A path-dependent contingent-claims approach to capacity investments

This note presents a contingent-claims approach to strategic capacity planning. We develop models for capacity choice and expansion decisions in a single firm environment where investment is irreversible and demand is uncertain. These models illustrate specifically the relevance of path-dependent options analysis to planning capacity investments when the firm adopts demand tracking or average capacity strategies. It is argued that Asian/average type real options can explain hysteresis phenomena in addition to providing superior control of assets in place.

The functional anatomy of the McCollough contingent colour after-effect

We report two functional magnetic resonance imaging (fMRI) experiments which reveal a cortical network activated when perceiving coloured grids, and experiencing the McCollough effect (ME). Our results show that perception of red-black and green-black grids activate the right fusiform gyrus (area V4) plus the left and right lingual gyri, right striate cortex (V1) and left insula. The ME activated the left anterior fusiform gyrus as well as the ventrolateral prefrontal cortex, and in common with colour perception, the left insula. These data confirm the critical role of the fusiform gyrus in actual and illusory colour perception as well as revealing localized frontal cortical activation associated with the ME, which would suggest that a 'top-down' mechanism is implicated in this illusion.

Macroeconomic determinants of contingent protection:the case of the European Union

Contingent Protection has grown to become an important trade restricting device. In the European Union, protection instruments like antidumping are used extensively. This paper analyses whether macroeconomic pressures may contribute to explain the variations in the intensity of antidumping protectionism in the EU. The empirical analysis uses count data models, applying various specification tests to derive the most appropriate specification. Our results suggest that the filing activity is inversely related to the macroeconomic conditions. Moreover, they confirm existing evidence for the US suggesting that domestic macroeconomic pressures are a more important determinant of contingent protection policy than external pressures.

La contingence des faits linguistiques:réflexions sur la variation et le changement

This paper is a reflection on the role of contingent facts for the general understanding of language. Such facts are illustrated by the lacks of proportionality in the paradigm of French indefinites and the irregular correlations between the Null Subject Parameter and other hypothesised parameters. Such contingencies clearly go against the expectation raised by at least some versions of structuralism and the current chomskyan Minimalist Program. As demonstrated by alternative views being developed in various natural and social sciences, and as shown by recent research on formulaic language, contingency may be understood as the result of the expedient character of a medium geared towards action. A view of language as action may thus offer a perspective able to account both for the general default rules shaping a grammar and for the contingencies that entrench them in use, as both are integral and complementary aspects of language.

Modernisation in small steps? Comparing the organisational reforms of the British Conservative Party and the German CDU

Research on political parties has long identified “environmental” pressures upon parties to undertake organisational and programmatic reforms – this applies in particular to “catch-all” parties or Volksparteien. Changed social and media structures, the decline of organisations traditionally associated with the parties, and the growth in alternative possibilities of political participation create significant organisational – as well as programmatic – challenges. This paper compares the German CDU and the British Conservatives in two respects: in particular it focuses on their organisational responses to the election defeats they suffered at the end of the 1990s, examining those reforms which took place and consider whether these match the expectations of organisational reforms anticipated by proponents of the “cartel party thesis”. While in both cases there are similarities, but (in particular in the German case) it is important not to understate the extent of internal party resistance to reform, and thus the difficulties with which aspiring party reformers are confronted. This conclusion suggests, more broadly, that in reality the process of party change is more than an almost automatic, isomorphic, and inevitable response to a changing environment. Rather it is punctuated, messy, and often contingent on events and agents.

Memory for emotional faces in major depression following judgement of physical facial characteristics at encoding

The aim of the present study was to establish if patients with major depression (MD) exhibit a memory bias for sad faces, relative to happy and neutral, when the affective element of the faces is not explicitly processed at encoding. To this end, 16 psychiatric out-patients with MD and 18 healthy, never-depressed controls (HC) were presented with a series of emotional faces and were required to identify the gender of the individuals featured in the photographs. Participants were subsequently given a recognition memory test for these faces. At encoding, patients with MD exhibited a non-significant tendency towards slower gender identification (GI) times, relative to HC, for happy faces. However, the GI times of the two groups did not differ for sad or neutral faces. At memory testing, patients with MD did not exhibit the expected memory bias for sad faces. Similarly, HC did not demonstrate enhanced memory for happy faces. Overall, patients with MD were impaired in their memory for the faces relative to the HC. The current findings are consistent with the proposal that mood-congruent memory biases are contingent upon explicit processing of the emotional element of the to-be-remembered material at encoding.

Transfer of technology to China:A Scandinavian and European perspective

This paper examines the question of technology transfer from the perspective of techno-economic security and how companies respond to the possibility of losing competitive advantage through misappropriation or leakage. It explores transfers from Europe to China and addresses in particular the operations of Scandinavian companies within the context of the general picture for other European firms. Its point of departure is the authors' earlier research that looked at the motivations for transfer and the awareness of companies of techno-economic security issues. This has been supplemented by new data gathered by the authors from a number of Scandinavian companies in China. Specific actions have been identified and the ownership issue is introduced together with consideration of the role of the companies against the 'Ferdows' model. The analysis shows that the nature of the security question has changed together with the evolving context in which the companies are operating. In turn, the response of companies is contingent on a number of factors including the time horizon of the strategy for a unit in China and the nature of the strategy. It is also influenced by the form of ownership and management style in a particular organisation. © 2002 Elsevier Science Ltd. All rights reserved.

The future of manufacturing

Anyone who looks at the title of this special issue will agree that the intent behind the preparation of this volume was ambitious: to predict and discuss “The Future of Manufacturing”. Will manufacturing be important in the future? Even though some sceptics might say not, and put on the table some old familiar arguments, we would strongly disagree. To bring subsidies for the argument we issued the call-for-papers for this special issue of Journal of Manufacturing Technology Management, fully aware of the size of the challenge in our hands. But we strongly believed that the enterprise would be worthwhile. The point of departure is the ongoing debate concerning the meaning and content of manufacturing. The easily visualised internal activity of using tangible resources to make physical products in factories is no longer a viable way to characterise manufacturing. It is now a more loosely defined concept concerning the organisation and management of open, interdependent, systems for delivering goods and services, tangible and intangible, to diverse types of markets. Interestingly, Wickham Skinner is the most cited author in this special issue of JMTM. He provides the departure point of several articles because his vision and insights have guided and inspired researchers in production and operations management from the late 1960s until today. However, the picture that we draw after looking at the contributions in this special issue is intrinsically distinct, much more dynamic, and complex. Seven articles address the following research themes: 1.new patterns of organisation, where the boundaries of firms become blurred and the role of the firm in the production system as well as that of manufacturing within the firm become contingent; 2.new approaches to strategic decision-making in markets characterised by turbulence and weak signals at the customer interface; 3.new challenges in strategic and operational decisions due to changes in the profile of the workforce; 4.new global players, especially China, modifying the manufacturing landscape; and 5.new techniques, methods and tools that are being made feasible through progress in new technological domains. Of course, many other important dimensions could be studied, but these themes are representative of current changes and future challenges. Three articles look at the first theme: organisational evolution of production and operations in firms and networks. Karlsson's and Skold's article represent one further step in their efforts to characterise “the extraprise”. In the article, they advance the construction of a new framework, based on “the network perspective” by defining the formal elements which compose it and exploring the meaning of different types of relationships. The way in which “actors, resources and activities” are conceptualised extends the existing boundaries of analytical thinking in operations management and open new avenues for research, teaching and practice. The higher level of abstraction, an intrinsic feature of the framework, is associated to the increasing degree of complexity that characterises decisions related to strategy and implementation in the manufacturing and operations area, a feature that is expected to become more and more pervasive as time proceeds. Riis, Johansen, Englyst and Sorensen have also based their article on their previous work, which in this case is on “the interactive firm”. They advance new propositions on strategic roles of manufacturing and discuss why the configuration of strategic manufacturing roles, at the level of the network, will become a key issue and how the indirect strategic roles of manufacturing will become increasingly important. Additionally, by considering that value chains will become value webs, they predict that shifts in strategic manufacturing roles will look like a sequence of moves similar to a game of chess. Then, lastly under the first theme, Fleury and Fleury develop a conceptual framework for the study of production systems in general derived from field research in the telecommunications industry, here considered a prototype of the coming information society and knowledge economy. They propose a new typology of firms which, on certain dimensions, complements the propositions found in the other two articles. Their telecoms-based framework (TbF) comprises six types of companies characterised by distinct profiles of organisational competences, which interact according to specific patterns of relationships, thus creating distinct configurations of production networks. The second theme is addressed by Kyläheiko and SandstroÍm in their article “Strategic options based framework for management of dynamic capabilities in manufacturing firms”. They propose a new approach to strategic decision-making in markets characterised by turbulence and weak signals at the customer interface. Their framework for a manufacturing firm in the digital age leads to active asset selection (strategic investments in both tangible and intangible assets) and efficient orchestrating of the global value net in “thin” intangible asset markets. The framework consists of five steps based on Porter's five-forces model, the resources-based view, complemented by means of the concepts of strategic options and related flexibility issues. Thun, GroÍssler and Miczka's contribution to the third theme brings the human dimension to the debate regarding the future of manufacturing. Their article focuses on the challenges brought to management by the ageing of workers in Germany but, in the arguments that are raised, the future challenges associated to workers and work organisation in every production system become visible and relevant. An interesting point in the approach adopted by the authors is that not only the factual problems and solutions are taken into account but the perception of the managers is brought into the picture. China cannot be absent in the discussion of the future of manufacturing. Therefore, within the fourth theme, Vaidya, Bennett and Liu provide the evidence of the gradual improvement of Chinese companies in the medium and high-tech sectors, by using the revealed comparative advantage (RCA) analysis. The Chinese evolution is shown to be based on capabilities developed through combining international technology transfer and indigenous learning. The main implication for the Western companies is the need to take account of the accelerated rhythm of capability development in China. For other developing countries China's case provides lessons of great importance. Finally, under the fifth theme, Kuehnle's article: “Post mass production paradigm (PMPP) trajectories” provides a futuristic scenario of what is already around us and might become prevalent in the future. It takes a very intensive look at a whole set of dimensions that are affecting manufacturing now, and will influence manufacturing in the future, ranging from the application of ICT to the need for social transparency. In summary, this special issue of JMTM presents a brief, but undisputable, demonstration of the possible richness of manufacturing in the future. Indeed, we could even say that manufacturing has no future if we only stick to the past perspectives. Embracing the new is not easy. The new configurations of production systems, the distributed and complementary roles to be performed by distinct types of companies in diversified networked structures, leveraged by the new emergent technologies and associated the new challenges for managing people, are all themes that are carriers of the future. The Guest Editors of this special issue on the future of manufacturing are strongly convinced that their undertaking has been worthwhile.

An integrative framework for determining cross-national human resource management practices

Currently, debate in the area of cross-national human resource management (HRM) suggests that both “culture-bound” and “culture-free” factors and variables are important determinants of HRM policies and practices. HRM is presented as being context-specific and it is argued that with the growth of new markets world-wide, and increased levels of competition and globalization of business, there is a strong need for more cross-national HRM studies. However, the literature shows the absence of an integrated framework, which can help to highlight the different role that context-specific facets of HRM practices play. The nature of different determinants in different national and regional settings is rarely analyzed. This paper develops an integrated framework. It delineates the main distinctive facets associated with national factors, contingent variables, and organizational and human resource (HR) strategies and policies, that may be used to evaluate cross-national comparative HRM policies and practices.

A comparative study of HR practices in Britain and India

This paper traces the major developments in the field of human resource management briefly and then highlights the need for more cross-national HRM studies. The results from two parallel surveys of matched Indian and British organizations are presented. The main aim of the surveys was to examine a wide range of HRM policies and practices in a cross-national comparative context. The surveys were run in six industries in the manufacturing sector. The study controlled for a number of variables such as size of the organization, product, industry sector and personnel participation. Influence of a number of contingent variables (such as age, size, nature and life-cycle stage of the organization, presence of unions and human resource strategies) on HRM policies and practices is analysed. The study finds significant differences in recruitment, compensation, training and development and employee communication practices between India and Britain.

Dopamine, empathy and the neurobiology of leadership

Objectives: Organisational Psychologists have long sought after methods by which to train individuals to become more effective leaders. Indeed considerable sums of money are spent on the design of such training programs. Yet it is not clear whether or not leadership skills can be taught or whether they are innate. Social leadership is a varied construct consisting of many diverse aspects, yet the ability to empathise with subordinates is a core skill that underpins effective transformational leadership. This type of leadership consists of four characteristics which are labelled ‘idealized influence’, ‘inspirational motivation’, ‘intellectual stimulation’ and ‘individualized consideration’. This is distinct from the transactional style of leadership, which is based on offering contingent rewards for completion of specific tasks. By identifying a specific gene that mediates distinct leadership traits, more effective training regimes can be designed. Design: There are two likely candidate genes that may mediate empathic leadership. The first is catechol-O-methyltransferase (COMT) which is involved with dopamine synthesis, and the second is the serotonin transporter promoter gene (5-HTTLPR). Both these genes mostly appear in the general population in their heterozygotic form. Thus by comparing phenotypes in leadership traits a measure of base line differences can be examined. Methods: 115 volunteers completed the Multifactor Leadership questionnaire (MLQ), which is a standard 12-item leadership psychometric scale and also underwent buccal swab for subsequent genotyping. Results: Of the 115 subjects 37 were heterozygotic for the COMT gene and 47 heterozygotic for 5-HTTLPR. Of the 12 MLQ subscales, the scores for two of the subscales only differed between the two participant groups. Individuals who were heterozygotic for the COMT gene scored higher on the ‘Inspirational motivation’ t(84)=1.99, p=0.05 and ‘Intellectual stimulation’ t(82)=1.94, p=0.05 scales compared to the carriers for the heterozygotic 5HTPP gene. Conclusions: Given that the behaviours described by these two MLQ subscales require leaders to empathise with subordinates, the current results suggest that dopamine may play a role in this important social task. The fact that both heterozygotic carriers for COMT and 5HTPP were compared allows a comparison to be made between the genotypes most prevalent in the general population.

Managing the dynamic configuration of enterprises

Due to environmental changes and business trends such as globalisation, outsourcing and virtualisation, more and more companies get involved in business activities that are outside their direct control. This typically occurs by entering into collaborative relationships and joint ventures with specialised companies in order to fulfil the demands of customers quickly (DiMaggio, 2001). Organisational structures that results from such collaborative relationships and joint ventures are referred to in this paper as enterprises and the management of them known as enterprise management. The authors use the definition of the European Commission (2003) that defines an enterprise as “… an entity, regardless of its legal form … including partnerships or associations regularly engaged in economic activities.” Therefore in its most simple form an enterprise could be a single integrated company. However, findings from this research show that enterprises can also be made up of parts of different companies and the structure of the enterprise is contingent upon a variety of different factors. The success of the enterprise as a collaborative venture depends on the ability of companies to intermediate their internal core competencies into other participating companies’ value streams and simultaneously outsource their own peripheral activities to companies that can perform them quicker, cheaper, and more effectively (Lal et al., 1995). In other words, the peripheral activities of one member-company must be complemented by a core competence of another member-company within an overall enterprise.

The behavioural homogeneity evaluation framework:Multi-level evaluations of consumer involvement in international segmentation

This paper presents a generic strategic framework of alternative international marketing strategies and market segmentation based on intra- and inter-cultural behavioural homogeneity. Consumer involvement (CI) is proposed as a pivotal construct to capture behavioural homogeneity, for the identification of market segments. Results from a five-country study demonstrate how the strategic framework can be valuable in managerial decision-making. First, there is evidence for the cultural invariance of the measurement of CI, allowing a true comparison of inter- and intra-cultural behavioural homogeneity. Second, CI influences purchase behaviour, and its evaluation provides a rich source of information for responsive market segmentation. Finally, a decomposition of behavioural variance suggests that national-cultural environment and nationally transcendent variables explain differences in behaviour. The Behavioural Homogeneity Evaluation Framework therefore suggests appropriate international marketing strategies, providing practical guidance for implementing involvement-contingent strategies. © 2007 Academy of International Business. All rights reserved.

Group diversity and group identification:the moderating role of diversity beliefs

Research on diversity in teams and organizations has revealed ambiguous results regarding the effects of group composition on workgroup performance. The categorization—elaboration model (van Knippenberg et al., 2004) accounts for this variety and proposes two different underlying processes. On the one hand diversity may bring about intergroup bias which leads to less group identification, which in turn is followed by more conflict and decreased workgroup performance. On the other hand, the information processing approach proposes positive effects of diversity because of a more elaborate processing of information brought about by a wider pool and variety of perspectives in more diverse groups. We propose that the former process is contingent on individual team members' beliefs that diversity is good or bad for achieving the team's aims. We predict that the relationship between subjective diversity and identification is more positive in ethnically diverse project teams when group members hold beliefs that are pro-diversity. Results of two longitudinal studies involving postgraduate students working in project teams confirm this hypothesis. Analyses further reveal that group identification is positively related to students' desire to stay in their groups and to their information elaboration. Finally, we found evidence for the expected moderated mediation model with indirect effects of subjective diversity on elaboration and the desire to stay, mediated through group identification, moderated by diversity beliefs.

HRM as a predictor of innovation

There is growing evidence available to suggest that HR practice is an important predictor of organisational performance. In this article, we argue that HR practices also have the potential to promote organisational innovation. We describe a longitudinal study of 22 UK manufacturing companies and examine the relationship between such practices and product and technological innovation. Results reveal that training, induction, team working, appraisal and exploratory learning focus are all predictors of innovation. Contingent reward, applied in conjunction with an exploratory learning focus, is positively associated with innovation in technical systems. Furthermore, training, appraisal and induction, combined with exploratory learning focus, explain variation between companies in product and technological innovation above and beyond the main effects observed. © 2006 Blackwell Publishing Ltd.