White Papers

Temple University SingaporeTemple University Singapore professors author white papers on relevant topics tied to their research and curriculum. Our faculty are renowned scholars, editors of prestigious academic journals, award-winning teachers, business leaders and top consultants to industry and government. Fox School professors are consistently producing highly innovative scholarly work. White papers currently available include:

Design Thinking White Paper

Author: 
Dr. Marco Berti, Temple University
Published Date: 
8 Jul 2015

Most companies feel the need to innovate in order to keep up with potentially disruptive competitors. Design inspired approaches, such as design thinking, have been hailed as a new ‘silver bullet’ that can help organization to completely rethink their offerings, their relationship with customers, their business models. Despite a flurry of publications on ‘how to do’ design thinking there is very little research and understanding of the actual impacts and consequences of its application in existing organization.

Dr. Berti discusses about design thinking, what it means to adopt it and some implications of its adoption.

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Office Bullies & Other Workplace Incivilities White Paper

Author: 
Dr. Lynne Andersson, Temple University
Published Date: 
22 Jun 2015

A level of civility is fundamental to doing business. People tend to choose to do business with those who grant them respect and make them feel good (Martin, 1996). Civility among employees fosters smooth relationships in the workplace, promoting harmony and goodwill. When civility is absent, work relations are strained. Rude treatment can make workers unhappy, and this can lead to cynicism, aggressive behavior, higher turnover, lower productivity, and lost customers (Blau & Andersson, 2005; Cortina, Magley, Williams & Langhout, 2001; Pearson, Andersson & Porath, 2004; Yeung & Griffin, 2008). Uncivil behavior makes the work environment unpleasant, and it can negatively impact a company’s bottom line (Cortina et al., 2001; Gonthier, 2002; Pearson, Andersson & Wegner, 2001).

Professor Andersson discusses the negativity of incivilities and the insight that is needed to manage the phenomenon in the workplace.

Click on the link below to download the full white paper.

Negotiating Across Cultures; Toward Mutual Understanding White Paper

Author: 
Dr. Arthur Hochner, Temple University
Published Date: 
5 Nov 2014

1Quotations from Lee Kuan Yew, 1st Prime Minister of Singapore:

Corporations that get their ideas from only one culture will lose out in innovation. Those that have a creative meshing of cultures and ideas will forge ahead. (1997)

Japanese and East Asians are ethnocentric, close-knit societies. They do not easily absorb foreigners into their midst. There has to be a fundamental change in cultural attitudes before Japanese and other East Asians can compete with the Americans who, because of their different history, easily absorb peoples of different cultures and religions into their corporate teams. (2000)

Americans have a can-do approach to life: everything can be broken up, analyzed, and redefined. (2005)

The sense of cultural supremacy of the Americans will make this adjustment [the displacement of American dominance by East Asians] most difficult. Americans believe their ideas are universal—the supremacy of the individual and free, unfettered expression. But they are not—never were.  (2009)

In transforming Singapore from a poor colony into a rich, modern, and influential city-state, Lee Kuan Yew knew the importance of working with Singapore’s cultural mix and with multi-national companies from other cultures.

1All quotations from Graham Alison and Robert D. Blackwill, with Ali Wyne, Lee Kuan Yew:  The Grand Master’s Insights on China, the United States, and the World. Cambridge, MA: The MIT Press, 2012.

Professor Hochner discusses the importance of conducting negotiations with mutual respect and strive toward mutual understanding.

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Does language shape our economy? White Paper

Author: 
Dr. Amir Shoham, Temple University
Published Date: 
1 Jul 2014

In his Nobel Prize lecture, Douglas North (1993) argued that cultural knowledge is transmitted via language. Yet, language may be more than a vehicle of transmission, as the linguist Benjamin L Whorf hypothesized (1956):
 
“We are inclined to think of language simply as a technique of expression, and not to realize that language first of all is a classification and arrangement of the stream of sensory experience which results in a certain world-order, a certain segment of the world that is easily expressible by the type of symbolic means that language employs.”
 
Forefront research in evolutionary linguistics and cognitive science suggest that language is indeed the result of biological and cultural historical forces (Christiansen and Kirby 2003) and that it may influence cognition (Boroditsky et al. 2003).
 
If language captures speakers’ worldviews and/or influences their cognitive framework it may influence their decision-making processes as economic agents as well. What does the evidence tell us? Is the way we speak economically relevant?

While aspects of language such as vocabulary and slang may evolve rapidly as a result of socioeconomic forces and migration flows, in this column we analyze the most enduring feature of language, i.e. grammar. The grammatical features of a language are inherited from the distant past (thousands of years). Among the almost 200 grammatical features classified by linguists (The World Atlas of Language Structures) we study the most stable one, i.e. gender (Wichmann and Holman, 2009).

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The Best versus the Rest in New Product Development White Paper

Author: 
Dr. Anthony Di Benedetto, Temple University
Published Date: 
18 Mar 2014

Most firms recognize the importance of new products to their competitiveness and their bottom line. But what is it that the best firms do, and what can managers from other firms learn about the best practices employed by these firms? Also, what have been the most recent trends in new product development (NPD), and how has this process changed in recent years?
 
The Product Development & Management Association (PDMA) periodically surveys new product managers in an on-going effort to identify best practices in new product development. The first best practice study was conducted in 1990, and later studies were done in 1995, 2004, and now most recently in 2012. This effort is known as the Comparative Performance Assessment Study or CPAS, and had continued to expand in scope to include a wider range of issues from its earliest form up to the present.
 
Previous versions of CPAS studied key NPD practices including NPD process, portfolio management, the “fuzzy front end” of the innovation process, development tools, and NPD outcomes. The 2012 CPAS was a serious upgrade from previous studies in that there was a new or expanded emphasis on innovation culture, product strategy, sustainability, intellectual property, open innovation, social media as a source of information, service development, and new NPD analytical tools. In addition, for the first time, data were gathered globally, with managers from 24 countries included in the study. A total of 453 managers were included in the most recent study. About 44% of respondents were from North America, about 33% from Asia, 13% from Europe, and 10% from elsewhere.
 
To understand and identify best practices, the sample was divided into the “Best” and the “Rest.” The Best firms were among the most successful in their industries in terms of both NPD success and sales and profits generated by new products. Just under 25% of the sample was classified as “Best” according to these criteria.

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How am I doing? Developing life-long learners (and outstanding employees) through effective performance feedback practices White Paper

Author: 
Deanna Geddes, Ph.D., Temple University
Published Date: 
9 Jan 2014

Ongoing and increased interest in learning strategies reflects recognition of its critical role in continued professional success. Lifelong learning is synonymous with self-regulated learning, meaning one’s willingness and ability to learn and adapt throughout one’s life. The positive relationship between continuous learning and improved performance is at the heart of management education as well as the management function. Business students and organizational members alike are encouraged to set high, but achievable goals, monitor their progress, and regulate their effort as they accomplish various assignments. Faculty and supervisors assist in this learning process by providing timely, ongoing feedback on tasks and assessment of individual progress toward established goals and objectives. It is important for those interested in business to develop an ability to sense how well their efforts yield favorable results if they want to succeed. Self-monitoring and feedback-seeking (and feedback-providing) strategies can serve as vehicles to promote critical reflection that will help establish logical connections between one’s activities at work with subsequent outcomes. Enhancing abilities and inclinations to self-monitor/selfregulate-- using reliable performance information sources (e.g., self, peers, mentors, managers, and available performance data--allows individuals to improve their future growth and success in all achievement contexts, academic or professional.
 
Key to this process is the use of performance feedback. The purpose of performance feedback is to promote continuous learning and improvement through self-regulation of performance. Managers provide feedback to help employees improve their future performance and enhance the possibility of employee success (i.e., retention, professional development, and promotion). However, if managers are only approaching employees with praise, “good job, keep it up,” they are less effective coaches. The best coaches see the potential of their charge and are constantly promoting incremental improvements. No employee (or manager) is doing everything right or everything wrong. But managers are often afraid to provide negative feedback. Worse, they may do so in a manner that is confusing to the employees. For instance, the traditional “sandwich” approach to feedback starts with praise then critique then praise again. Often the employee is more confused after the review than before, “Does my supervisor think I doing well, or not?” Sometimes managers are guilty of being overly critical and abusive in their criticism, which is also problematic--decreasing employee motivation and increasing turnover. When we do try to offer the right amount of constructive criticism, there is still a strong possibility recipients might perceive any “negative” feedback as inaccurate and unfair, causing stress and promoting negative emotions to surface. Complicating this is the fact that many employees consider themselves to be above average in performance.
 

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Tolerating Ambiguity in the Negotiating Process White Paper

Author: 
Arthur Hochner, Ph.D., Temple University
Published Date: 
24 Oct 2013

In his classic work, The Nature of Managerial Work, the scholar Henry Mintzberg observed that “most characteristic of top manager decision-making as the unstructured situation” (1973, p. 191). That is, managers have to make decisions in open-ended, dynamic circumstances, faced not only with risk and uncertainty but, more importantly, with ambiguity.  Good managers learn how to deal with the ambiguities of predicting the consequences of their strategic choices, of having incomplete information, of coordinating the activities of many subordinates, and in general dealing with many difficult and complex matters.

Similar ambiguities and paradoxes apply to the negotiator.  For instance:

What is my relationship with my counterparts, and how important is that relationship to the achievement of my goals? Are the people or organizations I am negotiating with my potential partners or my foes?  If they are my partners now, will they become my enemies tomorrow?  Can I trust them?

Do I need them more or do they need me more?  Who has more power in the situation?  How should I deal with power issues and egos?

How can I achieve the best results on my major goals?  Is it better to play hardball or to be cooperative, i.e., to approach negotiations as win-lose (zero-sum) or as win-win (variable-sum) situations?  Or is that a false dichotomy that does not characterize the way real negotiations take place?…

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Technology Innovation and Globalization - A Competitive Strategy Perspective

Author: 
Dr. Frank Azuola
Published Date: 
20 Aug 2013

Frank AzuolaAn overview of globalization strategies that enable and foster opportunities for technology spillover and innovation is presented.

Three main perspectives related to the impact of globalization on technology spillover and innovation are considered. First, country-level competitive strategies geared towards globalization are analyzed. Second, strategies adopted by firms for global leadership are reviewed. Lastly, the paradigm shift in globalization brought along by the Digital Economy is discussed.

Countries looking for opportunities to attract foreign direct investment, adopt competitive strategies to help them become more desirable targets to investors. In its various forms, foreign direct investment brings along opportunities for economic benefits to the host countries, including technology spillover and innovation. Following varied globalization strategies, firms move out of their local environment, setting targets outside of their home base, in order to seek growth, expansion, and cost-saving opportunities. As the presence and use of the Internet becomes ubiquitous around our planet, opportunities for globalization along with technology spillover and innovation are no longer exclusive of countries and firms, but are also open to individuals.

Click on the link below to download the full white paper.
 

Applying Leadership to your Life: 7 Actions for an Extraordinary Existence Paper

Author: 
AnaMaria Rivera
Published Date: 
28 Jun 2013

Volumes written about leadership and its applications to organizations and millions of well-intentioned executives wanting to “improve their social skills” so their teams and companies can achieve greater performance and it seems like a blind-spot to question: how can we instill leadership in our companies if we first don’t apply it to our lives and selves? How can we even begin to imagine achieving quantum leaps in performance if we, ourselves don’t undergo a deep personal transformation first?

Seems crazy, but we all do it, be in our personal, family or work relationships, be to our parents, our children, our spouse or our employees: we keep trying to change them, their behaviors, their opinions, their reactions and sometimes even who they are, or at least know themselves to be. My only question to you is: how is that going for you? How successful have you been in trying to change the behavior of your employee who never gets to meetings on time and seems to create excuses that no one believes to be true? How successful have you been in having your spouse change that annoying behavior that reactivates you constantly? Let me guess: not very successful, and yet, you keep insisting in changing the other person. Sometimes, our insanity is so big that our father dies and 15 years after his death we keep fighting with something he did while he was alive, as if we could change the man that has been dead for years.

That answer: our personal transformation, not the change in others. As Mezirow defined it: “Transformation is a change in reality to the better, in contrast to a ´fixing of the problem´ approach” (Mezirow, 2009, 22). That is what I mean by applying leadership to our lives, miraculously we will achieve the performance results that seemed impossible while we were out to change the world without doing the most minimal transformational work on ourselves…

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Measuring Automatic Consumer Processes Paper

Author: 
Ross B. Steinman, Ph.D., Temple University
Published Date: 
22 May 2013

To what extent are people aware of and in control of the influences for their purchasing and consumption behavior? Consumer researchers have dedicated considerable attention to aspects of consumer behavior that are deliberate, conscious, and intentional. However, relatively limited attention has been paid to aspects of consumer behavior that operate outside of conscious awareness. These are referred to as automatic consumer processes. In the past decade, an increasing number of consumer researchers have focused on automatic consumer processes in their attempt to understand judgment and behavior. As such, developing research methodologies that can provide insight into these underlying processes has become essential to the advancement of the field.

These methodologies are important because in consumer research explicit measures, or traditional paper-and-pencil instruments, have been largely used to measure automatic consumer processes. That is, researchers studying automatic processes have had to rely on self-report measures despite the incongruity between the construct and instrument. Examples include research on consumer ethnocentrism and country-of-origin effects, mere exposure to a brand image or product package in influencing consumers’ attitudes toward the brand, and levels of processing research focusing on the effects of incidental advertisement exposure. In each of these cases, the measurement of automatic processes of product or brand information is of interest, but the lack of a reliable and valid measure of consumer attitudes, cognitions, emotions, or behaviors limits what can be learned about the topic. The issue of gathering accurate data from respondents is of utmost importance to consumer researchers. However, in the aforementioned topics, and in many other consumer areas, it is difficult to obtain accurate information about consumers by directly asking them to report their thoughts and feelings…

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Financial Accounting – Development and Problems

Author: 
Marco Malandra
Published Date: 
24 Apr 2013

Marco MalandraAccounting is called "the language of business" because it is the process of identifying, measuring, and communicating financial information to many different groups of people, necessitating different types and uses of accounting, for instance, Managerial Accounting for managers, Tax Accounting for governments, and Forensic Accounting for litigants.  The focus of this paper is Financial Accounting, the preparation and issuance of financial statements to help external users, primarily the owners and creditors of a business, make informed investment decisions.  Surprisingly, most accountants know little about the history of financial accounting because it is not generally taught in accounting courses. However, everyone knows something about its current problems that affect the economy and their lives, the enormity of the accounting scandals since 2001– Enron, World Com, and Lehman Brothers, to name just a few.

The initial development of accounting is older than civilization itself and plays a key role in a number of important phases of history.  There is ample evidence showing that written language developed from early bookkeeping, the recording of assets.  As long as 10,000 years ago in Mesopotamia, alongside the development of agriculture, small clay cones, spheres, and other geometrical shapes or tokens, were sealed in hollow clay containers or balls and then baked, with the purpose of accounting for the amount of commodities owned or transacted: grain, cattle, wine, etc.  Two-dimensional outlines and later picture symbols, representing the tokens inside the balls, were drawn on the outside of the balls while the clay was still soft, before baking, until users eventually realized that neither the tokens nor the balls were needed – the symbols for the tokens could simply be drawn onto clay tablets.  This was a revolution in information technology.  The symbol representing the number one was a wedge (the impression made by the reed stalks used for drawing), and this early symbolic writing is now known as cuneiform, from the Latin word for wedge…

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First Chapter of Next Generation Excel 2nd Edition (Autofill)

Author: 
Dr. Isaac Gottlieb
Published Date: 
28 Feb 2013

Next Generation Excel Second EditionIn this new Second Edition of Next Generation Excel, Isaac Gottlieb shows financial analysts how to harness the full power of Excel to move forward into the new world of accounting and finance. Companies of all sizes use financial models to analyze their finances and plan business operations, as well as to create financial accounting reports like balance sheets, income statements, and statements of cash flows.  Download Dr. Gottlieb's first chapter and learn about AutoFill feature.

From the book: "Part One describes how Excel, the widely used spreadsheet software, can be used efficiently to help build your spreadsheet for a variety of purposes. As an MBA student, an analyst, or an executive, you will develop enough expertise to perform the same tasks you were performing before—using other means—much faster and in a more efficient way. This part of the book demonstrates tools, shortcuts, and techniques for carrying out some common tasks quickly and efficiently. This part will not turn you into an Excel expert in a short time, but by the end you should improve the tasks you can do—the types of tasks that make Excel into such an incredibly powerful and flexible tool for modeling, finance, statistics, and data manipulation.

In Part One: Using Excel Efficiently, we cover the AutoFill feature, efficient selecting, and highlighting in Excel. You will also learn how to use keyboard selection shortcuts."

Also check out Dr. Gottlieb's free monthly Excel Tips of the Month.

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OTC Derivatives Markets: An Introduction to a 700 Trillion Dollar Markets White Paper

Author: 
Dr. Bruce Rader
Published Date: 
28 Jan 2013

One of the fastest growing segments in finance is the derivative’s markets. The Over the Counter (OTC) derivative markets are an unregulated segment of these markets.  A derivative is a security that derives its value from some other asset hence the term derivative.  These are in essence contracts on those underlying assets that trade in what is known as the cash or spot market.  The types of cash market instruments, which are the basis for derivative contracts, are extensive ranging from commodities to currencies to financial instruments. The main categories of derivatives are Forwards, Options, and Swaps.

These contracts are between individual entities and generally fall outside of a regulatory structure even thought there are usually some regulated equivalent. An example of this is that Forward Contracts are on not regulated while Futures Contracts (A refinement of the Forward Contract Concept) are regulated.  The need or existence of any derivative contract is driven by the need to reduce risk.  They are risk control instruments that allow the transfer of risk from those who wish to reduce risk (hedgers) to those who are able to bear that risk (speculators). The growth in the markets is directly related to the increase risk (volatility) in the global market in the past decades. As such derivatives are sometimes thought of as unregulated insurance markets.

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Sarbanes-Oxley v. Dodd-Frank White Paper

Author: 
Dr. Lewis Kerman
Published Date: 
29 Dec 2012

A few years back, I originally wrote this white paper to describe the past, present and future of the Sarbanes-Oxley Act.  Most of us remember the debacle of the Enron collapse.  In an astounding revelation of risky “off-book” enterprises, Enron’s investments paled, and the company imploded as confidence sank to zero.  Employees, whose entire pensions were invested in the company’s stock, were left with nothing.  Stockholders were left with nothing.  “Whistler-blowers” did their best to help convict a large number of Enron big-wigs, but the whistle-blowers got nothing too. But as of 2011, only a few were convicted, and Ken Lay, its president, died before his appeals were up, so technically, he’s never even been convicted.

That sets the scene for the enactment of Sarbanes-Oxley (“SOX”), a measure intended to make companies more transparent in their activities, both from an accounting point of view and from a securities point of view.  Most accountants and most companies have focused on the accounting side of things – rules and regulations which limit the role of consultants, independent auditors, and partners in the firms which do the accounting and auditing.  Officers at the “C” level in companies took on greater responsibility for guaranteeing the efficacy of documents produced and were chastised by the threat of penalties, including jail time, for mistakes.  “Puffing,” “White Lies,” and “Cookie Jar Economics” would no longer be tolerated.  And truthfulness without candor would be punished.

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Double Lean Six Sigma White Paper

Author: 
Dr. Mark Gershon
Published Date: 
26 Nov 2012

There are a variety of ways to introduce Six Sigma into a company, involving different levels of structure, time frames, costs and management commitments. But all agree on the basic steps of the improvement process, the five stages of the DMAIC process.  DMAIC is synonymous with Six Sigma when talking about the process to follow, the steps.

In recent years, however, new developments in Six Sigma have led to the amalgamation of the “lean” tools to bring about certain changes in the methodology and expedite the results. In this context “Lean Six Sigma” (LSS) has now become the industry flavor and many applications are being cited to show its popularity.

To date, however, the proponents of Lean Six Sigma have failed to develop a process to prescribe how to apply Lean Six Sigma.  Most articles and textbooks on LSS read like Six Sigma texts with the word “lean” added many times, especially in the title, and with some of the lean tools added to the tool kit.  But the process followed is DMAIC with no changes.  If that is all Lean Six Sigma is, then it is still just Six Sigma.

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Impact of Technological Innovation on International Competitiveness of Firms White Paper

Author: 
Dr. Madan Annavarjula
Published Date: 
29 Oct 2012

Dr. Madan AnnvarjulaThe central role of innovation driven knowledge in enhancing economic performance of firms can hardly be overemphasized. Technological innovation as an accepted source of organizational knowledge has thus gained added significance as an important driver of organizational performance.

This study utilizes a broader definition of a firm’s technological innovation capabilities that include the generation, dissemination and strength of the innovative activity in a firm. They are then used to predict international competitiveness of the firm.

The unique features of this study are that it uses multiple indicators of firm’s technological innovation, it uses a cross sectional, longitudinal data along with lagged measures of international competitiveness.

Our results are quite encouraging with each factor being a significant predictor of foreign sales.  However, one factor, innovation generation, returned an unpredicted negative sign.  This is partially explained due to the nature of changes in how the underlying data are collected.

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Opportunity, Resources, Team Profiles and Performance of Small Firms Paper

Author: 
Dr. Rajeswararao Chaganti
Published Date: 
24 Sep 2012

Dr. Rajeswararao ChagantiThree elements: quality of opportunity (O), i.e., timely and favorable circumstances giving the firm high odds of doing well on a sustainable basis; management of resources (R), i.e., the way the entrepreneur and her team manage the bundles of assets and capabilities that can be used for productive purposes; and quality of team (T), including the entrepreneur and her team drive the performance of entrepreneurial firms. The three elements combine and jointly effect firm performance. In reality successful entrepreneurs take a rather holistic approach and manage O and R and T simultaneously as if the three elements are integral part of one large portfolio. Therefore the firm performance is better understood by looking at the entire portfolio rather than its parts.

To the extent that entrepreneur and his team have any managerial discretion, relative importance they assign to O and R and T reflect the choices that the management makes. And different combinations of O and R and T can be thought of as different approaches to the management of the firm.

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Flatness - The Global Disaggregation of Value Creation Paper

Author: 
Dr. Ram Mudambi, Temple University
Published Date: 
23 Aug 2012

Dr. Ram Mudambi, Temple UniversityAt the most general level, the idea of “flatness” in the context of economic development has to do with parity. This is the property whereby different individuals or areas of the world are roughly similar in terms of their levels of economic outcomes. Thus, the comparing one individual or area to another, the observer perceives similarity in terms of measurable outcomes like standards of living and incomes.

Academics see the approach to flatness as a part of the process of convergence. Theoretically convergence is occurring if the relationship between a measure of the level of economic outcome and the rate of growth of economic outcome is downward sloping. Thus, if we use gross domestic product (GDP) as the measure of economic outcome, a situation where high GDP countries witness relatively slower rates of growth than low GDP countries is associated with convergence. The greater the difference in growth rates, the more rapid the convergence.

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The Dark Side of Pay for Performance ​White Paper

Author: 
John R. Deckop, Ph.D., Temple University
Published Date: 
1 Aug 2012

What could possibly be wrong with pay for performance? Money is unquestionably a powerful motivator. Pay can encourage desired employee behaviors and discourage undesired behaviors. And there is justice in pay for performance. While should lesser performers receive the same pay raise or bonus as your leading performers?

To answer I will start with classic old story, or parable, which I will adapt: The Parable of the Old Man and the Football Game. There was once an old man who had recently retired from years working in the factory. He was a proud and good worker and always felt that he had plenty of ideas he could contribute to management if only someone would ask. But they never did. Anyway, the highlight of his retirement was the nap he could take every afternoon. For 40 years he would tire in the afternoon and wish he could take a nap. Now he could…

Dr. Deckop teaches in the Masters of Human Resource Management program in Singapore.

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Lehman Brothers’ Accounting Magic – Deleveraging and Moral Hazard

Author: 
Professor AJ Kreimer
Published Date: 
12 Jul 2012

As Wall Street’s problems were reaching a crescendo during 2007 and 2008, Lehman Brothers, a prominent New York based investment bank, faced a continuing drain on its cash and reserves. Its debt laden balance sheet, coupled with illiquid assets with uncertain valuations, constrained its ability to borrow or raise new capital. Lehman needed to convince its lenders, investors, and government regulators that its position was not as dire as the rumors on the Street suggested.

How then, could they make their quarterly 10Q reports appear to show deleveraging of their balance sheet, thereby enhancing critical ratios, and allay the solvency fears circulating on Wall Street? If they could manage to put lipstick on the pig, government regulators, analysts and investors would relax – and perhaps the shorts (speculators driving down the stock price by “shorting” Lehman’s stock) would retreat.

To solve the initial problem of raising cash, Lehman, as well as other investment banks, frequently employed the use of repurchase agreements, or repos. A common tool in the industry, repos, allows banks and other entities to raise cash quickly for short periods of time. The transaction is relatively straight forward. The borrower pledges collateral (securities, bonds, etc.) equal to the amount of cash that will be borrowed from the counter party, typically a bank or other entity with excess cash on hand. The lender receives a fee plus interest on the funds while they’re outstanding. When the transaction is unwound, the lender receives its funds and releases the hold on the collateral…

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The Role of Savings Rate in the Economic Crisis White Paper

Author: 
Dr. Amir Shoham, Temple University
Published Date: 
13 Jun 2012

Dr. Amir Shoham, Temple UniversityWhen considering the current economic crisis we can discern that variables of two different types contributed to its creation and magnitude. The first are the real variables that caused the initial imbalance in the economy. The second variables are the nominal ones, which are usually catalysts that accelerate situations. Metaphorically, the real variables can be compared to fire and the nominal ones to the fuel. Considering the way the crisis evolved, there is a clear view of the chief real variable that caused the crisis. This variable is the change in the savings rates, primarily in the US.

If we briefly review the history of the crisis, we see that the first signals of genuine economic instability began to appear in the first half of 2007, when a large wave of sub-prime mortgage lenders in the United States became insolvent. However, the seeds of the crisis were planted many years before. The United States created a deficit in its current account that grew steadily throughout the last decade. The deficit on one side of the ocean created surplus on the other side, especially in countries like China and Singapore. These countries then loaned the surplus back to the US so that it would be able to continue buying imports. Usually, a current account deficit is highly correlated with a government deficit, and the data from years before the crisis show that the US is no different. During this period, several bubbles were created in the American economy. The first bubble appeared in the lending market, led by the housing market where mortgages are granted to sub-prime borrowers and prime borrowers with low self-equity. These loans expanded beyond all reasonable proportions because of the financial system’s eagerness for short-term profits. This eagerness was ignited by short-term incentive contracts signed with managers of financial companies or what is known professionally as the “principal-agent problem.” Simultaneously, mortgages became securitized, which created an additional problem when rating companies granted these securities AAA ratings despite the high risk levels. The lack of supervision over the highly-influential rating companies working in an unregulated branch exacerbated the crisis.

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Crowdfunding: A New Era of Democratized Entrepreneurship Paper

Author: 
Dr. Sunil Wattal, Temple University
Published Date: 
10 May 2012

Crowd-funding has been defined as a collective effort by consumers who network and pool their money together, usually via the Internet, in order to invest in and support efforts initiated by other people or organizations. Crowd-funded marketplaces, Internet platforms that support the crowd-funding process, have recently emerged as a viable new approach to sourcing capital to support innovative, entrepreneurial ideas and ventures. In these markets, any individual can propose a project, and interested others can contribute their funds to support it.

These markets typically come in one of four configurations: i) lending-based, ii) reward-based, iii) donation-based and iv) equity-based. Amongst these, lending- and donation-based platforms are the longest standing. Well-known examples of lending- and donation-based markets include Kiva.org (micro-finance), which was established in 2005, and Prosper.com (peer-to-peer lending), which was established in 2006. Recently, reward-based platforms have come to the fore. A prime example of this marketplace type is Kickstarter, which helped entrepreneurs to raise just under $100 million in 2011 and is set to raise triple that amount in 2012. Finally, equity-based platforms are virtually non-existent in the United States at the moment, due to legal restrictions that are currently undergoing changes. However, CrowdCube, founded in 2010 and based in the United Kingdom, is the best-known example of this crowd-funding format.

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The Road to Convergence...One Set of Global Accounting Standards?

Author: 
Michael Moughan, CPA, CFP & Ph.D., Temple University
Published Date: 
24 Apr 2012

Professor Michael MoughanCan the Financial Accounting Standards Board and the International Accounting Standards Board Agree on One Set of Global Accounting Standards…and will the Securities Exchange Commission Agree to the Standards adopted?

The Securities and Exchange Commission (SEC) is on record as stating that they are responsible for the protection of American investors, and that they will never compromise that mission.  The SEC believes it has set the highest regulatory standards for the financial markets of any country on earth as it oversees the Financial Accounting Standards Board (FASB) and approves the FASB’s formulation of accounting principles for US companies. These principles are known as Generally Accepted Accounting Principles or GAAP.

Starting in 2001 the International Accounting Standards Board (IASB), a successor of the 1973 established International Accounting Standards Committee, has been issuing International Financial Reporting Standards (IFRS) for most of the rest of the world to follow when producing financial statements (over 100 accounting organizations and 80 countries and 9,000 companies are involved complying with the IFRS).

However, for many years the accounting profession, both within the US and internationally, has recognized the need for one set of high quality accounting standards on a global basis.  The accounting profession, as a whole, certainly is in agreement that investors require full and accurate information and that the data behind the information must be reliable and transparent.  The goal to set consistent accounting standards and disclosures, which would lead to comparable financial statements worldwide and, hence, aid globalization and development, has been in place for decades.

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Using Earned Value Analysis to Manage Projects White Paper

Author: 
Dr. Mark Gershon, PMP, Temple University
Published Date: 
27 Feb 2012

Any curriculum on the subject of Project Management explains that there are three major tools that are needed to manage projects, three tools that are not used in other types of operations. These three tools are the Work Breakdown Structure (WBS), Critical Path Method (CPM) Scheduling, and Earned Value Analysis.

The WBS provides the scope of the project, detailing each task required to be performed. Since it is very difficult to conduct a project without a list of tasks that need to be completed, virtually everyone in project management used the WBS.

The CPM schedules the tasks from the WBS, putting them on a calendar to provide a plan for carrying out the project. This plan or schedule is usually illustrated with a Gantt chart. Again, no organization would allow a project manager to spend their money or use their resources without such a plan, so again virtually everyone in project management uses this CPM tool.

Earned Value Analysis is not a planning tool. It is a tool for managing the work during the Execution phase of a project. It is a Control tool. We would think that every project needs a good Control tool, and every project manager would use it. But most project managers, and most organizations, do not use Earned Value analysis.  

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Global Branding Strategies White Paper

Author: 
Anthony Di Benedetto, Ph. D., Temple University
Published Date: 
24 Jan 2012

One of the most important decisions at the time of a new product launch is selecting the brand.   Branding a product represents a promise made by the firm to the customer about the product’s value or quality.  Effective branding differentiates competing products and contributes to the mental image the customer has about the product and the firm.  It is easy to see the value in familiar brands such as Coca-Cola, Toyota, Nike, or Apple.  Marketing people refer to brand equity as the added brand value that results from careful investment in brand marketing by the firm, and is created over time by the relationship between the brand and customer.  Brand equity is valuable to the firm as it builds customer loyalty and repurchase and gets greater reseller support, thus making future marketing and product launch activities much more cost-efficient.

Branding for the domestic market is challenging enough.  Names must be chosen that communicate the physical or sensory qualities of the brand; that are clear, relevant, and not irritating or insulting; that might be transferable to a line of products in the future; and that support the overall new product strategy.  Few if any brands score high on all these dimensions.  But when developing a branding strategy for the global market, the branding decision becomes even more complicated.  In addition to all of the above, the firm must now consider whether it should standardize the brand name across all markets, or use two or more regional brand names.  And this decision in not made in a vacuum, but must be tied to the global management of the brand…

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Voodoo Presenting: A Finance CLASSIC! White Paper

Author: 
Stanley Ridgley, Ph.D., Temple University
Published Date: 
1 Nov 2011

Whether the presentations class is in Philadelphia…or Mumbai…or Cali…or Singapore…I hear the same universal and eerie refrain from  finance students.

“Finance is different.”
“We don’t do all of that soft-skill presentations stuff.”
“For us, the numbers tell the story.”

Numbers seem to enchant business-people in deep and mysterious ways, as if numerical constructs are somehow less malleable than the English language, less subject to manipulation.  In a chaotic world, a spreadsheet exudes familiarity, a firm valuation offers comfort, an income statement serves as anchor.

For some, numbers convey a certitude and precision unavailable to mere rhetoric.  And this illusion of certitude and precision exerts influence on finance folks to believe that, well … that the laws of human nature that stymie the rest of us do not apply to them in the coldness and hardness of objective numerical analysis.

But this is an illusion. And the result is 2D presenting, full of voodoo and bereft of nuance and subtle analysis…

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Sarbanes-Oxley - Past, Present and Future Paper

Author: 
Professor Lewis Kerman
Published Date: 
1 Sep 2011

Most of us remember the debacle of the Enron collapse. In an astounding revelation of risky “off-book” enterprises, Enron’s investments paled, and the company imploded as confidence sank to zero. Employees, whose entire pensions were invested in the company’s stock, were left with nothing. Stockholders were left with nothing. “Whistler-blowers” did their best to help convict a large number of Enron big-wigs, but the whistle-blowers got nothing too. But as of 2011, only a few were convicted, and Ken Lay, its president, died before his appeals were up, so technically, he’s never been convicted…

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