Global economic trends in the context of investor relations and strategic management. A longitudinal analysis of trends utilized in annual reports of German blue chip corporations.

Besides being confronted with fierce competition, today’s corporations face macroeconomic driving forces that change the configuration of existing and future markets that are also called “global economic trends” (GET) or “megatrends”. Currently, research does not provide a coherent view or theory for the assessment of these trends, which often leads to misinterpretation in business and academics. Literature such as publications provided by governmental institutions, multinational corporations, or consulting companies provide numerous examples where economic trends like globalization or the over-aging of western societies are depicted as global megatrends in the context of strategic management and economic research. The rather arbitrary use of the terms in literature leads to the idea that trend terms are vehicles to transport subjective assumptions about future developments that stem from foresight and innovation activities. Authors like Groddeck and Schwarz (2013) or Rust (2008) criticize the vague definition of these types of trends and question the information value and validity of “global economic trends” and “megatrends”. A growing body of literature points out that web search data is an ideal foundation for econometrical analysis and forecasting, because behavioral data of online user activity allow researchers to make inferences about the current state of economic decision-making of users, which is also called nowcasting (cf. e.g. Askitas and Zimmermann, 2009; Choi and Varian, 2012; Vosen and Schmidt, 2011; Dimche and Davcev, 2014). So far, there has been little to no work on trends that implements the tool Google Trends, which is the breading ground for the empirical research of this thesis. To get an insight view into the utilization of trends, a pilot study revealed that (1) corporation use of the terms “global economic trend” and "megatrend" in annual reports from 2008 to 2012, and (2) web search data from Google Trends correlates with the geographical location of multinational enterprises and economic wealthy regions measured in GDP. In the empirical part of the thesis, a long-term study from 2004 to 2014 explores how German stock market listed corporations (DAX) adopt trends in their business strategy, and how these trends are represented in web searches. Based upon a mixed-methods research approach, the thesis examines in detail what trends are utilized in annual reports and investigates these trends based on qualitative methods from the field of foresight. Then the results are analyzed with the use of web search data quantitatively. The qualitative analysis of annual reports revealed that: • In total, 5,920 passages that contained the term “trends” were identified in the population (n=330) of annual reports from 2004 to 2014. Included in the empirical research were 2,012 trend passages, whereof 392 trends were categorized as direct trend passages (TP), and whereof 1,620 were classified as indirect TPs. • The use of terms like “global economic trends” and “megatrends” grows from 2004 (117) to 2014 (273). However, only a few corporations used this term directly, but describe the effects indirectly with the use of other terminology. In 2005, Siemens AG firstly introduced the term “megatrends”. • The analysis revealed that directly mentioned TPs are more likely to be depicted as an opportunity, rather than a risk in annual reports with an odds ratio of 6.63. The 2,012 trend passages found in annual reports were categorized with an existing system that provides the attributes social, technological, economic, environment, political, and value (STEEPV). In addition, an individual categorization system (ICS) was developed as a tailor-fitted solution for the analysis of trends used in annual reports. The following outcomes were produced when both systems were applied to the data: • The STEEPV categorization system is capable of categorizing trend passages from an ex-post perspective. The final distribution of categories has a strong qualitative appeal and the application of a STEEPV category is ambiguous. The category “Economic” (74%) dominates in the overall population. • The implementation of the newly developed system reduced the overall use of the category “economic” was reduced to 45%. For quantitative analysis, (1) an indicator called Regional Index (RI) was created to analyze geographical information of web search data and (2) an indicator called confidence ranking index (CRI) was developed that measures the reported confidence of a corporation towards each trend mentioned in the annual report that is used for further examination. First, the regional index was used for correlation analysis between geographical information of web search data and GDP data, and for creating a visualization module developed with the statistical software R that provides geographical maps of web trend searches. It could be shown that: • Google Trends data is not provided globally. Scarce data from countries like China and Russia shows that the use of Google is restricted in these countries. • The regional index correlates well GDP with .591 (p < .001) on a global level, which indicates a linear relationship. A regression analysis reveals that the global RI index is able to explain 35% of the total variance. • The regional index has an even higher correlation for Germany with .841 (p < .001) on a local level. In the regression model, the local RI is able to explain 70% of the total variance. This undermines the results of the pilot study. Assuming that financial KPIs might have an influence on the CRI index, two regression models were developed that incorporate operational income and shareholders’ equity as explanatory variables. One model interprets the overall population as cross-sectional data and uses regression analysis, and the other model uses a generalized estimated equations (GEE) approach. The results indicate that: • The cross-sectional model has an R2 of .103 and adjusted R2 of .097. Approximately only 10 % of the total variation is explainable by the model, which is considered as interim results in the exploratory research. • The GEE model only contains operating income as an independent variable. With an R2 of 0.174 and an adjusted R2 of .143, the model showed little improvement in comparison to the cross-sectional model. The rather weak influence indicates that financial KPIs have a rather low influence to the CRI index, which motivated further steps of inquiry. At this phase, web search data from Google Trends was implemented and tested for its explanatory capacity. An automated correlation analysis based on the qualitative assessment of annual reports was developed to identify those Google Trend time series with the best model fit. It could be demonstrated that, • Nine hundred forty-one trend terms were found in the annual reports that were the foundation for extracting Google Trends data from 2004 to 2014 with the regional setting global and local for Germany. Globally 315 trends were returned, of which 87 trend series had a high significance (p < .01) to the CRI index. One hundred twenty- two (39%) series correlated significantly with CRI (p <0.05), and 106 (34%) showed no correlation. Thirty-six trends were returned on the local level, whereof six were highly significant (17%), 19 were significant (53%), and 11 (31%) had no significance. • Each dataset was used as a foundation for regression analysis with the confidence ranking index (CRI) as the dependent variable. The individual qualities of the ordinary least square (OLS) models measured by the coefficient of determination (R2) range from .36 to .85 on a global level and from .37 to .75 on a local level. • To optimize the previously developed OLS model with CRI as the dependent variable, the annual mean of the obtained global and local web search data was added. Google Trend data could optimize the regression measured in R2 to .151 for global data based on search terms like “Innovation trends” or “Corporate responsibility, and to .149 for local data based on search terms like “Social media” or “RFID”. • On the contrary to OLS, an optimization of the developed GEE model required the creation of an index per annual report that sums up the local and global Google web search results individually per for each trend used per annual report. A comparison of different working structures based on the Akaike's information criterion reveals that an one-period autoregressive correlation or AR(1) has the best model fit. The thesis contributes to the theoretical discussion about the information value of GETs and shows empirically that trend terms like “GETs” and ”megatrends” are rather artificial and have a strong subjective character. This was also confirmed by the longitudinal trend analysis that was based on the methodologies of mixed-method research, which combined and extended qualitative and quantitative methods. In addition, the thesis takes a unique approach optimizing the quality of multivariate models. By implementing web search data into linear regression and generalized estimation equation models, the overall performance of the models could be improved.Administración y Dirección de Empresa

Views on the Past, Present, and Future of Business and Information Systems Engineering

‘‘The times they are a-changin,’’ a famous song title by Bob Dylan, also applies to our profession and our subject of study. Information technology has always been a driver for innovation. The recent years, however, have seen IT-based innovations that truly impact everybody’s lives. Everything that can be digitized will be digitized, and this trend is continuing at an amazing speed. For a discipline that looks at the design and utilization of information systems these are exciting times. Yet, it is also a time full of challenges. While our discipline has much to contribute, it competes with other disciplines for topics and ideas. Also, the scope of topics studied has become broader and broader, and so have our methods. While initial work in Business and Information Systems Engineering (BISE) was often rooted in artificial intelligence, database systems, or operations research, the community has adopted new approaches to address new types of problems. Nowadays, we also have a strong group of academics working primarily with empirical methods or methods from microeconomics, to name just a few. This development towards a more multiparadigmatic discipline also had its challenges and there were controversial discussions along the way

Innovation and corporate governance in the firm - an empirical analysis with a focus on patents and ownership structure

This thesis aims at better understanding the complete process of knowledge production in the firm with a focus on Corporate Governance. I theoretically and empirically investigate firm decisions on innovation throughout a concept called the Innovation Value Chain (IVC). This concept includes all relevant firm decisions regarding developing innovative strategies. It starts at evaluating when firms innovate and – if they do – how much they invest in Research and Development (R&D) activities. Next it investigates which factors affect the transition from innovation input into actual tangible innovative assets. In case innovation projects are successful, I evaluate their actual value for the firm. Chapter 2 of this thesis offers a summary of the concept of innovation in the firm, a literature review on how it is affected by Corporate Governance, a discussion on innovation and patent measures as well as descriptive evidence on patenting activities of German firms. Chapter 3 investigates both the investment decision of firms as well as how these investments are transformed into innovative assets. These assets are – unlike in most other concepts – divided into different consecutive measures: Patent applications, patent grants and patent citations. In doing so we are able to address a project’s quality and novelty. A particular focus lies on the role of Corporate Governance in the form of ownership structure. It turns out that – whereas R&D investments are not affected by such structures – firms where managers own shares (owner-led firms) underperform in transferring investments into patents. Moreover – if they innovate – they rather focus on less risky worldwide conformity in innovation. On the other hand it turns out that firms benefit from monitor ownership, thus owners in the supervisory board that tend to control managers. Other control channels like capital concentration and institutional ownership also do not prove beneficial for firm-level innovation. Chapter 4 examines the effect of successful innovation on different performance measures. It turns out that patent grants and citations both increase sales in a production function environment, whereas there was no impact on return on assets and return on equity. Concerning ownership information the results again speak in favor of monitor rather than managerial ownership. Firms should thus endow monitors with shares to increase their effort and interest in the firm. Also owners should withdraw from management positions and rather carry out controlling duties. Chapter 5 focuses on the effect of innovation on firm survival. I am able to confirm the results from former studies that innovation decreases the probability of market exit. Furthermore the opinion of a stable effect throughout a firm’s life cycle is rejected. Whereas mature firms benefit from innovation by strategic renewal when competitors have caught up, young firms should rather stick to conventional investments rather than risky innovation. In summary this thesis helps in better understanding the complete process of knowledge production within the firm. It addresses ownership structure as a crucial factor of Corporate Governance which can be chosen by the firm as well as the role of different patent measures and their impact on different performance dimensions. Firms are thus encouraged to pick adequate Corporate Governance techniques in combination with clear innovation and performance goals, as links can be complex

Travels along the hype cycle: a set of blockchain applications and the economic processes they impact

Some commentators refer to blockchain as a potential General Purpose Technology. Yet despite a plethora of cryptoassets and projects, it has struggled to gain traction beyond payments and price discovery. This thesis explores how the technology is being applied to better understand the potential and risks of deploying blockchain. It examines four different use cases with econometric and case study methods: (1) Bitcoin mining as the token incentivized processing of records, (2) Initial Coin Offering tokens as a form of venture financing, (3) Uniswap the decentralized exchange and (4) Kompany improving the data integrity of compliance records via notarization to a public blockchain. It finds that blockchain enables capabilities that did not exist before, but that these capabilities are bounded by trade offs and developer priorities. Ultimately this research expands the literature on blockchain applications and argues that blockchain does not build better systems, but different systems that can achieve different objectives. It provides evidence that firms and society are gradually traversing the hype cycle, deploying blockchain, solving real world economic problems and creating value

The Political Economy of the State-Finance Nexus: Public Debt, Crisis and Bank Business Models

This dissertation aims at advancing our understanding of the state-finance nexus in times of globalized financial market capitalism. It sheds light on the profound changes that have occurred on both sides of this relationship since OECD countries have transitioned into debt states since the 1970s. This is done in a first part by examining the financialization of the state in the area of government debt management. Based on the development of a concept that makes it possible to measure this phenomenon, a discernible trend is shown according to which states have aligned their handling of debt with financial markets along two dimensions. First, the sense-making frameworks that guide action in debt management, nowadays, originate from financial economics, so that a portfolio view on indebtedness has found its way into the public realm. Second, the financial market has become the predominant governance mechanism in which economic coordination takes place in this area. Thus, states have increasingly adopted financial market logics and practices in public finance, one of the core areas of modern democracies. At the same time, governments have made a decisive contribution to the development of modern financial markets by the increasing orientation towards international investors and marketability of public debt. These interpenetrations of politics and finance are not limited to the national, but also extend to the subnational level. Local governments in Germany, the US and UK have introduced financial derivatives since the 1980s and continue to use them in some cases, even though they suffered major losses from these instruments during the financial crisis. By combining political economy with an economic sociological perspective, the causes that led to the local manifestation of this phenomenon are scrutinized. It is shown that the chronically underfinanced municipalities hoped to regain financial and political leeway through the use of financial innovations, which were strongly promoted and lobbied by financial institutions. The second part of the thesis analyzes the state-finance nexus from the perspective of the financial industry and the business with public debt, which is embodied in the emergence of pure public sector lending banks in the German mortgage banking sector. Unpacking the manifold state-banks relations demonstrates that the historical emergence of this crisis-ridden business model focusing on public finance closely interacts with the different roles played by the state in financial markets as economic policy maker, borrower, regulator and supervisor. The state is deeply involved in the process of coping with competition between banks by enabling change and stabilization of the social structures in which banks’ activities play out. Overall, this dissertation reiterates that the relationship between the state and finance is by no means one-sided, but rather characterized by mutual conditionality. It further highlights that the state-finance nexus is a complex configuration that also arises from the multilayered nature of the two entities themselves. Neither the financial sector nor the state are monolithic, but highly differentiated social arenas in which different actors and interests coexist. It is therefore of great importance that intra-state politics and dynamic relations within both entities are taken into account when studying relations between state and finance

Overcoming digitalization-driven challenges in banks : An exploration of theory and practice towards improving Enterprise Architecture Management’s ability to support rapid change

Banks increasingly need the ability to implement rapid change to react to changes in technology, user demands, and regulations that are difficult to foresee. The complex information systems (IS) and process landscape of incumbent banks impede this ability. Enterprise architecture management (EAM), as a function that aims to oversee the coherent development of the IS and IT landscape in alignment with the business, is argued to have the capability to support this ability. However, the speed and uncertainty of changes, as well as a focus of banks to implement Agile project methodolo-gies and de-centralize decision-making, challenges EAM to effectively fulfill this role. A Theoretical Base model is constructed from the literature and promising approaches to increase the effectiveness are identified. An exploratory case study of three large banks that are affected by digitalization to different extents, is conducted on the basis of this model. The findings indicate non-technical issues to be the most challenging factors for EAM today, which need to be addressed to allow EAM to valuably support banks’ ability to accommodate rapid change by providing transparency, guidance for projects regarding processes and technology, as well as steering for the long-term evolution of the IT landscape. EAM can help banks most effectively by supporting cross-team communication and facilitating reduced complexity in the long-run

The Socio-Technical Dynamics of Renewable Energy Policies in Germany

Growing environmental concerns and human-caused climate change increase the pressure on policymakers for rapid action to transform how societies convert energy, produce goods, or transport freight. Innovation and technological progress may contribute to such transitions. However, technological change is hard to predict, requires time, and may be laden with political conflicts. Although more sustainable technologies are available, incentivizing demand and deployment are crucial to accelerate transitions. As transformations develop over decades, understanding the temporal dynamics of policies is critical for governance. In Germany, the renewable energy act incentivizes the deployment of renewable energy technologies by remunerating electricity fed into the common grid. This dissertation assesses how socio-technical developments of solar and wind energy conversion technologies and the renewable energy act interactively shaped each other. Drawing on frameworks such as technological innovation systems, legitimacy, framing, and policy feedback, the contents of 16,485 newspaper articles and additional empirical studies were scrutinized. Combining methods from natural language processing, machine learning, and statistics, this thesis develops text models to assess changes in content and sentiment in large corpora over time. Three studies focus on the shifts in media framing of the German renewable energy act, the underlying co-evolution of technological and policy processes, and the development of the legitimacy of wind power. The results confirm that renewable energy deployment and policy are contested with varying intensity over time. Where change ought to occur, non-linear dynamics of innovation and technology uptake, growing policy costs, economic interests of incumbents, and technology side effects increasingly complicate policymaking over time. The early phases of the renewable energy act were shaped by positive expectations toward renewable energy technologies, which later shifted towards an emphasis on policy costs. The findings highlight the importance of the prosperity of underlying innovation systems as supporters of policy ambition and maintenance over time. However, policy costs and side effects must be managed effectively to withstand increasing contestation. These results may contribute to advancing the successful governance of sectoral transitions likely to unfold over several decades

Association of Architecture Schools in Australasia

"Techniques and Technologies: Transfer and Transformation", proceedings of the 2007 AASA Conference held September 27-29, 2007, at the School of Architecture, UTS

A critical view of sustainable architecture in Turkey: a proposal for the municipality of Seyrek

Thesis (Doktoral)-İzmir Institute of Technology, Architecture, İzmir, 2003Includes bibliographical references (leaves: 417-463)Text in English; Abstract: Turkish and Englishxxv, 540 leavesThis dissertation aims at developing a sustainable design process prioritizing locality in social, cultural, ecological, political, economic, technological, legalistic,and architectural terms. To this end, it aims first of all at developing an approach for elimination of misconceptions.primarily informed by technological, morphological and numerical indicators.about what constitutes the concept of sustainability in architectural practice today and therefore starts out from a critical historical overview of approaches and practices for sustainability in the world and in Turkey. The thesis undertakes the critique of sterile projects in sterile environments and calibrates the replicable and exemplary aspects of international and national sustainable design practices so as to introduce, promote and guide realistic, practicable, and case-specific sustainable architectural solutions. The specific focus in both the critical evaluation of extant sustainable practices abroad and the proposed process for the municipality of Seyrek in Menemen, Izmir, Turkey, is the distinction between the assets and needs of industrialized northern geographies and southern geographies which are in the process of industrialization and which are frequently misguided by economic exigencies imposed by the industrialized north. As a village located in an Important Bird Area, in the vicinity of a Ramsar Site and on the edge of a First-Degree Natural Conservation Area, the case area in question provides a trenchant example for the study of the meaning of sustainability in a southern socio-politico-economic zone and a challenge for the architectural designer. Seyrek is a mirror of global as well as local problems today. It is located in the middle of Gediz Delta, the large agricultural land as well, and on the edge of several specialized industrial districts of the urban sprawl of Izmir.Placing the analysis of the case area in the context of the wider framework of international policy, the thesis proceeds to propose specific design tools for a sustainable housing development project in a crucial typical new residential segment of the semi-rural settlement of Seyrek

Essays on Customer Engagement Strategies and Tactics in Business and Consumer Markets

In the last decade, customer engagement has become a key topic for both practitioners and researchers. Classically, customer engagement deals with customer behavior beyond purchase and thus non-monetary contributions by the customer, such as Word-of-Mouth (WOM), feedback and online reviews, or participation in the innovation process. While previous literature largely focused on the conceptualization of customer engagement itself, only a few studies have investigated how managers can actually stimulate and/or facilitate customer engagement. However, the latter is of high importance since only a few customers are truly engaged and it is often left to the firm to take the initiative to engage the customer. Thus, marketers need to understand how to design and successfully implement customer engagement initiatives. Accordingly, this dissertation investigates customer engagement strategies and tactics. While customer engagement strategy pertains to the overarching plan to leverage customer engagement to achieve the firm’s goals, customer engagement tactics deal with single actions taken by the firm to facilitate customer engagement across the various touchpoints in the customer journey. Specifically, this dissertation includes three essays, each addressing distinct questions with respect to customer engagement over the customer journey. Specifically, the first essay is conceptual in nature and provides an analysis of the strategic relevance of customer engagement in business-to-business (B2B) markets. The second essay explores how industrial firms can leverage service touchpoints as opportunities to engage their B2B customers in the post-purchase phase by employing the field service force for cross- and up-selling. Finally, the third essay investigates how marketers can use executional content cues in their TV advertisings (e.g., informativeness, creativity, or branding) to engage consumers and mitigate zapping behavior. Both empirical studies are based on unique datasets of real-world engagement tactics and related customer behavior obtained from co-operating companies