Jeffrey P. Katz

How Much Does Performance Matter? A Meta-Analysis of CEO Pay Studies

Through a meta-analytic review of the empirical literature on the determinants of CEO pay, this study tests the hypothesized relationships between firm size, performance, and CEO pay. We show that firm size accounts for more than 40% of the variance in total CEO pay, while firm performance accounts for less than 5% of the variance. We also show that pay sensitivities are relatively similar for both changes in size (5% of the explained variance in pay) and changes in financial performance (4% of the explained variance in pay). The meta-analysis also suggests that moderator variables may play an important role, but we were unable to test for this.

The importance of national culture in operations management research

Purpose – The purpose of this study is to test the validity of national culture as an explanatory construct for international operations management decision‐making.Design/methodology/approach – National culture is multi‐dimensional thereby allowing for much finer grained comparisons than are possible when examining differences based purely on geography or the level of industrialization. This proposition is examined from the theoretical standpoint then empirically investigated using an existing database.Findings – This article finds that national culture significantly explains international operations management behaviors among similar manufacturing plants in the same industry located in different cultures.Originality/value – This study represents a first attempt at using national culture to explain differences of operations decision‐making.

Wealth Creation and Managerial Pay: MVA and EVA as Determinants of Executive Compensation

Designing effective compensation contracts has become increasingly complex due to the globalization of the executive work force and the multitude of incentive schemes. We examine the relationships between managerial pay and firm performance among domestic and global firms using economic value added (EVA) and market value added (MVA) to assess wealth creation. Our work suggests that top managers in domestic- and globally focused firms are not only incented to increase EVA, but also rewarded for past additions to MVA. The results of our research suggest that managers of highly globalized firms tend to be paid at higher levels, reflecting the increased complexity of managing global firms.

A new value-added strategy for the US beef industry: The case of US Premium Beef Ltd

US Premium Beef Ltd is a cooperative partnership between all segments of the beef industry value chain, affording each segment an interest in the key stages of beef production and processing, as well as an equal share of the financial risks and rewards. This “value‐added” strategy is accomplished through vertical integration and adding a quality‐based pricing structure to more closely link beef producers and consumers. The case study is an example of supply chain management as a strategic response to a mature industry. It also exemplifies how ownership structure of the firm, particularly the emergence of new‐generation cooperatives, is employed as a strategic factor in developing a new competitive approach in an industry characterized by sales decline and aggressive competition from substitute products such as poultry and pork.

One for All and All for One? A New Generation of Co-operatives Emerges

Abstract Business owners who traditionally organised their marketing and supply activities through co-operatives are changing their strategic orientation with increased frequency. The result is a “new generation” of co-operatives sweeping through several industries. This article examines how traditional co-operatives differ from the typical investor-owned firm and some of the motivating factors leading to the emergence of the new generation of co-operatives. These new generation co-operatives (NGCs) appear to be organisational hybrids combining aspects of investor ownership and co-operative ownership structures. The article describes differences between the traditional and new generation co-operatives with the objective of providing implications for managers who are faced with the movement toward more entrepreneurial organisations in their industries.

Strategies of supply communities

Only one customer really counts: the end customer. The final purchaser decides whether each supply chain member adds value, and is thus willing to pay for the added benefit, or whether by‐passing a particular link in the supply chain makes economic sense. It is in this context that profit, based on value‐adding behaviors, provides the primary incentive and reward for supply chain members to organize. This article suggests that successful supply chains are those that are evolving into supply communities. This article presents a framework for more thoroughly understanding the motivation that members of the supply chain have for developing consistent business strategies, thereby enabling the supply community to compete effectively.

A new value‐added strategy for the US beef industry: The case of US Premium Beef Ltd

US Premium Beef Ltd is a cooperative partnership between all segments of the beef industry value chain, affording each segment an interest in the key stages of beef production and processing, as well as an equal share of the financial risks and rewards. This “value‐added” strategy is accomplished through vertical integration and adding a quality‐based pricing structure to more closely link beef producers and consumers. The case study is an example of supply chain management as a strategic response to a mature industry. It also exemplifies how ownership structure of the firm, particularly the emergence of new‐generation cooperatives, is employed as a strategic factor in developing a new competitive approach in an industry characterized by sales decline and aggressive competition from substitute products such as poultry and pork.

Does Winning Mean the Same Thing around the World? National Ideology and the Performance of Global Competitors

Abstract Do firms based in different countries have different and predictable performance objectives that reflect their national ideologies? This question is tested by examining the performance of 114 firms based in the United States, Japan, and the European Union. We find that firm performance reflects country of origin in a predictable fashion based on national ideologies. Implications for business include the possibility that competitive strategies for successful global competition can be developed based on the results reported. Opportunities for future research are also offered.

How Owners Influence Strategy—A Comparison of Owner-Controlled and Manager-Controlled Firms

Abstract Is there a difference in how firms compete if owners take an active role in setting strategy versus when managers make all the decisions? The recent management literature is full of cases where managers choose strategies that ultimately diminish shareholder wealth. Would their decisions be different if owners of the company were involved in those strategic decisions? In this article we examine the effect that owners have on the strategy and performance of companies publicly-owned and traded on U.S. stock exchanges. Prior research has indicated that as ownership in firms becomes widely held, the strategic choices made by owners and managers increasingly differ. Our study specifically examines the impact of company owners on the selection of strategies and performance of the company. Our results indicate that patterns of strategies vary depending on whether strategy-makers have an ownership interest in the firm. The results suggest that owners and managers perceive risks impacting the firm differently and thus make strategy-setting decisions affecting the performance of the firm based on their potential for personal gain. We offer suggestions for the design of top manager incentives and enhanced oversight role of the board.

The 21st Century Alliance: A Dry Edible Bean Cooperative

Producers of the 21st Century Alliance in western Kansas had an opportunity to vertically integrate in the dry edible bean industry in the winter of 1998. Demand for dry edible beans, especially pinto beans, has been increasing in recent years. The major decision in this case was to determine whether to (a) build new facilities, (b) build a dual-purpose grain elevator for beans and other crops, (c) not buy, or (d) purchase an existing facility in Burlington, Colorado, or Sharon Springs, Kansas.