The purpose of this integrative review is to develop a holistic behavioral framework on capital allocation decisions.
Abstract
Purpose
The purpose of this integrative review is to develop a holistic behavioral framework on capital allocation decisions.
Design/methodology/approach
The article first structures, maps and synthesizes the prevalent cognitive biases that are present during capital allocation decisions. It then seeks to offer a robust understanding on how firms can mitigate the effects of cognitive biases.
Findings
Not only do several cognitive biases interfere with a decision-makers ability to make adequate capital allocation decisions but firms already have a number of tools at their disposal to mitigate them.
Research limitations/implications
Besides identifying cognition- and repair-based implications to extend the literature, this article outlines key methodological challenges for future research conducted along the lines of capital allocation.
Practical implications
Since the paper structures cognitive limitations in one of the most important managerial decision-making processes and discusses what firms can do to counteract them, it is of high relevance for practitioners. Managers need to know what drives successful capital allocation and what not.
Originality/value
The article provides a rare integrative review on the impact of cognitive biases on capital allocation and addresses the need to build linkages to the ongoing conversation on how to design strategic decision processes.
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Based on the theory of basic human values, this study aims to examine the impact of CEO conservation (i.e. security, conformity and tradition) and openness to change (i.e…
Abstract
Purpose
Based on the theory of basic human values, this study aims to examine the impact of CEO conservation (i.e. security, conformity and tradition) and openness to change (i.e. self-direction, stimulation and hedonism) values on one of the most conflictual decisions inside a firm: workforce downsizing.
Design/methodology/approach
The hypothesis testing was done in the context of all workforce downsizing decisions made by German companies (and their CEOs) listed on the German Prime-Index between 2005 and 2019. A software-based psycholinguistic assessment of various sources of CEO communications was conducted to tap into their underlying values.
Findings
Tobit regression analysis confirms that CEO conservation and openness-to-change values impact the severity of workforce downsizing. Namely, the higher the CEO conservation values, the lower the downsizing severity (i.e. employees dismissed in relation to overall workforce). In contrast, the higher the CEO openness to change values, the higher the downsizing severity.
Originality/value
Against prior research that has centered around political ideology as a proxy to understand the mechanisms through which values impact strategic decisions, the present study employs advanced measurement approaches to assess the general impact of CEO values on critical firm decisions. As such, the study contributes to upper echelons research by offering a new perspective on how CEO values impact critical firms' decisions.
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Manuel Lobato, Javier Rodríguez and Herminio Romero-Perez
This study aims to examine the herding behavior of socially responsible exchange traded funds (SR ETFs) in comparison to conventional ETFs during the COVID-19 pandemic.
Abstract
Purpose
This study aims to examine the herding behavior of socially responsible exchange traded funds (SR ETFs) in comparison to conventional ETFs during the COVID-19 pandemic.
Design/methodology/approach
To test for herding behavior, the authors use the cross-sectional absolute deviation and a quadratic market model.
Findings
During the pandemic, investments in socially responsible financial products grew rapidly. And investors in the popular SR ETFs herd during this special period, while holders of conventional ETFs did not.
Practical implications
Investors in socially responsible investments must do their own research and make their own financial decisions, rather than follow the crowd, especially during extreme events like the COVID-19 pandemic.
Originality/value
The evidence shows that, during the pandemic, socially responsible ETFs behaved in line with theoretical predictions of herding, that is, herding is more significant during extreme market conditions.
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The overall purpose of this paper is to analyze variables that influence how top financial executives view their return on information technology (IT) investment in their…
Abstract
Purpose
The overall purpose of this paper is to analyze variables that influence how top financial executives view their return on information technology (IT) investment in their organizations. Specifically, relationships between a series of independent variables are measured against the dependent variable overall return on its technology investment. The goal is to determine what contributes to IT success in an organization so that all organizations can focus attention where needed and improve their IT operations.
Design/methodology/approach
An analysis of secondary data obtained from the 2003 Financial Executives International (FEI) comprehensive survey‐based research on technology issues for financial executives was conducted. The study was carried out by the FEI and Computer Sciences Corporation. Regression analysis and other statistical methods were used.
Findings
The findings suggest that overall information return is rated medium to high by top financial executives. Variables that significantly and positively affect return include: progress on number one IT issue, seeing IT as a competitive advantage, and IT as a core competency. In addition, though just having an information systems (IS) strategic plan is a significant variable, if there is a plan and it is aligned with the overall corporate strategy, then this variable is positive and significant as well. Most view outsourcing as successful but outsourcing per se does not add to success.
Research limitations/implications
The study can be used as a basis for further exploration on the influences on technology success as well as serve as a preliminary model to analyze firm IS. Limitations of the study include that the only group included in the survey were financial executives. Non‐response bias is also possible.
Practical implications
The findings can be used to guide management teams in emphasizing control of the important variables in implementing IS and IT that influence overall corporate returns.
Originality/value
The paper analyzes a large current sample set that empirically reviews a cross‐section of major corporations' IS departments and their returns. In addition, it begins to explore the variables influencing overall IS returns.
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Jacqueline Solis and Katherine S. Dabbour
This paper aims to describe how an academic library is using federal grant money to contribute to Latino student success by strengthening library collections, archives, and…
Abstract
Purpose
This paper aims to describe how an academic library is using federal grant money to contribute to Latino student success by strengthening library collections, archives, and information competence.
Design/methodology/approach
This paper examines the inequalities faced by US Latinos in higher education and how the Oviatt Library at California State University Northridge is addressing this through a project funded by a Hispanic‐Serving Institutions (HSI) Program grant from the US Department of Education. The grant project has three objectives: 1) Increase students' library use by expanding the library's collection of Latino‐related materials, library instruction program, and outreach; 2) Acquire and provide access to primary archival materials related to Latino individuals and organizations in the local community; and 3) Create and administer valid and reliable information competence assessment tools.
Findings
Grant money can be an important tool for contributing to a library's ability to respond to the needs of its community.
Originality/value
This case study should encourage libraries to seek funding from sources that are not generally considered.
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Lyndsay M.C. Hayhurst, Holly Thorpe and Megan Chawansky
This study aims to elucidate the role of nostalgia in collecting behavior and evaluate its effects during the collecting process in the context of an online collecting community.
Abstract
Purpose
This study aims to elucidate the role of nostalgia in collecting behavior and evaluate its effects during the collecting process in the context of an online collecting community.
Design/methodology/approach
A netnographic study was conducted to enhance the understanding of the online collecting community for vintage toys on YouTube. The study analyzed more than 40,000 comments from 9,028 users. Data were then analyzed, codified and grouped to determine the coexistence of collecting and nostalgia within the community.
Findings
Nostalgia influences collecting mainly in three stages: beginning of a collection, progression of a collection and the end of the collecting process (as a barrier). Additionally, new information about collecting behavior is presented: Collectors are mainly influenced by the people around them during the collecting process, and they are highly oriented toward obtaining information about pieces in their collection.
Originality/value
This study builds on the premise of nostalgia as a motivator for collecting and describes its effect in depth during the collecting process. Specifically, netnography was used to analyze this phenomenon within the context of the online collecting community.