Manoj Athavale

The Integrated Business Curriculum: An Examination of Perceptions and Practices

Constituents often criticize business schools for failing to provide students with a comprehensive understanding of how business organizations function. Business schools have responded to the mandate with attempts to integrate discipline-specific functional knowledge into a coherent understanding of the evolving business organization. Successful integration of the undergraduate business curriculum will result in students who are more directly involved in the learning process and will increase curricular relevance by translating functional knowledge into business skills. However, curriculum integration is an extensive and potentially disruptive curricular change that may involve cost and is fraught with pitfalls. The authors surveyed deans at member schools of the Association to Advance Collegiate Schools of Business International to assess the extent to which and the manner in which integration has taken place within the business curriculum.

An Analysis of the Demand for Earthquake Insurance

This research examines the decision to purchase earthquake insurance by analyzing data on earthquake insurance price and penetration in the New Madrid fault zone in Missouri. Earthquake risk is of concern to consumers, the insurance industry, industry regulators, and government agencies because of the potentially catastrophic nature of losses resulting from a major earthquake. Despite the significance of the earthquake peril, the recent literature does not contain estimates of the price and income elasticity of the demand for earthquake insurance. Our analysis indicates that homeowners acquire earthquake insurance because of risk considerations, at higher levels of risk the demand for earthquake insurance is higher, and the price of earthquake coverage does not provide incremental information in explaining the demand for earthquake coverage.

Large Deductible Workers’ Compensation Plans

orkers’ compensation is a “nofault” system that provides compensation to individuals for work-related injuries and occupational diseases. The compensation generally covers the medical expenses for an injured employee, disability benefits to replace the worker’s loss of income or earning capacity, rehabilitation of the injured worker and death benefits. Most employees are covered by state laws, although federal employees, maritime workers and railroad workers are covered under alternate jurisdictions, and self-employed persons are not required to purchase insurance. The workers’ compensation system relieves employers of liability from common-law suits, and if a worker is covered by workers’ compensation, jurisdiction-specified workers’ compensation benefits are the only damages available to the worker. Depending on jurisdiction, employers may be self-insured or purchase insurance to cover workers’ compensation claims. Guaranteed workers’ compensation insurance plans transfer financial risk from the employer to the insurance company in exchange for periodic insurance payments. The rising cost of guaranteed workers’ compensation insurance has caused many employers to seek alternate financing structures. Self-insurance allows an employer to retain all financial risks and benefits, whereas group selfinsurance allows groups of employers to retain all financial risks and benefits from their combined insurable pool. Another alternative available to employers who would like to reduce the risk of catastrophic loss but would also like to reduce their insurance premiums through quasi-self-insurance is the large deductible insurance contract. Large deductible plans may reduce insurance costs for employers who are willing to retain most of the claims risk without depriving employees of the certainty of insured benefits. Empirical evidence on the benefits of large deductible workers’ compensation insurance contracts was provided

A Practical Approach to Using Taguchi Loss Functions to Rank Investment Choices

We use a series of hypothetical financial situations to describe the manner in which a quantitative technique could assist analysts in making financial decisions. We also provide a detailed example of a portfolio managers attempt to replicate a given stock with another stock that meets multiple characteristics. The demonstrated quantitative technique is an improvement over the traditional “accept/reject” dichotomy because it imposes an explicit penalty for deviations in the observed values from the desired characteristic values, allows multiple characteristics to be considered simultaneously, and also allows the selected characteristics to be weighted based on their relative importance

Prioritizing Investment Screens in a Multiple-Criteria Framework

Investment professionals often screen the investment universe for investment opportunities that meet some benchmark criteria. This screening process provides a subset of acceptable investment opportunities that are not all equally acceptable. A technique that allows prioritization of the subset on the basis of deviations from the benchmark criteria used to obtain it is an adaptation of the Taguchi loss function, which has found application in the management, marketing, accounting, and real estate literature.

An Empirical Comparison of a Low-Deductible Health Plan With an HSA-Qualified Plan

The desire to control health care expenses has led to the increasing adoption of consumer-driven health plans. One such choice is between traditional low-deductible and health savings account (HSA)—qualified high deductible health plans. In this analysis the authors forecast medical expenses over a 40-year period to compare financial outcomes associated with each plan. Using realistic plan parameters and assumptions, the authors find that the HSA-qualified plan outperformed the traditional plan in 21 of 24 simulations. The framework provided in this article will assist employee benefits professionals in structuring appropriate plans and will assist employees in making appropriate health plan choices.

The Selection of Competing Third Party Administrators

benefits professionals select third party administrators (TPAs) to service employer-provided benefit plans offered to employees. Many of the variables in the decisionmaking process can be modeled quantitatively so as to avoid the subjective bias caused by “eyeballing” the data. In this article we describe the specific case of selecting a TPA for a partially self-funded health insurance plan. The technique described here can also be applied in other situations, for example, selecting a pension plan administrator. Health care costs have been increasing 7% to 14% annually for the past few years and constitute a major employee benefits expense for all types of organizations. Organizations are therefore trying to find ways in which these costs can be controlled without any significant loss of covered benefits. One such method has been employer participation in a partially self-funded health care arrangement. Irrespective of the choice of health care arrangement, businesses need to periodically evaluate the services rendered by the TPA or insurer for the current plan and the cost associated with those services.

Non-CEOs as the Highest Paid Executives: Evidence from the Insurance Industry:

This article identifies instances where the CEO was not the highest paid corporate executive and presents reasons for this aberrant compensation behavior. The findings suggest that such instances are an exception to the traditional understanding of compensation structures rather than the norm. The study found that the base pay and bonus paid to the CEO who was not the highest paid executive was similar to that paid to the highest paid executive. The difference in compensation can be attributed to long-term compensation and option grants. The study also found that asset growth and revenue growth at companies where the CEO was not the highest paid executive lagged the asset growth and revenue growth of peer institutions.