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Independently of the larger economic cycle, economic indicators often change significantly from one month to the next. Employment, industrial output, consumption... they all depend on factors that are not easily predicted using statistical methods. one of the factors that may upset our calculations is the seasonality of certain industries, such as agriculture or tourism, where production - and the employment it brings - is concentrated at a particular time of year. Seasonality thus impacts on employment and the nature of work in certain sectors. The OECD recently drew attention to the high proportion of temporary work in some European economies. In the case of Spain the OECD report pointed to evidence of an imbalance between the quality of temporary jobs and permanent jobs. But is an economy that has a high proportion of temporary employment necessarily "precarious"? on a different level, seasonality also has implications for company valuation. What is the right way to value a seasonal company? Two of the studies presented in this October issue of IESE Insight address these questions.
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Organizations and People |
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The Impact of Temporary Work on the Economy |
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| Ángela María Gallifa, José Ramón Pin, Esperanza Suárez |
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Although everyone wants a stable - and, if possible, permanent - job, there are many jobs that cannot be anything but temporary. Is temporary employment really as bad as its detractors claim? Is a high proportion of temporary employment a sign of a precarious economy? The IESE-IRCO study "Managing temporary employment in 2003" sets out to answer this and other questions using data from Spain. 
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Leadership, Strategy and Change |
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People Matter!: Why Some Company Units Outperform Others |
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| Johanna Mair |
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| Within the same company, why do some units consistently yield better results than others? This is a key question of strategy research, which IESE Professor Johanna Mair answers by focusing on people. Though corporate strategy is determined at the top, it is the middle managers who are responsible for translating plans into action and real results. Mair finds that how mangers enact strategy, who they are and where they are significantly affects a unit's performance.
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Finance |
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Seasonal Companies Are Best Valued Using Monthly Data |
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| Pablo Fernández |
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| While many analysts and academics spend a lot of time studying and valuing companies, surprisingly little attention is paid to what is the correct way to value companies the bulk of whose activities are concentrated in a short period of the year. Apparently, the experts simply consider the median of full year data sufficiently representative. However, life is not as simple as that. Professor Pablo Fernández of IESE Business School shows that valuing a seasonal company based on monthly data gives a much more reliable insight into the true value of the enterprise. And for those who prefer to stick to their old ways, Fernández proposes a few adjustments that clearly improve the calculations based on full year data.
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Economics |
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When a Group Must Make a Decision, Pair Off! |
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| Manel Baucells |
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| How can a group, faced with multiple options and composed of different individuals with different preferences, make a decision? Companies grapple with this question constantly, when deciding where to locate a new factory, how to introduce a new product or which candidate to hire. This article, published in Management Science, offers some tips and demonstrates how working in pairs can inspire compromise.
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E-Business |
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Value Creation and Appropriation in Internet Times |
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| Joan Enric Ricart, Brian Subirana, Josep Valor |
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| E-business has demonstrated great potential for value creation through the reduction of transaction costs and search costs and enhanced customization opportunities. However, fierce rivalry and the constant entry of new competitors, combined with greater market transparency, create significant barriers to value appropriation by firms. The question is: what business models are capable of capturing the value? And where does the value reside in information-based industries? In the book "Sources of Information Value: Strategic Framing and the Transformation of the Information Industries", IESE Professors Joan E. Ricart, Brian Subirana, and Josep Valor answer these questions.
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Organizations and People |
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Agilent's Tower of Babel |
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| José María Rodríguez Porras |
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| The Biblical story of the Tower of Babel tells how the descendants of Noah were unable to complete their work once God confused their language so that they could no longer understand one another. In a modern-day version of the mythical Tower, almost 500 people of 34 different nationalities, speaking 23 mother tongues, were asked to work together for Agilent Technologies' Shared Services Center in Barcelona. How should an organization with such diverse people be run? Would Agilent be able to carry over and consolidate the corporate culture in such a diverse environment? IESE Professor José María Rodríguez investigates.
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Marketing |
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Enhancing Customer Equity: How to Acquire the 'Right' Customers |
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| Dominique M. Hanssens, Julián Villanueva, Shijin Yoo |
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| A company's long-term profitability depends not on acquiring any customer, but the "right" customers. So, which channels should marketers use to reach the ideal clientele: online banners, TV ads, mailings? Based on the new marketing paradigm of customer equity, Villanueva, Yoo and Hanssens introduce two groundbreaking models. The first measures acquisition channels' long-term effects and the second enables managers to maximize customer equity by optimally allocating the marketing budget across different acquisition channels.
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Organizations and People |
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Dual-Income Families, Victims of Work-Family Conflict |
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| Mª Nuria Chinchilla, Sonsoles Gallo, Consuelo León, Steven Poelmans |
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| Fatigue, stress and tension are not the only consequences when both partners in a marriage work outside the home. In the study "Dues professions i una família" ("Two professions and one family"), carried out by IESE professors Nuria Chinchilla and Steven Poelmans, with the collaboration of Sonsoles Gallo and Consuelo León, on behalf of the Welfare and Family Department of the Catalan government, the authors claim that perceptions of work-family conflict undermine the partners' resilience and energy, while at the same time breeding discontent and dissatisfaction with life, and impoverishing marital relations.
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Innovation and Entrepreneurship |
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Innovation Management: Keeping a Grip on Free Minds |
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| José A. Muñoz-Nájar, Joaquim Vilà |
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| It's a classic management challenge: To find an equilibrium between, on the one hand, allowing time for personnel, production processes and products to mature through a learning process and so evolve into a smooth-running and successful whole, and on the other, fostering a constant search for new ways of doing things or big leaps forward. In their technical note "An Integrated Framework to Manage Innovation" José A. Muñoz-Najar and Joaquim Vila of IESE Business School explain why innovation is simply vital to the sustainable success of a company.
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