also made to provide solutions for these questions.  Goodrich Aerospace is a leading global aerospace and defense company. It was founded in 1870 and incorporated in 1912 as BFGoodrich Corporation. The founder of the company, Benjamin Franklin Goodrich, originally started the company to manufacture rubber products that he had invented. For seventy years, BFGoodrich was widely known as a tire manufacturer even if the company also produced other products such as space suits and specialty chemicals.


The Effects of Organizational Culture and Knowledge Management Mechanisms on Organizational Innovation:  An Empirical Study in Taiwan

Su-Chao Chang, Ph.D. and Ming-Shing Lee, Ph.D. Candidate



 The 21st century is an era of knowledge Economy. Knowledge will replace some traditional factors like capital, land and labor to become the most strategic resources among organizational competition. Knowledge management is aimed to enhance organizational competence and allow adequate people with adequate information technology at tight time.  This research was mainly based on experimental subjects of Top 5000 Business Organizations 2005 published by the China Credit Information Service Ltd. The random sampling was adopted from 800 business organizations with respondents ranking of department managers above or chairmen in charge of business. There were totally 138 valid responses received. According to analysis results of multiple regressions, the findings are shown as below.1. Supportive culture and innovative culture had significantly positive effect on knowledge acquisition and knowledge diffusion; 2. Innovative culture and supportive culture had significantly positive effect on administrative innovation and technical innovation; 3.


Strategic Planning Practices in Profitable Small Firms in the United States

Dr. Karen A. Meers and Colin Robertson, Western Connecticut State University, Danbury, CT



 Strategic planning has been linked to performance in small business enterprises in several dimensions.  This study investigated the extent and types of strategic planning tools and techniques used by profitable, privately- funded small firms.  The sample consisted of 17 strategic planning executives, each representing a successful small business.  A self-report questionnaire inquiring about company planning practices was distributed.  The data were analyzed to identify common themes associated with Roney’s (2004) three stage comprehensive planning process and other popular strategic tools and techniques utilized in strategic planning.  The data revealed that these small firms primarily engaged in comprehensive planning on an informal basis.  Traditional tools and techniques prevalent in strategic management literature, however, were not used in the process.  Practical implications of the contextual nature of small business planning are discussed.


Cost Containment Strategies and Quality of Care

Saeed Mohaghegh, Assumption College, Worcester, MA



 Two of the major concerns in the health care industry today are cost containment and quality of care.  Health care providers have strived to strike a balance between these two goals with very little success.  Managed care organizations have failed to develop strategies that can successfully control health care costs without sacrificing the quality of care.  This paper will discuss cost containment strategies used by managed care organizations, the main cost drivers in health care, and the impact of these strategies on the quality of care provided.  A survey of sixty five health care providers showed that cost cutting measures adversely impacted the quality of care.  In addition, cost containment strategies have not been successful in controlling the health care costs due to cost drivers and quality concerns.   Although adequate research on the topic of cost containment and quality of care has been conducted, there is no conclusive evidence on how quality of care is affected by cost containment strategies (Shi, 2004).  Of course, consumers desire and expect the best possible quality of care, but it is questionable if this care is likely with the financial pressures put on healthcare providers. 


The Impact of the European Integration on the Pharmaceutical Industry

Dr. Aysegul Timur and Dr. Gabriel Picone and Dr. Jeffrey DeSimone



 The European Union has experienced closer market integration through the Single Market Program (SMP) and Economic and Monetary Union (EMU) since the 1990s.  The SMP has motivated changes on the product markets by the elimination of trade barriers, whereas the EMU has facilitated changes by the common notes and coins across the euro area. In addition, there have been specific attentions and structural reforms in various product markets to increase competition, monitor cross country price differences and increase transparency. This study is aimed to find how the integration process has affected price differences in the European pharmaceutical market, which is the fifth largest industry in the EU. Using the data between 1994 and 2003 from five EU countries on prices of cardiovascular disease drugs, the results provide evidence that there are still significant price differences across the nations in the single pharmaceutical market in the European Union.


Independent Directors and the Propensity to Smooth Earnings: A Study of Corporate Governance in China

Prof. Liona Lai and Prof. Henry Tam



 The purpose of this paper is to examine empirically whether independent directors serve an effective role as a corporate governance mechanism in reducing income-smoothing earnings management in China. Using board of directors and financial accounting data for a sample of firms listed on the Shanghai Stock Exchange and Shenzhen Stock Exchange from 2000 to 2002, we explore whether the adoption of independent directors affects the negative relationship between the change in cash flows and accruals. We extend the model developed by Dechow (1994) and Dechow et al. (1998) and show theoretically that a less negative relation between the change in cash flows and accruals indicates less income smoothing. Our empirical results suggest that Chinese firms that voluntarily adopt independent directors, as well as firms that have larger fraction of independent directors, have less severe practice of income smoothing.  The monitoring role of independent directors within a firm’s corporate governance structure has been an object of increasing attention in recent years. While the concept was not new in the US, the trend toward a more prominent role for independent directors has become global recently.


Logical Spreadsheets:  A New Tool for Business Students

Jerry M. Chin, DBA and Mary H. Chin, MBA



 Logical spreadsheets have become a new area of research (Kassoff, 2006) for faculty from computer science, accounting, finance as well as the business faculty.  While the spreadsheet in its present form is a valuable tool to students throughout the business curriculum, it can be improved by implementing logic into the capabilities.  Many of the users of Excel do not program, especially in the VBA code native to Excel.  The ARulesXL software adds the ability of the user to make queries in an environment that is easier to maintain for the non-programmer.  In this paper, we show one example implemented in VBA and then using the ARulesXL rules engine.  Spreadsheets are everywhere.  They are pervasive in corporations, classrooms, and labs.  Early on, Powell (2006)  knew students would learn spreadsheets because they knew that their jobs would involve spreadsheets.  


Age Discrimination and Downsizing

Dr. Suzanne M. Crampton and Dr. John W. Hodge



 Downsizing, outsourcing, and privatizing have been popular topics since the 1980s.  During the past decade greater attention has been given to the aging of the American workforce.  As the workforce has aged and companies have downsized and generally increased their efforts to control labor costs, the number of age discrimination lawsuits has also increased.  The extent to which there is a causal relationship among downsizing, cost containment, the aging workforce, and the increasing claims of age discrimination cannot be scientifically concluded.  A discussion of the relationship between these cost-cutting strategies (e.g., downsizing, outsourcing, privatizing) and age discrimination will be provided along with recommendations organizations can implement to avoid legal problems.  Downsizing, outsourcing and privatizing have been common occurrences for public employers since the 1980s with the common goal being to cut the cost of operations.  Since wages generally increase with age, there are experts that suggest that these labor cost control measures have a greater negative impact on the older worker (Administration on Aging, 2002; Joyce, 1999).  The loss of a job is especially problematic for the older employee.


Strategic Role of International Companies for Developing Romanian Brewing Market

Adina Negruþa, Ph.D., Smaranda Cosma, Ph.D., and Partenie Dumbrava, Ph.D.,



 The goal of this paper is to analyze the strategies used by international brewing companies in Romanian market and the development of Romanian beer market in the context of UE integration. CEE has played a significant role in the growth strategies of European breweries, increasing their market reach in terms of consumer base, volume and dynamics. The paper starts with a review of the evolution of Romanian brewing industry and the characteristics of the consumer behaviour in this market. Furthermore, the investment strategies of the most important competitors are analyzed and the paper outlines the opportunities of the market and the competitive advantages created by the foreign investors in brewing industry, like BBAG, Interbrew, SAB Miller and URBB Tuborg, based on strategic decision and alliances. In the last part, the paper presents the most important decision and strategies applied by the domestic brewing companies in order to survive in the market. In conclusion the key objective for investment in the Romanian market was market-seeking and the main market entry modes have been acquisition of former state-owned breweries


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