Reconciling value estimates from the discounted cash flow model and the residual income model

This paper examines why practitioners and researchers get different estimates of equity value when they use a discounted cash flow (CF) model versus a residual income (RI) model. Both models are derived from the same underlying assumption -- that price is the present value of expected future net dividends discounted at the cost of equity capital -- but in practice and in research they frequently yield different estimates. We argue that the research literature devoted to comparing the accuracy of these two models is misguided; properly implemented, both models yield identical valuations for all firms in all years. We identify how prior research has applied inconsistent assumptions to the two models and show how these seemingly small errors cause surprisingly large differences in the value estimates. [ABSTRACT FROM AUTHOR]

Transforming the architect: Ownership form and archetype change

The adoption of the incorporated form of ownership in preference to partnership is linked to the shift to a more modem organizational archetype in professional firms. Yet existing empirical research offers insufficient insight into the organizational processes of this transformation in different professional arenas. Where ownership and control become separated, there is a clearer theoretical explanation of the implications for the way the firm is run. Where ownership and control remain inside, the firm, however, the consequences are not so clear and have not been well explored. Using survey and interview materials derived from a study of architecture practices, we examine the processes by which differences based on ownership emerge. Then, by drawing on Weberian theories, where they are concerned with professionalization as a project with material and social rewards, we specify more clearly the context for change in professional firms' archetypes. This, we conclude, provides a stronger basis for understanding the change trajectories of firms within professions and comparative organizational analysis between professions.

Transformational leadership, corporate cultism and the spirituality paradigm: An unholy trinity in the workplace?

Leadership is a perennially popular topic in the academic and practitioner literature on management. In particular, the past twenty years have witnessed an explosive growth of interest in what has been termed 'transformational leadership' (henceforth, TL). The theory is closely linked to the growth in what has been defined as corporate culturism - an emphasis on the importance of cohereat cultures, as a means of securing competitive advantage. This article outlines the central components of TL theory, and subjects the concept to a critical analysis. In particular, similarities are identified between the components concerned and the characteristics of leadership practice in organizations generally defined as cults. This connection has been previously unremarked in the literature. These similarities are comprehensively reviewed. Trends towards what can be defined as corporate cultism in modem management practice are also discussed. We conclude that TL models are overly concerned with the achievement of corporate cohesion to the detriment of internal dissent Such dissent is a vital ingredient of effective decision-making. It is suggested that more inclusive and participatory models of the leadership process are required.

Information internalisation in internationalising the firm

Internationalisation occurs when the firm expands its selling, production, or other business activities into international markets. Many enterprises, especially small- and medium-size firms (SMEs), are internationalising today at an unprecedented rate. Managers are strategically using information to achieve degrees of internationalisation previously considered the domain of large firms. We extend existing explanations of firm internationalisation by examining the nature and fundamental, antecedent role of internalising appropriate information and translating it into relevant knowledge. Based on case studies of internationalising firms, we advance a conceptualisation of information internalisation and knowledge creation within the firm as it achieves internationalisation readiness. In the process, we offer several propositions intended to guide future research. (C) 2002 Elsevier Science Inc. All rights reserved.

The global sports-media nexus: Reflections on the 'Super League Saga' in Australia

Despite the social and (increasingly) commercial significance of sport and sporting bodies worldwide, they remain under-represented in the mainstream management literature. One of the more recent and dramatic examples of the global sports-media nexus is the 'Super League saga' in Australia. This paper recounts the tale of the Super League saga, providing a holistic analysis of the events and competitive issues arising by drawing on literatures concerning the economic nature and value of sports leagues, the resource-based view of the firm and the nature of psychological contracts in changing environments. The analysis confirms the general monopolistic tendencies of professional sports leagues in an increasingly global industry driven by the sports-media nexus, in accord with a number of comparable cases internationally. The particular conditions of the Australian marketplace that exacerbate this tendency beyond, for example, that found in the USA, and differences in the outcomes of battles between rival leagues are also considered. The Super League saga portrays the importance of effective management of resources key to the production of the 'rugby league product' including, among others, the often over-looked importance of careful management of local resources for the success of global strategies, and, where human resources are key, the importance of psychological contracting. The holistic analysis of the Super League saga in Australia affords lessons that extend well beyond the realm of sports.

Research commentary: Information systems and conceptual modeling - A research agenda

Within the information systems field, the task of conceptual modeling involves building a representation of selected phenomena in some domain. High-quality conceptual-modeling work is important because it facilitates early detection and correction of system development errors. It also plays an increasingly important role in activities like business process reengineering and documentation of best-practice data and process models in enterprise resource planning systems. Yet little research has been undertaken on many aspects of conceptual modeling. In this paper, we propose a framework to motivate research that addresses the following fundamental question: How can we model the world to better facilitate our developing, implementing, using, and maintaining more valuable information systems? The framework comprises four elements: conceptual-modeling grammars, conceptual-modeling methods, conceptual-modeling scripts, and conceptual-modeling contexts. We provide examples of the types of research that have already been undertaken on each element and illustrate research opportunities that exist.

Resolving the puzzle of productive and destructive conflict in culturally heterogeneous workgroups: A communication accommodation theory approach

This study presents an investigation of the communicative behaviors and strategies employed in the stimulation and management of productive and destructive conflict in culturally heterogeneous workgroups. Using communication accommodation theory (CAT), we argue that the type and course of conflict in culturally heterogeneous workgroups is impacted by the communicative behaviors and strategies employed by group members during interactions. Analysis of data from participant observations, non-participant observations, semi-structured interviews, and self-report questionnaires support CA T-based predictions and provide fresh insights into the triggers and management strategies associated with conflict in culturally heterogeneous workgroups. In particular, results indicated that the more groups used discourse management Strategies, the more they experienced productive conflict. In addition, the use of explanation and checking of own and others' understanding was a major feature of productive conflict, while speech interruptions emerged as a strategy leading to potential destructive conflict. Groups where leaders emerged and assisted in reversing communication breakdowns were better able to manage their discourse, and achieved consensus On task processes. Contributions to the understanding of the triggers and the management of productive conflict in culturally heterogeneous workgroups are discussed.

Corporate stadium sponsorships, signaling theory, agency conflicts, and shareholder wealth

Contrary to the plethora of critical articles recently appearing in both the popular and business press, this carefully controlled investigation of 49 stadium- and arena-naming-rights agreement announcements provides striking evidence that such sponsorships can significantly enhance the stock prices of sponsoring companies. Indeed, the results of the study show that the average stadium sponsor's stock prices increased by 1.65 percent at the time of announcement of the programs-a result considerably in excess of the returns associated with other major marketing programs such as the signing of Olympic sponsorships and celebrity endorsers. A multiple regression analysis employing firm-specific changes in stock prices as the dependent variable and quantifiable corporate and sponsorship-related attributes as independent variables is also presented. Variables positively and significantly correlated with perceived sponsorship success include team-winning percentages, contract length, and high technology and locally based companies. Overall, the findings of the study are consistent with the novel hypothesis that, for some firms, the real value-added of a stadium sponsorship may lie in its ability to serve as an effective or honest signal of managerial confidence in the future of the company.