9,467 research outputs found

    Analytical Challenges in Modern Tax Administration: A Brief History of Analytics at the IRS

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    Stock Market Reaction To Chief Marketing Officer Appointment Announcements

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    This paper investigates the stock price performance of 166 firms appointing a new Chief Marketing Officer (CMO) between 1999 and 2005. Following event study methodology, the results reveal that abnormal stock returns around the appointment day are greater for firms appointing a CMO with prior marketing executive experience, in firms where the new CMO explains the intended future marketing strategy on the appointment announcement day, whereas it is lower in firms operating in higher growth, high technology industries with higher product differentiation. Announcement-induced returns are also greater for firms that experienced poor stock price performance in the year leading to the appointment. Taken together, the results suggest that the market’s assessment of a change in marketing leadership should not be viewed as being uniformly beneficial, but should be assessed against the profile of the appointee and the appointing firm

    How do top- and bottom-performing companies differ in using business analytics?

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    Purpose Business analytics (BA) has attracted growing attention mainly due to the phenomena of big data. While studies suggest that BA positively affects organizational performance, there is a lack of academic research. The purpose of this paper, therefore, is to examine the extent to which top- and bottom-performing companies differ regarding their use and organizational facilitation of BA. Design/methodology/approach Hypotheses are developed drawing on the information processing view and contingency theory, and tested using multivariate analysis of variance to analyze data collected from 117 UK manufacture companies. Findings Top- and bottom-performing companies differ significantly in their use of BA, data-driven environment, and level of fit between BA and data-drain environment. Practical implications Extensive use of BA and data-driven decisions will lead to superior firm performance. Companies wishing to use BA to improve decision making and performance need to develop relevant analytical strategy to guide BA activities and design its structure and business processes to embed BA activities. Originality/value This study provides useful management insights into the effective use of BA for improving organizational performance

    Assessing the Role of Marketing at Earnings Announcement: Stock Market Response to Marketing Metrics Surprises

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    The explanatory power of earnings per share (eps) is on the decline as firms are focusing more on intangible assets and are disclosing more marketing metrics when they announce their earnings (e.g., subscribers for the telecom & media industry and monthly active users for social media industry). However, the performance of these marketing output metrics beyond market/analysts’ expectations (i.e., surprises) requires marketing resources, which may reduce current profitability but may also signal a higher future cash flow. Therefore, building on information economics, we assess if there is information content in marketing metric surprises, and how the stock market reacts to such surprises. Further, we argue that the information content of marketing metric surprises varies under different information signals by firms (strategic emphasis) and screening cues by investors (marketing expenditure). We also investigate the temporal variations in the effect of marketing metric surprises and also examine the relative importance of marketing metric surprises as compared to earnings surprises across multiple industries. We test the claims using an event study methodology around earnings announcement on S&P 1500 firms consisting of firms disclosing industry-specific marketing metrics and non-disclosing firms. We account for sample selection bias and correcting for potential endogeneity concerns of surprises marketing metrics. Our findings suggest that (1) although an increase in marketing metric surprise affects the stock market returns positively, (2) this effect is strengthened when firms signal strategic emphasis on value appropriation relative to value creation whereas (3) it is attenuated when investors screen for firms with higher unanticipated marketing expenditure, (4) the effect of marketing metric surprises increases over time whereas it decreases for earnings surprise, and (5) the effect of marketing metric surprise is higher in the telecom and media industry as compared to earnings surprises. The study helps to improve marketing accountability at the time of earnings announcement by improving the overall earnings quality of firms

    Differential Market Reaction to Data Security Breaches: A Screening Perspective

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    This paper aims to identify breach- and firm-level characteristics that may account for the heterogenous stock market reaction to data breaches. Drawing upon the screening theory, this paper examines the possibility of three breach characteristics (breach severity, breach locus and breach controllability) and two firm attributes (CEO stock ownership, and corporate social responsibility (CSR) performance) serving as information screens to influence stock market reaction to a data breach incident. Using an archival dataset compiled from multiple sources, we examine 607 data breaches from 2004 to 2018 and find that the stock market reacts more negatively if a breach is more severe (i.e., involving more data records and financially sensitive consumer data), controllable (i.e., could have been prevented), and if the breached firm has weak corporate governance, as indicated by low CEO stock ownership. Furthermore, CSR provides an “insurance-like” protection by attenuating the negative effects of breach severity, breach controllability, and poor corporate governance on firm value. Findings of this research highlight the relevance of screening theory as a theoretical lens for examining the contextual dependence of stock market reaction to data breaches on key breach- and firm-level characteristics

    Product quality as competitive priority: Its relationship with total quality management implementation in Indonesia-SCOPUS version

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    Literature has widely reported the increase of firms competitive advantage resulted from better product quality. However, in some industries product quality does not escalate competitive advantage significantly. Competitive priority stemmed from product quality is presumed to be the driving factor of Total Quality Management (TQM) implementation. This study investigates how product quality as competitive priority influences the implementation of TQM. The results explain the divergence of TQM implementation among manufacturing firms. Empirical data from 152 manufacturing firms in Indonesia are analyzed using structural equation modeling (SEM). The results indicate that product quality as competitive priority affects TQM implementation positively. In addition, the structural model shows that the relationship between product quality as competitive priority and firm performance is fully mediated by Total Quality Management. The contribution of this study is providing explanation why some firms are more receptive toward Total Quality Management than the others. The strong positive relationship between Total Quality Management and firm performance suggests that, whether the manufacturing firms have product quality as their competitive priority or not, they need to recognize the impact of Total Quality Management on firm performance

    Impact of Service Recovery on Customer Loyalty: A Study of E-Banking in Spain

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    The purposes of this study are twofold: (i) to propose and apply a scale to measure service recovery in the electronic banking (e-banking) sector; and (ii) to examine the relationship between service recovery and customer loyalty in the setting of e-banking services. An online questionnaire is used to survey 123 Spanish customers of e-banking services using a modified version of the E-RecS-QUAL scale. The data are analysed by exploratory factor analysis to: (i) test the applicability of the scale to the setting of online bank services: and (ii) generate a model including constructs for e-recovery and e-loyalty. The study reassures online banks that a modified version of the E-RecS-QUAL scale is an appropriate instrument for measuring service recovery. The study also provides empirical evidence that responsiveness to requests and complaints has a positive influence on e-loyalty. The study is the first to provide definitive empirical evidence of the presumed link between the recovery dimensions proposed in the E-RecS-QUAL scale and the construct of e-loyalty.recovery; electronic commerce; electronic service quality; E-RecS-QUAL.
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