Knowledge at Wharton

AT&T and Verizon are about to throw the dice in a bet that will put billions of dollars on the line. The companies the two largest mobile phone operators in the United States are expected to launch a pilot program to see whether their customers are ready to trade credit cards for smartphones equipped with similar swipe technology for making purchases. But will Americans want to put aside their comfortable relationship with plastic credit cards? And can they overcome security concerns about adopting a new payment system? Industry experts weigh in.

Hosted on Acast. See acast.com/privacy for more information.

When Roche Holding acquired full ownership of Genentech last year the $46.8 billion deal was the culmination of a more than 20-year relationship between the Swiss pharmaceutical giant and the Silicon Valley biotechnology company. In a recent presentation at Wharton San Francisco Steve Krognes -- a former Roche executive who is now senior vice president and CFO of Genentech -- talked about the pharma company’s decision to pursue the merger efforts to raise capital amid the beginnings of the 2008 recession and the aftermath of the deal.

Hosted on Acast. See acast.com/privacy for more information.

Despite being pilloried by the public lately a banker’s lot can’t be all that bad. At least that’s what Wal-Mart executives must be thinking. Over recent months there has been a flurry of announcements from the world’s largest retailer about the expanding array of banking products sold at its U.S. stores. Company officials insist that their main aim is to reach the ”unbanked” and ”underbanked” with the type of low-cost services that cemented Wal-Mart’s reputation as a retail giant. So do traditional retail banks on Main Street USA have reason to worry?

Hosted on Acast. See acast.com/privacy for more information.

It has been a battle of the balance sheets as rivals Dell and Hewlett-Packard continue to wrangle over who will win the right to acquire 3PAR a little known data storage company. While the 3PAR bidding war which HP is expected to win is part of Dell’s ongoing ambition to get a bigger foothold in high-margin enterprise technology services the $53 billion company has also been chasing consumers with lackluster products. As one expert asks: ”Dell sees the need for diversification but does it see the need for transformation?”

Hosted on Acast. See acast.com/privacy for more information.

What inspires an employee to work harder? More money more often than not. But what about being benchmarked against peers asks Wharton management professor Iwan Barankay in a new study titled ”Rankings and Social Tournaments: Evidence from a Field Experiment.” With the help of a ”crowd-sourcing” website Barankay set out to discover not only whether workers are interested in how they rank against their peers but also what happens to their performance if they find out how they placed. His conclusion may leave companies thinking twice about the best way to appraise staff performance.

Hosted on Acast. See acast.com/privacy for more information.

While most experts agree that a single-minded focus on the short term can cause negative consequences for companies they also suggest that blaming quarterly earnings reports and the pressure to meet analysts’ targets or company guidance is like shooting the messenger. Although the system of quarterly earnings might be broken fixing it is no easy matter and might create even more pressure to produce immediate results.

Hosted on Acast. See acast.com/privacy for more information.

After a year of solid gains the economic recovery is beginning to slow. Demand is trailing off as inventory levels have been restored and emergency stimulus measures withdrawn. Continued high unemployment and a downtick in housing are weighing on consumer confidence and spending. Add unexpected shocks from Europe and a slowdown in China and forecasters are now ratcheting down their expectations for growth over the next year. While many still expect economic expansion to continue in the longer term ”we have definitely hit a soft patch ” one Wharton faculty member notes.

Hosted on Acast. See acast.com/privacy for more information.

The recent financial crisis triggered primarily by bad bets in the financial sector has added momentum to the idea that executive compensation should be tied more closely to corporate debt rather than equity. Last month for example American International Group (AIG) announced that it will link incentive pay to the value of the troubled insurer’s bonds. In a new paper Wharton finance professor Alex Edmans and doctoral student Qi Liu argue that these types of incentives protect bondholders’ interests and the value of the firm particularly when a company’s solvency is in question.

Hosted on Acast. See acast.com/privacy for more information.

Whether they are artists or executives every worker has the potential to be excellent. The challenge for any leader according to Boston Philharmonic conductor Benjamin Zander is to tap into employees’ strengths and give them the tools they need to shine. In a speech at the 14th Annual Wharton Leadership Conference Zander described how the same techniques he uses in the concert hall can be employed in creating a happier more successful business environment.

Hosted on Acast. See acast.com/privacy for more information.

China’s announcement in June that it will abandon the peg tying the renminbi (RMB) to the U.S. dollar and gradually let its currency appreciate was widely applauded in international business and economic circles. The decision is important experts say not only in debates about the future clout of the dollar and the RMB in global trade and politics but also for correcting global economic imbalances. Yet now many observers are wondering what impact the revaluation will have on jobs and prices for the average person -- whether in Boston Beijing or anywhere in between.

Hosted on Acast. See acast.com/privacy for more information.