Knowledge@wharton

What makes some companies so much better at managing customer relationships than their competitors? Put a different way how are companies like Enterprise Rent-A-Car Pioneer Hi-bred Seeds Fidelity Investments Lexus Intuit and Capital One able to stay more closely connected to customers than their rivals in ways that significantly influence the profitability of the firm? It’s a question that Wharton marketing professor George Day answers in a new paper. His research notes among other things three distinct approaches to customer relationship management (CRM) each with dramatically different results. See acast.com/privacy for privacy and opt-out information.

In the foreword of Who Says Elephants Can’t Dance? Louis V. Gerstner Jr.’s memoir of his nine years as CEO of IBM the author confesses that he isn’t one for reading the kind of book he’s written. After a twelve-hour day at work he asks “who would want to go home and read about someone else’s career at the office?” Apparently a lot of people do if book sales are any indication. Although he has his critics Gerstner’s book tells how he turned IBM from a potential dinosaur into a dancing pachyderm. See acast.com/privacy for privacy and opt-out information.

Many Western companies are considering moving back-office operations such as call centers to low-wage countries like India. While this approach can result in significant savings when the project is handled right potential pitfalls can undo the benefits. Knowledge at Wharton spoke with two executives who have undertaken such projects for their organizations to understand where the pitfalls lie and how to avoid them. See acast.com/privacy for privacy and opt-out information.

According to Ken Lewis chairman chief executive of Charlotte-based Bank of America standalone investment banks are headed for obsolescence and perhaps even extinction. Speaking at Wharton on Nov. 7 Lewis painted a grim future for the once high-flying investment banking business while discussing the strategy corporate culture and ongoing expansion of Bank of America. See acast.com/privacy for privacy and opt-out information.

EBITDA or Earnings Before Interest Taxes Depreciation and Amortization has been used by analysts and investors to measure the fiscal health of the many high-tech media and other asset-heavy firms that do not generate earnings but instead incur plenty of depreciation amortization and other charges. Recently however EBITDA has come under fire for contributing to accounting irregularities at such companies as WorldCom and AOL Time Warner. See acast.com/privacy for privacy and opt-out information.

What constitutes a successful identity-oriented marketing strategy? According to Wharton marketing professor Americus Reed II it consists of three critical links – the consumer the identity and the brand. If these links are forged says Reed who recently completed a research paper on this topic “then they create connections that can lead to advantageous marketing outcomes for companies that are savvy enough to incorporate identity into their marketing strategy.” Think Harley-Davidson. See acast.com/privacy for privacy and opt-out information.

A few days before Daniel Kahneman and Vernon Smith won the Nobel Price in Economic Sciences for their research into how individuals make economic decisions Wharton hosted a debate showcasing two views of market efficiency. The efficient-markets banner was carried by Princeton professor Burton Malkiel author of “A Random Walk Down Wall Street ” while Richard Thaler a professor at the University of Chicago represented the behavioral finance camp. The debate was moderated by Wharton finance professor Jeremy Siegel. See acast.com/privacy for privacy and opt-out information.

Drinking and driving don’t mix but Absolut vodka and NASCAR now have something in common. The two companies were honored along with Nike as winners of the Excellence in Marketing awards at last week’s CMO Summit held at Wharton on Sept. 19-20. Knowledge at Wharton covered presentations describing the award-winning ad campaigns that have earned these brands global recognition. See acast.com/privacy for privacy and opt-out information.

Linux is unlikely to dethrone Microsoft’s Windows as the ubiquitous operating system on desktop PCs anytime soon. But the open-source system will gradually become more attractive to consumers as more applications are written for it. The real growth of Linux will be in its chief market as an operating system for servers. See acast.com/privacy for privacy and opt-out information.

Peter Cappelli director of Wharton’s Center for Human Resources began his research into employer-paid tuition programs with some skepticism. Why he wondered would employers pay for workers to develop a credential (education degree) that is useful to other employers and will raise the workers’ marketability? Furthermore if the employer’s goal is to give workers skills for their current job why not just offer training in-house? After several months of research Cappelli has found some surprising answers which he summarizes in a new paper entitled “Why Do Employers Pay for College?” See acast.com/privacy for privacy and opt-out information.

Dell Computer the no-fuss PC sales machine has set the standard for a successful direct-distribution company. But Dell is now reworking its bare-bones formula in an attempt to branch out from the PC market into more sophisticated and profitable computer systems. It’s a risky strategy in a tough economic climate but experts suggest it’s Dell’s only option if it wants to keep growing. See acast.com/privacy for privacy and opt-out information.

Until recent times marketing was perhaps the only corporate department that did not use metrics that were meaningful to bottom-line-oriented CEOs and CFOs. But that indifference to metrics is becoming a thing of the past. Marketing executives are paying more attention than ever to ways in which they can measure the impact of marketing initiatives on their companies’ financial performance. Developing appropriate metrics to capture the financial impact of marketing will be a key topic for discussion at an upcoming conference co-sponsored by Wharton McKinsey & Company and the Marketing Science Institute. See acast.com/privacy for privacy and opt-out information.

As businesses struggle to differentiate themselves in an increasingly crowded marketplace the challenge of choosing a company name looms large. How creative should a name be and what kind of image should it project? Knowledge at Wharton looked at some existing corporate names – old and new effective and not so effective – and asked marketing professors for their views of the corporate name game. See acast.com/privacy for privacy and opt-out information.

The residential real estate market in many U.S. cities shows no signs of slowing down as eager home buyers continue to drive prices ever higher. Is this too good to be true? Are home prices a bubble that is soon to burst? Real estate experts at Wharton and in the private sector offer their predictions. See acast.com/privacy for privacy and opt-out information.

According to a recent study from the Information Technology Association of America U.S. companies will be short nearly 600 000 qualified IT professionals over the next 12 months. Unemployed IT workers find that hard to believe. Indeed the report has rekindled the debate over whether there are too few or too many skilled technology workers in this country and what role if any immigrant workers should play in filling tech jobs. See acast.com/privacy for privacy and opt-out information.

Yes but which one was it? On April 22 2002 eight finalist teams in the Wharton Business Plan Competition presented their business plans to a panel of six judges hoping their venture would win the $25 000 Grand Prize ($15 000 for second place $10 000 for third place). Read the summaries pick your winners and see if the judges agree. See acast.com/privacy for privacy and opt-out information.

Ever since the Internet emerged as a sales channel in the 1990s it has been thought that one of the chief advantages of e-commerce would be its ability to facilitate the customization of goods and services for consumers. That promise however is not yet close to being realized according to experts at Wharton and an e-commerce research firm. See acast.com/privacy for privacy and opt-out information.

Now that an underperforming stock market and the excesses of Enron have focused new attention on the use and abuse of stock options as a way to incentivize senior managers what changes if any should companies make in their design of compensation packages? The answer depends on each company’s philosophy and goals but Wharton faculty and others suggest guidelines to help define the appropriate combination of executive incentives. See acast.com/privacy for privacy and opt-out information.

J. Scott Armstrong is a marketing professor at Wharton and author of the recent book Principles of Forecasting. In the article that follows he talks about role-playing as a tool for business and government leaders who face crucial decisions in situations ranging from military clashes to marketing challenges. See acast.com/privacy for privacy and opt-out information.

When management professor Peter Cappelli and the executive search firm Spencer Stuart asked a group of investment bankers to name their top career objective the answer was hardly earth-shattering. The survey however also went on to look at the expectations and concerns of investment bankers at a time when their business has been rocked by recession and a terrorist attack. See acast.com/privacy for privacy and opt-out information.