Editor’s Note: A Quarter Without Quarter
The energy crisis, downsizing, and a dangerous obsession with bottoms
NASDAQ left everyone with nagging questions like I had after seeing Crouching Tiger, Hidden Dragon – “What just happened?” And, “Is it over?” Not only did the NASDAQ take a drubbing, the S&P 500 Index dropped a cool 25+ percent in the first quarter. Most investors apparently looked in the mirror and saw the word “SELL” looking back at them.
Importantly, the bear market does seem to be clawing at everyone, even politicians. The 90-day ethics rule that requires newly-installed political office holders to divest themselves of investments which might provide a conflict of interest (or put their holdings in a blind trust) forced such luminaries as Secretaries Rumsfeld, Powell, and O’Neil to ponder the price of ethics and power as they challenged the bear in re-arranging their financial holdings. Indeed, the stock market, the energy crisis, and the outfits at the Oscars leave us wondering if we have a national obsession with “bottoms” in the new century.
Fortunately, the Dodgers have given us hope with their recent performance that this summer is still full of promise and we aren’t all secretly being filmed in a new nationwide episode of “Survivor.”
The Spring Issue of the GBR also contributes to this optimism, providing business practitioners with some interesting insight, practical information and useful tools to welcome the new season. David Smith and Al Hagan help us ‘lose the lights’ without losing some lessons taught by our experiment with de-regulation of the electricity industry in California. They provide some useful insight into what we can learn from the California energy crisis. This article also raises the provocative question: “Can we always trust a free market?” Pointing out that paying attention to the demand-side is essential for appropriately managing the deregulation process, David and Al go on to provide us with four critical lessons to consider while sitting in the dark.
In this regard, don’t miss the Conversation with Mitchell Held, Chief Economist of Salomon Smith Barney, as he discusses the lingering effects of the energy crisis on businesses and consumers in California.
Not only do we have to contend with the bears, Michael Davis shows us how electronic finance and new exchanges are affecting stock markets. It is possible that the “best execution” of your trade may be different from the “best price,” and that may even make you pleased. Someday, at least theoretically, there could be brokers that pay you to trade with them rather than vice versa. Sound intriguing? Check it out.
John Paglia takes us on a bear hunt as well, demonstrating that not only is the S&P 500 a bit mauled, but that the Dow was bleeding in the woods as well. He shows us how the Dow’s price-weighted calculations have hidden some pretty deep gashes and shows how understanding this index can help you more effectively judge the market. He also raises some interesting questions about the appropriateness of using the Dow for making critical NYSE decisions.
This issue of GBR even takes us through the upside of downsizing by showing how management can create a learning environment by working with employees during this painful process. Ann Feyerherm shows us how even this potentially devastating process can be undertaken with dignity. She provides us with insight as to how managers can do this by asking key questions such as, “Hey, this is a bad situation, but what can we learn about ourselves from it?” And, “How can we use this to make our lives better? What would help?”
Otis Baskin, Dean of the Graziadio School, gives us insight into the inner-workings of family businesses. This article shows us how these companies may have strategic advantages in the global marketplace not only because they can plan strategically without having to be concerned about quarterly earnings every three months, but because the majority of businesses worldwide are family businesses. As such, they share some basic business practices and understandings that transcend national boundaries and can provide a basis for working well together.
Lastly, Scott Fletcher and I provide a glimpse into the present and future of business practice by examining knowledge management in the era of corporate portals. While portals provide significant and sustainable strategic advantages for firms, there are some key considerations for maximizing benefit from both the business intelligence and collaborative tools provided. Not only is it important to make careful choices in terms of selection and deployment, it is also critical to take steps that ensure your business system does not fall into “portal anarchy.”
This issue, the LOOP asks the provocative question, “Does your organization have dynamic, innovative work teams or do you just have a bunch of darn committees?” And, of course, we also bring you an array of other lively departments including The Arcade, the GBR Quiz, and EBIZ@GBR.
We invite you to dig beneath the surface of this issue, and promise that you will find nuggets of great value in your workplace.
About the Author(s)
Charla Griffy-Brown, PhD, is an associate professor of information systems at the Graziadio School of Business and Management. In 2004, Dr. Griffy-Brown received a research award from the International Association for the Management of Technology and was recognized as one of the most active and prolific researchers in the fields of technology management and innovation. A former researcher at the Foundation for Advanced Studies on International Development in Tokyo, she has also served as an associate professor at the Tokyo Institute of Technology. Dr. Griffy-Brown graduated from Harvard University, is a former Fulbright Scholar, and holds a PhD in technology management from Griffith University in Queensland, Australia. She has worked for NASA at the Kennedy Space Center and has taught innovation/technology management courses in Australia, Singapore, Indonesia, Malaysia, and Japan. She has also served as a consultant for the United Nation's Global Environmental Facility and the European Commission.