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Journal Article
Organizational Research Methods
Eric Quintane, Martin Wood, John Dunn, Lucia Falzon
Subject(s)
Management sciences, decision sciences and quantitative methods
Keyword(s)
Brokering process, behavioral measure, relational events sequences, network algebra
Extant research in organizational networks has provided critical insights into understanding the benefits of occupying a brokerage position. More recently, researchers have moved beyond the brokerage position to consider the brokering processes (arbitration and collaboration) brokers engage in and their implications for performance. However, brokering processes are typically measured using scales that reflect individuals’ orientation toward engaging in a behavior, rather than the behavior itself. In this article, we propose a measure that captures the behavioral process of brokering. The measure indicates the extent to which actors engage in arbitration versus collaboration based on sequences of time stamped relational events, such as emails, message boards, and recordings of meetings. We demonstrate the validity of our measure as well as its predictive ability. By leveraging the temporal information inherent in sequences of relational events, our behavioral measure of brokering creates opportunities for researchers to explore the dynamics of brokerage and their impact on individuals, and also paves the way for a systematic examination of the temporal dynamics of networks.
With permission of SAGE Publishing
Book
New York: Dutton Books
Kenneth Cukier, Viktor Mayer-Schönberger, Francis de Véricourt
Subject(s)
Diversity and inclusion; Economics, politics and business environment; Health and environment; Information technology and systems; Management sciences, decision sciences and quantitative methods; Strategy and general management; Technology, R&D management
Keyword(s)
Decision science, Artificial Intelligence, cognitive psychology
From pandemics to populism, new weapons to the rise of artificial intelligence, and gaping inequalities to climate change, humanity faces unprecedented challenges that threaten our very existence. In FRAMERS: Human Advantage in an Age of Technology and Turmoil, the authors offer a reason to be optimistic: humans have a unique ability to frame—or think in mental models—
and so come up with solutions that meet our moment in history.

To frame is to make a mental model that enables us to see patterns, predict how things will unfold, and make sense of new situations. Frames guide the decisions we make and the results we attain. People have long focused on traits like memory and reasoning leaving framing all but ignored. But with computers becoming better at some of those cognitive tasks, framing stands out as a critical function—and only humans can do it. This book is the first guide to mastering this innate human ability.
Framers shows how framing is not just a way to improve how we make decisions in the era of algorithms—but why it will be a matter of survival for humanity in a time of societal upheaval and machine prosperity.
Pages
272
ISBN
978-0593182598
ESMT Case Study
ESMT Case Study No. ESMT-421-0191-1
Bianca Schmitz, Ulf Schäfer
Subject(s)
Human resources management/organizational behavior
Keyword(s)
Culture, organizational culture, organizational structure and design, leadership styles
At the end of 2008, the founder and employees of MEG - an insurance brokerage firm active in the market since 2003 - were looking forward to a promising future. Having achieved sales of €33 million in 2007 and just short of €54 million in 2008, the company was aiming to hit the €100 million mark in the next financial year. Within a very short time, the firm founded by Mehmet E. Göker as “insurance specialists” had established itself as the second-most successful insurance broker in Germany. Its rapid rise to the top was thanks to a business model that consistently identified and supported customers interested in insurance products - and also thanks to a particular corporate culture at MEG.
Key teaching/learning objectives:
- Introduction to corporate culture
- What is a corporate culture?
- How to establish and change corporate culture?

Journal Article
Journal of Economic Behavior & Organization
David Ronayne, Daniel Sgroi, Anthony Tuckwell
Subject(s)
Economics, politics and business environment
Keyword(s)
sunk cost effect, sunk cost fallacy, endowment effect, cognitive ability, fluid intelligence, crystallized intelligence, reflective thinking, online experiment, online survey, psychological scales, scale validation, Raven’s progressive matrices, international cognitive ability resource, cognitive reflection test, openness
JEL Code(s)
D91, C83, C90
We provide experimental evidence of behavior consistent with the sunk cost effect.Subjects who earned a lottery via a real-effort task were given an opportunity to switch to a dominant lottery; yet 23% chose to stick with their dominated lottery.The endowment effect accounts for roughly only one third of the effect. Subjects’ capacity for cognitive reflection is a significant determinant of sunk cost behavior.We also find stocks of knowledge or experience (crystallized intelligence) predict sunk cost behavior, rather than algorithmic thinking (fluid intelligence) or the personality trait of openness. We construct and validate a scale, the “SCE-8”, which encompasses many resources individuals can spend, and offers researchers an efficient way to measure susceptibility to the sunk cost effect.
Journal Article
Organizational Behavior and Human Decision Processes
Martin Schweinsberg, Michael Feldman, Nicola Staub, Olmo R. van der Akker, Robbie C.M. van Aert, Marcel A.L.M. van Assen, Yang Liu et al.
Subject(s)
Human resources management/organizational behavior
Keyword(s)
Crowdsourcing data analysis, scientific transparency, research reliability, scientific
robustness, researcher degrees of freedom, analysis-contingent results
In this crowdsourced initiative, independent analysts used the same dataset to test two hypotheses regarding the effects of scientists’ gender and professional status on verbosity during group meetings. Not only the analytic approach but also the operationalizations of key variables were left unconstrained and up to individual analysts. For instance, analysts could choose to operationalize status as job title, institutional ranking, citation counts, or some combination. To maximize transparency regarding the process by which analytic choices are made, the analysts used a platform we developed called DataExplained to justify both preferred and rejected analytic paths in real time. Analyses lacking sufficient detail, reproducible code, or with statistical errors were excluded, resulting in 29 analyses in the final sample. Researchers reported radically different analyses and dispersed empirical outcomes, in a number of cases obtaining significant effects in opposite directions for the same research question. A Boba multiverse analysis demonstrates that decisions about how to operationalize variables explain variability in outcomes above and beyond statistical choices (e.g., covariates). Subjective researcher decisions play a critical role in driving the reported empirical results, underscoring the need for open data, systematic robustness checks, and transparency regarding both analytic paths taken and not taken. Implications for organizations and leaders, whose decision making relies in part on scientific findings, consulting reports, and internal analyses by data scientists, are discussed.
With permission of Elsevier
Subject(s)
Health and environment; Information technology and systems
Keyword(s)
Public health, epidemic control, information design, strategic behavior
This paper explores how governments may efficiently inform the public about an epidemic to induce compliance with their confinement measures. Using an information design framework, we find the government has an incentive to either downplay or exaggerate the severity of the epidemic if it heavily prioritizes the economy over population health or vice versa. Importantly, we find that the level of economic inequality in the population has an effect on these distortions. The more unequal the disease's economic impact on the population is, the less the government exaggerates and the more it downplays the severity of the epidemic. When the government weighs the economy and population health sufficiently equally, however, the government should always be fully transparent about the severity of the epidemic.
© 2021, INFORMS
ESMT Case Study
ESMT Case Study No. ESMT-421-0190-1
Urs Müller, Ulf Schäfer, Nora Grasselli
Subject(s)
Human resources management/organizational behavior
Keyword(s)
Initiating change, implementing change, change management, communication of change, lateral change, leading change from the middle, influencing, persuading, stakeholder management, power and politics in organizations, change in a global matrix organization, digital strategy, Generation Y
Lea Block has tried to initiate digital transformation at Seuzach AG, a large global provider of medical devices for the health care industry. As marketing director, she has identified major shifts in German health care that demand that Seuzach changes its ways of approaching customers. Instead of targeting the specific needs of doctors in hospitals, Seuzach should rather address the new decision makers: the CEOs, CFOs, or CIOs of hospitals, who have a different buying logic. Seuzach should also leap into the future players in the industry through the application of digital innovations which allow for data driven, cloud-based digital services and business models that integrate data across the whole product range. In Seuzach's matrix organization (global product responsibility, supported by regional sales) Lea wants to convince the heads of marketing for the different product businesses to change. She seems to be able to quickly convince her colleagues of what she calls 'digital C-level marketing.' However, as soon as work is supposed to start, she realizes that commitments were less strong than she assumed. A few weeks later, Lea is clearly told that there will be no support for her. The short case study is set when Lea realizes the failure of her digital transformation initiative.
The case discussion allows analyzing and discussing various mistakes in the areas of: (1) defining an attractive vision and strategy; (2) reading and playing the organizational culture, power and politics; (3) leading from a peer-position, with a diversity profile (gender and age); (4) communicating a digital transformation initiative successfully; and (5) managing the stakeholders.

Key teaching/learning objectives:
(1) defining an attractive vision and strategy for a digital transformation initiative
(2) reading and playing the organizational culture, power and politics
(3) leading from a peer-position, with a diversity profile (gender and age)
(4) communicating a digital transformation initiative successfully
(5) managing stakeholders
This case is an update of the case Anna Frisch at Aesch AG: Initiating lateral change, a sanitized case that was set in 2007, in response to demands from students to have more up-to-date case as a basis for classroom discussions. As compared to the original case, this case provides an update of the developments in the German healthcare sector and puts stronger emphasis on the technology-related aspects of the proposed changes.

Journal Article
International Economic Review
Subject(s)
Economics, politics and business environment; Information technology and systems
Keyword(s)
online markets, price comparison websites, price dispersion, price competition, platforms, consumer search, consumer welfare
JEL Code(s)
L11, L86, D43
The large and growing industry of price comparison websites (PCWs) or “web aggregators” is poised to benefit consumers by increasing competitive pricing pressure on firms by acquainting shoppers with more prices. However, these sites also charge firms for sales, which feeds back to raise prices. I find that introducing any number of PCWs to a market increases prices for all consumers, both those who use the sites, and those who do not. I then use my framework to identify ways in which a more competitive environment could be achieved.
ISSN (Online)
1468-2354
Subject(s)
Economics, politics and business environment
Keyword(s)
Cartels, private damages, competition law
Private cartel damages litigation is on the rise in Europe since early 2000. This development has been initiated by the European courts and was supported by various policy initiatives of the European Commission, which found its culmination in the implementation of the EU Directive on Antitrust Damages end of 2016. This paper explores the impact of this reform process on effective compensation of damaged parties of cartel infringements. For that purpose we analyse all European cartel cases with a decision date between 2001 and 2015, for which we analyse litigation activity and speed. Overall, we find a substantial reduction of the time until first settlement (increase in litigation speed) together with a persisting high share of cases being litigated (high litigation activity). This supports the view that the reform not only increased the claimant’s expectation about the amount of damages being awarded, but also resulted in an alignment in the expectations of claimants and defendants in the final damages amount, i.e. the European Commission succeeded in reaching its objective to clarify and harmonize legal concepts across Europe.
Subject(s)
Management sciences, decision sciences and quantitative methods; Strategy and general management
Keyword(s)
behavioral strategy, diversity, behavioral failures, strategic opportunities, CSRL limits to arbitrage
The persistent failure of organizations to engage diversity—to employ a diverse workforce and fully realize its potential—is puzzling, as it creates labor-market inefficiencies and untapped opportunities. Addressing this puzzle from a behavioral strategy as arbitrage perspective, this paper argues that attractive opportunities tend to be protected by strong behavioral and social limits to arbitrage. I outline four limits—cognizing, searching, reconfiguring, and legitimizing (CSRL)—that deter firms from sensing, seizing, integrating and justifying valuable diversity. The case of Moneyball is used to illustrate how these CSRL limits prevented mispriced human resources from being arbitraged away sooner, with implications for engaging cognitive diversity that go beyond sports. This perspective describes why behavioral failures as arbitrage opportunities can persist and prescribes strategists, as contrarian theorists, a framework for formulating relevant behavioral and social problems to solve in order to search for and exploit these untapped opportunities.
Copyright © 2021, The Author