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Article
Publication date: 1 February 2004

L.R. GORMAN, R.A. WEIGAND and T.J. ZWIRLEIN

We investigate the empirical characteristics of firms resuming cash dividends to determine if dividend resumption is most like dividend initiation, a large dividend increase, or a…

306

Abstract

We investigate the empirical characteristics of firms resuming cash dividends to determine if dividend resumption is most like dividend initiation, a large dividend increase, or a completely unique event. Firms that resume dividends earn considerably larger returns than firms initiating or increasing dividends, both before and after the announcement. Dividend‐resuming firms exhibit changes in profits similar to firms increasing dividends, but the risk change following dividend resumption is more like that reported by studies of dividend initiation. These findings are unaffected by the length of time it takes firms to resume paying cash dividends, or whether the firm also declares a stock split and/or stock dividend during the period surrounding the resumption announcement. We conclude that dividend resumption is sufficiently unlike other dividend events to be regarded and studied as its own unique event.

Details

Studies in Economics and Finance, vol. 22 no. 2
Type: Research Article
ISSN: 1086-7376

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Book part
Publication date: 18 October 2017

Lucy Taksa and Dimitria Groutsis

Most publications on the management of diversity in Western countries pay homage to history by referring back to the way regulatory frameworks developed to promote equal treatment…

Abstract

Most publications on the management of diversity in Western countries pay homage to history by referring back to the way regulatory frameworks developed to promote equal treatment and to oppose discrimination. In work on English speaking countries, particular attention has been given to the struggles waged in the USA for civil rights and for gender equality in the 1960s and their impact on the emergence of equal employment opportunity and affirmative action laws and policies. Generally, these developments are depicted as the antecedents to the emergence of diversity management in the USA. This genealogical orientation is usually designed to establish historical foundations. However, as we see it, this approach to history has promoted an impression of linear evolution. Our general aim in this chapter is to show how an historical perspective can help uncover continuities in regard to equal employment opportunity, affirmative action and diversity management policies and strategies in Australia, particularly in relation to the management of cultural diversity in Australian workplaces. Rather than seeing development in linear terms, our aim is to highlight connections and the implications of such connections. Accordingly, this chapter relates each of these policies/strategies to analogous political and legal developments that emerged concurrently, in particular such initiatives as multiculturalism, anti-discrimination laws and what became known in Australia as ‘productive diversity’ policies.

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Book part
Publication date: 10 April 2019

Richa Saxena and Vibhav Singh

The purpose of the chapter is to integrate the understanding of diversity from different perspectives in Indian context and see how the holistic view emerges.

Abstract

Purpose

The purpose of the chapter is to integrate the understanding of diversity from different perspectives in Indian context and see how the holistic view emerges.

Methodology

The methodology used is primarily the literature review of the concepts and their evolution in Indian context and the use of secondary sources to extract praxis information.

Findings

It emerged from the exploration on diversity practices at the societal as well as organizational level in India that the country demonstrates intent to mainstream the people from different wakes, but with the changing context the format of the practices has changed.

Research Limitations

The basic premise of the chapter needs to be explored further through primary data from practice.

Originality

This chapter is novel in a way that it integrates the diversity scholarship of four different streams viz. caste, gender, disability, and generation. Most of the existing research focuses only on a thin slice/one key dimension of diversity.

Details

Diversity within Diversity Management
Type: Book
ISBN: 978-1-78754-821-3

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Article
Publication date: 31 October 2008

Wayne S. DeSarbo, Rajdeep Grewal, Heungsun Hwang and Qiong Wang

The purpose of this paper is to integrate aspects of the literature on strategic and performance groups and explicitly derive strategic/performance groups which exhibit…

1101

Abstract

Purpose

The purpose of this paper is to integrate aspects of the literature on strategic and performance groups and explicitly derive strategic/performance groups which exhibit differences with respect to both strategy and performance, as well as display associations and potential interrelationships between the two sets of variables.

Design/methodology/approach

A two‐way clusterwise bilinear spatial model was formulated (e.g. a scalar products or vector multidimensional scaling model (MDS)) for the analysis of two‐way strategic and performance data which simultaneously performs MDS and cluster analysis. An efficient alternating least‐squares procedure was devised that estimates conditionally globally optimum estimates of the model parameters within each iterate in analytic, closed‐form expressions.

Findings

This bilinear MDS methodology was deployed in the context of strategic/performance group estimation using archival data for public banks in the NY‐NJ‐PA tri‐state area. For this illustration, four strategic/performance groups and two underlying dimensions were found.

Practical implications

Consideration of both strategy and performance data should be employed in describing the heterogeneity amongst firms competing in the same industry.

Originality/value

The paper provides a new spatial methodology to derive strategic/performance groups in any given industry to more completely summarize intra‐industry heterogeneity.

Details

Journal of Modelling in Management, vol. 3 no. 3
Type: Research Article
ISSN: 1746-5664

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Article
Publication date: 18 January 2011

Stoyu I. Ivanov and Janis K. Zaima

The purpose of this study is to examine whether employee stock ownership plans (ESOPs) add or destroy value from a new perspective by examining the relation of the adoption of…

2976

Abstract

Purpose

The purpose of this study is to examine whether employee stock ownership plans (ESOPs) add or destroy value from a new perspective by examining the relation of the adoption of ESOP and the company cost of capital.

Design/methodology/approach

The capital asset pricing model is used to estimate the company's cost of equity capital, and the cost of debt is estimated using bond yield spreads. The weighted average cost of capital (WACC) is calculated as the weighted percentage of the firm funded by equity, preferred stock, and debt multiplied by the individual costs of capital. Univariate and multivariate analyses are conducted around the event of adoption to determine if the cost of capital changes after the adoption of ESOP.

Findings

Results from the univariate analysis show that firms adopting leveraged as well as non‐leveraged ESOP plans experience decreases in costs of equity and debt capital as well as decreases in their WACC. However, the multivariate analysis demonstrates that only the non‐leveraged common ESOPs are negatively correlated to cost of equity, cost of debt, and WACC. Robustness tests confirm that the reduction in the cost of equity capital drives the decline in WACC.

Originality/value

The findings contribute to the cost of capital literature and have implications for firms that decide to engage in ESOP plans. It is found that ESOPs benefit from decreased cost of capital related to the ability to increase debt capacity for the firm as well as the existing tax preferential treatments of ESOP plans.

Details

Managerial Finance, vol. 37 no. 2
Type: Research Article
ISSN: 0307-4358

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Article
Publication date: 16 March 2010

Ning Gao and Jason Everett Brooks

The purpose of this paper is to investigate the influence of capital structure changes by target firms on the outcome and ex post performance of firms targeted by proxy contests.

1875

Abstract

Purpose

The purpose of this paper is to investigate the influence of capital structure changes by target firms on the outcome and ex post performance of firms targeted by proxy contests.

Design/methodology/approach

The influence is examined by using predictions of control‐driven model developed by Harris and Raviv and signaling theory of debt in capital structure.

Findings

The results are consistent with the predictions of both control‐driven model and signaling theory. Significant differences are found between two groups of target firms – management victory targets and dissident victory targets. Specifically: management victory targets feature proxy contests that are accompanied by leverage increasing changes in target firms' capital structure; the same group also realizes better long‐run stock performance compared to dissident victory targets; and the long‐run abnormal stock performance of management victory targets is significantly positively related to the increases in leverage in the capital structure during proxy contest period.

Originality/value

This paper is the first to directly address the relationship between leverage change and the outcome and long‐run performance of proxy contest targets, thus confirming both the defensive and the signaling role of debt on firm's capital structure decision.

Details

Managerial Finance, vol. 36 no. 4
Type: Research Article
ISSN: 0307-4358

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Book part
Publication date: 13 August 2007

Russell W. Coff and Kevin J. Laverty

Scholars have begun to recognize the importance of integrating organizational issues into real options theory. In doing so, some argue that options are inappropriate for…

Abstract

Scholars have begun to recognize the importance of integrating organizational issues into real options theory. In doing so, some argue that options are inappropriate for evaluating critical strategic investments. In a more in-depth analysis, we argue that the organizational form that an option takes has a profound effect on exercise decisions. When options are initially integrated, organizational elements such as routines and culture become increasingly intertwined over time, raising the cost of abandoning the option – in effect, pushing firms to exercise options. In contrast, initially isolated options become idiosyncratic and more costly to integrate over time – pushing firms to kill them. There are also reputational and social capital effects that may bias exercise decisions beyond the mere consideration of costs, leading to escalation or missed opportunities.

Accordingly, firms must first be able to manage the associated organizational costs and minimize systematic bias in exercise decisions. Real options theory is moving away from the limitations of the financial options analogy and is increasingly integrated with strategy and organization theory. This shift requires that researchers consider issues such as intermediate organizational forms, external monitoring of exercise decisions, portfolios of competing options, and group process interventions.

Details

Real Options Theory
Type: Book
ISBN: 978-0-7623-1427-0

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Article
Publication date: 15 August 2016

Jamil Anwar and SAF Hasnu

The purpose of this paper is to investigate the strategy-performance relationship in a multi-industry setting for joint stock firms operating in Pakistan using Miles and Snow…

7129

Abstract

Purpose

The purpose of this paper is to investigate the strategy-performance relationship in a multi-industry setting for joint stock firms operating in Pakistan using Miles and Snow typology. The impact of firm size and industry on performance along with strategy is also investigated. The empirical research evidence on strategy-performance relationship for Miles and Snow typology is updated as well.

Design/methodology/approach

Scoring methodology is applied for identification of strategic types, including the reactor strategy. The consistency of the firms over time is also checked. Seven year archived financial data of 320 Pakistani joint stock firms from 12 industries are used for analysis. Descriptive statistics and analysis of variance is used for analysis.

Findings

Hybrid strategies are practiced by firms rather than pure strategies. The distribution of strategic types is uneven. There are mixed results for performance difference among strategic types for different industries and firm size. Defending and analyzing strategies are better than the prospecting strategies. Reactors performed better in some industries as well.

Originality/value

Proposed scoring methodology can be applied to identify all strategic types including reactors in the longitudinal studies. This can be replicated for other typologies or strategic group classifications. The process for identification of reactor strategy through a consistency check is a unique contribution to the literature, especially when archived financial data are used.

Details

Journal of Strategy and Management, vol. 9 no. 3
Type: Research Article
ISSN: 1755-425X

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Article
Publication date: 1 August 2016

Jamil Anwar and SAF Hasnu

Strategic typologies are applied to investigate strategy–performance relationship. The typology of Miles and Snow (1978) is one of them, but the methodology applied for…

1381

Abstract

Purpose

Strategic typologies are applied to investigate strategy–performance relationship. The typology of Miles and Snow (1978) is one of them, but the methodology applied for identification of strategic types for archival financial data is questionable on three grounds: no standard procedure for categorization of strategic types; identification of reactor strategy is always ignored; and the behavior of firms’ strategic orientation over time is under-researched. Besides, the assumptions that viable strategies are expected to perform equally well, outperform reactors and distributed evenly are not overwhelmingly supported. The purpose of this paper is to address these issues.

Design/methodology/approach

A refined scoring methodology is developed and used for identification of all strategic types, including reactors, by investigating the consistency of the firms over time. Empirical analysis using seven years of data of 121 joint stock firms of the textile sector in Pakistan is performed to test the assumptions regarding presence, distribution and performance of strategic types.

Findings

There is significant difference in the distribution of the strategic types. Pure defenders and pure prospectors are non-existing, whereas a reasonable number of reactors are present. Overall difference in performance among strategies is generally insignificant and viable strategies outperformed reactors. The effect of size on performance is also insignificant. However, there is variation in performance of strategies with variation in size. Strategy is the better predictor of performance than size.

Originality/value

The transition of strategic stance of the firms over time and the identification of reactor strategy from archived financial data are the important outcomes of the proposed methodology. The proposed methodology can be used for any longitudinal study for identification of all possible strategic types and can also be used for any other typological research.

Details

Journal of Asia Business Studies, vol. 10 no. 3
Type: Research Article
ISSN: 1558-7894

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Article
Publication date: 31 October 2008

Hsin‐Hung Chen

The purpose of this study is to adopt data envelopment analysis (DEA) to construct portfolios, and compare their return rates with the market index to examine whether DEA…

3177

Abstract

Purpose

The purpose of this study is to adopt data envelopment analysis (DEA) to construct portfolios, and compare their return rates with the market index to examine whether DEA portfolios created superior returns. In addition, this study investigated whether using the “size effect” as a stock selection strategy is appropriate in Taiwan.

Design/methodology/approach

This study applied two DEA models to evaluate the efficiency of the firms and construct portfolios by selecting stocks with high efficiency. Furthermore, the return rates of the portfolios constructed by small‐size firms, DEA models and market indices were compared via empirical data analysis.

Findings

The results showed that size effect seems inappropriate as a stock selection strategy in the Taiwan stock market. However, the portfolios constructed by DEA models achieved noticeable superior returns.

Research limitations/implications

Future studies can apply DEA models to other stock markets in different countries to confirm the effectiveness of DEA methods in stock selection.

Originality/value

This study is the first attempt to select stocks using DEA models and compares the performances of the portfolios composed by DEA analysis, small‐size firms and the stock market indices. The proposed approach provides useful managerial implications in stock selection and insight to improve financial efficiencies of corporations.

Details

Industrial Management & Data Systems, vol. 108 no. 9
Type: Research Article
ISSN: 0263-5577

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