ABSTRACT OF APRIL EDITION 2016
Volume 12*Number 1* APRIL 2016
1.The Determinants of the Japanese Real Imports from Australian Exports
Duy Nong, Mahinda Siriwardana, Nam Hoang and Sam Meng, University of New England, Australia
The bilateral trade between Australia and Japan has played very important roles in Australian and Japanese economies over a long period of time. In this study, we apply the bounds testing approach within an Autoregressive Distributed Lag framework (ARDL) to evaluate the major determinants of Japanese demand for Australian exports. The modelling results show that real Gross Domestic Product (GDP) is the most important factor positively affecting the Japanese real imports from Australia. The real exchange rate and foreign reserves assets affect negatively but are inelastic in both the long run and the short run. With a value of -0.74, the error correction coefficient is very significant. This indicates that only a short period of time (4 months) is needed to achieve long run equilibrium.
Key Words: International trade, Japanese economy, Australian economy, the bounds testing, ARDL model.
2. The Taylor Rule in Australia, 1989-2014
Dr Frank Elston,Domenico Pensiero
School of Commerce, University of Southern Queensland, Toowoomba, Australia,
The Taylor rule is a rules based monetary policy whereby the policy maker reacts to inflation and output gaps in setting the policy instrument, usually a short term interest rate. It can be prescriptive or descriptive. This study examines whether the Taylor rule describes the behaviour of the Reserve Bank of Australia since 1989, a period encompassing the last three Governors of the RBA. Using the traditional gap coefficients of .5 we find the implied Taylor cash rate, which then can be compared with the actual cash rate. The Taylor rule describes well the policymaking during the era of Governor Glenn Stevens, but does not describe as well the policymaking during the two predecessors. The study also determines the least squares estimates of the coefficients and finds that both the inflation and output coefficients exceed .5. A supplementary finding is that lagging the output and inflation gaps did not make any material difference.
Key words: Taylor rule, Monetary policy, Inflation gap, Output gap
Coordinating Transportation Activities With Demand:
An Expanded Conceptual Model
David R. Rink, Indiana University Kokomo, U.S.A.
Peter F. Kaminski, Northern Illinois University, U.S.A.
Intensifying competition, changing customer preferences, spiraling fuel costs, added product complexity, and rapidly evolving technology coupled with increasing demands on productivity, cost reduction, customer service, and continuity of supply have significantly broadened the scope and highlighted the importance of transportation, thereby elevating its stature at the top-management level. Today’s transport executives command greater decision-making authority, are more active in developing and implementing strategies for different departments in the company, and participate in formulating and implementing corporate policies and strategies. These new responsibilities necessitate a reconceptualization of transportation’s role within an organization. A need exists among transport executives, therefore, for an integrative, conceptual model to serve as an aid in decision making. Specifically, there is a necessity for a set of carefully conceived transportation activities sequenced according to some workable framework. The product life cycle concept represents such a guideline. It can integrate, coordinate, and relate the effects of various transport practices to a dynamic business environment, thereby assisting transportation executives in the effective and timely performance of their traditional duties and new responsibilities for the optimal benefit of the company. In the following article, the authors present a synthesized, substantially expanded, and updated product life cycle-transportation activities model, which consists of 176 transport operations sequenced according to five stages of a product’s sales trend.
Keywords: Transportation, Product Life Cycle, Physical Distribution, Logistics, Marketing
JEL Classification: M31
4. Universities – Identifying and Developing Dynamic Capabilities
Benita Hube, Gary Stockport(Corresponding author)
University of Western Australia
This paper considers how a university can build a sustainable competitive advantage (SCA) through the identification and development of its dynamic capabilities (DC). We contribute to the existing body of knowledge through proposing a DC framework for universities which builds upon Teece (2007) and Teece (2009) DC framework of sensing, seizing and reconfiguring. Data was collected from an in-depth case study about one major Australian university. This involved the collection and analysis of secondary data which was widely available in the public domain such as Annual Reports, Strategy Plans and Senior Executive Strategy widely circulated discussion papers. Within our DC framework, we emphasise the dual importance of strategic leadership as well as managing strategic change as critical and integrating components of the DC building process. We also consider how to measure SCA.
Keywords: Dynamic capabilities, universities, environment, sustainable competitive advantage, organisational change
Tacit Knowledge Strategic Use in Organizations – A New Model for Creation, Sharing and Success
Ahmed Elmorshidy, Ph.D.
Claremont Graduate University, USA / Gulf University for Science & Technology
Tacit knowledge in many situation is as useful as -or maybe more useful- than explicit knowledge. It is usually acquired from employees’ life-time experience and practical interaction with real-life work challenges. This paper discusses the importance of tacit knowledge in organizations in the new era, the strategic use of tacit knowledge as a competitive advantages, the effect of social networks and advances in communications in collection and conversion of tacit knowledge to explicit knowledge. The paper also proposes a new model for tacit knowledge creation, conversion, sharing and success.
What Matters: Pay Unfairness Perception
Qiumei Jane Xu, Northeastern Illinois University, USA
Asel Moldousupova, Northeastern Illinois University, USA
This research examined individual factors that can impact pay unfairness perception. We conducted an experiment composed with a set of vignettes and found that individual characteristics such as job performance, work effort, job tenure, education and family size influenced their judgment of pay unfairness. In addition, we found that individuals are more sensitive to the negative inequity than the positive inequity. Implications of the findings both for justice theories research and the practice of management were discussed.
Pay is arguably one of the most critical outcomes of organizational behavior for employees (Gupta & Shaw, 1998). Actual pay and people’s attitudes about it are the subject of much research (Lawler & Jenkins, 1992; Miceli & Lane, 1991). In the Human Resource Management (HRM) practices, how to design an effective pay system has always been a challenge for HRM researchers and practitioners. One big factor that plays an important role in the effectiveness of design for compensation system is fairness perception. Fairness perception influences individual employees’ pay satisfaction (Folger & Konovsky, 1989).Perceived pay fairness is also an important determinant of effort and performance at work. Thus, the perceived fairness of pay has been a key component in a successful compensation system (Milkovich & Newman, 2005). The pay system serves as an instrumental function by directing individual employees’ behaviors toward fulfilling organizational goals. It also enhances greater work motivation by differently rewarding employees with different level of performance. Thus, the pay system plays a crucial role in retaining more effective employees. Lack of opportunities to enhance compensation levels influences employees’ decision to quit and their commitment to the organization (Singh, Verbeke, & Rhoads, 1996).
Currently, pay systems include seniority based pay, merit-based pay, need-based pay and other types of pay. The theories that the pay system has been built upon include different motivation theories and justice theories.
We would like to examine how individual employees’ fairness perception may be affected by the pay based upon factors such as job performance, tenure, education level, work effort and family size. We would also like to examine individual sensitivity in term of pay fairness for overpay or underpay.As an absolutely fair pay system is ideal for organizations, we need to examine the tolerance level of unfairness for individuals in terms of both under-compensation and over-compensation.
The article is organized as follows. A literature review on pay systems study and fairness theories will be introduced first, followed by the hypotheses built upon current justice theories. Second, the methodology for this research is presented. Third, a detailed analysis for the data will be conducted. Results of the study are discussed next. Finally, implications of results for practitioners are discussed and directions for future research are offered.
The Effect of Institutional Pressures on Quality Management
Farhana Ferdousi, Kevin Baird, Rahat Munir, Sophia Su
Using DiMaggio and Powell’s (1983) notion of institutional theory, this study examines the influence of institutional pressures on quality management (QM) practices in a developing economy. The study employs the case study approach, focusing on a manufacturing organisation operating in the garment industry in Bangladesh.
The findings suggest that QM practices are influenced by coercive, mimetic and normative pressures. The coercive pressures, mainly consisted of directives from top management aimed at improving quality in response to pressure from retailers and increased competition following the removal of the Multi-Fibre Arrangement. Mimetic pressure arose due to the high competition and the resultant uncertainty within the market, while normative pressures were attributed to the influence of professional garment associations, top management support and training. This study highlights the importance of adjusting QM practices in a developing economy in order to maintain competitiveness. The findings assist managers by highlighting the need for QM change and by providing an insight into how institutional pressures influence such changes. The findings will assist practitioners by highlighting the importance of the evolution of QM practices, and enabling them to anticipate the need for change and adjust their QM practices accordingly.
Keywords: quality management practices; institutional pressures; developing economy.
HR Practices and Organizational Commitment among Non-family Employees in Family Firms: The Moderating Role of Organizational Tenure.
Hazel M. Ramos, Mandy Siew Chen Sim , Michael J Mustafa
The University of Nottingham Malaysia Campus
What drives non-family employees’ organizational commitment? To address this question, this particular study draws on the concept of High-Involvement HR Practices (HIHRPs). Drawing on Social exchange theory, we argue that HIHRPs represent an important way through which family firms can send a strong message to their non-family employees that they care for their well-being and are willing to invest on their development and growth. Additionally, this particular study also examines the moderating affects of non-family employees organizational tenure on the relationship between HIHRPs and Organizational commitment. We test our specific hypothesis using a sample of 154 non-family employees’ from six family SMEs in Singapore. Specifically, we find that different HIHRPs affect different types of organizational commitment. Additionally, we found non-family employees’ organizational tenure to only moderate the relationship between fair rewards and affective commitment, and between competency development and normative commitment. Our findings make a number of valuable and timely contribution to the literature on non-family employees and the drivers of their organizational commitment.
The Effect of Uncertainty Avoidance on the Effectiveness of Comparative Advertising
Lin Zhang, Truman State University, USA
Baolong Ma, Beijing Institute of Technology, P. R. China (corresponding author)
Qinyu, Liao, the University of Texas Rio Grande Valley, USA
This research focuses on how the individual level of uncertainty avoidance (UA) influences evaluations of advertisements and the advertised brand. In the context of comparative vs. non comparative ads we examine the moderating influence of UA in two distinct product categories; a high cognitively involving product and a low cognitively involving product. We suggest that ads that are presented in a format (CP vs NC) that are aligned to be congruent with the individual’s level of uncertainty avoidance will generate more positive attitudes. Experiment results provide reasonable support for the hypotheses. Implications for managers and academicians are discussed.
Conceptualising the Symbolic Product:
An Arts and Cultural Marketing Imperative
Dr Kim Lehman, Dr Mark Wickham
University of Tasmania
Dr Ian Fillis
University of Stirling
The purpose of this paper is to critique existing understanding of the nature of product within the arts and cultural setting, thereby identifying gaps in knowledge regarding ‘product’ in this context. We then develop a reconceptualisation of the product notion, accounting for its symbolic value to society as a whole. We critically review the relevant literature and generate a conceptual model of the symbolic value inherent to an ‘arts and cultural product’. We then set out an agenda for research in the field, i.e. a framework for interviewing established artists to assess their reactions and affinity to our conceptualisation of symbolic product value. Results from the literature review, and our specialist knowledge of the arts and cultural sector, have resulted in the construction of an arts and culture product model which accounts for its tangible, intangible and symbolic dimensions. Our conceptual model can assist cultural producers (e.g. artists) to engage with marketing. Experience tells us that cultural producers often have little or no training in marketing. Addressing our proposed research agenda (which accounts for specific industry practices and philosophies) will enhance engagement with ideas about the product notion and marketing more generally.
Keywords: Arts and cultural marketing, Product concept, Symbolic value
A Higher Order Construct of E-Supply Chain Capability: Theoretical Perspectives and Empirical Operationalization
Rui Bi, Charles Sturt University, Australia
Information Technology (IT) has been widely employed in supply chain operations, helping companies to respond to clients’ needs in real time, facilitate paperless transactions, reach out to difficult-to-access markets, and outperform competitors. This paper presents a theory-driven, validated higher-order construct that measures e-supply chain capability, integrating typical procurement and order-taking functions within an organization’s supply chain. It is a response to a call in information systems literature to develop and assess multidimensional IT capabilities. Drawing on tenets from both resource based view and relational view, we developed a conceptual definition of e-supply chain capability. Using structural equation modeling techniques, we constructed a measurement model of e-supply chain capability encompassing four dimensions: communication with customers, order taking, procurement, and communication with suppliers. The new validated measurement model of e-supply chain capability offers opportunities to expand IS research in supply chain management.
Keywords :Resource-based view of firms, relational view, e-supply chain capability, structural equation modeling
Retail Servicescape: An Exploration of the Relevant Dimensions and Their Impact on Consumers’ Behavioral Intentions
Jaipuria Institute of Management, Jaipur
Impalpability is a defining characteristic of services. The prospect of a service offering is involved in an inexorable search for pre-purchase cues that can reduce his degree of perceived risk for the service that he or she is intends to purchase. Servicescape, the environment in which a service process takes place, has a paramount influence in re-assuring the customer and eventually enabling him or her in comprehending the experiential outcomes of purchase and consumption.
The paper investigates the impact of servicescape on behavioral intentions of customers in the retail industry. The servicescape framework in this paper is based on selected aspects of Bitner’s (1992) servicescape framework and Wakefield and Blodgett’s (1994) model. Five servicescape dimensions have been identified, viz. ambient conditions, spatial layout, functionality, spatial signs, symbols and artifacts and cleanliness. The paper studies the impact of these dimensions on the perceived quality of the servicescape and on the shoppers’ desire to stay in the retail store.
The research concludes that spatial layout followed by ambient conditions are the two most dimensions in affecting the perceived quality of servicescape. Also observed is a positive relationship between the perceived quality of servicescape and satisfaction with the servicescape and the shoppers’ desire to stay in the retail store.
An Analysis of the Shutdown of the United States Government and Its Impact on the US/Taiwan Exchange Rate
Srinivas Nippani, College of Business, Texas A&M University-Commerce, USA
In October 2013, the United States Government shutdown over the disagreement between the Legislative and Executive branches over the debt ceiling. The purpose of this study is to examine the impact of this disagreement on the exchange rate between the Taiwanese dollar and its American counterpart. We analyze the impact of this event on the exchange rate and show that fewer Taiwanese dollars were needed during two months of disagreement as compared with other periods. Our results are robust and have implications for banks, foreign exchange traders, businesses that import/export goods from Taiwan to the United States and vice-versa, and other market participants.
Drivers of Value Creation and Profitability in Indian Pharmaceutical Industry: An Empirical Examination Using Latent Variable Approach.
B Rajesh Kumar , K S Sujit,
Institute of Management Technology, Dubai International Academic City, Dubai
Value creation depends on how well a firm strategizes its financing, investment, working capital and dividend decisions. This research paper examines the determinants of profitability and value creation in Indian pharmaceutical industry based on a sample of 350 firms using the PLS SEM modeling technique. Size of a firm is an important determinant of profitability and value creation in drug industry. Higher liquidity leads to more value creation. Management efficiency is another determinant of profitability and value creation in pharma industry. Higher leverage signifies higher valuation lending support to the signaling theory that stock market investors react favorably to higher leverage decisions of pharma firms. Higher dividend payments result in more value creation. The drug firm’s dependence on external factors like outsourcing, technological knowhow are not favorably viewed by stock markets. The study finds investments like R&D investments don’t have any impact on value creation in Indian pharma industries. The average R&D expenses as a per cent of sales was only 8 per cent approximately during the period 2010-2015.
The Impact of Data Mining on Risk Management Process(Field Study on Jordanian Insurance Companies)
Shadi abualloush(corresponding author), Mohammad alzoubi,
Irbid National University.
The aim the study is to investigate or identifying the impact of data mining of risk management, and relationship between data mining with risk management process , the data mining and risk management are considered most important factor within organization that help to decision making. Organization must take care data mining to take advantage of the discovery knowledge and hidden pattern. Company insurance in Jordan were used as the main sample of this study. A random sample was selected where 310 questionnaires were distributed to such Company .The study showed that there is a direct effect of between data mining on risk management , The study recommended apply advanced technologies via data mining in using the last moment, accurate and valuable business data. The same applies to data with high accreditation which can be available from multiple resources. Additionally, apply what have been acquired of expertise in order to improve and enhance the quality of decisions to be made based on these data.
Key word: Data mining. Risk management, risk management process, Insurance companies
Impact of Degrees of Operating and Financial Leverage on Systematic Risk: Evidence from India
Pradeep Kumar Gupta, L M Thapar School of Management, Thapar University, Derabassi, India
Shailendra Kumar, Indian Institute of Information Technology, Allahabad, India.
Piyush Verma, L M Thapar School of Management, Thapar University, Derabassi, India
The paper examines the impact of degrees of operating and financial leverage on systematic risk of common stock of the firms in an emerging market. This study assumes importance due to inconsistencies in results of previous empirical studies (Gahlon and Gentry, 1982; Mandelker and Rhee, 1984;Huffman ,1989; Lord, 1996) conducted largely in developed economies. The focus of this research is on Indian context as the business organisations in emerging markets differ in terms of their structures (Sarkar, Sarkar and Sen, 2008) and economic environment from those in developed markets. The relationship between degree of leverages and systematic risk is analysed for a sample of 232 manufacturing firms listed on National Stock Exchange (NSE) of India over a period of 10 years from 2002 to 2011 including the period of recession. The findings of our study support the results of Huffman (1989) that the relationship between degree of operating leverage and systematic risk is found statistically insignificant but degree of financial leverage and systematic risk are significantly positively related. However, in our study we have observed a significant positive correlation between degree of operating leverage and systematic risk for the firms with high degree of sensitivity and operating leverage. Thus, our study provides managerial insight to practitioners, investors and scholars about the relevance of degrees of operating and financial leverage in the context of India, one of big 10 emerging markets (Garten,1997).
Financial Inclusion - Value Chain Finance Approach
Ramesh Subramanian,Ph.D Research Scholar,SCSVMV University,
Enathur, Kanchipuram, Professor, IFMR, Chennai,India
Charusree Rajagopal, PGDM (Finance), IFMR, Chennai,India
“Overcoming poverty is not a gesture of charity. It is an act of justice. It is the protection of a fundamental human right, the right to dignity and a decent life. While poverty persists, there is no true freedom.”Nelson Mandela
“Poverty is the worst form of violence.” - Mahatma Gandhi.
“Helping people better understand how to borrow and save wisely and how to build personal wealth is one of the best things we can do to improve the well-being of families and communities.”Bernanke. (RBI, 2013)
Financial inclusion could be an important instrument for alleviation of poverty. Financial Inclusion would result in economic growth and lead to balanced economic development. Policy transmission of the central bank could be most effective only when the entire financial system is under the organized sector. Two-fifths of rural households still rely on informal credit. The agriculturist and the rural folk depend on the money lenders for meeting their credit needs. India as a member of G20 has rightly put financial inclusion at the top of the agenda of the Central Bank.
Value chain finance is financing provided to a value chain actor in order to increase value-chain growth and competitiveness. This approach would enable the participants in the value chain who are operating at a lower equilibrium to operate at a higher equilibrium. Porter’s value chain enables the activities within and around an organization to be identified and related to the assessment of competitive strength. Value Analysis is a process of systematic review that is applied to existing product designs in order to compare the function of the product required by a customer to meet their requirements at the lowest cost consistent with the specified performance and reliability needed. The Theory of Constraints is geared to help organizations continually achieve their goals is a case in point and is equally applicable to the agri-value chain. Application of drum-buffer-rope in the context of agri-value chain would enable optimization of production schedule.
To achieve the objective of Financial Inclusion there is a need to adopt a suitable strategy. A value chain finance approach by banks and financial institutions could be a strategy to bring about financial inclusion in the country. The objective of this paper is to demonstrate how the inefficiencies in the agricultural value chain could be identified by applying the Porter’s Value Chain model to the external environment and apply management concepts like Value Analysis and Theory of Constraints with proper tweaking. Adoption of such management concepts and financial strategy would enable the funding institutions in achieving the dream of full financial inclusion which would be sustainable and beneficial to all the stake holders.
KEY WORDS:Financial Inclusion, Value Chain Finance, Value Analysis, Porter’s value chain, Theory of Constraints
Stock Returns and Idiosyncratic Volatility: Evidence from India
Institute of Management Technology, Nagpur, Maharashtra
Existing research provides conflicting evidence on the relationship between realized idiosyncratic volatility and future returns. We investigate this relationship in Indian stock markets. In addition we also investigate the relationship between expected idiosyncratic volatility and stock returns. The study utilizes a panel data spanning over ten years and uses panel data regression with firm and time fixed effects to analyze the relationship. The results suggest that there is a significant negative relationship between realized idiosyncratic volatility and future stock returns. The results, however, do not suggest any significant relationship between expected idiosyncratic volatility and stock returns. Both the results are consistent in different specifications.