The objective of this paper is to develop the model that can be used to explain the amount of research and development (R&D) expenditures of large and mature companies. The research methodology is based on real options approach. We model companies’ R&D expenditures as payments for the real option, which is the right of a company to invest in real assets in the future, and therefore to ensure business development. The main result is a valuation model, which includes several relevant factors. While existing research papers apply real options approach mostly to the R&D projects of particular companies or within particular industries and situations, the current paper applies the corresponding methodology in general and aggregated setting. We hope that it will contribute to understanding of R&D intensity in large innovative companies.
Nascent entrepreneurs are those individuals who engage in start-up activities as part of the process of starting a new venture. In many cases, these activities lead to successful founding, but in some situations, the entrepreneur’s initial ideas go unrealized because the new venture cannot mobilize the necessary resources needed to create a fledging firm. In this paper, we look at the impact of the family and university social context on young student nascent entrepreneurs. Our findings based on Global University Entrepreneurial Spirit Students’ Survey (GUESSS) wave in 2011 suggest that both family and university have a significant impact on the entrepreneurs’ progress through the venturing process. However, when we take a finergrained look, we find surprising gender differences. Female entrepreneurs rely on their strong family ties for support; however, they are also able to better utilize their weaker university connections to make progress through the venture creation process than are men. This suggests that for women, all types of social support are important in their venture creation processes.
While the field of customer orientation (CO) has been studied extensively since the 1990s,
there have hardly been any attempts to revisit the concept for the specifics of B2B markets,
especially in the context of emerging economies. This paper explores the peculiarities of B2B
firms’ CO on the example of Russia. The empirical survey of 272 Russian B2B firms show
that well-established CO measurement can be used as integrated complex measure. The
results of our analysis demonstrate a critically important aspect of CO, which helps to differentiate
the customer-oriented firms from those with only “declared” CO. The study indicates
a need to critically assess widely used marketing concepts and their measurement in B2B
markets of emerging economies.
This paper is aimed at identifying the role of digital manufacturing in changes of marketing activities of industrial companies from the point of view of a business management system. Authors define and conceptualize the notion of “digital manufacturing”. Research design is based on the Deloitte Company methodology based on value creation approach. Customers, product, economics of production, and value chain are essential methodology parameters. Our analysis shows that implementation of digital manufacturing will necessarily significantly change entire business model and marketing activity of the company. The main drivers of this process are building and maintaining relationship with customers and new opportunities related to product design and production. Interaction with customers without intermediaries, customers’ involvement in the processes of new products development, new technical possibilities of creating personalized product-service solution are main changes in marketing activities caused by the implementation of digital manufacturing at the company.
Competitive strategies of platforms often involve contractual arrangements that might be considered as anticompetitive. Since recent decisions of European Commission after investigations against Google in 2017 and 2018, and Bundeskartellamt against Facebook in 2019, the standards of liability for abuses applied by competition authorities will inflence business models of digital platforms. This paper summarizes theories of harm applied by BRICS competition authorities applied towards multi-sided platforms under investigations. One may expect that BRICS approach to be harsher compared to mature competition jurisdictions. However, a comparison shows that discrimination and tying with exclusionary effcts have been the focus of investigations and decisions in BRICS. Remedies in the infringement decisions are intended to protect rivalry through “no restriction of multihoming” conditions. There is no evidence that BRICS authorities apply a specifi economic theory of multi-sided platforms. At the same time, BRICS competition enforcement could be applied as one of the legal instruments when one platform tries to crowd out another from global markets.
The problem of earnings management is on of most topical issues in accounting practice worldwide. There are many reasons for this phenomenon. In this paper we will follow papers [Fischer, Rosenzweig, 1995; Geiger et al., 2006] to present the results of analysis of a survey of Russian respondents concerning their attitudes on the ethical acceptability of earnings management. It occurs that Russian respondents’ behavior is different from other countries and we find factors that are associated with these differences. On the other hand, it was found that Russia is not significantly different in earnings management perception from market oriented developed countries.
E-commerce market development depends on the configuration of factors which both enable its further development, but might as well hinder its adoption by consumers. In particular, emerging markets provide numerous opportunities for e-commerce; however, they are also associated with specific barriers, limiting the potential for fully exploiting these opportunities. With an Internet audience of 93 mln people, the Russian emerging market represents the largest online audience in Europe, stimulating substantial e-commerce growth over the last decade. The main objective of this paper is to explore consumer perception of e-commerce adoption factors on two levels — the first are the macro-level factors, associated with the overall environment, institutional factors and trust; the second one is store-level factors, or factors associated with real consumer experiences. This multi-level approach reflects the complexity of consumer thinking about the market — both in terms of the evolving environment, offering opportunities to make decisions and make purchases; and real experience, where the factors are influencing particular consumer decisions and are weighted by consumers as pros and cons. Our study is based on a survey, using a sample of 3 387 respondents representing the consumer perspective. The findings reveal the structure of the driving and limiting factors, highlighting the core role of the trustworthiness and transparency of the e-commerce market players, delivery conditions and store-related risks.
One of the most important factors determining a firm’s profitable growth is scientific and technological progress. In the age of high technology innovations are vitally necessary for companies to compete with one another. Global statistics show that a huge amount of investments are focused on research and development projects in different sectors of the economy such as software and programming, biotechnological products, capital goods, beverages, accessories, restaurants, retail, hotels and motels, and so on.
However, R&D expenses are characterized by high uncertainty and returns in the long run, so not every company can afford such risky investments, for example, most of small and medium enterprises (SMEs). Besides external uncontrollable factors such as crises, disasters, political instability, and armed conflicts, each firm has its own internal problems. Together this can lead to the financial distress or even failure of a firm, and each additional risky asset can increase the probability of insolvency.
Thus, the relevance of the present paper is that each company has to find the optimal tradeoff between investments in innovations and financial distress. The solution to this problem can improve a company’s efficiency and lead to its growth. And vice versa, an unsuccessful selection can result even in the default of a firm.
The purpose of the present paper is to evaluate financial distress costs at innovative companies. In order to achieve stated this aim, the following tasks will be completed in this paper:A detailed literature review on financial distress cost evaluation will be provided; The most appropriate models will be determined for both direct and indirect costs related to financial distress; Explanatory factors will be defined for both types of insolvency; The model for direct distress cost evaluation at innovative companies will be developed; The model for indirect distress cost evaluation in innovative companies will be designed; The results of the conducted analysis will be described; Recommendations for further research studies will be given.
The subject of the investigation is financial distress costs. Our study focuses on companies that spent at least $200 million on research and development in 2015. For the further development of the topic, data was collected from Bloomberg and the financial reports of companies. The novelty of the present paper is that the model for direct and indirect cost evaluation at innovative companies was developed.
This study is focused on gaps in the theory of capital structure research regarding the phenomenon of zero-debt behavior. On the sample of firms from 21 countries with emerging capital markets over the period of 2010–2015, we show that the zero-debt policy choice is firstly driven by financial flexibility motive, while financial constraints could be regarded as the second motive. We show that major determinants of the zero-leverage choice are growth opportunities, profitability, business risk and cash holdings. We find that all these firms are smaller, less profitable, riskier and possess high cash holdings. Moreover, we find that macroeconomic conditions have lower influence on the debt policy decision in comparison with corporate determinants.
The study offers a structural literature review on the twenty years the evolution of the fast-growing research topic of intellectual capital (IC) and intangible-driven performance. Despite a rather short independent history, the IC concept has undergone a substantial transformation, bringing to the discussion vast empirical and methodological literature. Several endeavors carrying out literature review studies could only partially satisfy the needs of the systematization of the relevant research. Hence, there is still a large room for such kind of analysis due to the increasing number of new papers published in the area and puzzle of IC-related sophistications. To draw a holistic picture of the landscape of IC and associated corporate performance, this study departures from the mixed research methodology embracing elements of machine-learning tools and in-depth qualitative interpretation of obtained results and critical discussion of the most influential studies in the field. Our findings demonstrate that four professional outlets selected for the examination have generated four relatively isolated research topics: “Human capital and performance”, “Knowledge sharing, organizational learning: processes that drive performance”, “IC and knowledge management for business performance”, “Measurement, disclosure of IC and knowledge for business performance”. All these research lines are welcomed by all leading journals in the field, having high potential to create a dense flow of conceptual and empirical contributions and practical value for a knowledge-intensive business.
Over the last decade academic literature faced a boom of publications devoted to the notion of ecosystem, which resulted in the emergence of various research streams and corresponding fragmentation of the research domain. Existing variety of meanings and contradictory definitions necessitates conducting a thorough literature review on three tightly coupled concepts of innovation ecosystem, business ecosystem and entrepreneurial ecosystem. This study is based upon a mixed technique, which combines bibliometric analysis and in-depth investigation of papers devoted to these research streams. Trough examining their theoretical background, constructing conceptual structures and in-depth analysis we were able to define the essence of innovation, business and entrepreneurial ecosystems as well as their distinctive features. Then we proceed with the comparative analysis of these concepts, which allowed us to outline existing similarities and to demarcate them from an ontological perspective. This study provides certain clarification for the existing conceptual mix in the field of ecosystem research and can be used as a foundation for a further investigation of the concept.
In this paper we apply social network analysis to study the boards of directors of 107 large listed Russian firms between 2009 and 2014. Traditional corporate governance metrics, such as demographic characteristics, experience or multiple directorships, confirm a previously established positive trend towards greater independence and better qualification of the boards of Russian firms. We also find a decrease in the centrality of directors, which corroborates the diminishing concentration of power of some directors. The most connected firms have a specific profile since they are larger, have lower market valuations, and stronger ties with government (both due to higher proportions of government owned shares and a greater number of directors who are former politicians). Our findings also demonstrate that the boards of financial institutions are less connected, whereas political and independent directors are more centralized.
Many researchers believe that knowledge is the most important resource in the contemporary economy, but empirical studies show that knowledge management is not among the most used managerial tools. This gap can be explained with the hypothesis that knowledge management produces the significant impact on the effectiveness of organization only with the accompanying development of change management. Herewith the critical element of change management is a change readiness that allows to assess the possibility and feasibility of changes, consolidate and focus efforts, assess the adequacy of resources. This hypothesis is empirically tested using the partial least squares structural equation modeling (PLS-SEM) method on data for 103 Russian organizations. The results show that the empirical sample includes two statistically different datasets. The separating variable is the type of owner, so separate models were built for state-owned and private-owned organizations. For privateowned organizations, the hypothesis that knowledge management and changes readiness jointly affect effectiveness is fully confirmed. For state-owned organizations, knowledge management is not a factor of effectiveness. These results have two practical implications. First, managers who rely on the organizational knowledge should focus on the joint and coordinated implementation of knowledge management and change management. Special attention should be paid to the organizational context that supports individual change readiness. Second, state-owned organizations in Russia are less effective rather private ones, it is due to the fact that knowledge management for them is not the factor of effectiveness, that is in its turn a consequence of suppression of initiatives at the individual level.
515The International Business Management Environment in the BRIC(S) BlocРоссийский журнал менеджментаRussian Management JournalТом 15, No 4, 2017. С. 515–536Vol. 15, No. 4, 2017, pp. 515–536The InTernaTIonal BusIness ManageMenTenvIronMenT In The BrIc(s) BlocR. F. LittReLL*National Research University Higher School of Economics at St. Petersburg, RussiaaP. RambuRuthUNSW Business School, University of New South Wales, AustraliabThe BRIC countries (Brazil, Russia, India and China) were identified as the fastest growing emerging economies by the economist Jim O’Neill in 2001. He created the acronym BRIC (which became BRICS in 2010 to include South Africa) and raised their profiles. Some researchers viewed the rise of BRIC(S) as phenomenal, others were more cautious. Scholars such as [Sinha, Dorschner, 2010] noted the disparate nature of the BRIC countries, being separated geographically, culturally and politically. Others (e.g. [Armijo, Burges, 2007; Tudoroiu, 2012]) noted a lack of conceptualization of BRIC(S) as a group, that is having an array of similar characteristics. This article reviews the international business management environment in the BRIC(S) bloc, finding uncertainties about the sustainability of their upward trajectories. Historically and statistically, emerging economies that secure rapid economic growth seem unable to sustain it after a decade, evident in the decline of the economic fortunes of BRIC(S). This paper provides statistical insights into BRIC(S) individual and bloc performance and discusses alternate clusters of emerging economies and predictions (e. g. FIG, MINT, MIST, etc.). The discussion briefly considers the role of the New Development Bank (2015), provision of development finance to BRIC(S) and other emerging economies, and positioning in relation to existing financial institutions. The paper concludes with suggestions for a more considered assessment of emerging economies and their role in the global economy.
Wage adjustments for employees are a reactive mechanism to changing market conditions and form a significant part of pay policy. Though various attempts to explore wage levels and wage differentials have been made, wage adjustment policies remain an understudied topic. This paper analyses the determinants of wage adjustments based on data from Russian companies 2015–2017. The analysis is based on detailed data from an employer survey which covers more than 5,000 firms in both the public and private sector. The study adopts probit models to identify the reasons for wage revisions, depending on internal employer characteristics and external labour market conditions. The results are in line with previous research on the topic and suggest that both internal and external factors influence wage adjustments. A wage adjustment is a reflection of an ability to pay, meaning that revisions are often made by successful firms with high employee turnover. Institutional frameworks, especially trade union activity, affects a firm’s decision to adjust wages, despite the widely-held opinion regarding the insignificance of unions in Russia. This study contributes to the limited literature by analysing the determinants of wage policies depending on a firm’s characteristics. This is the first study of its kind based on extensive Russian data.