James R. Bartkus and M. Kabir Hassan
Modern portfolio theory demonstrates that a well‐diversified portfolio will minimize unsystematic risk. It may be impractical to achieve a well‐diversified portfolio of venture…
Abstract
Purpose
Modern portfolio theory demonstrates that a well‐diversified portfolio will minimize unsystematic risk. It may be impractical to achieve a well‐diversified portfolio of venture capital (VC) investments due to market imperfections, leading to the decision to specialize. The purpose of this paper is to determine the implications of choosing a strategy of specialization versus diversification in venture investing.
Design/methodology/approach
Using a dataset of US VC funds across a 20‐year time period, this paper verifies that there has been a tendency for venture capitalists to pursue a specialization strategy in both industry and stage of development of portfolio firms. A multivariate two‐limit tobit model is constructed to determine the effects of these decisions on venture success rates.
Findings
It is found that venture capitalists that diversify across portfolio company stage of development have greater success in bringing companies public and exiting their investments via acquisition. Industry specialization has no significant impact on venture fund success rates.
Research limitations/implications
Success rates may be less important than returns to investors in VC. Future research should examine the effects of specialization on investor returns.
Practical implications
It may be beneficial to increase the level of diversification of VC investments across portfolio company stage of development. The lack of diversification across industry has not significantly affected success rates across funds, thus the tendency to specialize in particular industries over the sample period is not necessarily a poor decision.
Originality/value
Prior research demonstrates a tendency for specialization in VC investing. This paper examines the implications of adopting this strategy.
Details
Keywords
James R. Bartkus, M. Kabir Hassan and Geoffrey Ngene
The purpose of this study is to investigate the effects of increased fund commitments on portfolio size and subsequent effects on portfolio success rates. This paper empirically…
Abstract
Purpose
The purpose of this study is to investigate the effects of increased fund commitments on portfolio size and subsequent effects on portfolio success rates. This paper empirically analyzes the changes in average portfolio size over a 20‐year time period and how these changes affect the venture capitalists' ability to successfully exit their investments.
Design/methodology/approach
The authors utilize venture capitalists' fund level data and conduct both univariate and multivariate analysis. The multivariate analysis is conducted using a two‐limit regression tobit model. This is justified since the authors' dependent variable is a ratio bounded by zero and one, hence the tobit specification is the most appropriate methodology.
Findings
The authors find that increasing the size of portfolios not only leads to a decrease in the number of successful investments but also significantly affects portfolio success rates. They also find evidence which suggests that some optimal portfolio size exists.
Research limitations/implications
The sample was limited to independent private partnerships that raised funds specifically for investment in US portfolio companies and it represents all funds maintained in the SDC database with non‐missing data on fund size and other fund characteristics.
Practical implications
There are three main practical implications derived from this study. First, venture capitalists overextend themselves by investing in too many portfolio firms. Second, some optimal portfolio size exists beyond which success rate of the venture capitalist's portfolio declines. Third, portfolio size is an important determinant of venture capital portfolio success rates.
Originality/value
The study presents new evidence that venture capitalists have a tendency to increase their portfolio size in years following growth in fund inflows, an idea that has not been investigated earlier. The authors also use data that is not adulterated by significant economic and financial conditions such as internet bubble burst of 2000 and financial crisis of 2007/2008.
Details
Keywords
Farhan Iqbal, Jonathan Bundy and Michael D. Pfarrer
Organizational crises are complex events for researchers to assess. However, research in this domain remains fragmented, and advanced empirical techniques remain underutilized. In…
Abstract
Organizational crises are complex events for researchers to assess. However, research in this domain remains fragmented, and advanced empirical techniques remain underutilized. In this chapter, we offer an integrated approach to assessing crises. We first specify a behavioral process model of crisis management comprised of three stages: interpretations, responses, and outcomes. Within each stage, we identify areas of opportunity and provide methodological recommendations that enhance our understanding of crises and crisis management. We also provide recommendations that could be applied across stages of the model. Taken together, we present a framework by which researchers can more effectively measure and analyze critical crisis dimensions.
Details
Keywords
William I. MacKenzie, Jorge A. Colazo and Robert F. Scherer
Association to Advance Collegiate Schools of Business (AACSB) accreditation encourages business schools to exhibit alignment within their mission, strategies and outcomes to…
Abstract
Purpose
Association to Advance Collegiate Schools of Business (AACSB) accreditation encourages business schools to exhibit alignment within their mission, strategies and outcomes to achieve success. The present study aims to explore the idea of mission alignment and how it may serve as an important moderator to the relationship between organizational resources and school performance as measured through business school rank.
Design/methodology/approach
Our study utilizes the AACSB International business school survey (BSQ) data to analyze the mission statements of accredited business schools and capture data on organizational resources. We also created an index of mission alignment to gauge congruency between the stated mission and strategic focus. Our performance measure was the U.S. News and World Report undergraduate business school programs ranking value.
Findings
Our results show mission alignment on its own has little direct impact on organizational performance. However, when mission statement alignment and resource allocations are combined, they interact to influence organizational performance.
Originality/value
Our research demonstrates that resource allocation decisions and mission alignment are two important attributes of an organization and that mission alignment has the potential to leverage an organization’s resources and capabilities to improve performance.
Details
Keywords
Daniel Cameron Montgomery, Jeffrey G. Blodgett and James H. Barnes
According to a recent study, one of the ten most stressful occupations in the USA is that of a financial services salesperson. Severe job stress has been linked to decreased…
Abstract
According to a recent study, one of the ten most stressful occupations in the USA is that of a financial services salesperson. Severe job stress has been linked to decreased satisfaction, commitment and productivity, and increased absenteeism, burnout and turnover. Aims to test a model of job stress in the financial services profession, focussing on two central sources of stress: individual characteristics and organizational factors. Based on a sample of 288 stockbrokers in nine mid‐south metropolitan areas, finds that the major determinant of job stress is role overload. Recommends that managers impart better time management skills to salespeople, and hire highly competent sales assistants to handle much of the routine work. In order to reduce role conflict and role ambiguity, suggests that sales managers grant salespeople a high degree of autonomy and provide a high level of constructive feedback.
Details
Keywords
Stephen P. Borgatti, Daniel J. Brass and Daniel S. Halgin
Is social network analysis just measures and methods with no theory? We attempt to clarify some confusions, address some previous critiques and controversies surrounding the…
Abstract
Is social network analysis just measures and methods with no theory? We attempt to clarify some confusions, address some previous critiques and controversies surrounding the issues of structure, human agency, endogeneity, tie content, network change, and context, and add a few critiques of our own. We use these issues as an opportunity to discuss the fundamental characteristics of network theory and to provide our thoughts on opportunities for future research in social network analysis.
Details
Keywords
Sarah Willey, Matthew Aplin-Houtz and Maureen Casile
This manuscript explores the value of mission statement emotional content in the relationship between money raised by a nonprofit organization through fundraising efforts and the…
Abstract
Purpose
This manuscript explores the value of mission statement emotional content in the relationship between money raised by a nonprofit organization through fundraising efforts and the money spent. It proposes the emotional content of a mission statement moderates money spent and earned to ultimately to impact how much revenue a nonprofit makes through fundraising.
Design/methodology/approach
The manuscript evaluates the qualitative turned quantitative data (via text mining [TM]) in mission statements from 200 nonprofits serving the homeless sector via a moderation analysis. After segmenting the sampled nonprofits by gross revenue, the authors analyze the impact of the positive and negative emotional tone in each group to determine how the content of a mission statement impacts organizational revenue.
Findings
The paper provides empirical insights about how the emotional polarity of a mission statement influences money earned through fundraising. However, the positive and negative tone of a mission statement impacts organizations differently based on size. For nonprofits that report an annual revenue of less than $1 million, a positive tone in the mission statement results in higher revenue. Conversely, nonprofits that report over $1 million earn less revenue with a positive tone in their mission statement.
Research limitations/implications
Owing to the specialized group sampled, the findings possibly only apply to the sampled group. Therefore, researchers are encouraged to test the relationships found in other areas of nonprofits. However, the implications of mission statement polarity influencing financial performance in any population should be of keen interest to practitioners when crafting mission statements.
Practical implications
The finding that mission statement emotional tone influences the financial performance of a nonprofit has direct implications for the effective delivery of services in the nonprofit realm. Leaders of nonprofits can use the study’s findings to position their organizations to capture potential needed revenue in the crafting of their mission statements.
Originality/value
This paper uniquely exposes the moderating impact of the emotional tone in mission statements in relationship with financial performance.
Details
Keywords
Sheshadri Chatterjee, Ranjan Chaudhuri, Demetris Vrontis, Alkis Thrassou, Soumya Kanti Ghosh and Sumana Chaudhuri
This study aims to identify the business benefit of and factors affecting the use of social customer relationship management (SCRM) in Indian organizations.
Abstract
Purpose
This study aims to identify the business benefit of and factors affecting the use of social customer relationship management (SCRM) in Indian organizations.
Design/methodology/approach
Building on theoretical foundations, a conceptual model of factors affecting SCRM in Indian organizations is developed and empirically tested through a survey and corresponding analysis using SPSS and AMOS software.
Findings
The study presents empirical evidence that technological competence, environmental characteristics and organizational environment positively impact the actual use of SCRM on Indian organizations. Additionally, leadership support of organizations impacts positively the actual use of SCRM in organizations, while the trust factor insignificantly impacts the latter. The actual use of SCRM in organizations was found to have a positive impact on their business benefits.
Research limitations/implications
The theoretical model is built on the constructs of the technology, environment and organizational framework. It has added new factors, such as leadership support and trust, and thereby identified the business benefits of organizations using SCRM mediating through the organizations’ actual use of SCRM. The proposed model is simple, implementable and has a high explanative power of 81 per cent.
Practical implications
The study provides practitioners with evidence and practicable knowledge regarding the means and impact/benefits of SCRM use in Indian organizations.
Originality/value
The study is one of few empirical studies on the topic and contributes valuable knowledge to extant works through additional factors, theoretical conceptualization and empirical scientific findings of both scholarly and executive worth.
Details
Keywords
Chiara Fantauzzi, Nathalie Colasanti, Gloria Fiorani and Rocco Frondizi
This study aims, first of all, to analyze the extent to which Italian higher education institutions declare their mission statements in their official documents; then, to examine…
Abstract
Purpose
This study aims, first of all, to analyze the extent to which Italian higher education institutions declare their mission statements in their official documents; then, to examine their content; and finally, to investigate whether mission statements include considerations on sustainability dimensions.
Design/methodology/approach
After a theoretical background on the new strategic approach adopted by higher education institutions and the related disclosure of their mission statements, the study deepens their sustainable perspective presenting the concepts of social engagement and knowledge transfer from a literary point of view. Then, a documentary analysis on the content of Italian universities’ official mission declarations will be conducted, to understand the role they play in society, by individuating their actual interest in sustainable dimensions.
Findings
Findings suggest that 36% of the 98 Italian universities state their engagement in societal issues, but only 3 of them mention sustainability targets in their mission declarations.
Research limitations/implications
The study is limited, exclusively based on what higher education institutions share and, in terms of future perspective, the aim can be to investigate further official documents, especially for what concerns sustainability reports.
Practical implications
Practical implications regard the denounce of weak attention paid by Italian universities to sustainability, with the aim to foster them to increase connections with the external world, aware of the centrality of their role within society.
Originality/value
In a context that is not yet completely investigated, the originality of the paper regards the intent to study the sustainable propensity that characterizes the Italian higher education system.
Details
Keywords
The purpose of this paper is to analyse a women entrepreneurial model that promotes inclusive strategy and organizational structure for sustainable outcomes in a masculine society.
Abstract
Purpose
The purpose of this paper is to analyse a women entrepreneurial model that promotes inclusive strategy and organizational structure for sustainable outcomes in a masculine society.
Design/methodology/approach
The paper adopts qualitative research methods, such as case study and in‐depth interviews, to analyse possible factors that promote sustainable outcomes among rural women entrepreneurs, such as purpose, processes and products of the strategy and stakeholders. The paper reviews existing literature on women entrepreneurship, especially in a masculine society.
Findings
The analysis reveals that women face three primary challenges: ability to take financial risk, ability to mitigate organisational risk, and ability to empower as a social collective. It also highlights that there are different phases of enterprise development and each phase requires a dedicated strategy. Lastly it identifies several social, political and economic advantages that are embedded in a social enterprise, if a social entrepreneurial sustainable model is adopted.
Research limitations/implications
This paper is confined to qualitative methods applied to key resource persons and case study. The paper does not include a survey of all the beneficiaries.
Practical implications
The outcome of this paper shall be useful for the government, funding agencies, and non‐government organisations to formulate an inclusive and sustainable policy that enables women to become successful entrepreneurs.
Social implications
This paper will influence across South Asia that faces similar socio‐economic challenges of women marginalization.
Originality/value
The paper is unique in providing a social entrepreneurship sustainable model for promoting inclusive outcomes in a masculine society.