“We continue to develop principled and impactful leaders and entrepreneurs, foster innovation for a data and technology driven world, and grow a global presence fueled by local synergies,” said Gareth James, John H. Harland Dean. “I’m proud of our faculty and staff – and energized about the future of our school and students.”

Impacting Business & Beyond

Faculty and staff contribute to the Goizueta and Emory community, but also have significant impact on society and the broader business world. External awards include:

Karen Sedatole, Asa Griggs Candler Professor of Accounting, was named as an editor to the Accounting Review. Sedatole was also elected to the position of president elect for the Management Accounting section of the American Accounting Association.

Emma Zhang, associate professor of information systems & operations management, was named an elected member of the International Statistical Institute. Zhang was also named an associate editor to the Journal of the American Accounting Association.

Ruomeng Cui, associate professor of information systems & operations management, was a finalist for the 2022 Management Science Best Paper Award in Operations Management for her paper, “Learning from Inventory Availability Information: Evidence from Field Experiments on Amazon.”

Panos Adamopoulos, assistant professor of information systems & operations management, was named as an associate editor at Management Science.

Giacomo Negro, professor of organization & management, was appointed as the senior editor of Organization Science and also received an honorable mention for the Robert K. Merton Award for his paper, “What’s Next? Artists’ Music After Grammy Awards.” Negro additionally served as the principal investigator for the 2022 LGBTQ Southern Survey.

Erika Hall, associate professor of organization & management, was named as an incoming associate editor at the Academy of Management Discoveries.

Dan McCarthy, assistant professor of marketing and Marina Cooley, assistant professor in the practice of marketing were recognized by Poets&Quants’.” McCarthy was also a finalist for the Weitz-Winer-O’Dell Award.

John Kim, associate professor in the practice of organization & management, was designated as one of the top instructors by Coursera for Management Consulting courses.

Vilma Todri, assistant professor of information systems & operations management, was named an associate editor to the Management Information Systems Quarterly Journal, one of the top three leading Information Systems journals.

Tonya Smalls, assistant professor in the practice of accounting, has been appointed to serve on the Inaugural Advisory Board for Make-A-Wish Georgia (MAWGA).

Leading the Future Of Emory and Goizueta

Goizueta Business School and Emory also honor academic professionals and leaders for their dedication to excellence through teaching, content development, experiential learning, scholarly inquisition, and commitment.

“We could not be prouder of our exceptional faculty and staff for their remarkable work and dedication throughout the past year,” says Anandhi Bharadwaj, who will step down as vice dean for faculty and research this summer as Professor Wei Jiang prepares to take on the role. “It has been an honor to work alongside our faculty and staff in developing the school and its programs.”

The recipients of these prestigious honors and awards are listed below:

Rajiv Garg, associate professor of information systems & operations management, was awarded the Provost’s Distinguished Teaching Award for Excellence in Graduate and Professional Education. Garg was also honored as the MSBA Distinguished Core Educator.

John Kim, associate professor in the practice of organization & management, was awarded Emory Williams Distinguished Undergraduate Teaching Award.

Giacomo Negro, professor of organization & management, received the Keough Faculty Award. Negro also received the Jordan Research Award.

Marvell Nesmith, associate dean of academic affairs & instructional design, received the Keough Staff Award.

Marina Cooley, assistant professor in the practice of marketing, was honored as the BBA Distinguished Educator and was also recognized for MBA Teaching Excellence (One Year).

Omar Rodríguez-Vilá, professor in the practice of marketing, was awarded the Evening MBA Distinguished Core Educator and was also recognized for MBA Teaching Excellence (Two Year).

Charles Goetz, associate professor in the Practice of organization & management, was awarded Evening MBA Distinguished Elective Educator.

Ray Hill, associate professor in the practice of finance, was recognized for MBA Teaching Excellence (Classic Faculty).

Alvin Lim and David Sackin were awarded MSBA Distinguished Elective Educators.

Rob Kazanjian, Asa Griggs Candler Professor of Organization & Management, was awarded Executive MBA Distinguished Educator (Core).

Kevin Crowley, associate professor in the practice of finance and Narasimhan Jegadeesh, Dean’s Distinguished Chair of Finance, were awarded MAF Distinguished Educators. Crowley was also awarded Executive MBA Distinguished Educator (Elective).

Giacomo Negro, Melissa Williams and Panos Adamopoulos received Goizueta research awards at the levels of full, associate, and assistant professor, respectively.

Goizueta Business School is proud to present the accomplishments of these and other faculty members within our institution. To learn more about the teaching, specialized research, and core interests of each faculty member, check out our faculty profiles and their related publications. 

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In the fall semester, students are immersed in Goizueta IMPACT’s core curriculum—courses and casework specifically designed to build the foundational skills necessary to excel in any area of business and to learn a structured approach to solving those messy problems. In the spring semester, students apply their newly minted practical skills to real world, ambiguous problems on behalf of clients such as Delta Air Lines, The Home Depot, Porsche Cars North America, Kimberly-Clark, Mailchimp, nonprofits, and community organizations. “The IMPACT project was a fantastic way to leverage everything we’d learned the previous semester,” said Sharma. 

For Spring 2021, 26 MBA teams and six BBA teams worked on a total of 23 real-world projects for 18 different sponsor companies. To earn a spot in the Showcase, each team gave a three-minute “elevator pitch” that outlined their project recommendations. Pitches were recorded and all students were randomly assigned six videos to watch and respond to a question. The top 14 teams presented their final client recommendations to more than 250 judges (a mix of alumni and business leaders), who identified the top three teams and crowned the first-place team “Goizueta Gold.” 

Like last year, 2021’s Showcase took place online, albeit with a few new features. Industry and “mini-reunion” breakouts were added to the schedule to enable alumni to connect. “It was our way to mimic running into your classmates on campus,” said Kore Breault, program director, Goizueta IMPACT. Showcase organizers also introduced “Goizueta Greats,” 10-minute, TED-like talks by Goizueta faculty “to give something back to the project sponsors and judges who were giving so much to us,” added Breault.

Sharma, along with Zad Adloo 22MBA, Kegan Baird 22MBA, Cesar Castro 22MBA, and Matthew Mastriforte 22MBA, captured “Goizueta Gold” on behalf of Goodwill of North Georgia. The non-profit had tasked Sharma’s team with exploring the feasibility (and building a business plan for the potential launch) of a joint venture between it and a non-profit staffing company. “We all trusted each other and we worked so hard for the client,” Sharma explained. “I learned so much from my incredible team. I already know that I have really strong friendships going into second year.”

A faculty advisor worked closely with each team to ensure it was on the right track and had the resources it needed. Jeff Rummel, associate professor in the practice of Information Systems & Management worked with Sharma’s team. Teams also had a second year IMPACT Coaching Fellow—a student who completed the Goizueta IMPACT project the prior year. Willie Sullivan, 21MBA worked with the first-place team. Elizabeth Hitti 21MBA, who will join Georgia-Pacific in a strategy role this July, worked with the second place team (Rachael Augostini 22MBA, Jessica Lewis 22MBA, Jonovan Sackey 22MBA, Nainika Sehgal 22MBA and Sam Wang 22MBA) and third place team (Julia Dong 22MBA, Brandon Makinson 22MBA, Kyle McLain 22MBA, Zachary Nusbaum 22MBA and Jakob Perryman 22MBA), both of which had been assigned Georgia-Pacific projects. Saloni Firasta Vastani, associate professor in the practice of marketing, served as faculty advisor for the Georgia-Pacific teams.

Hitti’s two teams had very different working styles. One team addressed the project much like Hitti, who was a consultant at Deloitte before coming to Goizueta, would have. The other team took a different approach. “There came a point where I was like, this isn’t how I would do it, but they’re doing well,” she explained. “That mindset shift was great for me. Sometimes you can learn more from the teams that do things differently.”

Each team was allotted 25-minutes for its Showcase presentation, and another 20 minutes for Q&A. The final scores were tabulated based on the team’s problem solving and recommended solutions as well as the team’s delivery, ability to communicate ideas, storyline, slide deck, and how it managed the Q&A. 

For the last 10 years, Carrie Schonberg 97C 03MBA has attended the IMPACT Showcase as a judge. “The Showcase is one of the events I most look forward to each year,” said Schonberg, who enjoys re-connecting with faculty and staff (many of whom were at Goizueta when she was a student). During her time at Goizueta, Schonberg, chief marketing officer, Ashton Woods Homes, competed in Goizueta Marketing Strategy Consultancy, or GMSC, the precursor to Goizueta IMPACT. “These projects are a great way for corporations to get a different level of insight and perspective than they would get from people in their own company,” she said. 

Kevin Kyer 05MBA, who lives in Geneva, Switzerland, was happy to be able to take part in the both the 2020 and 2021 virtual Showcases. Kyer, Hatch CoLab’s executive-in-residence and a self-described digital transformation leader, hopes to see a permanent, “hybrid type” way for alumni who can’t be on campus to attend the Showcase online. “It expands the experience to make it available to more people and to have their feedback,” Kyer explained. “It’s a great way to connect better and learn more.” 

Meeting Goizueta Greats and Reconnecting with Alumni 

In addition to his role as a judge, Kyer joined a mini-reunion and dropped into a Goizueta Greats session, of which there were five. Omar Rodríquez Vilá, associate professor in the practice of marketing and academic director of education at The Roberto C. Goizueta Business & Society Institute gave a talk titled, “Towards a definition of an anti-racist brand: concepts, actions, and tools to advance the practice of racial equity in the marketplace.” 

Other topics included “Startups and big companies: ‘It’s complicated,’” given by Amelia Schaffner, director of entrepreneurship, The Roberto C. Goizueta Center for Entrepreneurship & Innovation, and “Revolutionizing finance by valuing your customers,” presented by Daniel McCarthy, assistant professor of marketing. Erika Hall, assistant professor of Organization & Management and faculty advisor at The Roberto C. Goizueta Business & Society Institute, talked about “The effect of the racial labels African-American and Black on societal and organizational outcomes,” and Wes Longhofer, associate professor of Organization & Management and executive academic director at The Roberto C. Goizueta Business & Society Institute, discussed his most recent book, Super Polluters: Tackling the World’s Largest Sites of Climate-Disruption Emissions and what it tells us about our energy system and the future of the planet.

“Goizueta Showcase is a day where we showcase not only our students, but our project sponsors, faculty and school,” said Lynne Segall, associate dean, Goizueta IMPACT. “I am so proud of our students, thankful to our project sponsors and appreciative of the many judges—everyone played an important role in making Showcase a success.”

Take part in learning more about the Goizueta IMPACT Showcase, watch Goizueta Greats videos, and read more about the student teams and their real-world projects.Read more about Goizueta IMPACT. 

Listen to the Goizueta Effect Podcast on “Reimagining Business as a Catalyst for Social Change” with Wesley Longhofer.

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The results are detailed in a new paper to be published by Psychological Science this week. “What’s in a Name? The Hidden Historical Ideologies Embedded in the Black and African American Racial Labels” is co-authored by Professors Erika V. Hall of Emory University’s Goizueta Business School, Sarah S. M. Townsend of the USC Marshall School of Business, and doctoral student James T. Carter of Columbia Business School.

In one particularly stark finding, white Americans wanting to eradicate racial injustice will donate more to non-profit organizations describing themselves as “Black” compared to “African American.”

Key Conclusions:

• Activists and journalists may not be aware of the ideologies embedded in these labels. They must carefully choose which one to use: either “Black” or “African American.”
• People and organizations should be allowed to self-label in the way that most closely reflects their identity.
• Associations between racial labels and past social movements may alter white American’s perceptions of minorities’ intentions.

By the Numbers:

• If whites personally endorse bias and discrimination ideologies, they are 99% more likely to donate to an organization labeled as a “Black” organization, rather than an “African American” one. 
• If whites personally endorse civil rights ideologies, they are 50% less likely to donate to an organization labeled as a Black organization, rather than one labeled as African American.
• Interchanging the labels in a non-profit organization’s name (e.g., Black Alliance vs. African-American Alliance) altered whites’ perceptions of the organization’s goal. The majority of participants estimated that a Black organization’s main goal was to ‘defund the police’ (55.1%), rather than to ‘stop voter suppression’ (35.6%). But they believed that the African American organization’s goal was to ‘stop voter suppression’ (38.2%) rather than to ‘defund the police (27.3%).

“Americans of African Descent have long fought for equality. But white Americans often misunderstand or misrepresent their advocacy,” said Hall. “We show the use of the Black versus African American label may fundamentally alter white Americans’ perceptions of their intentions.”

The studies explored the association between the African American and Black labels and the ideologies of the historical movements within which they gained prominence.

“Specifically, because the Black label became prominent amidst the Black Power Movement in the 1960s and the African American label gained popularity amidst the late Civil Rights Movement in the 1980s, people and organizations that use each term are perceived to embody the ideologies of those movements,” explains Townsend.

The authors argue that this means that the African American label is associated with voting rights and political participation and the Black label is associated with racial victimization and degradation. The authors find that the use of one or other label skews the results of Google image searches and the content of editorials in media. Use of the Black label leads to more racially victimized imagery, while use of the African American label leads to more civil rights and inequality imagery.

Critically, this research also shows that use of these labels in any media can substantially influence white audiences’ financial support of the causes they advocate.

“It is possible that our findings may only generalize to groups that are not of African descent. Americans of African Descent may be unlikely to apply ideological stereotypes to people and organizations labeled by these terms,” said Carter.

“Seemingly small changes in labels can make a big difference,” said Hall. “Although activists and journalists may not be aware of the ideologies embedded in these labels, they must carefully choose which one to use: either Black or African American.”

“Of course, our studies also represent a snapshot of a particular time,” said Townsend. “The meaning of these words may shift with highly visible race-based events.”

About the Authors:

• Dr. Erika V. Hall is Assistant Professor of Organization and Management at Emory University’s Goizueta Business School, Atlanta.
• Dr. Sarah S. M. Townsend is Associate Professor of Management and Organization and the Interim Assistant Vice Dean for Diversity, Equity, and Inclusion, at the USC Marshall School of Business, Los Angeles.
• James T. Carter is a Ph.D. candidate in Management at Columbia Business School, NYC

About Goizueta Business School:

Emory University’s Goizueta Business School prepares principled leaders to have a positive influence on business and society. Business education has been an integral part of Emory University’s identity since 1919. That kind of longevity and significance does not come without a culture built around success and service. Goizueta Business School offers a unique, community-oriented environment paired with the academic prestige of a major research institution. Goizueta trains business leaders of today and tomorrow with an Undergraduate degree program, a Two-Year Full-Time MBA, a One-Year MBA, an Evening MBA, an Executive MBA (Weekend and Modular formats), a Master of Analytical Finance, a Master of Business Analytics, a Doctoral degree and a portfolio of non-degree Emory Executive Education courses.

For more information, visit goizueta.emory.edu or follow us on Twitter (@emorygoizueta).

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Do recessions stoke racial tension? When there’s an economic downturn, are White Americans more likely to feel distrust or even animosity towards their Black peers?

Researchers have long wondered about the broader societal impact of financial recessions, but until recently their effects on race relations have been unclear.

In a recent paper, Emily Bianchi, associate professor of organization and management, Erika Hall, assistant professor of organization and management, and Sarah Lee 19PhD, assistant professor of management, Dominican University of California and visiting professor of organizational behavior, Pepperdine University, find that there is indeed a subtle uptick in hostility towards Black Americans during bad economic times. Their paper, Reexamining the Link Between Economic Downturns and Racial Antipathy, examines publicly available data on attitudes, political trends, and behavioral patterns in the US.

While businesses tend to cut diversity, equity, and inclusion efforts during economic downturns, Bianchi and Hall underscore that these efforts may be even more critical during these times.

To study this phenomenon, the researchers analyzed more than 20 years of data from the American National Election Survey (ANES), a biannual survey capturing political affiliations and perceptions of political candidates from 1964 until 2012. They analyzed how White Americans’ attitudes towards Blacks changed depending on the state of the economy and found that in worse economic times, Whites felt more negatively about Blacks.

As Bianchi notes: “we were able to analyze the responses of more than 30,000 individuals who identified as White. And we do find that for decades – between the 1960s and the first part of the 21 century – White Americans feel less warmly about Black Americans during times of financial hardship.”

In a second study, Bianchi, Hall, and Lee examined data from Project Implicit, a popular website that allows people to test their own implicit bias and also gauges racial attitudes. Again, the authors found that in worse economic times, White Americans held more negative implicit and explicit attitudes about race. In particular, during the Great Recession, they found that White’s attitudes towards Blacks became substantially more negative in states that were hard hit by the economic crisis compared to states in which the economic downturn was less severe.

Having established that economic conditions affected fluctuations in attitudes towards race, the authors then examined whether these emotional shifts translated into actual behavioral outcomes. In other words, if Whites felt more negatively towards Blacks during recessions would this mean that Black professionals were less likely to be successful when the economy floundered? They tested this possibility by looking at two domains of public activity: record sales and voting patterns.

First, they examined data from the Billboard Top 10 American songs between 1980 and 2014 and recorded the race of each musician who secured a Billboard hit. They found that in bad economic years, Black musicians were 90% less likely to have a top 10 hit, presumably because White consumers (by far the biggest consumer group during this period) were less likely to support them. Next, they examined the results of more than 8000 elections to the U.S. House of Representatives over the same period. They found that in bad economic times, Black politicians were 21% less likely to win elections.

Interestingly, the converse also appears to be true. In good times, Black musicians and politicians fared much better in the polls and the charts – pointing to a certain fluidity in attitudes, says Bianchi.

“Across these very different domains, studies, and sample sizes, we find the same consistent pattern: when times are tough, White Americans feel more animosity towards Black Americans and are less likely to support Black musicians or politicians. When things pick up, White Americans have more positive attitudes towards Black Americans and are more likely to endorse Black musicians and Black candidates.”

The authors attribute these effects to innate human feelings of fear in the face of threat. Economic threats or shocks tend to evoke uncertainty and fear about what is to come. This translates into greater distrust of others, particularly those perceived as different in some way. And it’s an effect, they argue, that should be very much on the radar of businesses and decision-makers.

The research cites, “Anecdotally, we know that when times are good, organizations will tend to prioritize their efforts in the area of diversity and inclusion. But while this is critically important at all times, our research suggest that these efforts are probably even more important when times are tough.”

All of this points to a need to attend to these issues more acutely when there’s a downturn, says Bianchi. And she cautions that this is likely to be counterintuitive to most leaders, who are likely more inclined to sideline diversity efforts when the economy slides.

In terms of the current debate around race relations in the US, however, Bianchi stresses that the economic dimension is just one piece of a “very complicated puzzle.”

“What we have seen and are seeing in 2020 and 2021 is a confluence of many major factors: a pandemic that has put a lot of people out of work, and that has put everyone on edge, punctuated by some horrific and well documented instances of violence against Black citizens,” Bianchi said. “So many of these things are in the mixing pot, that it’s hard to pinpoint one specific cause behind the current race crisis in the U.S. So many things coming together at once that have put us in this moment.”

Only time will tell how this might play out compared to what we saw in the 80s and 90s, which were economic fluctuations rather than a complete drop off a cliff, she says. It will be more difficult to tease apart the effect of the economy versus the effect of the pandemic versus the effect of police violence on America’s race relations – a situation that Bianchi describes as a “cauldron of mess.”

That said, she stresses that for business leaders, now is a good time to double down on efforts to drive diversity and inclusion.

“I’d suggest leaders be especially mindful that at times of economic stress such as we are currently experiencing, there is a very real danger of heightened racial animosity.”

To gain more insight into the prevalence of racial bias, listen to The Goizueta Effect podcast episode by Erika Hall. To learn more about how recession changes our behavior, listen to The Goizueta Effect podcast by Emily Bianchi.

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Recessions also hurt race relations

Economic downturns aren’t just bad for businesses and households. Recessions tend to spur heightened animosity towards Black Americans in the U.S., and this not only drives social inequality but can significantly impair the outlook for Black professionals. These are the troubling findings of research published in Psychological Science by Goizueta’s Emily Bianchi, associate professor of organization & management, and Erika Hall, assistant professor of organization & management. They ran a number of studies to capture people’s responses and shifts in attitude during periods of recession. They also looked at the impact on professional success for Blacks in areas like the arts and politics. What they found is that when times are hard, White people feel more negatively towards Black people and are more likely to stereotype or compartmentalize them. They’re also more prone to seeing racial inequity as acceptable and even “natural.”

Similarly, Black politicians and musicians were less likely to fare well in congressional elections and in the Billboard charts. Bianchi and Hall’s research is striking in that it explores the more nuanced and subtle forms of racism that manifest when communities face financial downturns. It suggests there is a certain fluidity in attitudes towards race that can be shaped by changes in our economic and social context — which may also help explain, at least in part, why Black people are particularly hard hit in times of recession.

Whose side are you on?

Protest marches grab headlines. But while heightened visibility for a cause might be good news for the social movement in question, the trade-offs for other affiliated organizations may not stack up so positively. So says a recent article in Organization Science by Giacomo Negro, professor of organization & management at Goizueta. Together with Stanford University’s Susan Olzak, he put together a data set of pro-LGBTQ protest events staged across a range of U.S. cities over 20 years to gauge how these events impacted local organizations — social movement groups on the one hand, and on the other, more loosely affiliated organizations like local businesses with customers and stakeholders both in and outside of the LGBTQ community. What they found was that greater participation in pro-LGBTQ protests lowered the market viability of these neutral organizations. Negro puts this down to having to “choose sides” and being less effective at addressing the needs of multiple audiences in the presence of polarizing events such as protests. Protests by nature pose a type of challenge to society, so people associated with the cause motivating the protest have to take a clear side or stance, explained Negro. And the visibility protests generate comes at a price for any participating organization that engages distinctly different stakeholder groups, from customers or clients to employees. If one group endorses a controversial issue, another can shun it. These insights come at a time when U.S. firms are increasingly involved with social causes, from human rights to race and gender issues. They will need to balance the pros of visibility against trade-offs in terms of their stakeholders.

IoT boosts online sales

The Internet of Things (IoT) is a system of smart devices or objects that are connected to the internet — objects that “talk” to each other and that can be combined with automated systems to gather and analyze information. IoT technology is making waves in business today because of a slew of benefits that range from rich data collection, enhanced security and reduced operation costs to enhanced customer-centricity. One space benefitting from the use of IoT is e-commerce. And a forthcoming article in Information Systems Research by Goizueta’s Panagiotis “Panos” Adamopoulos and Vilma Todri, both assistant professors of information systems & operations management, suggests that forward-thinking retailers would do well to understand the advantages of using IoT as an alternative purchase channel for consumers.

Together with NYU’s Anindya Ghose, they tracked sales data from a major multinational online retailer using IoT to automate purchasing and consumers’ convenience. They found that implementing the new technology led to significant statistical and economic gains for the company thanks to increased automaticity and more favorable mental accounting that made these products “easier to consume.” Interestingly, these gains were particularly associated with certain product characteristics, helping retailers determine effective future IoT strategies. As businesses continue to waiver about adopting IoT because of technical challenges that surround its implementation, these findings should provide interesting food for thought.

Learn from experience (just make sure it’s someone else’s too)

Businesses and business managers grow and develop because we learn. We learn from our performance metrics and KPIs — they tell us what we do well and not so well. But it’s challenging. For a start, there’s the issue of the metrics themselves. In today’s complex, fast-changing environment, it can be hard to pin down our KPIs with total accuracy. Then there’s the question of how we learn. Is it better to learn from our own firsthand experience — or from others’? Kristy Towry, John and Lucy Cook Chair and professor of accounting, and colleagues Jongwoon “Willie” Choi 11PhD, Gary Hecht, and Ivo Tafkov 09PhD have explored the science behind learning and decision-making in heightened complexity, and their new paper in The Accounting Review finds that when KPIs are messy, managers learn far better when that learning is vicarious, in other words, when we learn from each other and share our learning. And that’s because vicarious learning helps us to see the bigger picture, the trends and the patterns, Towry said. Learning from our own experience alone tends to make us over-focus on what’s happened most recently and what’s immediately in front of us and miss the greater scheme. The challenge, then, to businesses that want to accelerate their growth is to break through the silos and proactively look for ways to share knowledge, explained Towry. Learn from experience by all means. Just make sure it’s other people’s experience too.

Putting a value on peer pressure

Our colleagues can exert some influence over different aspects of our careers and even our private lives. There’s nothing too surprising about that. However, new research published in The Review of Financial Studies by Associate Professor of Finance Gonzalo Maturana should give households and businesses alike pause. When it comes to making big purchasing decisions — whether or not to refinance our mortgage, say — we could be more susceptible to positive peer influence than we realize. Maturana and Jordan Nickerson from MIT Sloan School of Management leveraged publicly available employment records — public school teachers from Texas — and unearthed something stunning: where there was notable mortgage refinancing activity in a peer network, individuals within that network were 20.7% more likely to refinance their own mortgage and access positive savings. And that’s not all. The peer effect also helped shape individuals’ choice of mortgage lender. And critically, the more savings they were likely to make by refinancing, the more of this activity there was across the peer group. These peer dynamics should be on the radar of policy makers looking to incentivize mortgage refinancing and to drive household liquidity, said Maturana, as well as banks who want to drive their customer base growth responsibly. The latter could leverage the multiplier effect of peer dynamics to make sure that valuable information on mortgage rates reaches more households more efficiently.

Is breakthrough innovation always a team sport?

If you’re looking to innovate, conventional wisdom says you need to build a team. You only get the breakthrough ideas when you have different people working together, collaborating and sharing knowledge, right? Not necessarily, says Tian Chan, assistant professor of information systems & operations management at Goizueta. Chan and colleagues put together a study, published in IdeaWatch, that reveals something striking: in certain circumstances, individuals can be just as effective as teams in creating breakthrough innovations. It all depends on how easy it is to break down your invention into different components or modules, he said. With design patents that cover innovations on the way something looks — think the iconic curved bottle of a Coca-Cola or Apple’s sleek iPhone — innovations tend to be holistic and don’t easily divide into chunks, and a team might get bottlenecked by coordination or communication issues. With utility patents that cover innovations on the way a product functions, you can have inventions that are very modular (such as the Dell PCs) to inventions that are hard to break into components (such as the internal combustion engine). So here, teams do tend to do better than individuals. His advice to business? If you want to increase your chances of a breakthrough, align your human resources and collaboration structures around the type of invention in your sights. But don’t assume you always need a team.

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Do we dismiss bad news because we know better?

No one likes getting bad news. But grim tidings can, at least, inform our decisions and help us make better choices, right? Not necessarily, says Diwas KC, associate professor of information systems & operations management. Together with colleagues from UNC and Harvard, KC tested the hypothesis that we sometimes stick to pre-existing ideas even when bad news should reshape our perceptions. They looked at responses from 147,000 cardiologists to a 2016 announcement by the Food and Drug Administration criticizing a type of artery stent. While the doctors were generally less likely to use the stent following the news, it turns out that their views on it were also significantly influenced by their own experience and that of their peers. Not only that, but the more experienced they were, the faster they discounted the bad news over time. The study sheds new light on how we respond to bad news, and how perception and experience drive behavioral bias. Management Science (2019)

Calibration committees lead to better performance assessment

Most employees are dissatisfied with their company’s performance evaluation processes. This is one of the key findings of a new large-scale study conducted by Goizueta’s Karen Sedatole, interim dean and Goizueta Advisory Board Term Professor, in collaboration with the WorldatWork association. That said, there is one evaluation practice that consistently garners favor: calibration committees, which consist of peer supervisors or higher-level managers who assess performance ratings and adjust them to drive greater consistency across the organization. Surveying more than 250 WorldatWork members, Sedatole and colleagues found that 43 percent of organizations had been using calibration committees in recent years. Some 78 percent of the survey respondents reported that calibration committees were effective at reducing bias, while 82 percent said that they boosted consistency. These findings build on Sedatole’s previous research into calibration committees and their potential to attenuate the issues surrounding subjective performance evaluation. “Pay equity and even-handedness remain some of the most critical issues facing organizations,” she says. WorldatWork (2019)

Using customer data to value non-subscription firms

Deciding whether to buy or sell a company has historically boiled down to two things: sales growth and profits. Recently though, customer-based corporate valuation has been gaining traction on Wall Street and elsewhere. For “contractual” firms that operate a customer subscription system, tracking customer loyalty and engagement is relatively straightforward. But most businesses are non-contractual, making it harder to assess customer-based valuation. A new paper by Goizueta’s Dan McCarthy, assistant professor of marketing, addresses this. McCarthy and Peter S. Fader (Wharton) have developed a methodology that overcomes challenges such as unobservable customer churn and highly aggregated data—things that make customer-based valuation hard to assess. Their model crunches publicly available data like latent attrition, repeat purchasing and time-varying spend-per-purchase patterns to give new depths of insight into overall firm valuation. Not only that, says McCarthy, it also “permits external stake-holders to get beneath surface-level metrics like revenues, and to therefore better understand the underlying unit economics of these kinds of businesses.” Journal of Marketing Research (2018)

Racial stigmatization, employee performance and the tie to lower pay for all

Research shows that there is a tie between compensation and diversity: the more black, minority or female workers there are in a team or company, the more likely it is that salaries for everyone in that team or company will be lower. But new research by Erika Hall, assistant professor of organization & management, suggests that other factors like performance can make matters even worse than previously thought. Hall and colleagues ran two industry studies and a field experiment to determine whether performance can exacerbate or alleviate stigmatization. With poor-performing teams, they found that the presence of black coworkers drives even greater stigmatization and, as a consequence, lower salaries for everyone. This is likely because managers penalize a team under the guise of “poor performance,” but in reality are discriminating against a team with black teammates. When the team performed well, employers no longer had a plausible reason for discrimination, so compensation did not suffer. Hall warns that poor performance can mask racial discrimination within organizations’ culture. Moreover, the amplifying effect of poor performance on stigmatization extends to non-black employees: a lose-lose scenario that can lead to white employees distancing themselves from black colleagues to avoid stigmatization by association. Journal of Applied Psychology (2019)

Employees with families are more absorbed in work than single, childless peers

The ideal employee is single and childless—unencumbered by family responsibility and free to focus more on work. It’s a common perception across many sectors, and for people who are married or have children, the negative connotations can impact career advancement. But new research by Jill Perry-Smith, professor of organization & management, turns this idea on its head. Together with Tracy L. Dumas (Ohio State), Perry-Smith has found that employees who have a spouse or children are actually more absorbed in their work than their single, childless colleagues. Surveying 2,000 business school alumni and analyzing employee diaries, they found that family structures and associated after-work activities have a direct tie to how absorbed people actually feel in their work. “We discover that anticipating family chores or responsibilities after work actually reinforces the work mindset rather than distract from it,” says Perry-Smith. “It keeps employees more psychologically immersed in their roles.” The onus is now on organizations to “work harder to understand the diversity of employees’ nonwork lives,” she says. Academy of Management Journal (2018)

Is effective community action a case of going back to school?

Civic action can be hugely effective. From neighborhood watch to youth projects to traffic safety initiatives, civic engagement has the potential to make meaningful differences in communities. But what happens when communities become more diverse over time? Research by Goizueta organization & management faculty Wes Longhofer, Giacomo Negro and Peter Roberts looks at 30 years’ worth of data from UNICEF’s “Trick or Treat” campaign to find out.

They discovered that counties with greater racial or economic heterogeneity experienced declining fundraising performance, likely because of the fragmentation of shared interests and less interaction between diverse groups. Interestingly, they also found that among the different kinds of community organizations involved in sponsoring civic activities, schools significantly outperformed churches and clubs.

As such, schools could be better equipped not only to bring young people from diverse backgrounds together, but also to mobilize their families around a common goal. In light of this, Longhofer, Negro and Roberts urge the research community to adopt
a more general and systemic focus on schools as critical community organizers. Administrative Science Quarterly (2019)

Are recommendation systems skewing consumer choices?

Personalized recommendation systems can take the work out of deciding what to buy in the densely crowded online marketplace. In theory, they’re good for business too—driving loyalty and sales. But it’s not all win-win, according to new research by Associate Professor of Information Systems & Operations Management Jesse Bockstedt. And that’s because computerized recommendation system don’t just reflect consumers’ tastes—they can actually mold them. Bockstedt and colleagues from Carlson (U of Minnesota) and Kelley (Indiana U) ran a series of experiments, assigning random and erroneous recommendation ratings to downloadable songs. For each 1 star increase in ratings, participants were willing to pay up to 17 percent more for the song. And that’s problematic, says Bockstedt. If recommendation engines can manipulate choices this way, there’s the potential for consumers to buy products that are ultimately disappointing or to ignore products they may otherwise have purchased. Not only that, these anomalies can compound over time, as consumer feedback influences future personalized recommendations, creating a vicious cycle that further compromises prediction accuracy. A case of caveat venditor? Information Systems Research (2018)

Incumbents versus new players—the role of “legitimacy” in customer perceptions

What happens to incumbents when new players enter the market? Goizueta’s Özgecan Koçak, associate professor of organization & management, and colleagues have leveraged the recent legalization of recreational cannabis to investigate this. In 2012, Colorado became the first state to green-light cannabis for non-medical use, creating a domino effect across the country. The researchers used data from Weedmaps, a website, to look at how incumbent dispensaries (re)positioned themselves relative to the newcomers. In counties which had not voted for the legalization of recreational cannabis, they found a “sharpening” of identity among medical dispensaries, with customers typically referred to as “patients.” Conversely, in states where voters were in support of legalizing cannabis for non-medical use, the researchers found a “blurring” of medical and recreational identity in response to increasing competition from new dispensaries with recreational licenses. The study provides a useful framework that integrates local communities’ beliefs about the legitimacy of products to show how producers can (re)connect with current and potential customers. Organization Science (2018)

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Is the time of the employee close at hand? After more than 20 years of downsizing, offshoring, buyouts, and innovation setting fire to traditional rules of the workplace, things are looking up for experienced, in-demand professionals. Many economic trends are on the uptick, and the unemployment rate continues to drop, from 8.2 percent in July 2012 to 4.3 percent in July 2017.

For workers with specialized skills, the job market is ripe with opportunity.   

Top talent can be picky about where to work, and it isn’t necessarily about more pay. No, highly educated and skilled professionals are looking to work for companies where they feel motivated, engaged, and appreciated.

Employers must learn—quickly—what that means.

According to the Bureau of Labor Statistics, 25 percent of US employees quit their jobs in 2015.

The ability to recruit and retain top talent has become a valuable competitive advantage. Human capital, like equipment or products, translates to the bottom line. So why do established companies find it difficult to attract and keep the best and brightest? While many factors contribute to such turnover, research suggests one key reason workers leave jobs is because they aren’t sure they can trust their employer.

Recessions, globalization, and technological advances lead companies to downsize. But downsizing can exact a heavy emotional cost on workers—on those who lose their jobs and on others who remain.

These actions alone can breed distrust. It’s no wonder much of the workforce takes pause when choosing a place to spend their workdays.

According to Emily Bianchi, assistant professor of organization & management, trust and fairness impact recruiting and retention. She says employees must have confidence in employers to feel committed to their work and to the company.

“People are more likely to stay with employers they believe are trustworthy and fair,” she says. Indeed, a study from the Society for Human Resource Management ¹  indicates that “a culture of respect, trust, and belonging” is a key component for creating an effective workplace.

The rules of engagement

Long ago, corporate leaders embraced the importance of feelings in the workplace. But the competition for talent is steep and deep in intangibles, particularly for older companies looking to compete with Millennial-heavy firms embracing work-life balance, community activism, and any number of perks. A large, well-established corporation may not be seen as nimble or creative enough to attract experienced executives or retain more motivated employees. Highly skilled workers often seek smaller, more innovative firms that can add to their skill set and ability to pivot to the next career opportunity. With less hierarchy, smaller companies often offer a better chance for advancement and the opportunity to play a more decisive role in the organization’s future.

The result? Employees are more engaged.

A new guard of technology firms dominates Fortune magazine’s 100 Best Companies to Work For in 2017. Bianchi believes employers underestimate the role of trust, fairness, and engagement in recruiting and retention. She finds engagement improves recruiting and retention efforts and adds to worker productivity.

Culture and profit are connected.

Understanding fairness

So, what’s a company to do?  Bianchi argues corporations should work hard to develop a sense of trust in order to win—and keep—the best and brightest.
One way organizations can build trust is through transparency.

“Organizations and managers that are transparent about how they make decisions tend to be more trusted,” she says. “When they are not transparent, there is a sense there is something people are hiding—a reason they don’t want employees to know what is really going on.” 

Bianchi says it’s in a company’s best interests to figure out what truly motivates employees. That’s more than throwing money at the problem. She says employers assume employees care primarily about outcomes—how much they are paid, chances for promotions, and titles.

Not completely true.

“Of course people care about these things, but they also care a lot about whether they are treated respectfully and in fair and transparent ways,” Bianchi says.

Research suggests employees form trust judgments early in their tenure with an organization. Bianchi says once an employee forms a judgment, it’s hard to change and recommends managers do their best to earn employees’ trust early and often.

“Being fair and transparent is an inexpensive and relatively easy way to recruit and retain the best employees,” she says.

And retention is certainly in a company’s economic interest. According to the Society for Human Resource Management², employers shell out about six to nine months of an employee’s pay to recruit and train a replacement.

And don’t forget productivity.

The IBM Smarter Workforce Institute’s research report “The Employee Experience Index” notes, “Positive employee experience can contribute to higher motivation to apply extra effort at work and go ‘above and beyond’ typical job responsibilities.”

While it’s inexpensive (and smart) to be fair, Bianchi’s research suggests several ingrained behaviors work against managers. For example, people often have different assumptions about whether other people are trustworthy. Bianchi says employers may not recognize it, but some people are simply more trusting than others.

“They assume others have good motives and will act in the common interest,” she says. “Others tend to view people with suspicion and expect that others will somehow harm them. People who are more generally trusting tend to have more positive perceptions of whether their workplace is fair and equitable.”

In this sense, it can be hard for employers to change people’s preexisting beliefs about whether or not workplaces are fair.

A sense of belonging

But building trust and creating a culture of fairness can’t occur in a vacuum. A long stream of academic research, including that performed by Goizueta’s Erika Hall, reveals the power of bias in the workplace.

Hall, assistant professor of organization & management, notes racial and gender bias hurt employee engagement. Her research indicates most bias is not obvious, but the mere perception of bias can impact job performance and employee retention.

“People tend to know about overt prejudice, but bias isn’t always readily apparent,” she says. For example, a manager might favor one employee over another for a position simply based on perceived gender roles and what they think a “male” or “female” job should be.

Hall argues companies can work to handle covert biases and begin to create a fairer and more trusting workplace by acknowledging that bias exists and that most people have preconceived notions about a group or gender.

“If you’re conscious of bias and you have a desire to create a bias-free environment, it means you can work against it,” she says. “If employers can recognize the systemic bias in commonplace incidents, they can counteract it in the workplace.”

According to Hall, companies can select leaders who recognize what an inclusive workplace truly means. According to research from Catalyst³, “inclusive leaders both value their employees’ unique diversity and also find a common ground to foster a sense of belongingness.” 

As employees place an ever-increasing value on the company culture, it’s impacting the job decisions they make. If company culture is seen as inviting and accepting, then prospective employees will likely hear about it.

If the company is seen as a place where opinions and people aren’t valued, then the world will know it.

“Current and prospective employees are, generally speaking, looking for their companies to be more
socially minded or conscious,” Hall says. “Reputation follows a company, and even prospective employees know about the ‘feel’ or environment at certain companies.”

All things being equal

If negative impressions have an impact outside company walls, what is the impact inside? Rarely do decisions affect an internal or external audience exclusively. Willie Choi 11PhD, associate professor of business administration at the University of Pittsburgh, says choices managers make about an employee are observed and assessed by other employees in the organization. His research into “vicarious learning” shows a trickle-down effect leaders should recognize, especially if there’s a misstep.

“Imagine two coworkers, one more senior than the other,” Choi says. “If the more senior employee is let go, the more junior coworker sees that decision and will immediately think about the implications for himself or herself.”

But Choi says issues of fairness and trust can have differing implications depending on whether or not the manager makes decisions for recruiting or retention.

“I think there is a distinction regarding what fairness and equality mean for recruiting compared to what those concepts mean for retention,” Choi says. “In particular, recruiting processes are embedded within an external labor market, in which there are many prospective job candidates looking for jobs and, likely, many employers looking for qualified candidates.”

Uncertainty exists in an external market. No one is certain any specific job candidate is a perfect match for the position. That uncertainty affects what job candidates and employees view as fair or equal.

In contrast, retention is part of an “internal” labor market where employers and employees have
more information about the nature of the job and its demands.

“Both sides have tangible, firsthand experience of the employment relationship and thus have a better sense of the match between the employer and employee,” Choi says.

Those assessments relate to how the employee is performing in his or her current job and how said employee might perform if promoted.

A strategic approach

Additional insights change what employers and employees view as equal or fair.

Research indicates employers take a proactive approach to creating a fairer and more engaging work environment. Unfortunately, employers may not be making the critical link between improving the company culture and its positive impact on retention.

Karl Kuhnert, professor in the practice of organization & management, says high employee turnover is no surprise given a large number of companies have no efforts to address attrition. To rectify this, formal and informal training, as well as mentorship, should focus on future jobs, not merely improving current performance. Kuhnert’s research shows younger employees especially want to feel like the company is invested in them. Kuhnert joined the Goizueta faculty this fall, and for more than 20 years his research has focused on leadership development and organizational change.

“Your best employees want access to ways to increase their skills to rise within the company,”
Kuhnert says.

It’s no secret employees want work with a purpose.

One of the best retention strategies, according to Kuhnert, is to have a company purpose that deeply resonates with the people in the organization.

“If I am contributing to a worthwhile mission, and we are doing that together, I am unlikely to seek out [other] employment options,” he says. “Most employees want to know how they’re doing on their jobs. In too many jobs, people don’t see a connection between their work effort, pay, and rewards.” 

Employees and leaders working as one is of great importance, says Graham Geiselman 06BBA, manager in the human capital practice at Deloitte Consulting. He says collaboration can go a long way to bridging the gap between employer and employee. He recommends companies encourage a collaborative environment to build camaraderie and trust between employees and, consequently, the organization.

The end result, he argues (and research supports), is a more productive company.

For managers looking to encourage collaboration, they’ll need to think beyond the office. Leaders should appreciate work-life pressures their employees face and how the same pressures can tank a productive and collaborative workplace, says Geiselman. He notes Deloitte and its own generous leave policy as an example of such understanding. But the upstarts in the corporate world are leading the way and changing what top employees expect from a company.

“It seems that some of the companies that are best at embracing the balance of work and play are smaller startup organizations that feature things like unlimited PTO, flexible work schedules, and outstanding family benefits,” Geiselman says.

Value of empathy

Successful leaders are attuned to the particular needs, values, and motivations of their employees. In the book titled The Map: Your Path to Effectiveness in Leadership, Life, and Legacy, Kuhnert and coauthor Keith Martin Eigel argue great leaders lead where others are, not where they themselves are. This level of understanding creates a sense of inclusiveness and trust, and, in turn, employees feel more committed to the organization.

“Effective leaders know how to put themselves in another’s shoes and see what others see,” Kuhnert says. 

It’s a big mistake for top managers to forget their empathetic side, says Kuhnert, especially given the demands of a younger workforce. Perks like time off and higher pay are relevant, but growth opportunities, like increasing job responsibility and access to leadership development programs, are essential.

“What young leaders want is a chance to help grow the company,” he says. “Too often many managers miss the opportunity to invest in employee loyalty by not including young leaders in their executive development programs.” 

Loyalty is bred through trust and a sense of fairness in the workplace.

“In today’s organization, we are all networked, and we depend on one another to do our jobs,” Kuhnert says. “When we let others down, communication and relationships become strained and problems go unaddressed, and it eventually impacts bottom-line profits. With so much daily stress, there is little time for the important kind of reflection that unlocks commitment, trust, courage, loyalty, and other vital virtues necessary for leadership.”

The takeaway

Research is clear.

Companies must invest more time and money toward motivating employees—as much or more than skills training.

Bianchi says the absence of investment can have devastating consequences, whether it’s a drop in employee productivity or an increase in attrition.

While her research continues to delve into trust and fairness issues in the workplace, she has expanded it to study CEO misconduct, the impact of the economy on ethics, and the effect of economic recession on individualism.

But she isn’t surprised trust and fairness remain at the top of her mind in today’s ever-evolving and fractured workplace.

For organizations hoping to change the current dynamic, Bianchi recommends leaders start at the beginning and understand what causes employees to worry about trust and fairness in the first place.

“It’s simply because humans are hardwired to care about it,” she says. “Our attention and anger spike when we believe we are being treated unfairly. It’s something we see very clearly in children, but what we may not recognize is that adults care just as much about it. Employees who don’t believe they are being treated fairly are likely to be looking for other opportunities and putting in less effort towards helping the organization succeed.”

1  Society for Human Resource Management’s “Effective Workplace Index,” 2017

2  Society for Human Resource Management’s “Human Capital
Benchmarking Report,” 2016

3  Prime, Jeanine and Elizabeth R. Salib. “Inclusive Leadership:
The View From Six Countries.” New York: Catalyst, 2014

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