Publication records

With the current financial and economic crises and expectations or reality of a recession companies are looking at ways of optimizing the use of their resources and reconsidering their investments. Efforts at developing management talent and leadership capacities of company employees are often associated with significant costs and may, therefore, be among the first to undergo scrutiny in terms of feasibility and expected effectiveness. On the other hand, underinvestment in preparing people for leadership and management roles and tasks may come at a cost for the organization's survival, competitiveness, and future success. Although leadership development can take many forms, executive education courses and programs traditionally play a large role in the process, and constitute a major part of leadership development costs. This business brief outlines a number of issues that need to be taken into account when designing, developing, and delivering leadership and management development programs under the conditions of scarce financial resources.

In 2010 the legal barriers for international, intramodal competition in long-haul passenger transport in the railway sector will be abolished. This report analyzes the extent to which effective competition will arise in long-haul passenger transport after liberalization-from 2010 onward-and how co-operative agreements between European rail operators may impact the liberalization process. The study also provides an overview of the existing literature related to entry and intramodal competition in the rail sector, as well as intermodal competition between aviation and rail. In addition, it provides a review of the legal and regulatory environment of the sector at a European level and evaluates current organizations operating in it. The following are the main conclusions:- We find robust evidence for effective competition between low cost airlines (LCAs) and rail operators. A rail operator loses at least 7% of its passengers and 8% of its passenger kilometers due to entry by LCAs. We also find evidence of negative price effects of strategic LCA entry in both first class and second class. This demonstrates that LCAs are a significant competitive constraint for rail operators.- Based on a revenue & cost model ('R&C model'), only a minority of long distance origins and destinations (O&Ds) are profitable with respect to both operating profitability and total profitability from a pre-entry perspective - that is before entry by competing rail operators. This result does not change drastically even under optimistic but reasonable assumptions regarding future changes in demand, costs, and degree of intermodal competition.- An analysis of various entry strategies identifies the most profitable strategy as entry by an independent entrant with inferior technology. However, such a strategy is specifically vulnerable to legal and strategic limitations on exploitation of network effects (e.g. by imposing national levies or incompatibilities in ticketing or train schedules).- Overall, we find very limited evidence for intramodal competition arising on international O&Ds for long distance passenger travel after 2010, while past experience from airline alliances - although in a different competitive setting - promises significant efficiency gains as a result of international alliances.

The article refers to a technology commercialization strategy that was proposed by Teece (1986) and presents a game-theory model that considers complementary assets in the marketing process, strategic alliances, and hybrid contracts. The discussion focuses on: establishing co-promotion and the right to participate in the commercialization of an alliance product; using leverage in negotiations for gaining knowledge from a firm's complementary activities which can be applied to the commercialization of future products; learning in horizontal alliances between firms with complementary technology portfolios; and analyzing the structure of and access to knowledge in vertical arrangements.

A growing share of inward investment into the European Union, including but not limited to sovereign wealth funds (SWFs), will come from countries with diverse political regimes with which Europeans may not always see eye-to-eye. The current crisis may increase both Europe's need for such investment and its sensitivity to the non-economic implications. New investor countries have incentives to refrain from political use of their assets, as illustrated by the recently published 'Santiago principles' for transparency and accountability of SWFs. But these incentives are not powerful enough to spare Europe its own assessment of security risks linked to new trends in foreign investment.

As markets internationalize while consolidating, companies have to ask themselves if they can become leaders in these broader international markets. The consolidation index, developed by Burger, is a framework for developing and validating strategies in this regard. The European airline industry has a comparably low level of consolidation with the top 5 airlines having a combined market share of 31 percent in Europe. This business brief applies the consolidation index to the European airline industry and shows which airlines are in a good position to drive the future consolidation process in this industry.

Extensive industry consolidation is taking place in Europe in many industries. The aviation industry, for example, has seen mergers between Air France and KLM, as well as Lufthansa and Swiss. The German banking industry just recently started to consolidate with the takeover of Dresdner Bank by Commerzbank and the partial takeover of Postbank by Deutsche Bank. But how about consolidation in one of the biggest growth-markets worldwide - China? A recent survey by ESMT has looked at the differences between Europe and China when it comes to consolidation.

Following the merger of Commerzbank with Dresdner Bank and the subsequent takeover of a 30% share in Deutsche Postbank by Deutsche Bank the German banking market seems to enter the long awaited consolidation. The Business Brief analyses the consequences of these transactions and shows that they are merely first steps. Only the reform of the public sector banking system - with the dominant savings banks and the Landesbanken - will provide Germany's banks with a chance to remain market driving generalists in a consolidating European market.

Translating IPCC climate models into CO2 emissions per head results in 2030 emission targets of 5 percent of today's emission levels for the US and 10 percent for Europe. In an energy environment where externalities like CO2 are priced and where fossil fuels are becoming scarce and more expensive, only a major transformation of the 20th century energy and mobility infrastructure will be able to cope with these climate and fossil fuel scarcity challenges. With increasing energy prices, energy efficiency and decentralized energy generation will be key ingredients for this energy paradigm shift. Focusing on this paradigm shift, the business brief as a thought experiment intends to: - Identify implications for the value chain, namely the creation of new value-chain segments; - Indicate potential shifts in market size and margin of the respective value-chain segments; - Derive implications for players involved, namely the emergence of a new competitive landscape. The business brief addresses all energy players involved, especially incumbents who face the challenge to balance the tasks of securing and optimizing traditional business while at the same time taking part in new disruptive innovations.