Knowledge@wharton

At a time when many barriers to global trade have fallen countries all over the world are taking steps to harmonize their accounting standards and develop a truly global language of business. Under the lead of the International Accounting Standards Board (IASB) more than 100 countries have either implemented International Financial Reporting Standards (IFRS) or plan to do so. Yet while proponents of accounting harmonization say that IFRS will ultimately benefit firms and investors Wharton accounting professor Luzi Hail says that there are reasons to be skeptical about these high hopes. He and three co-authors present their views in a new paper titled ”Mandatory IFRS Reporting Around the World: Early Evidence on the Economic Consequences.” See acast.com/privacy for privacy and opt-out information.

At the end of October the Federal Reserve gave the financial markets just what they had been asking for: a 0.25% cut in the federal funds rate. But in early November stocks plunged and the dollar hit a new low. Applause turned into hand-wringing -- then back to applause as the markets rebounded in the middle of the month. Why can’t the experts make up their minds? Is the outlook good or bad? According to Wharton faculty forecasting is particularly hard now because some of the key factors -- such as the credit crunch arising from the subprime mortgage mess spiking oil prices and the plunging dollar -- have little historical precedent. The result: Finance experts including the Fed may not be able to see too far down the road. See acast.com/privacy for privacy and opt-out information.

When Merrill Lynch reported solid second-quarter earnings last July chairman and CEO Stan O’Neal sent employees a memo boasting about the firm’s risk management prowess. Only three months later Merrill Lynch took its historic $8.4 billion write-down for losses in mortgage-related securities with Citigroup and others soon reporting unprecedented credit losses as well. If the capital markets are models of efficiency it is fair to ask how could such staggering losses happen? Two Wall Street titans -- Lloyd Blankfein chairman and CEO of Goldman Sachs and Kenneth Moelis of Moelis & Co. -- addressed that question at the recent Wharton Finance Conference in New York City. See acast.com/privacy for privacy and opt-out information.

Turn on the Internet pick up your telephone or cell phone read a newspaper or watch television: No matter what the communication vehicle is polls and the reporting of poll results are ubiquitous. Yet how accurate are polls? Can they be manipulated? How do the Internet and the proliferation of cell phone users affect both marketing and political polls? And which polls are the most reliable? Knowledge at Wharton interviewed the experts. See acast.com/privacy for privacy and opt-out information.

For nearly two decades consulting firms technology companies R&D-driven corporations and other knowledge-intensive organizations have made significant investments in ”knowledge management” initiatives. These initiatives are intended to facilitate the capture and transfer of company expertise as a way to spur learning and innovation. But research by Wharton management professor Martine Haas and a colleague indicates that knowledge sharing efforts often fail to result in improved task outcomes inside organizations -- and may even hurt project performance. Their research is presented in a paper titled ”Different Knowledge Different Benefits: Toward a Productivity Perspective on Knowledge Sharing in Organizations.” See acast.com/privacy for privacy and opt-out information.

”One thing that makes my heart beat is the smell of drywall ” says Pastor T.L. Rogers whose Maryland-based congregation once turned a strip mall into a church complex. Having completed that renovation his church is now thinking about even bigger projects. But for Rogers whose advanced degree is in Bible studies meeting with bank executives can be a challenge. ”Finance is a whole different language ” he says. ”They use acronyms I’ve never heard of.” Rogers and others will take part in a new Wharton executive education program to teach pastors the financial skills they need to carry out economic development projects in their local communities. See acast.com/privacy for privacy and opt-out information.

In a span of four days earlier this month Google launched an initiative to enable social networking tools to work across dozens of web sites and rounded up 33 partners to develop software to power a new generation of cell phones. While these efforts illustrate Google’s determination to keep expanding its territory they also increase the challenges faced by the $200 billion company. And they pose a question that seems to crop up more and more these days: Where is Google headed? See acast.com/privacy for privacy and opt-out information.

When Wal-Mart starts its holiday markdowns three weeks before Thanksgiving you know it will be a tough Christmas season. The Arkansas-based discount chain a bellwether for U.S. retailing usually holds off on its ”door buster” sales until the day after Thanksgiving traditionally the year’s busiest shopping day. This year Wal-Mart decided that it couldn’t afford to wait. No wonder say scholars at the Wharton School and retail analysts. A host of economic worries -- plus concerns over toy recalls -- has this year shaping up to be a lump-of-coal shopping experience. Here is what retailers -- and shoppers -- can expect. See acast.com/privacy for privacy and opt-out information.

According to Larry Huston managing partner of consulting firm 4INNO future competitive advantage will depend on ”innovation networks” -- individuals and organizations outside a company that can help it solve problems and find new ideas for creating growth. A senior fellow at Wharton’s Mack Center for Technological Innovation Huston was vice president of knowledge and innovation for many years at Procter & Gamble where he was the architect of its Connect + Develop program an approach that helped extend the company’s innovation process to include 1.5 million people outside of P&G. Huston spoke with Knowledge at Wharton about how innovation networks function. See acast.com/privacy for privacy and opt-out information.

It’s been a busy few weeks for Adobe Systems Microsoft and Google. All three have announced plans or new technologies that will address the latest vision of software’s future -- one that combines the features of web-based applications with desktop software to create a hybrid model offering the best of both worlds. Indeed the question today is not so much whether this desktop/webtop model will be adopted but rather which company will provide the best platform for implementing it. Knowledge at Wharton looks at both the opportunities and the limitations of this new approach. See acast.com/privacy for privacy and opt-out information.

When Thomas Friedman wrote his popular book The World Is Flat one of its central arguments was that geography might soon become history. The proliferation of information technology and telecommunications networks has integrated the world in ways that were unimaginable in the past -- and this has transformed how companies produce and distribute products and services. One result of this transformation is the rise of networks of companies that are bound together through IT and logistics. How can firms strive for and gain competitive advantage in such an environment? Victor and William Fung group chairman and managing director of Hong Kong-based Li & Fung and Yoram (Jerry) Wind a professor of marketing at Wharton deal with this issue in their new book Competing in a Flat World: Building Enterprises for a Borderless World. They recently spoke with Knowledge at Wharton. See acast.com/privacy for privacy and opt-out information.

For marketers the Internet changes everything -- and nothing at all. For example it enables companies to instantly reach consumers in different countries and economically tailor messages to them based on demographics buying habits and other information. Yet it doesn’t free these companies from the constant challenge of building distinct durable brands. At the 2007 Wharton Marketing Conference participants on a panel titled ”The Challenge of Going Global and Staying Local ” debated the potential pitfalls of global marketing. A second panel discussed new media strategies and asked whether traditional off-line media are no longer effective. See acast.com/privacy for privacy and opt-out information.

Entrepreneurs love to grumble about the roadblocks and delays created by bureaucrats. Government officials they say are slow bumbling and concerned only about sticking to the rules and clocking out at 4:55 p.m. But in a study of global entrepreneurship Raffi Amit and Mauro Guillen both Wharton management professors have found that a simple if smart bureaucratic initiative mattered critically in determining a country’s level of entrepreneurship. See acast.com/privacy for privacy and opt-out information.

Oil is marching toward $100 a barrel largely due to China’s boom. Demand for ethanol is pushing corn prices up. Soybean prices are rising because so many bean fields have been switched to corn. In short prices of commodities worldwide are soaring making for frenzied action in commodities futures markets. New research by Wharton finance professor Gary Gorton and two colleagues shows how spot and futures prices are good indicators of low-inventory commodities which in turn can offer outsized investment gains. Their research is presented in a paper titled ”The Fundamentals of Commodity Futures Returns.” See acast.com/privacy for privacy and opt-out information.

Consolidation cutbacks and competition from the web -- these are the headlines grabbing the attention of business journalists around the world. Concerns about the quality of reporting and information have risen steadily as the industry has undergone dramatic changes. How has global expansion affected the standards of news organizations? What impact have blogs and ”citizen journalism” had on the industry? And what role does investigative journalism play in an age of around-the-clock cable news updates and shrinking budgets? To answer these and other questions Knowledge at Wharton spoke with four news professionals from the U.S. and abroad who attended the 2007 Wharton Seminars for Business Journalists. See acast.com/privacy for privacy and opt-out information.

In an era of rising petroleum prices African oil is drawing new interest from major companies around the globe according to John Ghazvinian author of Untapped: The Scramble for Africa’s Oil who spoke at a recent event sponsored by the Wharton African Students Association. Companies Ghazvinian says see the continent as the most promising place in the world for new production. Yet due to an economic paradox known as the ”Resource Curse ” most Africans are realizing little benefit from this influx of oil drillers and investment: Between 1970 and 1993 the author notes ”countries without oil saw their economies grow four times faster than those of countries with oil.” See acast.com/privacy for privacy and opt-out information.

Kristine Tompkins former CEO of outdoor apparel company Patagonia pulled no punches with the audience attending her recent Wharton Leadership Lecture. Tompkins said that when she began working full-time at Patagonia in 1972 she didn’t understand how the actions of the business world as well as the behavior of individuals ”affected the very underpinnings” of the individual the family and the community. ”You know that now ” she said and ”the choices you make count more and more.” People who can manage ”the tough decisions and incorporate” difficult issues into their lives she said ”are the future leaders.” See acast.com/privacy for privacy and opt-out information.

As medical costs escalate and the number of Americans without health insurance continues to rise the 2008 presidential candidates have responded by putting health care near the top of their agendas. Indeed many candidates have already laid out detailed programs to address the nation’s health care problems. As a result meaningful change in the system seems likely to occur once a new president takes office. As Mark V. Pauly Wharton professor of health care systems notes: ”I’m optimistic this time that we’ll get something.... There is actually a chance of doing more good than harm and I wouldn’t have said that in some other years.” See acast.com/privacy for privacy and opt-out information.

Long gone are the days when firms expected their chief information officer to function as ”chief technology mechanic.” As companies look for ways to maintain a competitive edge in new markets CIOs are playing a more central leadership role taking on increasing responsibility for corporate strategy and other duties outside of core technology. Even so CIOs are still expected to ensure the quality and performance of the IT organization. How can CIOs balance these priorities? To answer that question and others Knowledge at Wharton spoke with Mark McDonald group vice president and head of research for Gartner Executive Programs Michael Shannon chief information officer of international law firm Dechert LLP and Tony Habash chief information officer of the American Psychological Association. See acast.com/privacy for privacy and opt-out information.

It is perhaps the core question in the ongoing debate over corporate governance: Does the corporation exist for the benefit of shareholders or does it have other equally important stakeholders such as employees customers and suppliers? A new study by Wharton finance professor Franklin Allen and two colleagues does not claim to provide a definitive answer but it does show the various benefits of the stakeholder approach. It also demonstrates that the issue is not as settled as some researchers and business people in the United States United Kingdom and other shareholder-oriented nations might think. See acast.com/privacy for privacy and opt-out information.