MIT Sloan Management Review Summer 2013

YOU MAY NOT think of yourself as a force for change. But if you’ve ever used a smartphone to check prices or reviews for a product you are considering buying — or to locate a good restaurant in an unfamiliar area — then you’re part of an important shift in consumer behavior. That behavioral shift — consumers using information from mobile devices to inform their purchasing decisions — is in turn driving change for retailers and companies that sell their products through retail channels. As Erik Brynjolfsson, Yu Jeffrey Hu and Mohammad S. Rahman note in their article “Competing in the Age of Omnichannel Retailing”: Recent technology advances in mobile computing and augmented reality are blurring the boundaries between traditional and Internet retailing, enabling retailers to interact with consumers through multiple…

How Starbucks Has Gone Digital »In an interview, Starbucks Corporation chief digital officer Adam Brotman and chief information officer Curt Garner describe how they collaborate closely on their consumer- and employee-focused digital strategies. The two seek to improve customer experience through technology. Their partnership has forged a fast-paced rollout of new digital efforts, from quicker payment processing to mobile ordering. Read or download the interview at: sloanreview.mit.edu/x/54401 Lessons From Analytics Innovators »The authors of the recent study “From Value to Vision: Reimagining the Possible with Data Analytics” present their findings in this prerecorded webinar. The report characterizes the distinctive orientation toward data and analytics held by companies that innovate with analytics; it also includes a framework to help guide managers. sloanreview.mit.edu/?p=24881 The Emergence of Chief Digital Officers »As digital technologies shift responsibilities in the C-suite,…

“Paying outside directors with stock is an important and attractive tool to align outside directors’ goals with those of shareholders . Yet it also incentivizes them to ignore other stakeholders.” (From Deutsch and Valente, “The Trouble With Stock Compensation,” page 19.) “From the results of balanced benchmarking, a company can identify its least efficient offices or business units, and it can assess the magnitude of the inefficiency and investigate potential paths for improvement that the analysis has identified.” (From Sherman and Zhu, “Analyzing Performance in Service Organizations,” page 37.) “If social business initiatives need leadership and many leaders see the potential of these initiatives for their organizations, an important question remains: What constitutes effective leadership for a social business initiative?” (From Kiron et al., “The Executive’s Role in Social Business,” page 83.) “We…

Are you overlooking the danger of losing unhappy employees to your competition? Tough economic conditions in recent years have forced many companies to cut costs wherever they can, and sometimes this has had a direct negative impact on employees’ perceptions of their jobs and their treatment at work. Meanwhile, although it is true that employees are less likely to change jobs during a recession, experience shows that once things look up, turnover rates increase significantly. Unsurprisingly, talented yet disgruntled employees are often the ones to leave first. To study the impact of disgruntled employees leaving an organization, three of the authors of this article, Federica Pazzaglia, Karan Sonpar and Scott Flynn, studied a phenomenon known in professional soccer as the “Immutable Law of the Ex,” which postulates that players play unusually well…

The number of eco-label programs has grown from a mere dozen worldwide in the 1990s to more than 435 today in 197 countries and 25 industry sectors, according to the Ecolabel Index directory. But this growth has been accompanied by a high degree of consumer confusion and organizational skepticism.For example,consumers have admitted to difficulties recognizing the differences among the six-plus eco-labels for coffee.And in 2009, Ecover, a Belgium-based manufacturer of cleaning products, boycotted the European Union Eco-label, claiming lax standards allowed entry to subpar performers and harmed the company’s superior environmental credentials. In early 2012, the British supermarket chain Tesco PLC dropped the United Kingdom’s Carbon Trust label, citing prohibitively high costs and minimal consumer recognition. However, there is no denying that the value of eco-products — and the recognition of…

Savvy company executives know that some of their greatest and potentially most enduring assets are their long-run customer relationships. Trying to sustain a competitive advantage with new products is a frustrating game, where short-term leads often erode quickly. But by satisfying customers, companies can nurture long-term relationships and customer loyalty. What’s more, a small increase in customer loyalty can make a big difference in company profits. McDonald’s, for example, calculated back in the 1990s that just one additional visit per week by “heavy users” would boost annual sales by more than $10 billion dollars. Blending Bricks and Clicks In retailing, customer loyalty cannot be achieved for long by keeping customer interactions online distinct and separate from those offline. Many consumers have largely merged their shopping to the extent that they go back…